Today’s cattle producers throughout Canada can be thankful that those before them, all of 50 years ago, saw the need for such information and founded Canfax. Much has been written this year about its history, so I won’t dwell on those years. But it is fair to say that the Canadian beef industry owes a great deal to Canfax’s founders, its staffers who developed and expanded its services, and most of all, to every producer who supported it and does today. In Canfax’s case, its information is only as good as those who provide it.

This is also true in the U.S. where CattleFax last year also celebrated its 50th anniversary. CattleFax has grown over the years to be a global leader in beef industry research, analysis and information. It also offers research, analysis and information for the grains, energy and protein sectors, including pork and poultry, as well as trade. Like Canfax, CattleFax’s members are mostly cattle producers who provide it with a host of price and other information.

However, the U.S. meat and livestock industry has an even more comprehensive price reporting system that is the envy of the world. At any given moment of the day, one can find everything from the latest feeder cattle prices at auctions around the country to what kidneys or other steer byproducts sold for the day before. In all, USDA’s Agricultural Marketing Service (AMS) issues more than 300 market reports each week that detail livestock and meat price trends, contracting agreements, and supply and demand conditions, while protecting the confidentiality of proprietary transactions.

Given the plethora of price information today, it is easy to forget it didn’t used to be like this. Until the late 1990s packers were not required to report the prices they paid for animals or the terms of sale. But as more and more animals were sold under formula pricing, other contract or captive supply arrangements, the open cash markets became less helpful as benchmarks. There were also growing concerns in the mid-1990s in the industry and Congress over packer concentration as meat packing companies were consolidating and getting larger.

The result was the Livestock Mandatory Reporting Act of 1999. AMS then implemented its Livestock Mandatory Reporting program in April 2001. Mandatory price reporting, through the Livestock Mandatory Reporting program, has been re-authorized regularly since then. The current Livestock Mandatory Reporting Program authority is set to expire September 30, 2020. AMS has also, in consultation with industry groups, expanded its cattle and other reports.

Two of USDA’s most valuable cattle reports are its daily regional direct cattle slaughter report and its monthly Cattle on Feed report. No other country with a cattle feeding sector of any size publishes monthly reports, let alone with such detail. The reports provide on-feed inventory, placement and marketing data for the 12 largest cattle feeding states and a U.S. total. It also provides a placement breakdown in six weight categories, from under 600 pounds to 1,000 pounds and over.

These breakdowns are invaluable in allowing analysts to forecast likely marketings in the months ahead. This and other data that USDA provides give cattle producers added confidence to make informed decisions about everything from selling their calves to retaining ownership through the feeding phase. Such data is the lifeblood of the industry.

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Certainly the feedlot sector comes to mind when I think about change, and in particular, change that led to tremendous improvements in production efficiency. When I worked for Canada Packers as a cattle buyer in the early 1980s, heifers were typically finished at 900 to 1,100 pounds and steers at 1,100 to 1,300 pounds. A carcass weighing over 721 pounds was considered too heavy and was discounted. Today, we see finished heifers weighing 1,300 to 1,400 pounds and steers averaging 1,500 pounds, with 900-pound carcasses commonplace. Today’s cattle gain faster, are more efficient and spend significantly less time in the feedlot. While advances in nutrition and genetics have played a role, a great deal of the credit for these gains can be attributed to the development of an array of modern growth promoting tools, including hormonal implants, ionophores and beta agonists. Not only have they led to more efficient beef production, but they have reduced the environmental footprint of the industry by allowing for more beef to be produced from fewer cattle. Ironically, these same tools are increasingly the target of certain consumer advocacy groups who do not understand their impact and make unsubstantiated claims regarding the safety of the beef produced from their use.

There has also been an increasing emphasis on quality and safety of the product we produce. In the 1980s our beef grading system emphasized the production of lean beef, a trend that many in the retail and food service industries felt was having a negative influence on quality. Marbling was reintroduced into our grading system in the mid-1990s in an effort to halt this trend and to increase marketing opportunities south of the border. Since that time, producing Canada AAA carcasses has been a central focus of the industry. While this trend was a reaction to consumer demand, it has had negative consequences in terms of carcass lean content. Simply put, the push for higher-marbled carcasses in combination with heavier cattle has resulted in a greater proportion of carcasses in the higher yield grades which translates to more fat in the carcass and trim at the retail level. No doubt, the quest for the ideal carcass with continue.

In terms of food safety, the industry has also made tremendous gains, particularly in the aftermath of the BSE crisis of 2003. Credit needs to be given to oversight by the Canadian Food Inspection Agency and to a proactive approach by industry. Developments such as the national ID program, premise ID, BSE monitoring and the regulations governing the use of medically important antibiotics are examples that readily come to mind. At the packing level, major innovations have been implemented in order to ensure the safety of Canadian beef. Consider the issue of E. coli O157:H7. This bacteria is a natural inhabitant of the gut of cattle and can contaminate the carcass during processing. This, in turn, can lead to human illness, particularly if undercooked beef is consumed by immune-compromised individuals. Modern packers go to great lengths to reduce such contamination including hot water and/or steam carcass treatments and the use of dilute organic acid rinses. Food safety, animal welfare and environmental stewardship have also become a central focus of production practices at the cow-calf and feedlot level. Industry-led programs such as the code of practice for beef production, the Canadian Roundtable for Sustainable Beef Initiative and the Verified Beef Production Plus (VBP+) program are all a reaction to today’s consumer, who is increasingly interested in how their food is produced. There is no doubt in my mind that in the foreseeable future, these programs and the principles they embrace will become imbedded in our management.

While there are many other examples I could cite, I think it is fair to say that the Canadian beef industry has undergone a monumental transformation in the last three decades, growing from one that primarily focused on domestic consumption, to one of the world’s leading exporters of high-quality beef. For my part, the last three decades has gone by in a blink of an eye and I must say, it has been a privilege to witness this transformation.

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But the worst affected are those which are bought at the auction by an order buyer for export. After the sale they must be processed, tested, tagged and held until the paperwork is completed, and sent for signature and returned before they can be loaded for the trip to the border and the final destination. The stress on these calves is substantial, many will become ill with pneumonia and some will die or suffer from chronic lung problems.

The latter group is our concern. It is time to call Wilbur in Helena, Montana, and determine the date after which the least amount of stress due to testing and processing will occur. The deep Texas drawl confirms that he has the same concern for the calves as we do and we agree to a date, consistent with the rules under the United States Department of Agriculture and the Canadian Health of Animals Branch, after which the calves can cross the border without testing for bluetongue or being held up for other reasons. The date is set and the cattle industry is informed.

At one of the United States Animal Health Association conferences I finally met Wilbur. Not a big man, smaller than his voice would suggest, but pure Texas from his Stetson past the silver belt buckle to his boots, clothes all whipcord and denim, black. Lean and tough, bone, sinew and tanned rawhide without an ounce of spare flesh was Wilbur.

But Wilbur had a history prior to being responsible for enforcement of the federal rules governing animal health in the State of Montana. He was involved in research, not cattle but sheep, and an enigmatic confusing disease which affected only adult sheep. Normal animals with no other sign of illness would begin rubbing against any solid object until the wool was worn off and eventually the hide would be scraped raw. The disease was first described in Scotland three and a half centuries before and was called “scrapie” by the sensible Scots. No one knew the cause of this condition and it affected only certain members of the flock, only in adulthood and there was no cure. It wasn’t caused by a bacterium and the science of virology was in its infancy. These tiny disease agents were separated into “filterable” and “non-filterable,” depending on their size, and if this was the cause, one was likely able to pass through a filter and was therefore unrecoverable and unseen.

The site of Wilbur’s trial involving infected sheep was at the northern end of the Wyoming Basin, an area important to the petroleum industry because the type of clay there when mixed with water was pumped down the drill stem to cool and lubricate the drill bit and flush out chips of rock for examination by the geologist to determine the presence of oil or gas. It was neutral, bland clay, unthreatening to living organisms. When Wilbur’s investigation revealed all it could, the data recorded and evaluated, the sheep were destroyed and the pens were cleaned out and left empty.

We go to Iceland next, a volcanic inhospitable island in the North Atlantic, that was first discovered by Celtic fishermen heading westward guided by their notched sticks to maintain a proper latitude, fleeing rampaging Vikings from what would become Norway. Here on that North Atlantic island, hot springs bubbled at the foot of glaciers, volcanic mountains stood on flat plains, short-season crops could be grown in some areas and a steady diet of fish brought on a hunger for mutton. So sheep were imported from home and raised in Iceland. But they developed scrapie and had to be destroyed. For a decade and a half no sheep were permitted on those particular premises until a new shipment of breeding stock, guaranteed to be scrapie free, were imported and housed on it. But in a short time they developed scrapie. This showed that the organism, whatever was causing the disease, persisted in that hostile environment for at least 14 years and possibly much longer.

Back in southern Montana at the research station where Wilbur had kept his sheep, a project involving elk captured from the wintering grounds of the wild herds on the eastern slopes of the Rocky Mountains was underway. At the conclusion of the trial the elk were not destroyed as were Wilbur’s sheep but these magnificent animals were returned to their herds in the foothills in apparent good health.

Meanwhile, people in Asia, particularly the Chinese, who were rapidly becoming wealthy and consumer oriented were demanding ever-increasing volumes of a health supplement derived from the growing antlers of deer termed “velvet.” Asiatic deer had spindly antler, New Zealand deer sported larger racks of antler but numbers were limited. North American elk had antlers which reached as far back as the bulls’ rumps when they walked through the forests. Antlers which in the velvet and full of blood and hormones weighed in excess of 40 pounds were worth a fortune when dried and processed. This opportunity could not be passed by so governments were pressured to allow the capture of wild elk to be raised in captivity for the collection and sale of the velvet to Asian customers. Permits to capture elk from the herds in the foothills were issued and some of the previous trial animals were likely captured as well as others and they became the basis of a new North American industry. Demand was great and elk were traded widely both interstate and internationally.

But all was not well. Occasionally, one of these magnificent animals would begin to lose condition, waste away and die. Then another would do the same. The symptoms suggested no commonly known disease but a search of the literature revealed that this condition had been reported in Scotland and was called “Chronic Wasting Disease.” Again, the sensible Scots had accurately described the disease in its name.

Not only the farmed elk were affected with this disease, which came to be known as CWD, but now wild elk and deer in the Wyoming basin as well were now affected. The cause was unknown, not all animals in a herd were affected, but those that were, died.

At about the same time, a disease of cattle was threatening both animal and human lives in Europe.This was a new disease which affected only adult cattle, they became unco-ordinated, nervous, then unable to rise and eventually died. It was named “Mad Cow Disease” or “Bovine Spongiform Encephalitis.” Frantic efforts to learn the cause and method of spread of this disease were underway and panic in other countries led to trade restrictions and the application of massive amounts of funding, much of it misapplied, to learn more about the condition. Transmission to humans was suggested and caused panic. Years went by and millions were spent and misspent before Dr. Stanley Prusiner learned that the cause of the disease was not a virus but was a normal element, a short string of nuclear material which, when folded normally was essential to carry copper ions across the cell wall into the cell where they were needed. The string was called a “prion” and in animals affected with BSE the string was misfolded into the mirror image of the normal prion and this was what caused the deadly disease in susceptible animals and humans.

Prion research proliferated and it became known that the BSE prion was biochemically identical to those which caused human spongiform encephalitis so the fear was justified. A prion was established as the cause of CWD and scrapie but the BSE prion was not identical to those which resulted in scrapie nor CWD, but the latter two were identical to one another. Only the BSE prion affected humans. Prusiner also showed that the prions were shed, depending on the species involved, in various body fluids such as urine and saliva, and in the flesh eaten by predators and humans. Stringent laws were put into place to stop the spread of these dreaded diseases and international trade in many commodities was restricted for years. But now the cause was known, the restrictions on feeding ruminant animal products to other ruminants were effective in preventing the disease and the number of cases worldwide decreased. It was shown that there was a genetic predilection or protection limiting the spread of those diseases in both animals and in humans but those without the proper genetic makeup when exposed to the misfolded prions faced certain death.

Unfortunately, the deer which were affected with CWD were not all captive deer; many had been part of the released study elk and now were feral, and in a few years the condition had spread widely across the North American continent, eventually reaching from the Rocky Mountain foothills to the Carolinas. It still appears sporadically in captive herds in Canada. The spread seemed to stop as it spread into the southern United States and has not been reported in the Florida Everglades.

A cartoonist at the time of the Viet Nam war, Walt Kelly, commented on the human condition and other social issues through the voice of “Pogo,” an opossum who lived under the Cypresses festooned with Spanish moss in the Florida Everglades along with all his little animal friends. One strip explained the foregoing tragedy extremely well, years before the actual events unfolded. In that strip, Pogo stood up in the prow of his pirogue with all his little swamp friends around him and he stated: “Gentlemen! We have found the enemy! And he is us!” How bloody true!

Larry Delver is a veterinarian and retired export veterinary program specialist with the Canadian Food Inspection Agency.

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One of those delays could definitely affect trade with Canada. In the waning days of the Obama administration, USDA resurrected the GIPSA rule, a proposal that free-market farm and ranch groups had vehemently opposed. For several years their supporters in Congress had written language into appropriations bills prohibiting implementation of the proposed rule. The prohibitions were dropped from the last appropriations bill after USDA promised the cattle sector it wouldn’t pursue the rule. Secretary Vilsack then broke that promise and USDA published the same content in two proposed rules and one interim final rule a month before the Trump administration took office.

The interim rule would allow livestock producers to sue packers if they felt they were treated unfairly without the need to prove harm to livestock producers as a group. Nearly all U.S. Circuit Courts in cases involving different industries have consistently ruled that a plaintiff must prove harm to a class in order to have standing to sue a buyer. The rule’s author, former GIPSA administrator J. Dudley Butler, once described this exception to usual practice as a “plaintiff attorney’s dream.”

The interim rule was meant to work in conjunction with one of the proposed rules prohibiting packers from paying premiums on better quality livestock, as this would open them up to claims that they unfairly paid more to some individuals than others. The thinking is packers would have to go back to buying livestock on the average, to avoid being sued. This direct assault on differentiation to produce livestock based on consumer preferences is what fringe livestock groups have been seeking for some time. They want to be paid the same amount for both high-quality and less valuable animals, without having to do the work, management and planning to produce high-quality products

The interim final rule was scheduled to become law April 22, 2017. That was two days before the scheduled Senate hearing to confirm incoming Agriculture Secretary Sonny Perdue who would almost certainly have pulled the rule, but after President Trump’s hold on new regulations would have expired. Farm and ranch groups had been lobbying furiously to reverse this decision while fully expecting a flood of nuisance lawsuits being filed as soon as the rule went into effect.

Thankfully, in mid-April came news that someone in the government was listening, when USDA-GIPSA’s director of litigation and economic analysis, S. Brett Offutt, announced via the Federal Register that both the interim and proposed rules would be delayed until October 19, 2017. Additionally, a new proposed rule would open a comment period regarding the fate of the interim rule. The industry is vigorously pushing to have all three squashed.

Last month I wrote about the dangers of the Border Adjustment Tax (BAT) on imports being proposed to recover revenue “lost” in tax cuts. Since then it’s become evident that not everyone favours a BAT. The list of doubters includes Democrats and Republicans in Congress, members of the cabinet and several key figures in the White House, plus a long list of manufacturers who rely on imported parts and materials, and big retailers who rely on imported goods to keep prices down for consumers. Numerous members of the ultra-conservative House Freedom Caucus have also come out against the BAT.

President Trump remains noncommittal, leaving open the possibility that the parade of business leaders, retailers and farm groups who are opposing the BAT and pleading for more open trade might still have an effect on Trump’s thinking. During his confirmation hearing, Sonny Perdue noted about 80 per cent of the comments in support of freer trade flooding into the White House were from agricultural groups, a critical bastion of Trump’s election success.

As of mid-April there was still a real chance that the BAT would be stripped out of the tax reform legislation before it becomes the law of the land.

Any fast start regarding trade has been stymied by the Democratic campaign to hold up confirmations, especially that of Perdue and proposed U.S. Trade Representative Robert Lighthizer, who needs a waiver because he did work for foreign countries in the past.

The meetings between President Trump and Prime Minister Abe of Japan and Chinese President Xi before the U.S. had adopted an official trade policy or had a full complement of trade officials in place was seen by some as a way of keeping the U.S. from falling too far behind other countries working on bilateral agreements. President Trump and Chinese President XI have agreed to begin exploring re-opening China to U.S. beef. If Trump can get that done, he will have succeeded where no one else has.

As for NAFTA, a white paper circulated by the administration in Congress regarding negotiating positions lacked any fire-breathing rhetoric. It did indicate the administration wanted to negotiate more flexibility to impose tariffs on Mexican or Canadian goods. But it would keep NAFTA’s current dispute resolution system. A Wall Street Journal story in general indicated the draft was less threatening than the Mexicans expected and more contentious than the Canadians expected.

The post Events begin shaping trade with the U.S. appeared first on Canadian Cattlemen.

The act itself was approved by Parliament in November but doesn’t really become empowered until all the regulations are modernized to suit this new law. That was supposed to happen early in 2015 but as this issue moves to press it was still in the works and with a federal election in the wind, it may be held up even longer.

Whenever the regs are passed one of the options the new act will offer is the chance to slice through some red tape by having a document “incorporated by reference.” It’s a way to update a document, say something like beef grading standards, without having to amend the regulation itself. Thus the regulations can be updated as new science or innovations come along without the long and torturous process involved in making an actual amendment. Sounds like a good idea.

Of course the government requires that the change be appropriate for the document and all stakeholders have input into the change, so any third-party organization wanting to make a change in a document in a regulation has to do its due diligence before it submits it.

When the government gets around to passing these regulations the carcass grading requirements for beef, bison and veal are likely to become one of the first industry-managed documents to be incorporated by reference in Canada Gazette I.

Some would say, it’s about time. A joint industry request to the minister of agriculture to replace Canada’s three-yield grade standard with the United States Department of Agriculture (USDA) five-yield class classification was first submitted way back in November 23, 2011.

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There is no doubt such a change will make life simpler for Canada’s larger packers as they already utilize the USDA yield class system, and producers who market fed cattle north and south of the border.

Ironically, one of the people who won’t be happy to see this change pass is Cindy Delaloye, the longtime general manager of the CBGA.

“Personally I have never been fond of the industry position to move to the USDA yield algorithm with its five-yield classes. Yes, it is based on cutability of a carcass but only on the yield of four of the five primals. It is also based on what was considered industry standard trim in 1960, which was one-half inch. In addition to these items which are not representative of the entire carcass or current industry processing practices, the algorithm for USDA cutability was generated from a sample population that was 21.6 per cent cows, not the typical cattle population to which we assess yield grades. Add to that the fact that the Canadian gene pool for slaughter cattle is very different from the gene pool used to develop the algorithm by the USDA in the 1960s and we may be heading for a step back in yield assessment for true carcass value.”

Now the USDA has also recognized that its carcass evaluation is inadequate for today’s herd and is currently assessing comments from the industry before it makes a change. The comments found on the U.S. Federal Registry site (Docket AMS LPS 14-0052 Beef Carcass Revisions) suggest the industry also recognizes the deficiencies in the current USDA yield equation and the need for a more meaningful classification of expected yield to provide “relevant classification of beef carcasses by value,” as noted by National Beef Packing Co. LLC.

Other comments point to a bias in the current USDA algorithm that favours light carcasses and penalizes heavy ones so that it “systematically underestimates retail meat yield for heavier carcasses,” according to the Indiana Farm Bureau.

“Are Canadian cattle going to be penalized using this algorithm?” Delaloye wonders, pointing to CanFax research that shows average Canadian slaughter cattle have been heavier than U.S. slaughter cattle, even without accounting for the kidney, pelvic, and heart fat that adds to U.S. carcass weights.

“This may be the time to suggest a North American standard that is reflective of 21st century fed slaughter genetics and management practices,” she says.

The American Meat Institute wants a thorough scientific review by credible individuals and institutions before it recommends any grading change. Delaloye couldn’t agree more, and she would like to see what comes out of the research at the Lacombe Research Station into new methods for predicting per cent lean, cut yield and salable yield before we simply jump on the U.S. coattails.

“ We need yield assessment methodology that will help Canadian and potentially North American cattle industries select and improve production thereby achieving better efficiencies which should be reflected in profit.” To that end she says the CBGA has initiated discussions between Canadian and U.S. researchers.

“The five USDA yield classes do distribute cattle over a well-proportioned bell curve compared to the Canadian three-yield class system which is heavily skewed to the Canadian Y1 class. Unfortunately neither of the classification systems are set up to communicate production efficiencies to producers, and help them select cattle accordingly.”

“The truth is out there. Why don’t we seek it objectively and build a more meaningful scientific classification of carcasses by expected yield?”

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