May 17, 2007

BSE effects still lingers on Canada's beef industry, says census

Figures released Wednesday from the Canadian Statistics 2006 census of agriculture show the number of farms raising cattle in Canada has dropped 10 percent to 110,000 from 122,000 in 2001 - before mad cow disease brought prices down.

Though statistics also show that the size of Canada's beef herd increased to 15.8 million as of May 16, 2006 - nearly two per cent higher than in 2001-the effects of bovine spongiform encephalopathy (BSE) found in Alberta heifer in 2003 is still largely felt.

US, Mexico and Japan has partially shut out its market to Canadian beef due to mad cow disease. The country's meat-packing sector has been forced to increase its slaughter capacity from 65,000 cattle per week to 105,000 to handle domestic demand as Canada has also limited imports to avert further mad cow cases.

US has partially opened its cattle market in 2005 for cattle over 30 months of age and it is hoped it will fully reopen its border to all Canadian beef this year.  

The statistics also show Canadians are now eating limited beef due to mad cow fears and other restrictions on beef imports.

Though prices have already rebounded, it is still below pre-BSE levels.

Billion-dollar programs for mad cow disease by federal and provincial governments have also wound down as producers and meat packers now face higher costs conforming to the new rules of governing feed, cattle identification and slaughtering practices.

Statistics Canada says producers are selling off more of their replacement heifers "because they don't need so many calves". Nationwide, the number of has heifers dropped by 23 percent.

John Masswohl, director of government and international relations for the Canadian Cattlemen's Association admits they are facing the biggest challenge on the whole profitability and competitiveness of the industry.

Cattle farmers such as John Hrasko has shifted its oilseed production and vegetable farming to prep up losses from beef output. However, Hrasko said he is still holding on to its breeding stock on hopes that market conditions would improve.