THE battle back from the BSE crisis will be won by inches and there are encouraging signs that ground is being gained through cattle industry efforts.
No, there is no word of an imminent opening of the U.S. border to live Canadian cattle. But virtually all parties agree that in the absence of that fine event, a larger domestic slaughter capacity offers the quickest way to improve cattle prices and a longer-term way to decrease this country’s beef export dependency on the United States.
July 27 brought two announcements by beef packers that cattle producers can accept as progress in the battle.
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Lakeside Packers in Brooks, Alta., plans to expand so it can process an additional 1,000 head per day, for an average total of 5,000 head daily.
XL Beef has plans to double shift and double its cooler space in Moose Jaw, Sask., which will also increase the number of animals it can process.
There are hints of other announcements pending, though nothing to hang your cowboy hat on. Regardless, any substantial increase in slaughter volume and cooler space will increase demand for cattle, help address the oversupply and have a positive effect on prices.
In the longer term, it can improve the Canadian cattle and beef industries by supporting domestic processing and job creation. If our export partners want their beef in a box, we’ll give it to them in a box – given enough processing expansion on this side of the 49th parallel.
On another front, Japan admitted last week that there is little point in testing young cattle for BSE. This is a chink in Japan’s armour. Until now, it had insisted that all cattle be tested and its obstinance has hindered progress in reopening export markets for the U.S. and Canada.
Mexico has been an ally during this crisis and it continues to state its wish to resume live cattle trade with Canada. Like Canada, Mexico sees the diplomatic approach with the U.S. as the prudent battle strategy, but nevertheless, its opinion carries weight in the integrated North American cattle industry.
Work also continues behind the scenes, at the beef industry value chain round table. This group of industry and government representatives doubtless had a hand in some if not all recent developments. A News release
news from a July 26 round table meeting refers to plans for tax incentives and risk capital for processors that develop or expand slaughter facilities.
It also talks about work on a delayed marketing strategy to better match cattle to processing capacity, plans for export market diversification and – ever the realists – tax options for producers who leave the industry.
When beef producers look at the situation, it may seem that little has changed in the BSE war. Yet some are carefully choosing their battles and inches are being gained.
