The recent closure of one of the biggest cattle feedlots in Alberta due to poor market conditions and the decline of livestock exports from Saskatchewan indicated by figures released in the Saskatchewan Agriculture Exports Reports for 2015 are not good news for the beef and livestock industry in the Canadian Prairies.
If Canada strategically targets new trade frontiers for its livestock and beef, it might be able to reverse this trend. The Middle East and North Africa (MENA) region could be part of the solution.
The MENA region is diversified when it comes to food supply and consumption. Countries such as Israel, Turkey, and Morocco are considered food exporters, and to a large extent self sufficient in their agriculture produce.
On the contrary, the larger MENA region, including the Gulf Co-operation Council (GCC) countries and Egypt remain heavily dependent on food and agriculture imports. Moreover, apart from Israel and Turkey, the rest of the MENA region continues to lag in agriculture research and development.
Most MENA countries are predominantly Islamic and Halal meat is highly demanded. Some of the countries in the region enjoy high disposable incomes like the GCC bloc because of oil and gas dividends.
Unfortunately, Canada lags compared to other competitors when it comes to beef and livestock exports to the region.
For instance, countries including India, Australia, Pakistan, the United States and Brazil are considered the top five non-regional suppliers of beef to GCC countries.
Canada holds only 1.2 percent of the foreign supply markets in the GCC and ranks as the 10th largest supplier of beef and beef products with total supplies reaching only US$15.2 million in 2013.
Saskatchewan livestock production, for example, is very focused on the U.S. market and the exports in 2015 were on the decline.
The key question: Are the Canadian Prairies missing a specific opportunity in the MENA region, and can Saskatchewan in the future become a key producer of a world class Halal meat to meet the high demand in the MENA region and possibly other Islamic countries?
As well, would having some halal slaughter facilities in Saskatchewan help open the MENA beef and livestock markets to prairie exports?
Has the time come for a new approach?
If Canada is to revisit its agriculture trade policies with the MENA region, it should be able to benefit from an important current development, the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) that brings Canadian products close MENA countries.
Similar trade agreements can be signed with political and economic blocs like the GCC, drawing on the lessons from (CETA).
Such a trade deal could contribute to expanding Canada’s trade frontiers in this strategic rich region and the larger MENA region.
Another important development is the recent G3 Global Grain Group — a joint venture between Bunge Canada, and SALIC Canada, a wholly owned subsidiary of Saudi Agricultural and Livestock Investment Company — acquiring a majority stake in the former CWB grain handling company.
This signifies Saudi interest in the Canadian agriculture market. Livestock and beef produce can be on the top of such interest if the prairie provinces take advantage of current developments.
Last, but not least, Canada being one of the world’s leading countries in beef and agriculture produce, technologies and research can help in building the much-needed regional capacities in agriculture R&D.
Canada can develop mutually beneficial relations with the MENA region countries and research entities aimed at developing scientific and research based agricultural practices and best solutions.
Such co-operation can potentially take place in two ways: by facilitating Arab investments in the livestock and beef production sector in Canada and by helping the governments in the MENA region to acquire necessary skills and capacities in this sector.
Tamer Qarmout has worked with the United Nations Development Program in the Middle East region. Tamer holds a Ph.D. degree in Public Policy from the Johnson-Shoyama Graduate School of Public Policy, and an MA degree in Sustainable International Development from Brandeis University in the United States.