Young producers face particular challenges as they cope with a COVID-19 pandemic that has upended the cattle industry
Even though she says she’s surrounded by the excitement of spring, Kendra Donnelly worries about the future.
The third generation feedlot operator and her family have been heavily affected by the COVID-19 pandemic. It’s brought lots of uncertainty.
“It might wipe a generation out of business. We may lose an entire generation because of the losses we may face as we sell our cattle,” she said during a webinar about the impacts of COVID-19 on young beef producers.
“Rural communities rely on agriculture, and we can’t lose the next generation in these communities. We can’t afford losing an entire industry to this pandemic,” said Donnelly, a director with the Alberta Cattle Feeders Association.
During the webinar, hosted by the Canadian Cattlemen’s Association, young producers across the country spoke about their challenges.
Maryjo Tait of Celtic Ridge Farms in Ontario lost most of her customers at the start of the pandemic.
The family sells beef directly to restaurants and consumers. When the restaurant industry came to a halt, they immediately lost about 80 percent of their income.
“We didn’t have a home for that meat and we didn’t know how to come up with our mortgage payments to banks,” Tait said. “We had to take a look at what we were doing.”
She said the family re-tooled their website, focusing on customer deliveries. In doing so, they’ve managed to replace their lost income, Tait said.
“It has been great and a godsend,” she said. “We’re thankful for our customers and consumers. We didn’t know where we would be.”
Geoff Larken, who runs a mixed farm in Nova Scotia, has also been affected.
He said it’s extremely difficult for the family to plan for the future.
He said having business risk management (BRM) tools in eastern provinces would be extremely helpful.
“It would allow to plan, grow and get ready,” he said. “Young farmers don’t have much they can borrow against. There is no way I could talk to the bank and say I want to buy cows. I just don’t know how much they are going to be worth.”
Many beef producers have felt the impacts of the pandemic after market prices fell and slaughter plants slowed down or closed.
It has caused backups at cattle feeding operations because animals can’t be processed. As well, if issues persist long enough, it could affect the calf crop, said Bob Lowe, president of the Canadian Cattlemen’s Association.
Lowe said the industry is thinking of ways to help producers better mitigate risk should they find themselves in a similar situation in the future.
The industry has asked for changes to government business risk management programs to make them more usable. AgriStability, for example, doesn’t provide meaningful protection for most beef producers, the CCA said
As well, it wants changes to the Advanced Payments Program to provide added liquidity and flexibility.
The federal government has provided $125 million in funding through AgriRecovery and offered other loan programs to help producers stay afloat. Ottawa covers 60 percent of the AgriRecovery program while provinces cover 40 percent.
But an important change, Lowe said, would be shifting consumers’ attitudes.
“Canada, as a whole, does not recognize or appreciate the food supply chain,” he said. “Down south of the border, they ensure agriculture is important and, in Europe, it’s No. 1.
“What I’m proposing we do is start somewhere. There are a million different places we could look at and we are working on ideas, but changing the attitude of the public, so they respect and take ownership of the food supply chain, is important.”
There has been debate over whether de-centralizing processing plants could help the industry better weather a future storm.
COVID-19 exposed a weakness in the system. While large processing plants are efficient and provide consumers with cheaper beef, their impacts on producers are massive when they slow down.
Lowe indicated the solution could lie in the middle.
He said he doesn’t want to give up on large processors, but would like to see more surge capacity should it be needed.
“I’m not sure how to get that because most of the time it’s not necessary,” he said. “The time when plants slow down is when it would be nice to have it.”
Even though there have been severe outbreaks of COVID-19 at Alberta’s two largest meat-packing facilities, and several worker deaths, Lowe said the companies have made great efforts to help ensure safety.
“What they’ve done is amazing,” he said. “With smaller processors, would they have that incentive to spend that kind of money so things keep going?”
Tait said small abattoirs have been maxed out.
She said there is no harm in more local abattoirs opening, but the current system has shown itself to be efficient.
“If small processors were our number one main stream, that wouldn’t be good for the people of Canada,” Tait said. “It’s good to have a mix and for people to have choice.”
Donnelly said the pandemic has showed people the complexities of the food system.
“There is no easy answer to this COVID-19 problem, but there is an opportunity for Canadians to look at it and see where we can improve as an industry,” she said. “I think everyone is open to those ideas and are excited about opportunities. It’s now a matter of Canadians putting this as a priority.”