SWIFT CURRENT, Sask. – Canadian cattle producers were in trouble long before BSE closed international borders to their beef, says a well-known industry consultant.
The discovery of the disease was just the final straw in a series of events that began with the first year of tremendous growth in the cattle industry in 1987, said Charlie Gracey.
By October 2002 Canada’s burgeoning beef exports had attracted American protectionist interests.
Beef was the highest cost meat and had dropped to consumers’ third choice from the meat case.
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The herd had grown 60 percent since 1987 and yet consumption was declining.
“Growth was based totally on export demand,” Gracey said.
“Per capita consumption is only two-thirds what it was in 1978. Per capita consumption of domestic production is half what it was in 1978.”
In 2002, he said, record pro-
duction of beef was matched by record low per capita consumption of domestic product.
“Why didn’t we pick up on this?” he said.
South of the border, subsidies made it more attractive for farmers to produce grain and the livestock industry moved north.
Gracey said he was puzzled about why Canadians moved so wholeheartedly into increased livestock production until someone told him it cost less to put up a perimeter fence than to spray that same piece of land just one year.
“We created R-CALF,” he concluded, adding that it is dangerous to say “to hell with the Americans.”
Need open border
Gracey said Canada has few options to find its way out of the current mess but restoration of full access of cattle and beef to the United States is key.
Domestic consumption has to go up, he added. Exports to non-North American Free Trade countries must be expanded and supplemental imports should be eliminated.
Canfax analyst Anne Dunford said those imports haven’t been accepted since July 2003, but it’s an issue cattle producers keep raising.
“I think your national outfit is going to have to keep the pressure on,” she told the Saskatchewan Stock Growers Association convention.
However, on the flip side are Canadian processors that want imported product.
Dunford noted that Uruguay continues to ship beef into Canada not as a supplemental import but by paying a tariff.
“They have been in a position to continue to pay a tariff over and above what the quota might be,” she said.
“That’s how Uruguay has also moved more product into the U.S. market. It shows you just how competitive the world market is for manufacturing beef.”
She said the industry will continue to monitor that situation.
