August 23, 2011

 

Canada's cattle herd sinks to record low in 17 years

 

 

As of July 1, the cattle herd of Canada has dropped to its lowest in 17 years, whereas hog heads increased by mid-year for the first time in five years, Statistics Canada said on Monday (Aug 19).

 

Farmers had nearly 13.9 million head of cattle on their farms, down 0.8% from a year ago, continuing a six-year slide. High costs of feed grains and a robust Canadian dollar have cut into farmers' profits, although cattle prices are sharply higher than a year ago.

 

The biggest decline in the cattle herd among Canadian provinces was the 3.3% drop in Manitoba, where severe spring flooding of pastures forced ranchers to sell or move cattle.

 

Some of Manitoba's losses may have shown up in neighbouring Saskatchewan's slight herd increase, and some ranchers have quit the business, said Cam Dahl, general manager of the Manitoba Beef Producers association.

 

"The driver behind (the decline) is absolutely the flood and I would hope that will be recovering in the years to come," he said.

 

Manitoba had Canada's fifth-largest herd among provinces.

 

US cattle and calf inventories saw a similar decline at mid-year, easing about 1%.

 

Farmers reported 11.9 million hogs at mid-year, up 0.8%, marking their second straight quarter of growth. Supplies of sows and gilts, however - a measurement of the growth potential of hog supplies - dipped 1.1% to their lowest level in 11 years.

 

Those figures illustrate a trend of hog farmers becoming more productive over the years, said Kevin Grier, senior market analyst at the George Morris Center, an agricultural research centre.

 

The hog industry has gone through a six-year wave of downsizing, including government incentives started in 2009 to close barns.

 

"We've got a sense of stability now," Grier said.

 

Live cattle exports of 374,400 head during the first half of 2011 marked a drop of about 40% from a year earlier.

 

The plunge in cattle shipments illustrate cheaper feed costs in Canada, where ranchers use barley, versus the US, where cattle consume more corn, Grier said.

 

US corn prices set an all-time high this year, with strong demand from exporters, ethanol plants and the livestock industry.

 

Hog exports eased 3.1% during the second quarter to 1.4 million head.

 

The US country-of-origin meat-labelling law, which Canada and Mexico are fighting through the World Trade Organization, has curtailed Canadian livestock exports to the US for several years.

 

Statscan surveyed about 10,000 livestock operations.

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