Farm Credit Canada provided a seminar with workshops throughout the day in the Prince of Wales, where experts offered their insights to producers on marketing grain and beef on January 30. Brian Voth – an authority on grain marketing from intelliFARM – spoke during the morning in the Olympia Theatre. In the afternoon, the participants re-joined in the theatre to hear Anne Wasko, Marketing Analyst at Gateway Livestock, talk about Canada’s beef and pork industries to an involved audience from 1-2:30 p.m.
Although potential in upward developments is still existing for Canadian beef producers, Wasko said the period of immense growth in the early 2000s is over in North America, but most notably in the United States. Also, although the Asian market for pork and beef has become increasingly vital for Canadian and North American producers, the current trade war between China and the U.S. has continued to stifle the market’s future capacity somewhat. According to Beef, an online magazine, China was the fastest-growing beef import market in the world in 2019, with Australia, New Zealand and Brazil being the country’s major suppliers.
In particular, Wasko noted Brazil has continued to be China’s largest source for beef, pork and chicken. Beef is gaining in demand, especially in Asian markets. Requests for more beef and pork in China has influenced constructive economic growth. “We are starting to see strength in cow prices,” Wasko said, noting beef prices had risen by 40 per cent in 2019. Meanwhile, Chinese prices for pork have doubled. Yet, recent developments on the worldwide spectrum might hinder future growth. “The market is freaked out about the coronavirus,” Wasko stated, adding an economist she had spoken with currently also suggested that North America and Europe are due for a recession in the near future. “Beef demand feels it when recessions start to occur.”
But the North American palate still favours beef. “Demand has been strong for beef in North America,” Wasko declared. Additionally, in her opinion, Canada consumers are preferring to buy domestic products instead of beef from other countries, including New Zealand and Australia. A Buy Canadian ethic has influenced national consumers to have a preference for domestic beef over imports.
A significant challenge faced by Canadian beef producers had incorporated the current higher costs in feed, which increased prices for feeder cattle. “The U.S. feeder prices drives our prices,” Wasko recounted, also saying “The U.S. production of corn was down in 2019 by five per cent.” Wet weather in corn growing states such as Iowa, Illinois and Minnesota had literally dampened the corn production output last year on Midwestern farms.
Wasko noted the market had been bolstered by healthy growth in the autumn of 2019. “It was a busy fall, with 27 per cent more cattle placed.” Also, having the Canadian dollar hover between 75-76 cents provided stability for producers, since a low dollar helped to keep exporting costs low. “An 80-cent dollar is hard for the market,” she specified.
Although challenging times for producers might be in store for the future, Wasko encouraged the ranchers in the audience at the Olympia Theatre to be proactive. “You got to talk to buyers and know what’s going on, on the other side of the market. If you’ve got good product, get out there and market it yourself.” Wasko also briefly addressed the recent consumer trend for sustainable beef. “Buyers are asking for sustainable beef. We’re producing what they’re eating, so we have to start listening.”
