LIKE many cattle producers, Jonathon Kolish of Mossbank, Sask., wonders why the prairie industry has hung its hat so resolutely since 1989 on supplying the United States with cattle and beef.
“It is madness,” Kolish said.
“We built an industry and made ourselves dependent on a protectionist country. We let our domestic packing industry go to support plants that serve the U.S. market. We have to import beef to meet some domestic demand.”
BSE and the farm income crisis of 2003 brought that home to Canadians. Parliamentary reports in recent weeks have called for more investment in domestic packing plants.
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From Prince Edward Island to Alberta, farmers are talking about trying to recreate a domestic packing industry.
“I think the biggest message out of 2003 is that it is reckless to leave ourselves dependent on exports and made-in-Washington agricultural and trade decisions,” said Howard Leeson, chair of the University of Regina’s political science department and a part-time farmer.
The leadership of the Canadian cattle industry says it supports more domestic packing capacity but also scoffs at suggestions that the multi-billion dollar cattle industry should de-emphasize exports in favour of domestic sales.
“A policy to increase packing capacity here is good but we export more than 50 percent and I do not think the industry would be willing to shrink,” said Stan Eby, an Ontario producer and president of the Canadian Cattlemen’s Association.
“Exports are essential.”
They certainly have been the basis of the industry’s growth since the Canada-U.S. free trade deal was implemented in 1989.
Since then, the cattle herd has increased and by 2003, Canadian exports had increased five-fold, overwhelmingly to the United States.
In 2002, Canada exported more than 2.2 billion pounds of cattle and beef. In 2003 because of BSE, that total fell by more than half. At the same time, Canada imported more than half a billion pounds of beef, mainly under trade deal requirements from the U.S. and Oceania.
Beef industry leaders point to the trade surplus to argue that an export orientation is needed for the industry if the current beef herd is to be viable.
In fact, the last time the Canadian beef herd was as large as it is now was 1975 when exports and imports were minimal.
At the time, Canadian consumers were a bigger part of the solution. Per capita beef consumption was 40 percent greater than now but there were seven million fewer Canadians.
The result is that domestic consumers in 1975 ate 340 million lb. more than Canadians do today, meat that now has to be exported. In addition, 500 million lb. of imports displace domestic sales.
