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A year of speaking up for cattle feeders

As advocates for our province’s cattle feeders, the Alberta Cattle Feeders’ Association champions their interests, freeing them to concentrate on what they do best – producing premium beef for the world.

This past year has been another busy one. Here are the major projects the association has undertaken:

International trade

ACFA worked closely with the National Cattle Feeders’ Association to advance swift passage of several Canadian trade deals:

– Canada-United States-Mexico Agreement (CUSMA), which replaced NAFTA.

– The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which broadens access to Asian markets.

– Opening markets in China for Canadian bone-in-beef products, including the creation of a pilot project to export fresh and chilled beef to China.

– Positive changes to the Restricted Feeder Cattle Program at the Canadian Food Inspection Agency, and postponement of changes to the CFIA Manual of Procedure that would have stalled trade with China.

Labour

To address the chronic labour shortage, ACFA reached an agreement with the Alberta ministry of Labour to facilitate faster and more direct applications for temporary foreign workers, as well as relaxed education, language and income requirements.

ACFA continues to work on this crucial program.

Taxation 

Lobbying for fair taxation has been a top priority. Efforts include:

– $75,000 in funding to appeal Lethbridge County Livestock Head Tax.

– Successfully advocating to drop proposed changes to the taxation of family owned corporations.

– Seeking rebates for carbon tax paid by agriculture.

– Successfully advocating for improved allowances and deductions from federal corporate income tax for capital investment (i.e., new Accelerated Investment Incentive).

Government consultation and submissions

ACFA regularly consults with municipal and provincial governments to represent our members’ interests. This year, ACFA:

– Urged a return to full funding for veterinary schools at the universities of Calgary and Saskatchewan.

– Called for improved regulations for winter manure management.

– Consulted on an Animal Health Pathfinding initiative for Foreign Animal Disease Preparedness.

– Attended the World Organization for Animal Health (OIE) annual meeting, and met with the European vaccine bank.

– Worked with the province and Alberta Veterinary Medical Association on the dispensing of antimicrobial products.

Next week, we will explore upcoming priorities for 2019. In the meantime, we wish you a happy new year.

The rising cost of hiring temporary foreign workers puts cattle feeders at risk 

Many of Canada’s agricultural producers rely on the Temporary Foreign Worker Program to help keep their operations running. Even though they would prefer to hire from within the domestic labour pool, there are three main reasons why it is hard for them to find local workers:

1. Farm work is often seasonal, and many Canadian candidates choose to seek year-round work elsewhere.

2. The work can be extremely physical and strenuous, which limits the number of people interested in, or able for, such work.

3. While baby boomer farmers are retiring, young people are leaving rural areas for cities, creating a labour gap.

The agricultural industry collaborated to create a Canadian Agriculture and Agri-Food Workforce Action Plan and have urged the government to adopt their recommendations for addressing the labour crisis.

Why new changes to the temporary foreign worker program will impact cattle feeders

In October 2018, the Alberta government changed the prevailing wages for temporary foreign workers.

For example, the minimum wage for the NOC (national occupational classification, or occupational group) that includes specialized livestock workers and supervisors has increased from $18.43 per hour to $21.63 or more, across the province. That’s a wage increase of more than $3 per hour.

These minimum wages are in addition to other requirements such as supplying housing for workers, so the total cost of hiring a temporary foreign worker can quickly become prohibitive for agricultural producers, even though they desperately need help.

The Agriculture Industry Labour Council of Alberta (AILCA) has written a letter to the federal and provincial governments asking for support, because it is concerned that proposed changes to two programs intended to help farmers with a worker shortage will make it even harder to access labour. You can read more about that in ‘Alberta’s agricultural leaders ask government for help with labour crisis’.

To learn more about the agricultural labour crisis, read ‘12 must-know facts about the agricultural labour shortage and why it matters to Canadians.’

Trans-Pacific trade deal opens new markets for Canada’s beef producers

A recently ratified agreement between the government of Canada and 10 other countries will provide tariff-free and/or competitive access to key markets in the Asia-Pacific region.

On Oct. 25, The Government of Canada became the fifth member nation to ratify the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

CPTPP countries that ratified before Canada were Japan, Mexico, Singapore and New Zealand. The sixth nation to ratify the deal was Australia on 31 October. Because the provisions of the agreement specify that it enters into effect 60 days after ratification by at least 50 per cent of the signatories (six of the eleven participating countries), it will come into force on 30 December 2018.

Canada’s agricultural producers had urged the federal government to be one of the first six to ratify the agreement, allowing Canada to benefit from the early rounds of negotiations and tariff cuts. For beef producers, early ratification is considered key to securing the best terms with the growing markets in Japan, Vietnam and Malaysia.

The Japanese market in particular holds huge potential for Canadian beef producers. The CPTPP will reduce the current 36.5 per cent tariff to 27.5 per cent on Canadian fresh beef and 26 per cent on Canadian frozen beef. Further cuts will eventually bring the tariff down to nine per cent for fresh beef, while frozen beef will ultimately be completely exempt.

The National Cattle Feeders’ Association (NCFA) and Alberta Cattle Feeders’ Association (ACFA) are delighted the Canadian federal government worked so diligently to ratify the deal. The government used a rare walk-around process to pass the 14 Orders in Council required to complete the process.

“Canada is a trading nation,” Jim Carr, Minister of International Trade Diversification, said in a statement announcing the ratification. “The CPTPP will add nearly half a billion consumers to the growing list of places where Canadian businesses can compete and succeed on a level playing field. The ratification of the CPTPP represents another important step toward trade diversification to help the middle class and those working hard to join it to compete and succeed in the global marketplace.”

Why rural infrastructure must be a government priority

Our farmers rely on rural roads and bridges  to bring in supplies and get their products to market – but a lack of government funding to maintain and rehabilitate that infrastructure is working against them.  

There are three primary types of infrastructure – municipal (local roads and bridges), provincial (secondary and primary highways) and federal (railways and ports). The problem lies at the municipal level.  Local governments do not have large tax tools like personal income tax, corporate income tax, and sales tax.  Their taxing power is limited to the property tax. In rural areas, where the population is small, municipalities simply do not have the funds required to sufficiently maintain local roads and bridges.  

More and more, business is also being conducted online, but rural areas have limited access to consistent, reliable internet. This service needs to be extended to remote areas so that agricultural producers can benefit from the reach and efficiencies of digital commerce.

How municipalities are managing

Because municipalities are not receiving the financial support they require from senior level governments, some are taking radical measures.  Examples include the ‘livestock head tax’ imposed in Lethbridge County, recategorizing intensive livestock production from ‘agricultural’ to ‘commercial’ or ‘industrial’, and creating exclusion zones where agriculture activities are not allowed.   

Solutions

1) For rural infrastructure to adequately support farmers and rural residents, provincial and federal governments must provide adequate financial support. Rural infrastructure is just as important as urban projects such as transit or green initiatives.  

2) The taxation system for farmland in Alberta has not been updated in decades. Assessment does not capture farmland used for intensive livestock production, and the values attributed to cultivated land are inaccurate because new technology has made previously less productive land more productive.

Since the 1920s and 1930s, consecutive federal and provincial governments have invested billions of dollars in irrigation including headworks, canals, and reservoirs.  If there are no roads and bridges to go along with that, we will not maximize the return on these billions of dollars of historical investment.

Without the infrastructure to get product to market, investment in agriculture will slow. But high quality, public infrastructure will stimulate investment and support agriculture.

You can read about other issues affecting Alberta’s cattle feeders in ‘Pressing cattle feeders issues discussed with politicians during Ottawa trip’. 

Micro-machine helps reduce feedlot waste

Feeding cattle the best diet for growth is a complicated business. Now, new technology is making it not only easier to do but also more efficient. 

Micro-machine technology enables cattle feeders to accurately measure individual additives or supplements that help cattle grow. 

There are three primary constituents in cattle feed – the concentrate, which is typically grain; the roughage, or silage; and supplements, including minerals and vitamins. The makeup of the feed varies with the gender of the animal and how long it has been in the feedlot.

Most Canadian feedlots hire nutritionists to create a balanced feed plan for their livestock.

Once a nutritionist has decided on the optimum supplement blend, it is typically made into a custom pellet. These pellets are then mixed in with the grain and silage. A feedlot might have four or more different pellets formulated for use during different stages of the feedlot growth cycle. 

Simon Cobban, manager of feedlot solutions at United Farmers of Alberta (UFA), said customizing feed for different groups of cattle can be wasteful. “If a feedlot operator wishes to increase the use of any given supplement, he must increase the number of pellets added to the feed. This means increasing all the supplements in that pellet and incurring a great deal of waste.”

How technology is reducing waste and improving accuracy

With micro-machine technology, cattle feeders can measure individual additives or supplements to within 1/100th of a gram. Once measured, these supplements are then sprayed directly onto the grain. It provides a much more accurate and homogenous mix than mixing in a pellet.

“The machines aren’t new, but the high capital cost puts them out of reach for most feedlots,” said Simon. “At UFA, we have a program for cattle feeders where we provide the machine at no cost, as long as they buy our feed, additives and supplements. We install the machine in a custom building, set it up, program it and maintain it. It makes this technology much more accessible.”

Initially, UFA’s micro-technology program was only available for feedlots that feed 10,000 or more head of cattle per year. It is now available to feedlots with 5,000 head, and it will soon be going down to 1,500 head.

“We currently service something like 60 to 65 per cent of the fed cattle in Western Canada,” said Simon. “We have 100 per cent customer retention, and we have quite a few smaller feedlots waiting for when we can reduce that threshold to 1,500.”

To learn about other ways technology is used in feedlot operations, read ‘How technology is helping improve feedlot efficiencies’.

Revised NAFTA agreement a relief to Canada’s beef producers

Image Credit: KCL Cattle Company Ltd.

After more than a year of negotiations, Canada, the U.S. and Mexico have reached an agreement on NAFTA. The new, proposed agreement is called the U.S.-Mexico-Canada Trade Agreement (USMCA).

The agreement is good news for Canadian beef producers, as it preserves the duty-free trade in live cattle and beef, which has benefited all three partners under NAFTA. The existing rules of origin and the mechanisms for fair dispute settlement also remain intact.

Brian Innes, president of the Canadian Agri-Food Trade Alliance (CAFTA) issued a statement on the new agreement: “We welcome an agreement to renew NAFTA. Free and fair trade has made our agri-food exporters globally competitive. We’re very pleased that free and fair trade of North American agri-food products will continue.”

The U.S. is Canada’s largest trade partner for beef and live cattle, and the new agreement ensures that will continue. “USMCA gives the Canadian beef industry critically important ongoing access to our largest markets: U.S. and Mexico,” said Bryan Walton, ACFA’s president and CEO. “This is an integrated industry here in Canada and free trade in North America benefits producers in all three countries.”

Why diversification still matters

The uncertainty over NAFTA has been trying for Canada’s beef producers, and it has highlighted the need for Canada to expand its global reach and forge new trading partnerships.

Trade with Asia recently received a boost with the signing of the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP). Speedy ratification of this deal is of the essence for Canadian producers to ensure Canada is on the ground floor when it comes to securing lower tariffs with other partners. 

Europe is another market that provides export opportunities to Canadian beef producers. The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) is designed to encourage free trade between Canada and Europe, although Canada doesn’t currently fill its quota for beef exports because there are not enough Canadian packing plants qualified to send beef to Europe.

“The most important thing that we got out of reaching this USMCA agreement is we’ve removed most of the cloud of uncertainty that was hanging over the Canadian economy and discouraging investors from moving forward,” said John Weekes, former chief negotiator for NAFTA.

The pursuit of an ambitious international trade agenda is one of the key tenets of Canada’s National Beef Strategy, which is designed to ensure that Canada’s beef producers are positioned to weather challenges and take advantage of opportunities. You can read more about that in ‘4 reasons the National Beef Strategy is important to Canada’.

How regulatory changes could help trade with the U.S.

This week, we’re exploring recent changes to federal regulations that will help ease the trade in live cattle between Canada and the United States. It’s a follow-up to an earlier post in which we explained why trade with the U.S. is so important to Canada’s beef producers.

The governments of both Canada and the U.S. have strict regulations under which cattle can be imported into their respective countries.

One particular concern is to identify where an animal was born in the event of a disease outbreak. The required inspections, paperwork and documentation can be onerous. 

The Restricted Feeder Cattle Program

The Restricted Feeder Cattle Program was implemented to simplify keeping track of feeder cattle imported from the U.S. to a feedlot in Canada and then directly to the processor. The program allows importation without test requirements on a year-round basis but with proper identification and certification. 

The movement of these feeder cattle must be direct to a feedlot registered with the program, and from there, direct to processing. Because these cattle will not be going anywhere else, it makes them much simpler to trace back, so it was possible to relax the regulations.

Why there was a need for change

Typically, more feeder cattle and finished cattle are shipped from Canada to the U.S. than in the other direction.   But in 2017, market conditions changed, and between 150,000 and 200,000 head of feeder cattle were imported into Canada from the U.S. 

The National Cattle Feeders’ Association (NCFA) recognized that changes to the Restricted Feeder Cattle Program could make the process easier and less costly for Canadian feedlot owners, and the Canadian Food Inspection Agency (CFIA) accepted NCFA’s suggestions. 

A summary of the changes

Recent changes to the Restricted Feeder Cattle Program have focused on the following areas:

1. Identification – including the information to be included on RFID tags.

2. Vehicle sealing – making allowance for rest stops for cattle en route.

3. Documentation for importation and border requirements – including allowances for shipments contained in multiple trucks.

4. Inspection at destination, approved feedlot – which can, in some cases, be completed electronically, based on a reading of the RFID tags.

For feedlot owners who are importing large numbers of feeder cattle, these changes will have a  significant impact on their costs, and their ability to justify the import of cattle from the U.S.

Maintaining a regulatory regime that protects people and animals, while simultaneously facilitating free and open trade, will promote a continued, mutually beneficial relationship. That’s why livestock producers will be watching negotiations to update the North American Free Trade Agreement closely.

You can read more about this in the post, Why free North American trade is good for the beef industry and Canada.

Myth or fact? 5 beef myths debunked

Have you ever heard people say that eating meat is bad for our environment and our planet? In this latest Myth vs Fact post, we’re exploring some common misconceptions about beef production, so you can eat that next steak with a clear conscience.

#1 Beef cattle are a major contributor to greenhouse gas emissions

Cattle account for only 2.4 per cent of Canada’s total greenhouse gas (GHG) emissions – compared to 28 per cent for transportation. Cattle in Canada also produce some of the lowest GHGs in the world thanks to best practices developed through ongoing research. 

#2 We don’t need to eat meat – we can simply substitute it with plant proteins

Plant proteins such as beans and lentils are wholesome, nourishing foods. But it is wrong to assume that they can provide the same amount of protein per unit of food as beef. One 75 gram (2.6 ounces) serving of beef contains the same amount of protein as about two cups of beans. The plant-based protein is also not as easily digested and is missing important nutrients such as Vitamin B12 and heme iron – the type of iron most readily absorbed by the body.

Like beef, plant proteins have an important part to play in a balanced diet, but they cannot be compared, portion for portion, as a substitute.

#3 We need to eliminate beef production for the sake of the environment

Eliminating beef production would help reduce our GHG emissions by a small amount, but there are other significant reasons why pastureland is good for the environment:

    • Only 26 per cent of our native rangelands remain intact in Canada, and those would be lost without grazing animals to maintain their health. As an ecosystem, those grasslands support biodiversity and help retain water.
    • Grasslands provide important habitats for migratory birds, species at risk and other wildlife.
    • Grasslands store carbon, which would be released into the atmosphere if they were cultivated.

The relationship between cattle and wildlife is recognized by the World Wildlife Fund in its ‘2017 Annual Plowprint Report’.

#4 Feeding cattle is a waste of resources that should be used to benefit people

Cattle and other grazing animals in Canada are typically raised on land, and fed foods that might otherwise be unusable:

    • Most pastureland is unsuitable for crop production.
    • 86 per cent of all cattle feed in Canada is not fit for human consumption. 
    • Only nine per cent of cropland in Canada is used to grow grain specifically for cattle feed.
    • Food animals also play a huge role in recycling the by-products of human food production. For instance, cattle are fed the leftover grains from the production of beer, whiskey and other alcohols, which would otherwise be considered waste.

#5 Our food production is being taken over by huge, corporate factory farms

Ninety-eight per cent of Canadian farms, both large and small, are owned and operated by families. Some have been in the family for five or more generations. These farmers have been raised on the land, and they care deeply about preserving it for their own children and generations to come. 

They work hard to raise their animals in comfortable, low-stress environments. 

They understand that if animals are unhealthy or stressed they will not grow to their full potential. Even in an intensive livestock setting, healthy, well cared for animals help ensure the health of the operation.

So, next time you’re at the grocery store, wondering what to make for dinner, you won’t do better than a good serving of Canadian beef. It’s good for you, and raised ethically, sustainably and humanely.

For more in our Myth vs Fact posts, check out ‘3 feedlot myths busted’ and ‘Busted! 5 beef myths that don’t stand up to the facts’.

Why free North American trade is good for the beef industry and Canada

Since the inception of the North American Free Trade Agreement (NAFTA), in 1994, the beef industries of Canada, U.S. and Mexico have essentially been operating in one single, North American market. In fact, the beef industry is a good example of how the original design and intent behind NAFTA has been successfully accomplished.

In this integrated market, processed beef (fresh, chilled and frozen), as well as live cattle, move across the border relatively unimpeded and entirely tariff-free. The U.S. is Canada’s largest export customer for beef, and Canada’s single largest import supplier.

Did you know?
In 2016, Canada exported 270,00 metric tonnes of beef (75 per cent of our total beef exports) to the U.S. In the same year, 63 per cent of Canada’s beef imports (186,000 metric tonnes) came from the U.S. That same year, Canada also exported 765,395 head of live cattle, primarily to the U.S. The U.S. exported 30,291 head of live cattle to Canada.

 

Why an integrated market benefits beef producers on both sides of the border

Free and open trade between Canada and the U.S. has had two significant benefits.

First, the trade in live cattle and beef products ensure that both countries have a source of supply to meet the demand within their own domestic markets. A steady, and sufficient supply of cattle is critical to the efficient operation of feedlots and beef-packing plants.

Second, the vigorous and dynamic trade in live cattle and beef products has injected a healthy dose of competition into the beef industry on both sides of the border. This has resulted in a more efficient, productive industry that is highly competitive in the global beef market. For example, beef from Canada and the U.S. is proving attractive in the Asia Pacific marketplace, despite the geographical advantages of competitive beef exporters such as Australia and New Zealand. This is because of our ability to compete on quality and price.

The way forward for the integrated market.

Cattle producers on both sides of the border are well aware of the benefits of free and open trade. The National Cattle Feeders’ Association (NCFA) has been working with counterparts in the U.S., such as the Texas Cattle Feeders’ Association (TCFA), the National Cattlemen’s Beef Association (NCBA), and the North American Meat Institute (NAMI) to address any issues that could be an impediment to the continuation of NAFTA.

One such issue concerns the maintenance of a regulatory regime that provides essential safeguards for animal health and disease prevention without imposing unnecessary economic costs or barriers to trade. The right regulatory balance is crucial.

In an upcoming blog post we will write about a set of reforms to Canadian Food Inspection Agency (CFIA) regulations that will make importing and exporting live cattle easier, less time consuming, and less costly – helping to remove impediments to trade, smooth the border, and speed the pace of commerce. Stay tuned.

How funding for the New Era Beef Industry will benefit all beef producers

This fall, Alberta’s beef producers will vote in a province-wide plebiscite on the industry’s checkoff program. The issue at hand is whether the refundable payment should become non-refundable.

Why the checkoff is currently refundable

The beef industry checkoff has been around since 1969 as a levy paid to the Alberta Cattle Commission (later to become Alberta Beef Producers, ABP). Funds from the levy were used for industry research and marketing, but it was somewhat contentious from the start. In 2009, the Alberta government passed a bill making the checkoff payment refundable – meaning that producers were able to apply for full reimbursement.  

Why a change to the non-refundable checkoff makes sense

Despite these early challenges, ACFA believes the associations and organizations representing different sectors of the beef industry production chain must join together and work for the benefit of the entire industry.

In 2017, the Alberta Cattle Feeders’ Association and ABP reached an agreement founded on their shared belief in collaboration and mutual support between different beef production sectors. The New Era Beef Industry (NEBI) is the result of that agreement, and it heralds a return to a mandatory beef cattle checkoff, with revenues to be shared by ABP, ACFA and a new Alberta Beef Industry Development Fund (ABIDF).

The ABIDF will provide project funding for market development, research, education, consumer advocacy and industry collaboration, for a stronger, more profitable beef industry. The fund will be governed by a council comprised of three representatives selected by ABP and three selected by ACFA. The six council members will select a chair who is not a member of the board or of either organization.

ABIDF will help compensate for the loss of the Alberta Meat and Livestock Agency, which provided funds for industry development until it was shut down by the government in 2016.

Under the New Era Beef Industry, the total checkoff payment will be $2 per head of cattle. It will be distributed like this:

  • 5 cents to the remitters of the checkoff 
  • $1.30 to ABP 
  • 25 cents to ACFA 
  • 40 cents to the Alberta Beef Industry Development Fund (ABIDF)

If the plebiscite in the fall results in a vote for the refundable checkoff, ABP will continue to collect the mandatory checkoff, and producers can still request a full refund if they wish. If the plebiscite results in a vote for NEBI, it will provide a unique opportunity for crucial industry research and development.

The checkoff was just one of the issues that new ACFA board chair, Ryan Kasko flagged as important to cattle feeders this year. You can read about the other issues in ‘Finances are among cattle feeders’ top issues’.