PUBLISHED BY MANITOBA BEEF PRODUCERS
MAY 2020
Beef demand good despite COVID-19 The COVID-19 pandemic has disrupted the economy, caused widespread unemployment and upended millions of lives. But in a strange sort of way, it may actually be a silver lining for Canada’s beef sector. By declaring food production an essential service, the federal government is giving Canadians a new understanding of the importance of agriculture, including beef cattle, in their lives, industry officials say. As well, with restaurants and food service outlets closed, Canadians are headed back to the kitchen to rediscover cooking meals from scratch, giving beef a major role to play, said Michael Young, president of Canada Beef. “We’ve got kitchencaptive Canadians now with lots of time to cook,” said Young. “Having Canadians back home and cooking for their families, they may rediscover some things that us older people know quite well. And beef may be very well suited to the challenge.” Young said Canada Beef has seen a 75 per cent increase in downloads off its website for beef recipes and cooking information since the COVID-19 crisis hit. Beef began flying off grocery store shelves in March as consumers began stocking up on food supplies. Shutting down restaurants has pushed beef out of the food service sector and into the retail sector, giving shoppers an abundance of meat to choose from, from ground beef to middle cuts. With an availability
of supply and versatility of cuts, beef is well positioned to meet the needs of consumers with time on their hands, tight budgets and hungry families to feed, said Young. “Everyone is worried about the cost of food and I can see a lot of people going back to the basics, going back to preparing full meals the way we used to. And I’m hoping we will hang on to this as we come through to the other side.” Dennis Laycraft, executive vice-president of the Canadian Cattlemen’s Association, agrees declaring agriculture an essential service gives consumers a whole new outlook on food production and the people who make it happen. “Up until two months ago, people didn’t think very much about whether there would be a regular supply of food and where their food really does come from,” said Laycraft. “All of a sudden it’s more front of mind than it may have been since the last time there was a food shortage, which was the Second World War.” “There’s going to be a fundamental change in terms of how people view the importance of agriculture and food production.” On April 2 the federal government released a guidance document naming 10 sectors, including food and agriculture, as essential services. This allows industry supply chains to continue functioning while still following procedures to prevent the spread of COVID-19. “We’re trying to keep the critical mass operating as close to capacity as possible,” Laycraft said. “(But)
I certainly wouldn’t want to leave the impression it’s business as usual.” Laycraft said the industry is working with truckers, packing plants and auction markets to implement procedural changes related to COVID-19. He said last month supply chains seemed to be working, despite additional procedures and heightened security. “Every aspect of how we do business has changed but so far I think we’ve maintained a fairly significant level of business continuity.” That’s not to say there’s been no negative fallout, especially among cattle producers. “They’re just getting hammered by the market,” said Janice Tranberg, president and CEO of the National Cattle Feeders Association. “There is so much instability in the market today and it’s driving prices down, which is causing a lot of concern with our producers.” Brian Perillat, manager and senior analyst with Canfax Research Services, said the impact of COVID-19 on markets and prices has been “big time.” “With the crazy uncertainty in the marketplace, equity and commodity markets are off and cattle are not immune to that,” Perillat said. He said fed cattle prices in late March were $10 to $20 a hundredweight below where they were predicted to be. Prices later this year may also be lower than previously expected. “Short term, the biggest thing is keeping the supply chain running as smoothly as possible and getting
cattle processed in a timely manner. That right now is number one. The secondary effect longer term is, what’s the impact going to be on beef demand?” Laycraft said he doesn’t expect beef consumption to change a lot, although eating patterns will.
“Basically what we’re hearing is, they’re going to eat about the same quantity of beef. It’s just going to be, instead of going out and eating it, they’re going to be eating it at home.” Laycraft expressed confidence the beef sector will emerge from the CO-
VID-19 crisis stronger, not weaker. “The food industry’s going to become, as we go through this, one of the cornerstone industries,” he said. “If we manage this properly, it’ll be one of the growth industries coming out of this.”
A SPRING UNLIKE ANY OTHER
The melting snow and mild temperatures are a welcome sign of brighter days ahead but the ‘new normal’ brought about by the COVID-19 pandemic is weighing heavily on the minds of Manitobans. We have extensive coverage of the virus and its impact on the beef industry in this issue of Cattle Country. (Photo credit: Jeannette Greaves)
President's Column
Market Report
Ticks and Cattle
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BY RON FRIESEN