If consumer demand holds, Canada will be short of beef in the near future.
Charlie Gracey, former manager of the Canadian Cattlemen’s Association, says Canada disposed of 546,000 bulls and cows either through domestic slaughter or the U.S. market over the past year.
That’s 27.6 per cent more than the previous year.
But he added two caveats for Canadian beef men. He’s not sure how Country of Origin Labeling (COOL) is going to affect the market, nor what stand the Americans are going to take on the latest case of BSE. The animal was born after the 1997 feed ban came into effect.
But everywhere the number of beef cattle is in decline. Alberta, which produces as much beef as the rest of the country, decreased from 6.5 million head to 6 million head. According to Statistics Canada, the Canadian cattle herd declined 4.3 per cent between July 1, 2007 and July 1, 2008, making this the second year in a row the numbers dropped. Statistics Canada has pegged the Canadian cattle inventory at 15.2 million head.
The beef cow inventory went down by 4.7 per cent while the number of calves decreased by 4.8 per cent.
What’s more, the number of cattle in feeding operations has declined more than 12 per cent. Many of those cattle have been apparently moving south. The United States Department of Agriculture (USDA) in its August outlook said imports of Canadian cattle through June have been 46 per cent higher than the previous year. The USDA said the trend began in the fourth quarter of last year.
The higher cost of feed, the high Canadian dollar, plus a "comparative disadvantage in the Canadian packing industry have created an environment where feeding cattle in the United States is more economical."
This year the U.S. expects to import 2.65 million head, though not necessarily from Canada, an increase of six per cent. Gracey points out that the U.S. cow herd has been in a non expansion mode for a couple of years.
"The U.S. is going to need our beef," he says, adding that Canada has every right to be in the U.S. market because of NAFTA. "We signed a trade agreement."
U.S. cow inventories declined by July 1, 2008 to 42.4 million head, a low recorded only twice before, in 1973 and 2004.
However, the number of beef heifers for replacements was down only two per cent. The USDA believes farmers kept heifers and got rid of the cows because heifers were cheaper to feed. The 2009 calf crop is expected to be larger.