CLARESHOLM, Alta. – Canada could become a world class beef exporter if it had enough supply, says an industry expert.
“Canada is not now, but could become, a world class beef exporter,” beef consultant Charlie Gracey told a recent cattle workshop.
“We can be world class in terms of quality of stuff we produce but we’re never going to be a big, big player. We simply don’t have the supply.”
Canada is the world’s third largest beef exporter and sells 95 percent of its exports to the United States.
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However, it ranks 11th in beef production and its beef industry is among the most export dependent in the world.
Gracey said markets want reliability of supply, but producers don’t always have the information necessar y to make decisions on herd expansion or contraction.
“We need enough long-term, objective analysis in the industry to give producers the confidence to make the decision at the right time,” Gracey said.
“Case in point right now. Just when improved export opportunities are emerging and looking good, we don’t have the supply.”
Supply demands can’t be addressed until at least 2013, considering that three years are necessary to expand herds.
However, the situation isn’t all bad.
“I share with you the sense of relief and encouraging optimism that things are a whole hell of a lot better than they’ve been in the last eight years,” said Gracey.
“We’ve kind of moved out of the shadow of supply push into the opportunities for demand pull, and that’s a lot better place to be.”
Gracey, former manager of the Canadian Cattlemen’s Association, suggested the industry needs to “pick the winners” and devise a fed beef marketing strategy to a limited number of countries.
“We are not going to serve 18 markets. We simply can’t. But do we want to remain a farm team to the United States? I don’t know if we want to, but we’re going to.”
Gracey reminded cattle producers that the United States imports more beef than it exports and could eat its entire annual production. However, the Americans are able to aggressively export because they can backfill their domestic needs with Canadian cattle and beef.
Gracey said the sizes of the Canadian and American cattle herds were in lockstep until 1987.
However, Canada’s beef herd then began a major expansion based on duty free access to the U.S. rather than beef demand.
Beef consumption continues to decline, despite the anomaly of 2003 when consumption increased following the discovery of BSE in Canada.
“BSE was a terrible wreck but it happened at a time when we were most vulnerable,” Gracey said.
Canadian production was 1.7 million tonnes in 2002, up 16 percent from 1996. However, Canadia n consumption was 648,200 tonnes, down 9.7 percent from 1996.
He said those numbers show that the need for exports is obvious.
“We’ve got to recognize who we are, what we are, what we’re capable of, and act accordingly. We need to secure (market) access. We have to have access before we can even consider expanding.”
