Beef industry laments Alberta’s refundable checkoff

Alberta Cattle Feeders official said a fee increase or move to a non-refundable levy must be accompanied by a spending plan

PONOKA, Alta. — Canadian beef producers are in danger of losing valuable markets because Alberta feedlot operators have received millions of dollars in check-off refunds, said the chair of Alberta Beef Producers.

About $13.1 million of the money generated through a $2 per head provincial checkoff has been refunded in the five and a half years since it become refundable, and $11.3 million has gone back to producers identified as cattle feeders.

“It’s going into guys’ pockets. It is not going back to the industry,” Greg Bowie said during an ABP meeting.

“If it was staying in the industry and was used for the benefit of the industry as a whole, we wouldn’t have a problem with it, but $13 million is not going back to industry.”

This year, $2.2 million of the $2.5 million refund request went to people identified as cattle feeders. The other $1.8 million was refunded to producers identified as cow-calf producers.

“They’re not at all shy about admitting they take the refund,” said ABP executive director Rich Smith.

Cow-calf producers receive 14 percent of the refunds and make two-thirds of the refund requests, but 87 percent of the money goes to 86 people identified as cattle feeders.

“The refunds are very skewed,” said Smith.

Producers attending ABP fall meetings have been asked to make motions or indicate by show of hands who wants a return to a non-refundable checkoff and see a checkoff increase.

The ABP wants to increase the $1 non-refundable national checkoff to $2.50, keep the provincial checkoff at $2 per head and dedicate 60 cents of that portion to marketing and research.

“We’re not just turning the clock back. We need to address the key areas of the shortfall of money in markets and research,” said Smith.

Bryan Walton, chief executive officer of Alberta Cattle Feeders Association, said the organization “supports refundability.”

“We start with the philosophy that you need a plan, then you talk structure and governance and then you talk money. It always seems like it starts with money and we think it is inappropriate.”

Any check-off increase must be accompanied by a detailed plan of where it will be spent, including any increase in the national checkoff for research and promotion, he said.

“We have a resolution that we won’t support an increase to the national checkoff unless it is supported by proper governance and a budget laid out. It looks like Canada Beef is moving in that direction, which is a positive sign.”

Research money from the 80 member organization is directed at projects that benefit cattle feeders. Walton didn’t know exact dollar figures but said it has invested in research in feed grains, improved vaccines, barley straw, farm safety and emergency preparedness.

ABP invested $1.5 million in feed grains research in 2009, which encouraged the government to add an additional $8 million in research money.

Last year, ABP provided $100,000 in feed grains research with the promise of another $100,000 for the next two years if the money is available.

Government officials have made it clear they won’t put up money until the industry steps up with the initial investment, said Bowie.

“It is very evident we need to have industry dollars to stimulate that government contribution.”

Bowie believes the new NDP provincial government is more receptive to making the checkoff non-refundable again.

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