The past several years were among the most challenging ever for Canadian livestock producers, but better times lie ahead.
Livestock numbers are down in many countries and global demand for meat is rising, creating opportunities for producers with the right combination of quality and competitiveness.
Adversity breeds strength and Canadian livestock producers have faced more than their share of adversity in recent years.
Bovine spongiform encephalopathy, the rapid appreciation of the Canadian dollar, trade limitations due to American country-of-origin labelling and rising feed costs each delivered blows to Canadian livestock producers, causing most to hemorrhage money.
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Cattle and hog sectors that had grown thanks to the weak loonie in the late 1990s and early 2000s had to contract to limit the losses.
The national beef cow and sow herds are both down 20 percent from their peaks in 2004. In cattle and hogs, the total Canadian herds are the smallest since the mid 1990s.
The number of farms reporting hogs dropped by 10.6 percent in just the last year and the number of farms with cattle dropped by 3.5 percent.
Canada had particular struggles with BSE and currency appreciation, but the past several years have been difficult for producers in many important livestock producing countries. The recession that killed jobs, slashed wages and reduced many consumers’ ability to buy meat, presented one more challenge.
The Food and Agriculture Organization of the United Nations says meat production globally has stagnated this year.
The U.S. beef cow herd is the smallest since 1973. It expects to produce three percent less beef in 2011 than it did in 2009 and 1.5 percent less pork.
Australian livestock producers are only beginning to recover from two years of severe drought.
Argentina, once a mighty beef producer, has seen its cattle herd shrink as export restrictions and high oilseed prices cause producers to turn pastures into soybean fields.
In Russia and other former Soviet countries, the drought is delaying plans to rebuild livestock production after the sector’s collapse following the end of communism. Even when they get rain, the goal for the meat industry there is to displace large imports rather than increase exports.
Livestock production increases in the European Union will be constrained by strict environmental regulation.
While global meat output is stagnant, there are signs demand is reviving.
Economies in the developed world are starting to show some life and the developing world never stopped growing. More people in developing countries are attaining the income needed to add more meat to their diets.
By midcentury, developing country meat consumption is expected to rise by 65 percent, while developed countries’ consumption is expected to rise by 16 percent, the International Food Policy Research Institute estimates.
But just because there is rising world meat demand does not mean that every livestock producing country will benefit. Success will go to those that have competitively priced feed, available land to avoid the environmental problems associated with livestock crowding, animal health, traceability and a proven record of food safety.
Canada has advantages in each of those categories, but has work to do to be competitive with powerhouses like the United States and Brazil.
Among the tasks are breaking down barriers that Canadian beef still faces over BSE and designing domestic inspection rules that walk the fine line between ensuring safety without imposing onerous costs that hurt competitiveness.
Bruce Dyck, Terry Fries, Barb Glen and D’Arce McMillan collaborate in the writing of Western Producer editorials.
