22 February 2008

3 minute read

Highlights

• As of January 1, 2008, cattlemen reported 13.9 million heads on their farms, down by 210,000 heads, or 1.5%, from the previous year, according to the annual January Livestock Survey of 10,000 producers.
• Cattle numbers fell in all beef producing provinces with the western provinces accounting for almost three-quarters of the drop. The western herd combined, fell by 155 thousand heads.
• Exports of live cattle to the United States rose rapidly once the border was reopened in July 2005. During 2007, it is estimated that exports will reach 1.4 million heads, up 35% from 2006.
• Profits for cattle producers are being squeezed between a strong dollar and high feed costs. The stronger Canadian dollar essentially puts downward pressure on cattle prices in this country because the prices here largely follow US prices.
• At the same time, costs for feed grains have risen to challenge livestock producers. For example, Canadian Western barley prices were about 60% higher in September 2007 than they were during the same month in 2006. Meanwhile, corn prices in Ontario were up over 50%.

Analysis

Cattle estimates as of January 1, 2008

Canada’s national cattle herd continued to decline during 2007, as exports to the United States accelerated. Last year marked the second full year that the border has been open to Canadian cattle shipments since 2002.

As of January 1, 2008, cattlemen reported 13.9 million heads on their farms, down by 210,000 heads, or 1.5%, from the previous year, according to the annual January Livestock Survey of 10,000 producers.

In January 2005, a record year, there were almost 1 million more cattle held on Canadian farms as closed borders forced producers to keep much of their farm stock off the market. Despite the decline, the January 1, 2008 inventory remains 479,000 heads above the level as of January 1, 2003, prior to the border closure.

The American border, closed after May 20, 2003 following the disclosure of a case of bovine spongiform encephalopathy (BSE), was reopened to live cattle under 30 months of age on July 18, 2005. On November 19, 2007, it was opened to cattle born after 1999. Even with an open border, farmers continue to face different but rigorous challenges.

In general, inventories in the West rose during the early 1990s as farmers increased production in response to expanding export markets. With the closure of the US markets, thousands of cattle were held back on Canadian farms.

The livestock survey also showed declines in both hog and sheep inventories during the year. Hog producers indicated they had 14.0 million head as of January 1, 2008. Farmers reported 825,300 sheeps on their farms, down 6.1%.

Text table 1

Livestock inventories at January 1