Smoothing the kinks in the sustainable beef supply chain

“The people who are selling beef…are coming to us and saying, ‘we need you to supply this.’"

Ken McGladrie has always watched for new programs and technologies to keep his herd moving forward. It’s no surprise, then, that like many Canadian beef producers, he was eager to take advantage of the Canadian Beef Sustainability Acceleration (CBSA) pilot.

McGladrie, a commercial cow-calf producer from Wetaskiwin, Alta., became involved in the CBSA pilot through the Verified Beef Production Plus (VBP+) program, a third-party auditing body for the pilot. “We as producers need to provide a transparent and accurate information base on the food we produce,” he said.

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After selling 60 CBSA-eligible yearlings in early May, McGladrie learned that five head continued to a verified feedlot. However, the majority were sold to feeders not involved in VBP+ and the pilot. When he spoke to some of the buyers afterward, he learned that they didn’t have orders for cattle raised with verified sustainable standards.

McGladrie’s experience highlights the benefits and setbacks arising in the early days of the CBSA pilot. While he is encouraged thus far, he recognizes the importance of ensuring cattle continue through the program to meet consumer demand for sustainable beef. Overcoming this challenge is a priority for the pilot’s partnering organ­izations.

“We’re at a point now where producers recognize that… when the retailers say, ‘we want this type of product,’ they’re not just saying it for no reason,” said Melissa Downing, Alberta provincial co-ordinator for VBP+. “They’re saying it because they need to satisfy their customers’ request.” Downing believes this awareness has contributed to the number of producers now involved with VBP+ and the CBSA pilot. “We’re kind of at a tipping point where we realize that the failure to respond to that request means we lose market share.”

Early positive response from producers

The CBSA pilot was launched in October 2017, with partners VBP+, Beef InfoXchange System (BIXS) and Cargill working to create the first supply chain of verified sustainable beef in Canada. The pilot is open to all cow-calf producers, backgrounders and feedlots in Canada.

To become involved, producers first need to become registered with VBP+ or Where Food Comes From, the other auditing body involved with the pilot. Second, they need to become a member of BIXS. The third step is to upload their cattle through either BIXS or the Canadian Cattle Inspection Agency to the Canadian Livestock Tracking System, which requires a move-in report or age verification.

The goal is to establish a supply chain that provides enough beef to the partnering retailers, who plan to market a certified sustainable Canadian beef product. Quarterly credits are paid to participating producers, made possible by the companies funding the pilot — McDonald’s Canada, Loblaws and Cara Foods.

For many producers, VBP+ is an access point to the pilot. VBP+, which originated in 2003 as the Quality Starts Here initiative, allows cow-calf and feedlot producers to showcase their sustainable production practices by meeting certain criteria. Currently, about 800 operations across Canada meet the annual requirements to be registered with VBP+.

“It was originally designed to build consumer confidence and trust in our beef production system,” said Downing. Many producers are on the right track prior to being audited, and this is an extra step to gain market access. “It’s a way for producers to get verified, validate their production practices and demonstrate to consumers and to the rest of the industry that they’re doing a great job.”

Downing says VBP+ received an overwhelmingly positive response. “We have had a lot of people wanting to get signed up, people who maybe have known about Verified Beef for some time and have been following the principles but have never gone to the extra step of being audited, so we have quite a few producers who are now making that commitment,” she said.

BIXS has also received positive feedback during the pilot’s first months. “We’re getting tremendous uptake,” said Deborah Wilson, senior vice-president of BIXS. “Producers are signing on. They’re making more use of BIXS than we’ve ever seen before.”

“We’re getting tremendous uptake,” says Deborah Wilson, senior vice-president of BIXS.
photo: Supplied

While Wilson has found that communication and getting producers on board are the biggest challenges so far, she believes that the support of the retailers involved speaks volumes. “By just contributing back into the project to fund it and to send that financial credit out to producers has really spoken to the cattle industry. It has said that the retailers see value in doing this type of thing.”

Participating producers received $10 per head per owner in the first quarter of the pilot, and $20.11 in the second, with the third quarter ending in June. “We’ve successfully tracked quite a large (amount) of beef through both quarters,” said Virgil Lowe, business manager of VBP+.

“Everybody knows that trying to track something in the beef supply chain from birth to burger, as it were, is a complex job, no matter which way you slice it, and we’re learning a lot of interesting things about how to do that.”

This opportunity gives the industry a chance to share its message through the retailers. “The people who are selling beef…are coming to us and saying, ‘we need you to supply this,’” said Lowe. “I think if we can supply it, then we can help provide those people that talk to consumers with accurate information about beef production, and then they can take accurate information about beef production forward, which is a huge benefit for the beef industry.”

Like cow-calf producers, Canadian feeders are showing significant interest in the CBSA pilot. Downing said that she frequently hears producers say that they don’t believe feedlots would become involved in VBP+ or the pilot, but this isn’t the case. “We have quite a few feedlots that have been on the program for a number of years already, and we have had more join just in the last six months,” she said.

“We would need a lot more cow-calf operations registered with the Verified Beef program in order to fill the amount of pen capacity that we have at the feedlot level.”

Kasko Cattle of Coaldale, Alta., was one of the first feedlots in Alberta to become involved with the precursors to VBP+ in the early 2000s. “When VBP+ became available, we decided it was just kind of a natural thing to take us to the next level,” said Ryan Kasko, whose family-run custom feeding operation has four locations.

“We don’t get offered cattle that have gone through the program very often.” – Ryan Kasko.
photo: File

Food safety was one of his main motivations for becoming registered with VBP+. “It’s doing the right thing in your operation,” said Kasko. “We want to show our customers, the packing plants, that we care about food safety, and now with the VBP+ system, also care about animal welfare and our employees and kind of the whole gambit of our operation.”

Missed connections

As the pilot progresses, the organizations involved have heard from producers like McGladrie who find it difficult to keep their cattle in the program’s supply chain beyond the cow-calf operation. “That’s definitely our biggest challenge,” said Downing.

Lack of awareness may be part of the issue, as feedlots may not have had all the information when sourcing calves last fall. Also, the financial incentives weren’t announced until earlier this year and are being adjusted quarterly.

“An extra $20 per head for a feedlot is significant,” said Downing. “And every owner or feeder of that animal receives the same amount — cow-calf, backgrounder, finisher. They each received $20.11 per head for eligible cattle in the second quarter in the form of a cheque mailed directly back to them.”

McGladrie believes that marketing is key to meeting this challenge. While his yearlings were advertised through the Alberta VBP+ social media account prior to the sale, he would like to see more advertising from auction markets.

For example, McGladrie views being a part of a program such as VBP+ as a way to demonstrate his production practices and standards to potential buyers. He would like auction markets to promote this information. “I believe those of us as producers should want our animals represented more completely, and I believe the seller should represent them better, and then the buyers have a better choice.”

This gap is also experienced by the feeders in the program. Kasko noted that while they want to source calves from VBP+ registered operations, this has been difficult to achieve “We don’t get offered cattle that have gone through the program very often,” he said.

While Kasko said that feedlots need to let their buyers know that they want cattle raised with these standards, they don’t always know all the details on purchased calves. He’d like to see producers promote this information more actively. “Otherwise we just don’t know, and everyone wants to get paid a premium but we can’t do that if we don’t know what’s happened to the cattle.”

On the other hand, Wilson has heard from order buyers and auction markets that are actively sourcing cattle from registered operations. “The feedlots understand that if these cattle come out of a VBP+ operation, it’s an assurance for them that the cattle have received the appropriate vaccinations, that that operation is tracking its antibiotic usage and that the herd health aspect is right at the front of the minds of the feedlot owners and people purchasing cattle,” she said.

Getting more producers involved will also help to meet this challenge. “The more numbers we have, the greater chance we have of that connection happening,” said Wilson. She advised producers to work with auction markets to ensure they are aware of the pilot and that their cattle are being accurately represented. “Go into your auction market and have a discussion with them,” she said. “They’re an integral part of the industry and we need to utilize them.”

Wilson is currently looking into a system for creating a report on VBP+ calves that could be taken to an auction market, as well as a system for identifying these calves once they arrive at a feedlot. For the time being, she suggests making a screenshot of the My Account page on the BIXS website to share with the auction market and buyers.

To assist in increasing awareness, the VBP+ website features a list of Verified Beef operations, including those willing to share their information online, as well as a regional map. The provincial co-ordinators also promote the sale of eligible calves through social media and the VBP+ website. “We have a page on our website that has a listing spot where you can list cattle that are coming available, but it means that people need to actually be actively checking that page,” said Downing.

VBP+ plans to explore other methods to help connect cow-calf producers with feedlot operators. “The most effective thing, I think, is for more of the feedlots to be aware of the premium that’s being paid for these calves,” said Downing. “If we can start getting the demand more than pushing the supply, I think that’s more effective than trying to get the cow-calf guys to push to the feedlots.”

Naturally, there are aspects that can’t be controlled. “The program will be driven by market demand, so we can’t control and will never be able to control where calves are sold,” said Lowe. “What we can do is work to create a system that makes it as easy as possible for those buyers who are looking for calves with specific attributes, such as VBP+, to find them. We know that that’s an area of work that we’ve got to improve on.”

A promising beginning

What is unprecedented about this program, Downing explained, is the fact that the retailers are investing in a product that, up until July, was technically not yet available. “There’s no label that they can put on this yet,” she said. “They’re investing in the industry and trusting us to be able to come up with the volume that they’re going to need.”

For example, a retailer needs to have a certain amount of its beef raised sustainably before it can make a public claim about the product. “They don’t necessarily need 100 per cent, but they do need a certain per cent to make those claims,” said Downing. “Until we get to that level, they’re doing this just to help the industry build the supply. So it’s a win-win for everybody if we can do it, but we need to get as many people as possible on board.”

On July 11, McDonald’s Canada announced that due to the volume of beef going through the pilot and the partnership of the members of the Canadian Roundtable for Sustainable Beef, it will become the first Canadian company to source beef raised on verified sustainable ranches and farms. This will begin later this summer, beginning with its Angus line of products. John Betts, president and CEO of McDonald’s Canada, made the announcement at the Calgary Stampede’s International Agriculture Committee Reception, and explained that the company plans to source more than 20 million burgers from sustainable operations in the next 12 months.

To be at this stage is noteworthy in itself. Due to programs such as this, Wilson said, the Canadian beef industry is making great strides in areas that many see as challenging or simply not feasible. In her travels to the United States, Wilson has found that overall, the American beef industry would “give their eye teeth to have this program.” She added that she’s able to contradict arguments against traceability and sustainability based on the early success of the pilot.

For McGladrie, being part of this pilot is promising. “It’s got so much more opportunity to grow,” he said. He appreciates the education and guidance provided to him by VBP+ and BIXS, and is looking forward to further benefits. “It gives me faith that the system is functioning, but I would appreciate that it even has more to add to my operation.”

About the author

Field editor

Piper Whelan is a field editor with Canadian Cattlemen. She grew up on a purebred, Maine-Anjou ranch near Irricana, Alta., and previously wrote for Top Stock, Western Horse Review, and various beef breed publications.

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