Packers say the prices they pay for cattle have dropped as a result of the rising Canadian dollar, lost premium markets for offal and new costs for waste disposal and slaughter regulations.
They affirmed this at federal agriculture committee hearings in Ottawa last week.
Loss of markets for offal, hide, waste and other non-primal meat cuts have been blamed for a drop of $190, or about 16 percent of overall beef carcass value at Canadian cutout prices.
According to Statistics Canada, export beef offal sales did fall through 2003 and early 2004. However, the agency also reports that exports of offal have returned to about half of the previous two years’ average value, and with them come financial returns to the packer.
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Before bovine spongi-form encephalopathy was found in Canada in May, the nation’s meat packers and brokers exported an average of 4,392 tonnes per month of beef offal, not including livers, tongues, guts, bladders, stomachs, tripe or intestines.
In 2002, this amounted to exports of 52,704 tonnes for a value of $152 million.
In 2003, this market fell to 30,355 tonnes and $89.2 million.
Exports of the offal for the first four months of 2003 compared evenly to 2002 numbers, then fell to 120 tonnes in June. Offal exports rose slowly through July, August and September before rising to nearly 2,400 tonnes in October.
American imports of Canadian beef offal dropped to zero for June, July and August 2003 before recovering to 94 percent of 2002 import levels and earnings.
In November, Canadian beef offal exports brought $5.5 million from the United States, where imports have returned to near pre-BSE levels and prices.
In November Canadian offal brought in $1.1 million from the rest of the world. Statistics Canada export figures indicate exports of offal have dropped by $3 million per month to countries other than the U.S.
