NITON JUNCTION, Alta. – Cattle producers aren’t the only ones taking a sharp pencil to their budgets. Provincial cattle organizations have revised their budgets because of lower cattle sales.
The Alberta Beef Producers cut $750,000 from its 2007-08 budget mid year because of anticipated lower cattle sales. The ABP will still be $762,500 in the red, said beef producers’ finance chair Kelly Olson.
At the beginning of the year, the provincial cattle organization anticipated it would receive $13.5 million from the sale of 4.5 million head of cattle in the province.
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Every time an animal is sold, $3 is deducted and sent to the provincial cattle organization.
The budget has now been reduced to $12.7 million to reflect 250,000 fewer cattle sales.
Next year’s preliminary budget anticipates a further 250,000 head drop in cattle sales, which would lower the budget to $12 million.
The budget adjustment was due to a combination of fat and feeder cattle being shipped to the United States, cattle producers abandoning the industry and producers hanging on to cattle longer.
“We anticipate to have significantly lower marketings than we’ve had in the past,” said Olson.
“Once a feeder animal is exported to the U.S. there will be no checkoff generated when it’s sold as a fat animal, where it would be when it was sold here,” he told ABP’s fall meeting.
Olson said in the past cattle would be sold two to three times and a checkoff generated each time. Now the organization believes it gets a checkoff only one to two times on each animal.
“We think the cattle turn less often. People will hold cattle back and sell them not as soon.”
Adele Buettner with the Saskatchewan Stock Growers’ Association said her group has just begun the budgeting process for 2008 and it also is anticipating reduced income because of fewer cattle sales.
“We have to take that into account,” said Buettner.
In Saskatchewan, a $2 refundable checkoff is taken from each head for the Saskatchewan Cattle Marketing Deduction Fund.
Martin Unrau, president of Manitoba Cattle Producers Association, said it hasn’t adjusted its $980,000 budget yet, but the staff is aware they have to keep a close eye on finances.
In Manitoba, $3 a head is deducted from every animal sold. A $1 nonrefundable fee goes for national cattle promotion.
A $2 refundable fee is used by the provincial organization. For the first time the Manitoba group is seeing many producers requesting a refund on their checkoff.
“We’ve got a depressed industry and guys need money for telephone bills and hydro bills and so some guys are taking their money back,” said Unrau.
He said after the fall cattle run the group will take a closer look at its finances.
“The amount of cattle going out of the country is definitely going up, especially for Manitoba.
All the fat cattle are going south. There’s nothing going east or west at all now.”
