The implications loom large if proposed U.S. beef and lamb labeling legislation reduces American consumption of Canadian product.
In 1997, Canadian beef imports were equal to about nine percent of total United States beef production. Most of this beef was blended into ground beef or processed beef products, or was sold as U.S. product.
In addition to beef imports, nearly 1.1 million live cattle were imported from Canada to U.S. packing plants during 1997. After processing in the States, they were sold as U.S. beef.
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In 1997, beef exports accounted for approximately eight percent of total U.S. beef production and 12 percent of wholesale value.
Ben Thorlakson, president of the Canadian Cattlemen’s Association and an Alberta cattle feeder, sees a number of problems for the industry if the U.S. bill is passed without modifications.
“If this legislation goes through, we will require significant reduction in our industry,” said Thorlakson.
The cattle have to go somewhere and they will be sold at lower prices.
Canadian feeders have lost money for the last eight to 10 months on all cattle shipped. As the fall feeder run approaches, when the majority of calves are marketed, prices could dip even lower.
“All this incorporates cost into the marketing of beef and lowers the value of slaughter cattle, which in turn lowers the price Canadian feeders can pay for feeder calves,” said Thorlakson.
There may also be more feeders than slaughter cattle exported to the States.
If more feeders leave the country, there could be a decrease in domestic barley consumption. Canadian producers are also worried American retail chains that carry Canadian beef may decide to drop it rather than keep the two products separate in the meat counter.
Thorlakson said representatives from the Canadian Cattlemen’s Association met with the NCBA executive during its semi-annual meeting earlier this month and asked why it is sponsoring the legislation.
“They told us directly it was aimed at the Canadian cattle and beef coming into the U.S.,” said Thorlakson.
The carefully negotiated Northwest Pilot Project that enabled feeder cattle to move freely into Canada from the U.S. becomes an academic exercise.
“There will be no imports. We worked on that for years,” said Thorlakson.
Sheep exporters unhappy
Canada’s sheep industry will also be hurt if American label laws are passed.
While sheep exports are small compared to the giant Canadian beef industry, the proposed law will affect producers who ship live lambs or boxed lamb to the U.S., said Richard Stern of the Canadian Sheep Federation.
Canada is not a major exporter of lamb but is broadsided by this legislation because American producers are targeting Oceanic lamb imports.
“It is not aimed at Canada. It’s aimed at Australia and New Zealand that is pumping all kinds of low-priced lamb into that country,” said Stern.
Last year, 45,500 live sheep and lambs were exported from Canada to the U.S. for slaughter. No other countries received Canadian lamb exports.
The pork industry was not included in this legislation because the National Producers Council worries it will face trade retaliation if it supports the bill demanded by the American cattle and sheep sectors, said Martin Rice of the Canadian Pork Council.
The Canadian pork industry has won most of the numerous trade challenges and countervails from the American pork industry.
