Dene Moore: You’ll be paying a lot more for beef this summer. But producers and feedlots won’t be seeing the benefits.
The cattle ranches of the British Columbia Interior are quiet, idyllic places. Their hectares of rolling hills and open pastures surely are a dream to the cabin-fevered condo dwellers staring out their windows at closed playgrounds and parks during the pandemic lockdown.
They must seem so far removed from the COVID-19 crisis that has brought the world to its knees.
To date, the largest single outbreak of COVID-19 in Canada was at the Cargill beef processing plant near High River, Alberta. More than 1,500 confirmed cases have been traced to the plant, including 950 plant workers.
While there are no cases of the virus linked to consumption of food, the plant was forced to close for two weeks. It reopened last week.
Several other beef, poultry and pork processing plants in Canada have also been closed due to outbreaks among employees.
In the U.S., at least 115 meat and poultry plants have reported COVID-19 infections, according to a recent report from Bloomberg, and at least 18 have shut down.
But it’s the High River plant that processes about a third of the beef produced in Canada, and a majority of the beef produced in B.C. The two largest plants in Alberta process 80 per cent of Canada’s beef. Big is better, after all, and Big Agriculture is how you play the game in a globalized world.
Until you don’t.
“It has a huge impact,” says Kevin Boon, general manager of the B.C. Cattlemen’s Association. “We’ve become very dependent on a few very big plants.”
Normally, 8,000 to 9,000 head of cattle are processed on a daily basis in Alberta. Right now, only about 1,000 a day are being processed, Boon says.
In just a few weeks the closure in High River and slow-downs in other plants created a backlog of about 140,000 head of cattle. Those are cattle that have to be fed at a cost of about $4 per head per day. That’s $560,000 a day in additional costs. And more cattle just keep coming.
The shutdown also dropped the value of beef about $500 a head because of the kink in the supply chain. On the other end of Canada’s rather convoluted beef supply chain, demand is high and prices reflect the scarcity.
So while consumers will most certainly notice a big jump in the price of beef this barbeque season, it’s not the producers or feedlot owners who are benefitting.
“Demand is high. We just can’t get the price,” Boon says. “It basically ground us to a halt. And it’s very frustrating. We’ve got the cattle, we know that people want them, we know people need it. But there’s a weak link in the chain.”
This is prime season for cattle producers and the cost of the crisis will be felt for some time.
There are a handful of smaller, provincially regulated plants in B.C. that are operating at 110 per cent to try and help. But, like wine, beef processed at these plants cannot be sold across provincial boundaries. I would try to explain but, really, there is no reasonable explanation.
It’s a huge disincentive to large grocery chains to buy from these plants because it creates a red-tape nightmare in their own supply chain to ensure none of it crosses into – gasp! – another province.
“We have a very complicated system,” Boon admits.
The association has been working the past number of years to get a federally regulated packing plant in B.C. as a producer-owned co-op. It cuts out the middle-man and puts more money in the pockets of producers.
Boon hopes that the current calamity could give that project a boost. Maybe such a plant could even open this year.
“It will be a very good opportunity for our producers here in this province,” he says.
The federal government has earmarked $50 million to off-set the additional costs on producers, some of which will come from existing programs. Alberta and Ontario have agreed to cost-share the off-set program. B.C. has not yet.
In any event, it’s not nearly enough, Boon says.
“What it’s showing, I think, is that while efficiencies are created by these big plants in numbers and the ability to bring everything together in one place… it does not give the flexibility to manage when something like this happen,” he says.
“It’s run a lightning bolt through the heart of our industry.”
Dene Moore is an award-winning journalist and writer. A news editor and reporter for The Canadian Press news agency for 16 years, Moore is now a freelance journalist living in the South Cariboo. Moore’s two decades in daily journalism took her as far afield as Kandahar as a war correspondent and the Innu communities of Labrador. She has worked in newsrooms in Vancouver, Montreal, Regina, Saskatoon, St. John’s and Edmonton. She has been published in the Globe and Mail, Maclean’s magazine, the New York Times and the Toronto Star, among others. She is a Habs fan and believes this is the year.
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