The cattle business today is much different from the cattle business of eight, 10 and 15 years ago. That’s why it makes sense to reconfigure the organization that handles national beef cattle marketing and promotion.
On Jan. 6, the Canada Beef Working Group, mandated five months earlier to explore options for change, recommended that a single, independent national agency be created by merging the Beef Information Centre, the Canada Beef Export Federation and the national check-off agency into one entity called Canada Beef.
As envisioned, it will be a streamlined organization that will maintain programs while improving accountability to the producers and organizations that provide the funding.
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The idea has been considered in the past, but it seems likely that recognition of today’s climate will bring it to fruition. That would be a benefit to the industry.
Post BSE and post recession (more or less), the national herd is smaller, and that will mean less funding available to BIC and CBEF.
The two organizations were created years ago to fill various needs, but in those years, growth was fuelled by a low Canadian dollar, there was unrestricted access to the American market, the world economy was stronger and there were fewer restrictions on international trade.
In 2011, none of those things exist. The industry is to be commended for recognizing the need for change and creating a reasonable alternative.
The financial benefits of combining CBEF and BIC under a renamed national check-off agency are compelling. The working group estimates a savings of $1.3 million annually, partially offset by the loss of $104,000 in annual CBEF membership revenue.
Even more compelling, however, is the greater accountability expected to result from formation of the new group. Alberta cattle groups in particular have been critical about how check-off dollars have been spent and the input, or lack of input, on how their dollars are spent. As the province with the most cattle, their discontent has a loud voice.
Accountability was clearly on the minds of the working group, which notes in its report a goal to “respond to the needs of beef cattle producers who provide industry funding through the deduction of a mandatory non-refundable national checkoff on the sale of beef cattle in intraprovincial and interprovincial trade.”
It will be vital to the success of this new organization to ensure there is strong producer input into its activities. When groups become larger, the views of the grassroots can easily fall by the wayside.
It appears the proposed structure of Canada Beef recognizes that pitfall. It recommends a board with at least 12 members, “eight of whom will be primary cattle producers representing the provincial cattle associations and four members representing processors, exporters and importers.”
The proposed core functions of the new organization also show recognition of today’s market. North American beef consumption is dropping but it is expected to increase in international markets as the economy improves.
The top three core functions of Canada Beef, as listed by the working group, are:
• Prevent price erosion with a mid-term goal of achieving and sustaining U.S. price equivalency. The long-term goal is to achieve sustainable price premiums to the U.S.
• Facilitate the development of an export culture for the Canadian industry
• Assist in securing and developing access to all global markets by providing up-to-date market access intelligence and support.
The working group has come up with an ambitious plan to consolidate and improve the marketing, efficiency and accountability of existing groups. Its proposal should be carefully considered.
Bruce Dyck, Terry Fries, Barb Glen and D’Arce McMillan collaborate in the writing of Western Producer editorials.
