Winnipeg Free Press - PRINT EDITION

Beef producers smile, consumers cry

Cattle prices higher, feed costs lower

  • Print
Food Fare's Munther Zeid says if wholesale beef prices keep rising, he will have to pass on the increases to customers. 'What we're seeing now is ridiculous.'

WAYNE GLOWACKI / WINNIPEG FREE PRESS Enlarge Image

Food Fare's Munther Zeid says if wholesale beef prices keep rising, he will have to pass on the increases to customers. 'What we're seeing now is ridiculous.' Photo Store

Manitoba beef producers have a reason to smile these days as a combination of high cattle prices and lower feed costs puts them back in the black after a decade of struggles.

Manitoba Beef Producers president Trevor Atchison said North American feeder cattle prices have risen more than 35 per cent in the past 18 months, hitting a record $1.37 a pound last week on the Chicago futures market.

And feed barley prices have fallen about 40 per cent in the past year, he added, dropping by about $2 to just over $3 a bushel in the wake of last fall's record North American grain harvest.

While high cattle prices are causing a pain in the pocketbook for meat-eating consumers, they're providing much-needed financial relief for punch-drunk producers who have had to battle floods, droughts, a prolonged bovine spongiform encephalopathy (BSE) crisis, punitive country-of-origin labelling (COOL) regulations in their primary export market of the United States and soaring feed costs in 2011 and 2012.

"It's been a long time coming," Manitoba Beef Producers (MBP) general manager Cam Dahl said of the turn in fortunes. "Right now, things look good."

But he stopped short of agreeing producers are in a sweet spot right now. "I would describe it more as a return to profitability." Dahl and MBP president Trevor Atchison are hoping the improved market conditions will prompt Manitoba producers to start rebuilding their herds, which are now at their lowest level since the 1950s after soaring feed costs and mounting debt loads in recent years forced many producers to sell off cattle to stay in business.

Dahl said the number of beef cows in the province has dwindled to about 500,000 head from about 680,000 in 2006, when the BSE crisis was choking off beef exports.

And Atchison pegged the total number of beef cattle -- cows, bulls, calves, heifers, etc. -- at just under one million. He said that number was as high as 1.5 million in 2006 or 2007, before feed prices took flight and many producers began culling their herds.

Atchison said he's heard of some farmers who have already started rebuilding their herds. But he's also heard of others cashing in on the high prices and selling off all of their cattle to pay off debts or transition into retirement.

He and Dahl said it's hard to get a handle on which way most producers are leaning.

"But I think this year will give us a good indication..." Dahl added.

The shrinking Manitoba beef herd is part of a broadly based trend that has seen North America's beef herd plunge to its lowest level in 30 years in the wake of a variety of setbacks, including soaring feed prices and severe droughts in parts of the United States. And as the number of slaughter cattle declined, cattle prices increased.

Kevin Grier, senior market analyst with the George Morris Centre, an independent, not-for-profit research institute, said it's going to take several years to rebuild North American beef herds.

And he said the supply of slaughter cattle could tighten even more over the next couple of years if a significant number of farmers opt to rebuild their herds and hang onto heifers rather than sell them as feeder cattle.

murray.mcneill@freepress.mb.ca

Republished from the Winnipeg Free Press print edition January 16, 2014 B5

History

Updated on Thursday, January 16, 2014 at 6:06 AM CST: Replaces photo

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Wasylycia-Leis says Bowman and Ouellette ran a good campaign

View more like this

Photo Store Gallery

  • A black swallowtail butterfly land on Lantana flowers Sunday morning at the Assiniboine Park English Gardens- standup photo – August 14, 2011   (JOE BRYKSA / WINNIPEG FREE PRESS)
  • MIKE APORIUS/WINNIPEG FREE PRESS STANDUP - pretty sunflower in field off HWY 206 near Bird's Hill Park Thursday August 09/2007

View More Gallery Photos

Poll

Should Premier Greg Selinger resign?

View Results

View Related Story

Ads by Google