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Calgary, Alberta – During the 2014 International Livestock, Canada’s cattle producers, Ministry of Agriculture officials and industry representatives gathered to discuss the challenges facing their beef markets. 

Dennis Sun, Wyoming Livestock Roundup publisher, attended the event, gaining additional insight into Canada’s agriculture industry. Speakers at the event, he said, addressed similar topics to those we might see in the U.S.

One such speaker, Marty Carpenter, executive director of Canada Beef, Inc., looked at the importance of identifying markets around the world to best use the entire beef carcass.

“Finding the right markets for the right cuts is a very important component to ensuring value for us as an industry,” Carpenter commented during his July 9 presentation. “Canada approaches beef markets around the world, speaking to and working with clients to achieve strong values and build relationships.”

Worldwide influence

Global markets continue to play an ever-expanding role in Canada’s beef industry, Carpenter commented.

“The world is a big place, and we certainly need to be able to address the global markets,” he said. “The Canadian beef industry traded to over 71 countries around the world in 2013.” 

As part of their trading strategy, Carpenter noted that they continue to build relationships with countries to provide the product others need.

“We really want to be aware of the possible marketplaces,” he added.

Valuable markets

Carpenter identified several markets that the Canadian beef industry has found to be as particularly important.

“The single largest market for Canadian beef in the world is California,” he explained. “With over 14 million Hispanic consumers, it is a key market for us to be able to ensure value from all parts of the animal.”

Hispanic consumers, he said, appreciate the chop and shoulder clod cuts that they are unable to achieve value from in the Canadian marketplace. The volume of beef that Hispanic consumers eat is also larger than many others. 

“The average Hispanic consumer will eat three times as much beef as the average Canadian consumer,” Carpenter said. “We want to chase those kind of customers.”

In Japan, he listed the chuck as being an important cut, adding that beef consumption, however, is not as high in Japan.

“The Japanese don’t always view beef as their principle protein,” Carpenter commented. “They eat about 13 kilos a year, but they eat double that in seafood.”

Understanding these trends can enable the industry to identify niche markets and increase value in the beef carcass.

Export value

Canada, Carpenter added, is an export-dependent nation, making market identification even more important.

“We export close to 45 percent of our beef production,” he said. “It is a very large amount of product, and we need to be able to access those markets and have the ability to maximize them.”

With a majority of markets for Canada in the U.S., Carpenter also noted that opportunities are growing in the Middle East and Asia.

“We need to be able to set the table and work with clients in those markets to make sure we are maximizing the opportunity to work with those consumers,” he said.

The Beef Export Demand Index, which incorporates amount of product plus value, grew by over six percent in 2013, with the majority of their product being fresh. 

Canada exports over $1.3 billion in beef, making the export value very important.

Right cut, right market

Another strategy used to increase the value of their beef is in exporting offal.

“We need to maximize value and find markets that value those cuts,” Carpenter said. “I’m not sure the last time I saw a beef tongue in the Canadian marketplace, but in Japan, that is something that is in high demand.”

“It gets back to finding the right customer for the right cut,” he emphasized. “We really work off a number of key elements and focus on four pillars – brand differentiation; brand development and segmentation; product and image building; and return on investment and connectivity with stakeholders.”

In the increasingly competitive nature of the beef industry on a worldwide scale, Carpenter noted that a high quality product and production method is incredibly important.

Canadian Beef Advantage

“We need to address and identify opportunities quickly when working with clients,” Carpenter continued. “We need a technical edge to create interest and getting the conversation going. This really revolves around developing and understanding the Canadian Beef Advantage, or the CBA.”

The Canadian Beef Advantage creates a set of standards and processes that allow the industry to communicate the benefits of Canadian beef.

“One of the first things we like to ensure is that our clients know about our environment,” he said. “When you look around us, we can drive 100 miles in any direction to see beef production and agriculture in general.”

Canadian beef producers emphasize sustainability and the environment, as well. 

“Our customers around the world really get a sense that this is a great place to raise high-quality beef,” he added. “It builds a solid base of confidence about what we have in Canada.”

Saige Albert is managing editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..


SIDEBAR:
Quality

An additional focus point in the Canadian Beef Advantage (CBA) is the quality of Canada’s beef.

“When we talk about the CBA, another of our foundational elements is our genetic base,” Marty Carpenter, executive director of Canada Beef, Inc., said. “Genetics build confidence that it is a high-quality, beef.”

As a leader in grain production, Canadian producers are able to build feed cattle a high-quality grain diet that provides marbling to provide a positive eating experience.

At the same time, they emphasize that their quality standards are identical to USDA standards.

“We like to emphasize the equivalency relative to USDA’s standards,” Carpenter said. “It gives them a reference point that we can build on.”

 

While a number of factors have implications in the overall demand of U.S. meat products, as well as the price effects on quantity, CME Group notes that a particular factor – the value of the U.S. currency – deserves special attention.

“In the past, the devaluation of the dollar has helped offset some of the negative inflationary effect of record high feed costs,” says CME Group in their Daily Livestock Report. “Indeed, even as U.S. beef and pork prices hit record highs in some years, world buyers did not feel the full impact of such increases due to the effect of a weaker U.S. dollar.”

Recent changes

However, the U.S. dollar has swung in the other direction, resulting in the depreciation of the Japanese currency as compared to U.S. currencies.

“Japan is our most important meat trading partner, purchasing a little over $3 billion worth of beef and pork in 2012,” they add. “In the case of pork, Japan dominates U.S. pork trade, accounting for about a third, or approximately $2 billion, of all U.S. pork export receipts in 2012. Japan also accounted for almost 19 percent of the value of beef and veal shipments.”

Since November, the value of Japanese currency as compared to the U.S. dollar has dropped almost 18 percent.

“The change in the value of the Yen is not an accident that will be quickly rectified,” CME Group notes. “It reflects a dramatic change in the stance of the Japanese Central Bank and the Japanese Government.”

Political changes

CME Group continues that Japan is expected to become more activist with its monetary policies, printing more Yen and utilizing “easy money” policies, similar to those in the U.S., Europe and Britain.

“Some have argued that the change implies direct political interference in the affiars of what is an independent body,” they comment. “However, the Japanese Central Bank has missed its inflation target for the past decade, and sooner or later it was bound to come under increased pressure to deliver on its mission.”

U.S. meat markets

The implication for the U.S. meat market, however, depends on the reaction of other countries to the changes.

“Developed economies have embarked on a struggle to generate growth via easy money,” they explain. “Countries like Brazil, Canada, Australia, New Zealand will either stay put and see their exports and GDP decline, or they will also try to lower the value of their currencies via easy money and/or lower rates.”

Brazil has already begun reducing interest rates from 10.5 percent in March 2012 to 7.5 percent in January, thus lowering the value of their currency and bolstering Brazilian beef exports. 

At the same time, the U.S. dollar is also gaining as compared to Canadian and Australian currency. The development, says CME Group, further hurts exports and encourages imports.

“Domestic demand has struggled from weak income growth and the stronger dollar will further erode the profitability of US meat producers,” CME Group concludes.

Saige Albert, managing editor of the Wyoming Livestock Roundup, compiled this article from CME Group’s Daily Livestock Report. 

The Nature Conservancy’s efforts in landscape conservation recently brought five Argentine men to Wyoming to learn about effective conservation methods on private lands.
    “The Nature Conservancy has been working in Argentina for a number of years,” comments Paula Hunker, Wyoming associate state director for The Nature Conservancy. “We had the opportunity to bring five gentlemen to Wyoming. They are interested in learning more about our conservation efforts here to identify what methods could be appropriate for the Patagonia region of Argentina.”
    “Producers in Wyoming and Argentina have a lot in common,” adds Conservation Initiatives Director Arlen Lancaster. “They are great stewards of the land and sharing information about conservation tools just makes sense.”
Striking similarities
    Hunker notes the partnership works well because of the similarities between Wyoming and Argentina.
    “The Patagonia steppe, for example, is very similar to our sagebrush steppe,” she explains, noting that Patagonia has lots of open country and rugged mountains as well. “They are working on the same types of things as we are, looking at a sustainable future for the Patagonia area.”
    The group commented that if they didn’t see any signs in English, they might easily think they were home in Argentina.
    “There is a natural partnership,” Hunker says.
    “The main difference is that about 90 percent of Argentina’s land is in private hands,” she notes. “They are interested in learning how we work on private land conservation.”
    The Argentines also  looked at government involvement and incentives for conservation on private lands.
    “One method of establishing conservation efforts on private lands is the use of conservation easements,” comments Hunker, who added that only one conservation easement is in place in the entire country of Argentina.
Wyoming visit
    Rather than telling the Argentine group about Wyoming initiatives, Hunker invited the group to visit producers across the state for a hands-on look at conservation efforts.
    “We started by visiting with Representative Kermit Brown in Laramie,” she explains. “We were looking for someone involved in the government to talk about addressing conservation from that perspective.”
    Brown visited with the groups about incentives, conservation easements and strategies that have and have not worked, as well as how Wyoming has embraced private land conservation.
    “From there, we visited John and Reece Johnson’s Ranch out of Elk Mountain,” she says. “They have a conservation easement on their ranch.”
    Along with asking questions about the family’s ranch and water restoration efforts the family has taken on, the Argentine visitors were intrigued by things that many people in Wyoming consider every-day sights.
    “We stopped to see a wind turbine because they had never seen one up close,” Hunker notes, “and we talked to the ranchers moving about 9,000 head of cattle. They were fascinated. We took advantage of every opportunity.”
    The group also toured Red Canyon Ranch near Lander, which is operated by The Nature Conservancy. They went on to visit a ranching operation outside of Farson, ending at Pat and Sharon O’Toole’s ranching operation in Savery.
    “We spent a few hours to show them what we do,” comments Pat O’Toole. “We have some land that we have a conservation easement on, and they wanted to see some of the river restoration work we have done where we integrated our fishery and irrigation systems.”
    He continues, explaining that they also shared their experience about how easements work.
    “We are interested in helping the Argentinians learn how we did all of this,” he adds. “It sounds like there is an interest in doing conservation like this in Argentina.”
Land conservation efforts
    “We ended up in Salt Lake City at the Land Trust Alliance Rally,” Hunker comments. “There were people from Chile there who also talked about  easements. We were able to visit with them about the role of The Nature Conservancy in Wyoming.”
    “Right now we are working on the second and third conservation easements in Argentina,” Hunker mentions. “They have letters of intent with two ranches. We will be helping the local Patagonian land trust and the landowners work through the deed of the conservation easements.”
    Hunker hopes that The Nature Conservancy’s experience working with Wyoming landowners on private lands conservation will be helpful to Argentine producers and conservation groups.
Future endeavors
    Hunker says she foresees a long future working with Argentina’s land groups to develop conservation efforts.
    “We are hoping to set up an exchange,” she says. “We want to bring Wyoming cattlemen, sheep men, representatives of the legislature and others to help them figure out how to move conservation forward so it really works for the local people.”
    With Wyoming’s partnerships with Argentina in other areas, such as livestock genetics, Hunker says there are a number of opportunities to come together.
    “Anytime we can see how someone else does things, we can learn something,” says O’Toole. “My wife and I have talked about going to Patagonia to see how they do things.”
    “If we can share the lessons that we have learned and talk about how we try to keep the land intact, it is valuable,” Hunker comments. “They can learn from us, and we can learn from them. It’s very exciting.”
    Learn more about The Nature Conservancy at nature.org/ourinitiatives/regions/northamerica/unitedstates/wyoming/index.htm. Saige Albert is managing editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..


Argentina visits
  The five Argentines who visited Wyoming to learn about the efforts of The Nature Conservancy include a range of conservation-minded leaders.
    “One gentleman works for The Nature Conservancy as a coordinator for working landscapes strategy,” says Paula Hunker, who serves in Wyoming as The Nature Conservancy’s associate state director. “There was also another man who is the Estancia manager of a 70,000 acre cattle ranch.”
    The Director of the Foundation for the Conservation of Patagonian Land also attended, and Hunker notes he serves as the main partner of The Nature Conservancy. The Foundation for the Conservation of Patagonian Land is the local land trust.
    Additionally the group’s former president was part of the group and represented the Cattlemen’s Rural Association, an organization similar to the Wyoming Stock Growers Association.
    Lastly, Argentina’s Coordinator of the Grasslands Program of Aves Argentina’s - Bird Life International was present on the tour of Wyoming.
    “We have had several groups of people come from Argentina,” comments Hunker. “They are working toward  a sustainable future for the Patagonia region.”


Denver, Colo. – “Today we have to start looking at our industry in a global context and understand how we relate and how we’re considered by our competitors and our markets.”
That was the opening statement made by Phil Seng of the U.S. Meat Export Federation at the 2010 International Livestock Congress held in conjunction with the National Western Stock Show in Denver, Colo.
“The U.S. red meat industry is very highly regarded and has been successful over the years, and we export to almost 100 countries today,” he continued. “But today it’s not just the quality of the product that sells itself, but the story behind it and that’s becoming more important.”
The U.S. can produce everything its people can consume, while Japan can only produce 50 percent of its meat and Hong Kong imports 90 percent of its caloric intake.  That puts the U.S. in an ideal position for exports, provided it can produce the variety of products unique to and specified by other countries.
Richard Brown of GIRA Euroconsulting in France said the U.S. needs to be “incredibly careful to understand the complexity of different markets,” because it’s not just one big global market.
Brown said a 20 percent volume growth of meat consumption in the world is expected in the period from 2005 to 2015, and that it’s “phenomenally important” that over half of that extra meat will be consumed in China.
He continued that the global meat market outlook is the most optimistic it could be for beef. “Trade will grow, and it’s Brazil that’s the big winner in world meat trade.”
He said it’s “relatively marvelous” that Brazil’s meat trade, especially pork exports, grew as much as it did from 2002 to 2005, considering their lack of market access. “They don’t have many of the best markets in the world open to their pork,” he noted.
“The key thing for growth in the future and exploitation of agribusiness potential is market access and the ability to respond to what customers want,” said Brown. He added that care should also be taken when exporting to not undermine the producers in the domestic markets into which meat products are being exported.
However good export markets looked several years ago, Brown said that was before the “new world” of 2007 and 2008 and the economic challenges worldwide.
“It’s interesting to understand the implications on meat demand in economic crisis,” said Brown. “As a simple farmer from the south of England, I don’t believe that economies in U.S. and in Europe will recover from the shock of what happened last year very quickly at all.”
“If you go off to China and India, their economies somehow managed to shrug off the effects of America and Europe and keep going with export markets. They still record and produce the fantastic growth rates, which is why the world figure is very good,” said Brown.
But in the rest of the world, Brown said consumers everywhere traded down, both in quality and price, and that was within and between species.
He added that the return to a weaker U.S. dollar is a “significant advantage” to U.S. producers, and he said it will continue to be weak in years to come because of the various economic problems in the U.S. government.
Relating to feed prices, Brown said, “We are going into a long-term environment where feed will be more expensive. While that’s not an advantage to the beef industry compared to poultry, it is an advantage to you in the U.S. because you’re jolly good at producing beef. You do it well and efficiently and have a scale of operation more efficient than other people.”
“Never underestimate the importance of animal diseases to meat markets,” he added. “If you reflect upon 2009, it was a sheltered year and comparatively normal. The thing we’re quite worried about for this year is African swine flu. It has the potential to be quite disruptive to Russian pig production, and possibly production in the EU.”
Being from the UK, Brown said he’s had sadness for very nearly 20 years with BSE. “I had three cases on my farm in 1991. I can sadly say that on my farm I’ve had as many BSE cases as you’ve had in your country, which is a dramatic piece of perspective, and it’s unbelievable how expensive it’s been to deal with.”
He said he’s also been through the trauma of foot and mouth disease twice, which is “not the slightest bit amusing for anybody.” He adds it was a deeply troubling time and seriously disruptive and expensive for farmers to deal with.
“That was deeply demoralizing and incredibly expensive with a result in export markets being closed,” he went on. “My country’s a big importer, but not having access to exports is like keeping the lid on a pressure cooker. It’s unbelievably important to have good systems that work and farmers that understand the importance of them and don’t hide things.”
Regarding bovine tuberculosis, Brown said badgers in the UK are heavily infected with TB and they spread it amongst cattle farms. “The government’s spending $150 million a year, and achieving absolutely nothing,” he explained. “Which is extremely annoying and 40,000 cattle a year are being destroyed for TB. British farmers aren’t optimistic for the future because of cumulative issues like that, and a government that doesn’t support us.”
Moving on to political developments that will impact global beef trade, Brown said, “Absolutely do not underestimate the importance of the Copenhagen Climate Change Summit. There was a disappointing outcome that presents a serious challenge to the ruminant industry regarding the impact of livestock on the environment.”
Brown said the “Less Meat, Less Heat” slogan needs to be taken seriously. “That’s a powerful statement that resonates with consumers in many parts of the world,” he said.
However bad global economics were in 2009, world meat consumption only declined a fraction, with expectations of one percent growth in 2010. “That’s not bad going in a bad economic climate,” said Brown.
Christy Hemken is managing editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..

Consumers are becoming increasingly wary as they prepare to purchase imported fresh meat products due to the horsemeat scandal that swept Europe in early January. Although the contamination has not reached the U.S., the industry worries that consumers may be still concerned that what they believe to be 100 percent beef may actually contain horsemeat. 

Beginnings

The scandal began in January when the Food Safety Authority (FSA) of Ireland found that 10 out of 27 burger products tested contained horse DNA. One sample from Britain’s largest grocery chain, Tesco, contained roughly 29 percent horsemeat. 

Tesco is not the only company that has detected this contamination. Nestle is one of the latest corporations to find traces in their beef products.

The spokesman for Nestle said that the levels of horse DNA were very low but above one percent.  Items that were contaminated include seven Jenny Craig products and two Gerber baby food products. 

“There is no food safety issue, but the mislabeling of products means they fail to meet the very high standards consumers expect from us,” said a statement from Nestle.

Bute concerns

Britain’s FSA says that the presence of horsemeat “is not a risk in itself,” but has ordered companies that have detected it, such as Findus, to test for the veterinary drug phenylbutazone, more commonly known as “bute.”

Bute has not been allowed entrance into the food chain because it, in rare cases, can cause aplastic anemia in humans. This is a condition that occurs when the body stops producing enough new blood cells, leaving the person feeling fatigued and at a higher risk for infections and uncontrolled bleeding. Treatment for the afflicted includes medications, blood transfusions or a stem cell transport, according to the Mayo Clinic. 

Britain’s chief medical officer said, “It is understandable that people will be concerned, but it is important to emphasize that, even if bute is found to be present at low levels, there is a very low risk indeed that it would cause any harm to health.”

This anti-inflammatory was banned from use in humans after it was found that one person in 30,000 suffered a serious side effect such as aplastic anemia. FSA claims that the levels of bute reported in the previous testing of the contaminated meet would have to have been multiplied by 1,000-fold to be at the same level that used to be given to humans. 

Entering markets

Although some countries allow the consumption of horsemeat, it was not intended to enter the mislabeled beef products. Officials are currently searching to find where the food security was breached. 

Britain’s FSA says that the evidence that it has compiled “points to either gross negligence or deliberate contamination in the food chain.” Suppliers in Ireland and France are believed to be linked to some of the prominent contaminated products. 

The percent of products contaminated is ranging between one percent in the Netherlands and 13 percent of total products tested in France. Nothing definitive has been found yet about the source, but the mislabeling has affected consumers in at least 12 European countries.

Prevention in the U.S.

The USDA has stepped up security measures to ensure that these mislabeled products do not enter the U.S. 

According to the National Association of Farm Broadcasters News Service, the USDA’s Food Safety and Inspection Service (FSIS) announced that it will be conducting species sampling and testing on imported raw ground-beef and veal to ensure that the shipments do not contain horsemeat. This sampling was put in place to ensure that the products being imported do not contain anything that is not listed on the label. 

FSIS does not allow imports of horsemeat from other countries into the U.S. for human consumption. 

FSIS Spokeswoman Cathy Cochran says that the FSIS is confident that the inspection system at all ports of entry ensures the safety of the products that come into the county. However, FSIS is still increasing testing to enhance the current safeguards and prevent fraudulently labeled products from entering the U.S.

Kelsey Tramp is an intern for the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.