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Canadian industry continues to bounce back after BSEBy Jennifer Bremer
The reality of having to deal with a serious disease outbreak is that the industry really doesn't know what to do until it happens, according to Dennis Laycraft, executive vice president of the Canadian Cattlemen's Association. Canadian beef producers have had to learn how to deal with limited markets and new management techniques after the 2003 outbreak of bovine spongiform encephalopathy. "Prior to the May 2003 BSE outbreak, Canada was the third-largest exporter of beef in the world," said Laycraft during the 26th annual Alltech International Animal Health and Nutrition Symposium, in Lexington, Ky., recently. "Post-BSE many things changed for our producers." Having lost access to international markets for their products, Canadian beef packers dramatically reduced kill levels. The closure of international borders to shipments of live Canadian cattle suddenly made a large and liquid North American market into a small and thin regional Canadian one. Processor demand for slaughter cattle and cull cows declined sharply, as did live Canadian cattle prices. The immediate response to the BSE announcement was having daily media calls, crisis communication among all players in the beef industry, travel by the Canadian Cattlemen's Association to communicate with affected producers, and focus on how to get their border reopened. "In July 2003, Canadians remained highly confident in the safety of our beef product, and we actually experienced a beef shortage since beef packers had slowed down slaughter," he said. By August, the U.S. market for boneless beef from cattle under 30 months reopened, relieving some of the pressure on fed cattle prices. Canadian beef packers could again compete in the North American boxed beef market. "We also saw an increase in beef consumption in Canada of 57 percent in August 2003. We were very fortunate to have our consumers stand behind us," said Laycraft. "Ninety-two percent of these consumers thought our beef products were safe to eat." The closed borders also affected the Canadian beef prices as they went from $104 per hundredweight to $35 per cwt. "Slaughter capacity needed to increase in order to deal with the number of cattle that were ready for market, as well as cull cows that needed to be sent," he said. Prior to the closure of the U.S. border, Canada was heavily dependent upon the U.S. as a market for its slaughter cattle. In July 2005, the U.S. border was reopened to exports of live Canadian cattle under 30 months of age, but several new regulatory requirements were introduced for cattle that were to be shipped south. "Today, the new normal is still evolving," Laycraft said. "We are still trying to figure out what is the best way to help our producers." Age verification is pertinent for marketing since the market for cattle 30 months and younger is different from those that are older. He said there has been a continual integration of the branding mentality with programs focused on animal health, food safety and meat quality. "We want to maximize the value of every beef cut in order to add value to our beef," he said. "We have added $180 per head by selling byproducts that are not used in beef cuts." A voluntary information exchange is set up to gain more information about the beef. "Traceability capabilities are very important when dealing with a disease outbreak such as BSE," Laycraft said. "It is an investment in international relations. When you are in crisis, it is a lot easier to look to your friends than to look for your friends. It helps if countries are willing to help each other get out of the crisis." Traceability has helped Canadian producers improve their ability to shorten the length of the crisis. They implemented mandatory identification in 2001 and electronic identification in 2003. This, along with the feed ban of not feeding ruminant byproducts to ruminant animals have been some of the important ways the Canadian cattle industry has worked with their producers to work hard to restore full trade with all markets for Canadian beef and cattle. Jennifer Bremer can be reached by phone at 515-833-2120, or by e-mail atjbremer@hpj.com.
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