Cariboo ranchers Sharon Huffman (left)

Local ranchers work to remain competitive in global markets

Local cattlemen are trying to find ways to stay competitive in North American and international markets, which is no easy feat.

Local cattlemen are trying to find ways to stay competitive in North American and international markets, which is no easy feat due to issues ranging from carbon tax to country-of-origin labeling.

Duncan Barnett, president of the Cariboo Cattlemen’s Association, says the carbon tax makes it difficult to be competitive because it creates an extra cost that Alberta and Washington, for example, don’t have.

“We need a regulatory framework that allows us to be competitive,” Barnett says, adding that ranchers aren’t necessarily looking for a subsidy. He says the regional association put forward a resolution, which was endorsed by the B.C. Cattlemen’s Association, asking the government to look at rebates or exemptions from the carbon tax.

“The province said no to both of those but they have undertaken a review of the carbon tax.”

He says the government won’t provide an exemption to a particular sector and a rebate program would create a lot of paperwork.

“We said fine, do what you are doing with some of the other industries and reinvest some of those carbon tax funds in agriculture,” Barnett says, adding that the money could be used to fund the environmental goods and services that managed ranches provide, specifically a forage carbon sequestration program.

“We’re in the business of growing and using forage and they have carbon tax credits for trees and we are saying why not look at a carbon tax program for forage production?”

David Zirnhelt, a Cariboo Cattlemen’s Association director and chair of the association’s marketing committee, says work is underway at Thompson Rivers University on how to measure soil-carbon metrics and uptakes.

“It is all about the incremental amount you can add to what’s there in nature to the status quo,” says Zirnhelt, who is also on the carbon committee for the Grasslands Council.

“Our industry of agriculture relies on a fair bit of fuel, usually diesel,” Barnett says. “You could say that if they provided us with alternatives (to diesel) or if there was work being done on alternatives that got us away from the need for diesel fuel, then it could work out that way. They could exempt it, they could rebate it, they could invest it back into agriculture in some way, and that’s what we need them to do so that we don’t have what’s essentially just an additional cost that our competitors don’t have.”

He adds that ranches also provide ecological goods and services that have societal benefits and values, such as wildlife habitat, pollination of plants, landscapes, green spaces, and tourism.

Another barrier B.C. ranchers face is meat inspection and licencing of slaughterhouses.

While there are some slaughterhouses in B.C., and even the Cariboo, Barnett says that animals cut, killed, and wrapped in B.C. must stay in B.C., whereas Alberta can export out of the country since it has fully federal-inspected facilities.

He says while government’s agriculture strategy discusses increasing the export of B.C. beef to China, animals must first be sent to Alberta for slaughter before they are sent to China.

Grant Huffman is also a director of the local association, is involved in the B.C. Cattlemen’s Association, and represents a regional and national marketing perspective.

He says the reason why B.C. doesn’t have the same level of slaughterhouses as Alberta is due to scale — in order to justify having a federal investigator on site, there needs to be a certain volume to support having one.

Country of origin labelling, Huffman says, is also limiting ranchers’ ability to be competitive.

He says country of origin labeling, which has been in place in the U.S. for about two years, is a non-tariff trade barrier and imposes regulations and limits on the desirability of the Canadian product. In a U.S. supermarket, the product has to be marked as coming from Canada, which can be positive because many see the Canadian product as being a superior product, but packing houses have to keep those cattle separate during processing.

The supermarket also has to keep it separate. It’s an inventory problem, he says, that reduces Canada’s ability to be competitive in the U.S. by 10 to 20 per cent.

The World Trade Organization, he notes, has agreed with Canada that country of origin labelling is a non-tariff trade barrier, but the U.S. has appealed. A decision on the appeal is supposed to be in June, though Huffman is skeptical that will happen.

There are some positives in the industry.

Zirnhelt says consumer trends show that people are willing to pay a little more for having a healthier product, such as organic and grass-fed beef, which he says B.C. can provide.

But, he says, more infrastructure needs to be built for finishing and operations to help the grass-fed market grow.

Zirnhelt has worked to organize a series of workshops to help ranchers learn new skills or how to go back to the old ways of doing things.

The first session, which already has been completed, dealt with business models, particularly Manitoba’s. Next, the workshops will look at applications and animal evaluations for finishing on grass. Those interested in learning more about the workshops can e-mail cattlemen@xplornet.com.

Barnett adds that ranchers aren’t trying to replace grain-fed beef, but rather to develop complimentary alternatives so all of their eggs aren’t in one basket.

The international markets are opening up more to B.C. beef, which is especially good news for ranchers who are seeing a drop in red-meat consumption in Canada.

Huffman says in 1995, Canada’s per capita consumption of beef was 54 pounds per person. In 2012, it was 27 — almost half.

“It really emphasizes that off-shore markets are going to be more important,” says Huffman, a board member of Canada Beef Incorporated, which promotes and markets beef domestically and offshore. “U.S. is still our largest export market but the U.S.’s largest export market is Canada, so we trade back and forth.”

He says the European market is opening up as well, though with it comes more severe restrictions.

Growth promotants, for example, aren’t allowed in Europe.

“But we do have a quota there and we didn’t have a quota before, as long as you meet those restrictions,” Huffman says.

 

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