December 19, 2005

Canadian cattle industry's future uncertain for 2006
 

The future of Canada's cattle industry is uncertain for 2006, as analysts disagree on profitability next year.

Although the USDA had eased its ban on Canadian live cattle in July, only cattle younger than 30 months of age are allowed into the US.

The US banned Canadian cattle in 2003 after mad cow disease, or BSE, was found in an Alberta cow.

President of the Canadian Cattlemen's Association Stan Eby has expressed confidence in the country's cattle sector, due to the trade resumption with the US and strong cattle prices.

Meanwhile, Eby said Canada is actively lobbying the US in a bid to open trade of older cattle and breeder stock.

Eby stated that increased Canadian slaughter capacity would benefit the domestic cattle industry in the long term, due to more self-sufficiency in processing. Beef export markets appeared to be opening up as well, he added. Japan has recently lifted its two-year ban on Canadian beef.

He also expressed satisfaction that various countries importing Canadian beef helped reduce the country's dependence on the US market.

However, cattle analyst Herb Lock of Farm$ense Communications in Alberta said that while Canada's slaughter capacity has increased in recent years, capacity utilisation has not.

Additionally, the Canadian Border Services Agency had earlier launched an investigation into allegations that dumping and subsidising of US corn was harming the Canadian corn sector. As a result, possible Canadian duties on US corn imports might raise cattle production costs for domestic farmers, Lock added.