‘How can we grow back the herd in Canada?’

Amid high beef prices and trade uncertainty, a Farm Credit Canada executive touched down in Winnipeg with a message: it’s time for cattle producers to grow.

“What they face right now is … opportunity,” said Jean-Philippe Gervais, the federal Crown corporation’s executive vice-president of agricultural production.

Gervais was representing FCC, the country’s top agricultural lender, at the Canadian Beef Industry Conference.

He spoke to the Free Press ahead of his keynote speech Thursday afternoon. Hundreds of cattle farmers and industry leaders gathered at the RBC Convention Centre for the four-day event, which began on Monday.

Gervais pointed to the price of beef.

Beef striploin cuts sold for an average $40.15 per kilogram in June, up from $26.80/kg five years earlier, Manitoba-specific Statistics Canada data show.

Nationally, retail beef prices jumped 15 per cent year-over-year in April, a Canada Beef report says.

“We’ve seen constraints on the supply of beef. We have a herd that has been coming down, trending down, both in the U.S. and Canada,” Gervais said. “How can we grow back the herd in Canada?”

There have been early signs of more cattle. The Canadian herd grew 2.5 per cent year-over-year in January, the first time in eight years.

The head count had hit a 35-year low.

There’s a need for the cattle industry to become more efficient, including by digitizing systems and integrating artificial intelligence, Gervais said. “I think FCC can help as well by investing in different technologies.”

Farm Credit Canada is allocating $1 billion to project financing for food processing through Ottawa’s national food security strategy. The strategy was announced in June.

It’s too early to say where the money will be spent, Gervais said, adding it “could be the case” a portion goes to the beef industry.

The cattle and beef sector contributes $41.1 billion directly and indirectly to the Canadian economy, according to the Canadian Cattle Association.

Thursday conference attendees, including Trevor Welch, had been tracking back-and-forth trade talks between Canada and the United States.

“Just waiting to see when the next thing may come up,” said Welch, a New Brunswick cattle farmer.

Tyler Fulton, president of the Canadian Cattle Association, expects the industry to grow again this year — but not as much as it would without the trade uncertainty.

“We have a demographic that needs to transfer the farm,” Fulton said. “For most operations, (it’s) the biggest decisions that they can make.

“The market uncertainty or trade uncertainty really puts a little bit of a pause on some of those decisions.”

Still, the sector’s profitability is an incentive for young farmers, Fulton said.

Beef prices at the grocery store will drop as more cows are raised, he said. It’s a waiting game, he added — farmers are keeping heifers to bear calves, but calves aren’t ready for processing for two years.

Cattle farmers looking to invest need risk management tools, including better livestock price insurance, both Fulton and the Manitoba Beef Producers relayed.

Manitoba has roughly 6,000 beef farmers. Many have been impacted by weather — flooding, drought — over the past five years. It’s caused a decline in the number of farmers, said Carson Callum, the Manitoba Beef Producers’ chief executive.

“Current prices in the industry are quite favourable, so that is leading to a lot of optimism and hopes that we might see a bit of regrowth,” Callum added.

Grocery store beef prices are largely impacted by United States herds.

Another price factor is the rising demand for beef, Fulton noted. Per capita Canadian beef consumption rose 3.5 per cent last year, a Canada Beef report says.

gabrielle.piche@winnipegfreepress.com