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History: Clouds in the Cattleman’s Sky

Reprinted from the October 1952 issue of Canadian Cattlemen

By Grant MacEwan
General manager, Western Section, Council of Canadian Beef Producers

Canada’s livestock and meat industry is basically sound and with an ever increasing North American population, it is a reasonable bet that every pound of meat and milk which can be produced in the years ahead, will be needed. But temporarily at least, that mighty industry is in the grip of difficulties, fear and uncertainties.

Foot-and-mouth disease has been eradicated; 175 days after the fateful announcement, Canada’s Minister of Agriculture declared officially that all infection had been eliminated. It was heartening news that Canada was free from the insidious virus, but the marketing aftermath could not be liquidated with the same degree of finality and Canadian cattlemen who had geared their production to meet the requirements of an export as well as a domestic market faced the problem of growing surplus.

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To meet an emergency and provide some stabilization at a time when a market collapse could have brought ruin to Canadian feeders and producers, the Federal Government announced a support policy based on a twenty-five cent floor price for good steers at Toronto. The Prices Support Board would not actually buy live cattle but would take a certain quota of beef from the packers at prices relative to the basic Toronto price. It seemed a reasonable plan in the emergency even though many of Canada’s beef cattle producers were fundamentally disciples of a free market and not enthusiastic about Government intervention. As it was the situation was charged with threats of more serious difficulties; the decline from thirty-three and thirty-four cent feeder steers in the autumn of 1951 had already brought heavy losses to many feed-lot operators.

What would the Government do with the beef it acquired? The four-nation beef deal which was to allow Canada to send approximately 60 million pounds to the United Kingdom to replace an equal tonnage of New Zealand beef that would be diverted into United States markets to Canada’s account, was announced. However it may be assessed later, it appeared at the time as a complicated masterpiece in trade negotiations and was received with general acclaim. It would cost the Canadian taxpayer a few million dollars but it would provide an outlet for a substantial volume of beef and keep the wheels of industry turning.

On August 6th, Ottawa announced that the Prices Support Board had purchased about three-quarters of the amount of beef required as an offset to the New Zealand deliveries. It didn’t leave much for the heavy fall deliveries and in spite of the assurance that support prices for cattle would continue for the duration of the United States embargo, cattlemen began to see breakers ahead and new difficulties.

Ottawa officials insisted that all was well; producers, they said, should simply hold their cattle off the market and wait for the United States to remove the barriers to export. But cattlemen who traditionally think for themselves had found that all was not well, that the floor price being paid for a comparatively few cattle was having little or no influence upon some of the lower grades of killing cattle, notably heavy cows. With storage coolers pretty well loaded, pork deliveries well up and no known outside market for beef except the almost-filled United Kingdom quota, cattlemen have been inclined to conclude that the exiting Federal policy would be incapable of coping with heavy fall deliveries in October and November.

Holding cattle off the market would certainly furnish a temporary easement in the National problem and many cattlemen have been doing their utmost to follow this instruction. It must be remembered, however, that there are reasons why cattlemen cannot always hold cattle back; some of these reasons are physical and some are financial. Some growers do not have the help and facilities to keep big herds over the winter; some must sell to pay debts and with delivery quotas applying to wheat, more farmers than ever may see the necessity of selling cattle to pay wages and other bills coming due in the fall. On top of that, a degree of uncertainty has been allowed to spread and producers will not fancy carrying cattle over the winter unless there is reasonable assurance of a return for feed and labour.

Young cattle held back will continue to grow and nothing is surer than that a holding policy will mean much greater tonnage of beef to be marketed later at prices which are presently disturbingly uncertain.

It is always nice to write in the spirit of cheer and optimism but there are times when nothing is more appropriate than realism. Every Canadian would like to think that the United States market would be open to Canadian cattle 60 days after the official declaration of freedom from foot-and-mouth disease but most people are convinced that such is not going to happen. Some forecasting by people in high places mentioned September 1952 as the time at which we might expect Canadian cattle to start moving. It now appears most unlikely that the market will be restored to Canada at any time in 1952 and nobody is very sure that it will be open very early in 1953. The United States allowed 12 months of freedom from the disease to elapse before reopening the border to cattle in the case of Mexico and some Washington officials have hinted that for diplomatic reasons, policies could not be very different in dealing with Canada.

In spite of wishful thinking, one can only conclude that it might be March, it might be April; it could even be later. And in the absence of cattle from both Mexico and Canada, cattle prices in the United States have fallen. Indeed, if the American market opened tomorrow the prices on the top grades of Canadian cattle would have to be adjusted downwards to make exporting practicable.

‘Our History’ is curated by former Canadian Cattlemen editor, Gren Winslow.

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