EDMONTON – Minutes after the Alberta government announced its latest aid package designed to boost the price of fat cattle, the markets responded and prices crept up a few cents.
“There’s been a couple early signals within the last half hour. It’s way too early to claim this is a success, but the theory is it should have an impact on price,” said John Knapp, director of the Rural Services Division of Alberta Agriculture.
“I hope this will add several cents in the early going to the price,” said Knapp of Edmonton.
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Ron Axelson, general manager of the Alberta Cattle Feeders Association said even before the announcement, fat cattle prices rose on the rumour of the program. One packer bid 25 cents a pound for a group of cattle, but a week later phoned back to offer 35 cents a lb.
“The price is going the right way,” said Axelson.
Saskatchewan and Ontario an-nounced similar programs to help cattle producers cope with the closure of foreign borders to Canadian beef. Thirty-four countries, including the valuable United States market, have banned Canadian beef since bovine spongiform encephalopathy was discovered in an Alberta cow May 20.
The Ontario government pledged an additional $17.5 million, but has yet to announce details.
Saskatchewan’s program will put an additional $6 to $12 million into helping hard-pressed producers.
On July 25, the day of the Alberta announcement, Canfax, the Canadian cattle market analysis group, reported fed steer prices for the week ranged from 29 to 41.3 cents per lb., heifer prices ranged from 29 to 35 cents, the lowest cattle prices in more than 35 years.
Cattle producers, from feedlots to cow-calf producers, can’t continue to operate at those prices, said Jeff Ball, a feedlot operator and vice-president of the Alberta Cattle Feeders Association during the news conference to announce Alberta’s $65 million Fed Cattle Competitive Bid Program.
“At a cash price of 20 cents, for us to continue selling fat cattle is disastrous and there would not be any filling of feedlots. With competitive bidding in the market, it will bring that cash price up and there will be some stability,” said Ball, who operates Ballco Feeders, a 12,000-head feedlot east of High River.
“We hope within the first week we’ll hope to boost the cash price for these cattle significantly in the neighborhood to 45 cents.”
Under the Alberta program, feedlot owners can set aside cattle into their feedlot, or investors can buy fat cattle from the feedlot operator but must keep the cattle in the feedlot for at least 60 days.
The feedlot operator is then eligible for money without having to wait till cattle are slaughtered for payment.
Alberta agriculture minister Shirley McClellan said she hoped this set aside program would boost prices.
“We think this will put more buyers in the system and take pressure off feedlots to unload their cattle at any cost.”
Brad Wildeman, manager of Pound-maker Ag Ventures in Lanigan, Sask., said he was still trying to get details of the program, but he plans to take advantage it.
“We’ve been putting cattle on maintenance for some time now so to be able to enrol them and get some cash out of them will be helpful.”
The Alberta government also announced it was making changes to two loan programs and called on the federal government to revisit a national loan guarantee program.
