September 30, 2011

 

Prospects for Canada's beef, pork producers brighten

 

 

Canada's deputy minister of agriculture Pierre Lemieux recently said that things are looking better for beef and pork producers.

 

Lemieux, member of Glengarry-Prescott-Russell said that prices are up over where they were a few years ago, for both beef and pork, but that doesn't mean that all challenges have been overcome, but things are looking better. He added that there have been a number of polls done among farmers about the future but it looks like farmers have an optimistic view of agriculture and their own personal contribution to agriculture in the future.

 

The federal government can't contribute to Ontario's risk management program without risking a trade war with the US, said Lemieux, who is parliamentary secretary to federal Minister of Agriculture Gerry Ritz. Ritz was scheduled to speak but had to cancel because of emergency cabinet meeting so Lemieux took his place.

 

"We are very worried if the federal government did undertake a risk management program that it would be trade actionable and that would be very detrimental to our livestock producers," said Lemieux. The Ontario government recently announced an insurance programme for some farm commodities that will reimburse farmers based on their cost of production. But the Ontario programme only reimburses farmers up to 40%. The Liberals want the federal government to put in the remaining 60%.

 

Governments of Quebec and Alberta have similar risk management programmes, but they pay 100%.

 

"That is the flexibility that our system offers to producers. We have a federal government that is levelling the playing field for all farmers so that all are treated in the same manner," said Lemieux.

 

Bruce Grey Owen Sound MP Larry Miller, who is also chairman of federal agriculture committee, accompanied Lemieux to the meeting. He noted that the federal government can only enter into a risk management programme agreement if all provinces agree to be part of it and if they all agree to the terms. That has yet to happen, so the federal government has its own programmes instead, Miller said.

 

"The province of Alberta may do something for its own beef farmers but as a federal government we have to be very careful that we treat beef farmers the same across the country," said Miller.

 

Producers in attendance also heard that market outlooks are also good, according to another speaker Scott Krakar of London Agricultural Commodities.

 

Cattle prices, he said, "are up due to tightening supplies" and said the demand concern is due to economic uncertainty. Futures are more optimistic than other forecasts," Krakar said, adding corn and soy inventories are very tight because of an inadequate world supply, all of which is affecting grain markets. "As the US dollar declines, grain and corn prices rise."

 

Gary Grubb, a beef specialist for Master Feeds throughout Ontario, spoke about the trials and tribulations of the beef feedlot business and encouraged producers to be aware of what their competitors were doing. Feed costs, for example, for beef average CAD$0.47 (US$0.45) a pound while it is only CAD$0.335 (US$0.32) per pound for chicken producers.