Alberta’s single case of mad cow disease has devastated not only the beef industry, but other meat sectors, hitting pork and sheep producers particularly hard.
“Some people think the beef crisis has actually benefited other meat sectors, but the hard reality is that nothing could be further from the truth,” said Bill Wildeboer, chairman of Alberta Pork, the organization representing Alberta’s 1,800 pork producers.
More than 30 countries banned Canadian beef products after the discovery of bovine spongiform encephalopathy in a single cow in May. The ban included all ruminant animals including sheep, bison and elk.
The U.S. and Mexico borders have since reopened to boneless beef from animals under 30 months old, but are more restrictive to sheep. And all borders remain closed to live animals, a situation impeding the recovery of the meat sectors.
Rumours that the U.S. border will soon be opening to live Canadian cattle under 30 months of age have proven premature.
“Other meat sectors are victims in this as well, and the beef crisis is rapidly turning into a meat crisis that may drag all sectors down,” said Wildeboer, who raises hogs near Lacombe.
Agriculture Minister Shirley McClellan recently unveiled $4.4 million worth of programs to help meat processors develop “innovative solutions” and new markets to deal with an oversupply of cattle over 30 months of age.
The $4-million Beef Product and Market Development Program will focus on four main areas: secondary beef processing expansion; new product development; market re-entry; and new market development. The $400,000 Food Processor Assistance Initiative will help companies sitting on inventory they were unable to export into markets closed due to the BSE discovery.
The mad-cow crisis also comes at a time when all sectors were hoping to make a recovery from several years of drought and high feed prices.
“It’s not a very rosy picture. We’re hanging on as long as we can, but some producers have quit,” Wildeboer said.
Pork producers have been hit with falling market prices and retail sales. At the same time, production costs are increasing with rising feed costs, new rendering fees and a charge for removing dead stock. The new fees are a result of the BSE incident, which led to a ban of ruminant meat and bone meal in swine diets.
To break even, hog producers need about $140 a hog. “Right now, they’re getting about $120 a hog,” Wildeboer said.
With domestic beef consumption up over this time last year, pork producers are suffering from decreased sales. As a result, shipments of hogs to the U.S. have increased 138 per cent, causing prices to fall.
Canada’s pork prices are based on the U.S. market. Last year, Canada shipped between 20,000 and 40,000 hogs to the U.S. This year, more than 80,000 have been shipped. “That’s a lot of pork chops,” resulting in a five-per-cent drop in prices, Wildeboer said.
To combat the crisis, the pork sector is working with retailers to feature pork specials, similar to the beef specials featured throughout the summer.
“People need to understand this is a meat problem, not just a beef problem,” Wildeboer said.
In the sheep sector, a slump in markets has forced at least one producer out of business. “After eight to 10 years in the business, we are now sheepless,” said Sharon Stapley, who recently sold her last 60 sheep. “Prices were down and there was just no place to sell them.”
Purebred sheep producers are up against the wall, said Dan Sinclair of the Half Diamond Farm at Bowden. “This is hurting the purebred guys in a big way. A lot of breeding stock used to go to Mexico, and now that’s done. It’s a bad situation. We would normally sell 50 to 100 replacement animals. This year we sold 25.”
He now has 240 ewes, where normally he would only have 150. “I just can’t bring myself to sell them for nothing.” At press time, lamb prices were 49 cents a pound, compared to $1.20 this time last year.
Mexico was one of Alberta’s best customers for purebred sheep, but the U.S. will not allow Canadian stock to cross its border.
Typically, about 30,000 of Alberta’s flock of 140,000 ewes are shipped to the U.S., said Maureen Duffy, manager of the Alberta Sheep and Wool Commission. An increase in slaughtered sheep is also pushing Sunterra Meats, a federally inspected lamb-processing plant at Innisfail, to the limits. The plant added another slaughter day to handle the 17-per-cent average increase in animals.
“We have a lot of meat in the freezer, and it’s building weekly. We don’t have much more capacity,” said general manager Miles Kliner. “We have way more inventory than we’ve ever had, but we’re hopeful that cuts on hand can be merchandised over winter.”
When the borders closed, it left Canada without a market for “heavy” sheep. Larger animals are preferred in the U.S., but not in Canada. And the local industry failed to anticipate that the U.S. would restrict imports to only boneless cuts resulting in a surplus of chops and racks.
Since much of the lamb meat sold in stores is frozen cuts from New Zealand, Sunterra is decreasing some of its inventory by moving fresh cuts into Eastern Canada. “Much of the volume in Canada is frozen, so we’re competing by offering fresh cuts,” Kliner said.
As consumers become more aware and sensitive to imported products, the market for local fresh meat is expected to grow, he added.
Feedlots are also short on feeder lambs, because producers are taking advantage of the compensation slaughter program, Duffy said.
Sales of alternative meats, such as bison and elk, have also dried up, forcing some producers to slaughter and bury their cull animals. The majority of live bison exports went to the U.S., as well as 45 per cent of all Canadian bison meat products. About half of Canada’s 45,000 farmed bison are in Alberta.
Bison and elk were included in the government’s $460-million slaughter program, but the rules for those meats were not released until later, forcing a slaughter delay because plants were booked solid with cattle.
Only slaughtered animals were eligible for compensation.
With so much beef on the market, the biggest problem facing the turkey sector is the competition for retail shelf space, said Dawn Ius, marketing and communications co-ordinator with Alberta Turkey Producers.
Poultry producers have actually experienced an increase in sales, though it’s difficult to say whether it’s because BSE has turned some people off buying red meat. “We just haven’t seen an impact,” said Lloyd Johnston of the Alberta Chicken Producers.
In fact, chicken consumption over the last year has grown by 2.8 per cent – part of a trend that began 10 years ago when Alberta chicken production increased by 92 per cent, Johnston said.
Poultry is the obvious alternative to red meat, said Ius. “People have been stocking up on beef, but you can only eat so much.”