Issues Forum: International Trade
Nine-member U.S. delegation gives their perspective regarding Canada’s BSE surveillance program, feed ban compliance.

SAN ANTONIO, TEXAS (Feb. 3, 2005) — Among U.S. beef producers’ concerns over resumption of cattle and beef trade with Canada is the fear that Canadian feedlots hold huge numbers of fed cattle. The border has been closed since detection of bovine spongiform encephalopathy (BSE) in Canada. Do built-up cattle supplies stand at the chute, ready for shipment to U.S. packers? Will they flood the market and drive prices down? Answers to these and other questions were sought by a delegation of U.S producers that recently returned from a fact-finding mission in Canada.

They presented their findings during a Beef Industry Issues Forum Feb. 3 at the 2005 Cattle Industry Convention and Trade Show in San Antonio.

The nine-member delegation, appointed by NCBA’s Executive Committee, delivered its final report to association members during the Wednesday forum. The trade team visited Alberta, the top cattle-producing province, to evaluate Canada’s immediate fed cattle supply, expanded slaughter capacity and export projections. The group also gained perspective regarding the northern neighbor’s BSE surveillance program and feed manufacturer compliance with the ban on ingredients considered to increase the risk of spreading BSE.

“We saw no evidence of a wall of fed cattle ready to come [to the United States],” reported delegation member and North Dakota producer Gene Harris. “They will want to send feeder cattle — mostly from the light end of their 2004 calf crop. But delaying the border opening might see those go into [Canadian] feedlots and create a wall of fed cattle by the time the border does open.”

According to the delegation’s report, the Canadian cattle inventory is current. Estimates indicate Alberta feedlots are at 65% to 70% of capacity and could absorb 250,000-275,000 feeders in the short term. The total feeder cattle and calf supply is estimated at 7,650,000 head. The total number of cattle available for export is estimated at approximately 900,000 head, including 200,000-300,000 feeder cattle and 600,000-700,000 fed cattle.

Factors pointing toward moderate export levels include a 22% larger and still growing Canadian slaughter capacity, lower cost of gain in Canada and continuing weakness of the U.S. dollar. Plans call for admission to the United States of only those cattle under 30 months of age. It is estimated that only 50% of those will meet requirements for documentation, and be eligible for export.

The delegation concluded that the Canadian feed industry appears to be in compliance with its feed ban. Considering the advanced age of the four BSE-positive animals found previously, members see no reason to believe an increased risk is linked to the feed and rendering industry.

Since both countries imported cattle from the United Kingdom prior to the known BSE risk, and since implementation of safeguards in Canada closely paralleled those of the United States, there is cause to wonder why all North American BSE events involve Canadian-born cattle. Delegation member Tom Field of Colorado explained one difference between U.S. and Canadian feed bans.

The Canadian protocol, he said, did not include a recall of previously manufactured feed, and limited feeding of products containing specific risk materials apparently occurred. In addition, Canada’s rendering industry is more concentrated and formerly used low-temperature processes for the rendering of ruminant meat-and-bone meal. These variables may have contributed to an increased exposure rate.

Field said the Canadian BSE surveillance program appears to be on track to meet its targets and provide a science-based assessment of disease prevalence.

By the time the border opens, USDA’s Animal Plant Health Inspection Service (APHIS) must specify procedures for movement of cattle. According to the delegation’s report, details must address the critical question of how cattle age will be determined. The Canadian animal identification system provides for age determination. The bigger question is how to address age verification of U.S. feeder cattle that move to Canadian feedlots, then return to the United States for slaughter.

— by Troy Smith, field editor, Angus Productions Inc.
© Copyright 2005 Angus Productions Inc.

Editor’s Note: This article was written under contract or by staff of Angus Productions Inc. (API), which claims copyright to this article. It may not be published or distributed without the express permission of Angus Productions Inc. To request reprint permission and guidelines, contact Shauna Rose Hermel, editor, at (816) 383-5270 or shermel@angusjournal.com.