Australia imposed import restrictions on Canadian beef in 2003, following the discovery of Canada’s first domestic case of mad cow disease. It lifted a similar ban on U.S. beef imports last week.

Canada’s government celebrated the long-awaited resumption of access to the Australian market.

“With restored access to Australia, a key market in the Indo-Pacific, we can unlock more opportunities for our producers to deliver the top-quality beef we’re known for,” said federal Agriculture Minister Heath MacDonald.

Analysts are skeptical about how much North American beef can be exported to Australia because the U.S. has a major deficit and is importing beef from Australia, Canada and other suppliers.

“U.S. beef is still very highly priced compared to Australian beef,” said Resilient Capital analyst Jerry Klassen.

“North American beef is really the highest-priced in the world.”

The Canadian Cattle Association, which represents farmers and feedlots that raise cattle, celebrated the Australian market reopening, saying in a news release it was one of the last remaining countries to have maintained mad cow disease restrictions on Canadian beef.

Canada’s cattle ranchers were devastated by the 2003 restrictions placed upon Canadian beef exports because much of the country’s beef production is exported, especially to the U.S.

—Reporting by David Ljunggren and Ed White

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That was certainly the case at the Alberta Beef Industry Conference in Calgary with murmurs during networking sessions among producers, at annual general meetings and as a topic of discussion with multiple keynote speakers during the three-day conference.

“”One of the first things I’m telling folks across the industry, whether it’s cattle producers in the U.S., Canada or Mexico, the only thing we know for certain right now is this is going to add volatility and uncertainty to an already volatile and uncertain market environment,” said Lance Zimmerman, a senior beef analyst for the North American market for RaboResearch Food and Agribusiness, during Day Two of the conference on Wednesday.

“As we look at that volatility, a market that moved 10 per cent 20 years ago may of cost us about $60 to $80 a head. A value swing today at 10 per cent move in the market is worth $300 a head U.S. — add time-and-a-half to get to a Canadian value in terms of currency adjustment.”

Focus on risk management

With the sheer dollars invested in cattle today at nearly $4,000 a head , according to Zimmerman, a heightened focus must now be put on risk management.

Many people think of risk management in terms of contracts and the futures and options markets, but Zimmerman said it goes beyond that to include making sure all the bases are covered.

“One aspect of it is markets and financial risk. Another aspect of risk management is production risks, and then the very real risk that is being presented now is institutional risk from a government standpoint,” said Zimmerman.

“There are certain things we can control. We can’t control the markets, we can’t control drought, we can’t control a tariff, but there are things we can do to mitigate those risks.”

‘Lean on your network’

As the North American markets are feeling it out together, Zimmerman is encouraging producers to be hyper-vigilant in keeping up their communication as tense negotiations evolve daily in hopes to a quick end to the trade war.

“Get on the phone and really lean on your network right now. If you are on the feed yard side and you’re buying feeder cattle and calves out of the U.S. and bringing them up there, have discussions with your partners you’re buying from,” said Zimmerman.

While discussions have been heated and tense between Trump and prime minister Justin Trudeau in the early days of the trade war, Zimmerman has heard a general spirit of wanting and willing to work together among producers in the last 48 to 72 hours since the tariff announcement.

It is apparent in the Alberta beef industry that producers realize how small and tight-knit the industry is, a commonality shared across the U.S. border. A lot of fed cattle come out of the Alberta region and go into Pacific Northwest in the United States and a lot of dairy cattle are going from the U.S. into Canada.

‘Short-term’ tariff pains

“There are some short-term pains we are going through. For instance, I’m hearing instances of certain commodities that thought they could cross across the border today (Wednesday) and they are not able to. Whether that was mushrooms, or beef or other widgets, we are hearing a lot of instances of these things were priced pre-tariff and now the buyer isn’t just willing to write a cheque 25 per cent higher,” said Zimmerman.

“We have to work through those short-term pain points and no one knows really how to navigate this because the details are still flowing in in real time. We are specifically at a point in the cattle cycle today where we realize we’ve become a very much North American beef industry. We have our regional differences, but that’s no different in talking about the Pacific Northwest versus Texas, versus the Pacific Northwest versus Alberta. We have become accustomed to working together and helping each other through the challenges that exist.”

Zimmerman said the supply chains for basic production units are often globalized because amino acids and trace minerals often come from China. U.S. producers need to have discussions with feed suppliers and nutritionists to make sure that supply chain still exists with tariffs also implemented there.

Zimmerman has heard examples of some companies buying fresh colostrum in the U.S., bringing it into Canada, processing it and getting it standardized and unified as a dry product and then sending it back to the States.

“How do you treat that in this new environment?” Zimmerman said.

Constant communication

“A lot of it is getting on the phone, talking to your suppliers, talking to your buyers and sellers and staying in constant communication so that the communication flow continues to exist. Literally, what I tell you now may change an hour from now, not just a day from now.”

The immediate reaction to Trump’s tariffs has been negative as major equity markets around the world fell in response to Tuesday’s announcement. The EuroStoxx 600 fell by 2.14 per cent on the day, according to the Investment Strategists Team at IG Wealth Management. In Canada, the S&P/TSX Composite Index fell by -1.72 per cent. Exports to the United States represent 76 per cent of total Canadian exports as of the 12 months ending in 2024. These exports account for almost 20 per cent of Canada’s gross domestic product.

Canada, Alberta respond to tariffs

Canada’s response to Trump’s tariffs has been swift on both a national and provincial level. Alberta premier Danielle Smith announced the provincial government will avoid purchasing U.S. goods and services, including alcohol ($292 million in U.S. liquor sold last year in Alberta), and launch an advertising campaign to help shoppers buy Canadian products while U.S tariffs remain in effect. Other provinces across Canada have taken similar measures.

Even with feelings of western alienation, Smith has supported Trudeau’s response to Trump’s tariffs. At a news conference in Ottawa on Tuesday, Trudeau announced Canada would counter the tariffs by imposing 25 per cent retaliatory tariffs on $30 billion worth of U.S. products, and added that will grow to another $125 billion in U.S. goods in 21 days from the announcement. The list would include products such as electric vehicles, fruits and vegetables, beef, pork, dairy, electronics, steel, aluminum, trucks and buses.

The federal government has also been taking steps to mitigate the impact of the counter measures on Canadian workers and businesses by establishing a remission process to consider requests for exceptional relief from the tariffs imposed as part of national response to the U.S. applying tariffs on Canada.

The ag industry remains hopeful with Trump softening his stance in another industry on Wednesday, granting a one-month exemption on his tariffs on imports from Canada and Mexico for U.S. automakers.

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Dennis Laycraft, executive vice-president at the Canadian Cattle Association, said without knowing exactly what is coming, the organization could analyze the threatened tariffs only so much.

“They could announce tariffs that come into effect immediately. They could announce moving forward with hearings and that they intend to move ahead but they don’t come into effect immediately,” he said.

“They could be selective tariffs, or they might vary the amount or apply a broad-based tariff to all importers.”

Laycraft said the CCA and its beef advisers tried to look at all the risks, but even their counterparts south of the border had no better idea what would happen.

Trump had said he would impose 25 per cent tariffs immediately upon taking office Jan. 20. However, on inauguration day it appeared he would take a more methodical approach to examining trade with Canada and some other countries.

Analysts have said the tariffs wouldn’t be good for either country. Everyone agrees they are coming anyway.

Al Mussell from Agri-Food Economic Systems said there will be plenty of complaints in the United States from companies disadvantaged by the tariffs, but they will still go ahead.

“I think the tariffs are going to be necessary for the U.S. as a source of public finance, which sounds crazy,” he said.

Livestock market analyst Kevin Grier said it’s just a matter of when tariffs start and when they end.

“A lot of people are saying he won’t put them on in the livestock industry because there’s too many jobs at stake and so on. I think that’s very naïve. I think that cattle and hogs and so on are just a drop in the bucket compared to some of the other industries that are trying to lobby to be exempt,” Grier said.

Cattle producers are likely annoyed and worried but shouldn’t be too concerned at this point, he said, although sales were fully steady and higher than usual ahead of inauguration day.

“If I’m a cattle feeder, it’s a totally different story,” he said.

Feeders are uncertain if contracts will be honoured by the two major packers, JBS and Cargill, in Canada and in the U.S. Each individual packer will have different circumstances and ways of dealing with the tariff, depending on how much leverage they have, he said.

“There’s no real answer except that it’s bad news and probably will result in much lower prices,” he said, adding he does expect retaliatory action on beef.

It’s also bad for the hog industry.

About 70,000 weaners and feeders go south each week. Grier said they have to go, and the circumstances are similar to cattle in that contracts may or may not be honoured.

Grier said disease in the U.S. has led to strong demand for Canadian hogs.

The cash market will likely be affected negatively, but that demand may temper the situation.

Market hogs mostly move from Eastern Canada, and Grier said negotiations will be at play in that sector. The U.S. packer may take a long-term view and offer to split the tariff cost or not honour the contract at all.

Mussell said if U.S. buyers want Canadian pigs badly enough, they will find a way to share the burden.

“There’s probably some awkwardness if this is tied up in forward contracts because there’s some people who are going to say this is like a force majeure situation,” he said.

In terms of pork exports, he said tariffs could decrease the cut-out margin of Canadian processors and lead to different decisions.

The shorter production cycle for hogs creates a more urgent situation for those producers.

“Producers tell me they’ve got about a two-week window in which they can sort of slow things down,” he said.

Mussell suggested livestock producers could delay some discretionary spending and sit on some cash in order to ride out whatever is coming.

He warned that if access for live animals or processing economics change volumes, then the issue will back up into the feedgrains system.

He added it’s not in the best interests of the U.S. for Canada’s industries to suffer.

“They’re trade deficit in ag and food products with Canada. They need to be able to import from us,” he said.

University of Alberta agricultural economist Ellen Goddard said the sheer numbers of live animals moving south indicate how much they need that supply.

Laycraft said processors in the U.S. Northwest require a regular supply of Canadian cattle to operate at capacity.

However, Goddard said supply chain participants will react differently. For example, American beef producers who see higher prices might see them favourably.

“My suspicion is that the people who are working with integrated supply chains at the processing level and getting their product from wherever is cheapest at the time they need to buy it are not going to be happy,” she said.

At the farm level, she predicts lower prices for Canadian producers in the short term.

The pork industry will respond much more quickly to that by cutting back supply, unless they have already started aggressively looking for other markets, she said.

Canada and the U.S. are both at the tail end of their cattle contraction cycles and would have started expanding.

“With the tariffs, it will probably take longer for the Canadian industry to turn around and start increasing their beef supply because prices won’t go up as much here,” Goddard said.

Producers who weathered BSE can withstand the tariff, she said.

“A 25 per cent tariff is going to be a significant price impact but nowhere near as big as the price impact that happened in the latter half of 2003 and early 2004,” she said.

Goddard said Canadians who get the message about how much tariffs hurt farmers will likely support them, similar to the BSE years, even though inflation and high food prices are concerns.

She expects retail prices to come down a bit.

Grier said there could be some front-page flyer specials but overall he doesn’t see much change at retail.

Meanwhile, CCA is developing a multi-faceted strategy to deal with the tariffs.

“The shorter number one goal is hopefully stop or prevent it through talking about the benefits of the Canada-U.S. integrated marketplace and supply chain,” Laycraft said.

The discussion includes what business risk management tools are available to help.

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Any trade measures to try to reduce beef imports would hit China’s largest suppliers, Brazil, Argentina and Australia.

China’s total beef imports reached $14.2 billion (C$20.5 billion) in 2023, surging from $8.2 billion ($C11.8 billion) in 2019, customs data show. Brazil accounted for 42 per cent of the total trade value, followed by Argentina at 15 per cent and Australia at 12 per cent.

The inquiry will focus on fresh beef, cold beef, head of beef and frozen beef imported between Jan. 1, 2019 and June 30, 2024, the ministry said in a statement, adding that it followed an application by the China Animal Husbandry Association and other cattle and livestock groups.

The applicants said a sharp increase in import volumes over the period had “seriously damaged” China’s domestic industry, the ministry said.

Beef imports in 2023 were almost 65 per cent higher than in 2019, it said, with imports in the first half of 2024 more than double those in the first half of 2019.

The ministry said imports of the products under investigation accounted for 30.9 per cent of the Chinese market.

Meat prices in China, including pork, beef, and poultry have declined as shoppers, grappling with a slowing economy, buy less.

“Most beef cattle farms in China are in a loss-making situation,” the China Animal Husbandry Association was reported saying in a state media report. “The impact of a large amount of imported beef is undoubtedly adding insult to injury.”

The price of beef has fallen to its lowest level in the last five years, and the price of live cattle has fallen to the lowest in the last 10 years, the association said.

Average wholesale beef prices have declined 22 per cent to 59.82 yuan (C$11.81) a kilogram in late December from 77.18 yuan two years ago, agriculture ministry data showed.

The Brazilian government said in a statement that it will work over the coming months to demonstrate that the beef Brazil exports to China is “complementary” to Chinese beef output and does not harm the Asian country’s industry in any way.

“The Brazilian government reaffirms its commitment to defending the interests of Brazil’s agribusiness while respecting the sovereign decisions of our top trade partner,” it added.

Farmers asked to limit herds

Beijing in June sought to contain prices by asking farmers to limit and optimize the size of their beef cattle herd, but prices remain in decline amid a surge in imports, particularly from Argentina.

Beef imports from the South American producer during the first 11 months of 2024 rose 10 per cent from the same period in 2023 to 533,005 metric tons.

“The industry reflects that excessive beef imports have caused substantial damage to my country’s beef cattle industry,” China Animal Husbandry Association said in the report.

“The industry strongly calls on the country to take control measures on imported beef to protect farmers’ livelihoods and the industry’s security,” it said.

China imported 2.6 million tons of the targeted beef products between January and November. In calendar year 2019, China imported just 1.66 million tons.

The investigation is expected to conclude within eight months, although it could be extended in special circumstances. It is not targeted at specific countries or regions, does not distinguish the origin of products, and will not affect normal trade while under way, the commerce ministry said.

China is also considering trade restrictions on imports of dairy and pork from the European Union, although in those cases, the anti-dumping and anti-subsidy investigation are a tit-for-tat response against bloc’s tariff plan for China-made electric vehicles, analysts have said.

—Reporting by Ella Cao and Ryan Woo; Additional reporting by Lisandra Paraguassu in Brasilia.

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Official data released on Thursday showed that January-to-September beef exports totaled nearly 700,000 metric tons, with most of that volume, or nearly 70 per cent, purchased by Chinese buyers.

The next largest foreign buyers by volume were the European Union and then Israel, according to the data.

While grains exports, especially processed soybeans, corn and wheat, are the top farm exports from agricultural powerhouse Argentina, choice cuts of beef have long been coveted by carnivores outside its borders.

The country ships beef to 48 countries, with exports to the United States up 46 per cent compared to the same nine-month period last year, while exports to Chile were up 21 per cent and shipments to Israel up 11 per cent, according to a government statement.

Earlier this year, data showed that domestic beef consumption was down as locals are forced to tighten their belts due to a prolonged economic slump marked by triple-digit inflation and growing poverty.

—Reporting by Maximilian Heath

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Canada imported $10.2 million worth of beef from Jan. 1 until the end of April, a significant increase from the same period in 2023, when beef imports from Britain were $3.7 million.

Why it matters: The Canadian livestock sector continues to see no benefit from the CETA agreement and trade talks with Britain stalled earlier this year.

If the pace continues for the remainder of 2024, Canadian beef imports from the U.K. would top $30 million. It would be similar to 2022, when Canada purchased $33 million worth of beef from the U.K.

As for Canadian beef exports to Britain, there are none.

Agriculture and Agri-Food Canada supplied this data to Glacier FarmMedia in early July. It is significant for Canada-U.K. relations because red meat was a major reason for the breakdown in free trade talks between the two countries.

Britain suspended trade discussions with Canada in late January, claiming the talks had hit a wall.

“We have always said we will only negotiate trade deals that deliver for the British people. And we reserve the right to pause negotiations with any country if progress is not being made,” a U.K. government spokesperson said Jan. 25.

A sticking point was exports of British cheese to Canada. Prior to Jan. 1, British cheese makers had tariff-free access to the Canadian market for a certain volume.

That tariff-free quota ceased when a temporary free trade deal, a continuity agreement between Canada and Britain, ended on Dec. 31. Canada imposed tariffs on U.K. cheese in January.

On the Canadian side, Britain’s ban on beef from Canada is considered unacceptable. Since 2022, Canada’s beef exports to Britain have essentially been zero because the U.K. will not recognize the safety of Canada’s food system or permit imports of beef produced with growth hormones.

The British position on beef raised with hormones goes all the way to the prime minister. In an open letter to farmers, published last year, then-Prime Minister Rishi Sunak took a hard stance on imported beef.

“Without exception, we will continue to protect food standards in the U.K. under all existing and future free trade agreements,” Sunak wrote. “There will be no chlorine-washed chicken and no hormone-treated beef on the U.K. market. Not now, not ever.”

The Canadian Cattle Association says the British position is not based in science and is disconnected from Canada’s global reputation for food safety.

“Unfortunately, the U.K. has shown no indication that it is prepared to fully accept Canada’s food safety system, which is widely recognized as one of the finest in the world,” said a CCA news release from Jan. 25.

“Until the U.K. barriers to Canadian beef are resolved, Canadian producers will continue to be at a disadvantage. The U.K. currently has unlimited access for British beef exports to Canada while Canadian beef producers are unable to export into the U.K. market.”

Imports from EU also jump

European countries are also taking advantage of Canada’s willingness to maintain open markets. EU beef exports to Canada were $32.5 million in the first four months of 2024, an increase of 29 per cent from the same period in 2023, when imports were worth $25 million.

Ireland and Italy were the main exporters, shipping $16.5 million worth of beef to Canada.

Meanwhile, Canada’s exports of beef to the EU have declined in 2024. From January until the end of April, Canada shipped $6.3 million in beef to the EU. That’s down from $10.6 million during the same period in 2023.

When the figures are combined, Canada ran a trade deficit in beef with the U.K./EU of $36 million. Extrapolated for a full year, the trade deficit with Europe and Britain could top $100 million in 2024.

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Why it matters: Trade talks between the United Kingdom and Canada fell apart earlier this year.

Sunak listed six principles that he said will protect and assist British farmers. Principle No. 4 was a direct shot at free trade with Canada:

“Protecting U.K. food standards. Without exception, we will continue to protect food standards in the U.K. under all existing and future free trade agreements,” Sunak wrote. “There will be no chlorine-washed chicken and no hormone-treated beef on the U.K. market. Not now, not ever.”

Those words — “not now, not ever” — are clear. They partially explain why Canada-U.K. free trade negotiations fell apart this winter, when the British government suspended discussions and said progress had stalled.

The two countries were trying to negotiate a revised U.K.-Canada free trade agreement to replace a temporary deal based on principles of the Comprehensive Economic and Trade Agreement. Britain’s participation in CETA and other European trade deals ended because of Brexit.

Canada-U.K. negotiations hit a roadblock in January due to disagreements over the ingredients in a cheeseburger — beef and cheese. Britain has since called a federal election for July, which puts free trade negotiations off the table.

“The U.K. prime minister announced the suspension of the talks in an electoral period … so it’s hard to believe they would change their mind on anything at this stage (before an election),” said Michael Harvey, executive director of the Canadian Agri-Food Trade Alliance.

British cheesemakers lost tariff-free access to the Canadian market at the end of 2023. As of Jan. 1, Canada imposed a 245 per cent tariff on U.K. cheese because the three-year interim free trade agreement between Canada and Britain had expired.

British negotiators are frustrated with Canada’s stance on cheese. Cattle producers and meat processors in Canada are angry about Sunak’s words on hormone-treated beef and Britain’s refusal to recognize livestock production and food safety standards in Canada.

“Canadian meat is currently severely disadvantaged in the interim agreement with the U.K. as technical, non-tariff trade barriers have resulted in Canada being unable to access the U.K. market,” the Canadian Cattle Association said last year.

“(Meanwhile), the U.K. enjoys unfettered access into the Canadian (beef) market.”

The federal government and Ralph Goodale, Canada’s ambassador to Britain, have sided with cattle producers.

In an opinion piece published in the Western Producer, Goodale said the U.K.’s ban on Canadian beef has “no scientific justification whatsoever.”

“It’s an entirely arbitrary non-tariff trade barrier that violates the rules of both the CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) and the World Trade Organization,” Goodale wrote.

Given the hardened positions over beef and cheese, trade talks are somewhere between comatose and dead.

“It is highly unlikely that negotiations will resume before one or both countries have federal elections,” CAFTA said in April in a trade update published on its website.

Even after the federal election in Britain, it seems improbable that a new U.K. government will change its mind on beef imports from Canada and cattle raised with growth promotants. The Labour Party is favoured to win the election and it has a history of protectionist policies.

“It is not clear that a new U.K. Labour government will be as welcoming towards free trade as the … Conservative government under Prime Minister Rishi Sunak,” wrote David Collins, a professor of international economic law at City, University of London and a senior fellow at the Macdonald-Laurier Institute.

“Indeed, (Labour) may be even more likely to erect barriers to trade in the form of senseless bans on products in the guise of health or protecting the environment.”

– Robert Arnason is a reporter for the Western Producer.

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Brazil-based JBS, the world’s largest beef producer, said in a statement it is working with U.S. and Chinese authorities to resolve the situation and that no other JBS beef facilities in the U.S. have been impacted.

The suspension was effective Monday, according to a notice posted on the U.S. Department of Agriculture’s Food Safety and Inspection Service website.

Ractopamine is a feed additive used to boost animal weights. Its use has been banned or restricted in at least 160 countries, including the European Union, Russia and China.

Earlier this year, major food safety, environmental and animal rights groups filed a lawsuit against the U.S. Food and Drug Administration, seeking to force it to reconsider approvals of ractopamine, which they say is putting human health at risk and causing stress in farm animals prior to slaughter.

In addition, China has blocked meat and poultry products coming from the Cool Port Oakland in Oakland, California, effective the same date, according to the USDA site. Cool Port Oakland is a cold storage facility, used for storing perishable or other sensitive goods like food or medicine.

The restrictions sent Chicago Mercantile Exchange cattle futures slumping on Wednesday, analysts said, with the most-active August LCQ24 live cattle contract posting its biggest percentage drop since May 1.

Officials from Cool Port Oakland could not immediately be reached for comment on Wednesday. USDA officials had no immediate comment.

—Additional reporting for Reuters by Lisa Baertlein in Los Angeles

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The rule, proposed last March, is a victory for U.S. ranchers who argued for years that use of the voluntary label by companies who raised animals abroad and only slaughtered or processed them in the U.S. was misleading and disadvantaged domestic producers.

“This final rule will ensure that when consumers see ‘Product of USA’ they can trust the authenticity of that label and know that every step involved, from birth to processing, was done here in America,” said Agriculture Secretary Tom Vilsack in a statement.

Vilsack announced the final rule to cheers at the annual meeting of the National Farmers Union in Scottsdale, Arizona.

“The abuse of the ‘Product of U.S.A.’ label stripped America’s cattle producers of a vital opportunity to market their USA beef while denying consumers the opportunity to support them,” said Joe Maxwell, co-founder of the farm group Farm Action, in a statement.

Producers using “Product of USA” or “Made in the USDA” labels will need to comply with the rule by Jan. 1, 2026.

Canadian concerns

The Canadian meat sector has been concerned about the change in labeling practice could have on meat and live animal exports to the U.S.

The Canadian government said that country of origin labeling would run contrary to shared goals of reducing inflation, improving food security and building resilient supply chains, it said in a submission during consultations on the U.S.’s country of origin labeling rules.

Canada has argued that supply chains operating under the proposed rules will have to segregate Canadian and U.S. animals and products. This would be costly and inefficient and discourage companies from using Canadian inputs.

A similar rationale led to the downfall of vCOOL’s mandatory predecessor, struck down in 2015 following a World Trade Organization challenge that ruled in favour of the complainants, Canada and Mexico.

The new proposed rule could also harm U.S. producers, the Canadian government said.

“For example, in recent years, there has been an increase in live cattle exports from the United States to Canada due to feedlot capacity expansion in Canada, higher processing volumes, and strong demand for beef,” the submission read.

“Under the new proposed rule, if an American rancher sends an animal to a Canadian feedlot, by virtue of availability, proximity, or economics, that is then sent back to the U.S. for slaughter and processing, that product would no longer be allowed to bear a ‘Product of USA’ claim.”

–With files from the Glacier FarmMedia network.

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“Record average producer prices… drought conditions, and tight feed supply continued to put downward pressure on the cattle sector, and producers responded by sending breeding stock to feedlots,” StatCan said.

On January 1, Canadian farmers held 11.1 million cattle and calves on farms, down 2.1 per cent from a year prior, StatCan said in livestock estimates released today. It’s the smallest cattle herd since January 1, 1989.

Cattle producers kept less breeding stock, with year-over-year decreases in all categories. Producers held 0.7 per cent fewer feeder heifers, 0.2 per cent fewer steers and three per cent fewer calves compared with January 1, 2023.

Disposition of cattle was up almost one per cent compared with July to December 2022, StatCan said. Imports of cattle declined nearly 26 per cent to 153,400 head, and international exports increased 14 per cent to just over 389,000 head.

Average warm carcass weights have increased 18 per cent since 1999, offsetting decline in beef production, StatCan added.

A new report from Rabobank agreed that, despite declining numbers, cattle weights are supporting Canadian beef production.

“As drought continues across major cattle-producing areas, heifer placements were constant throughout the second and third quarter [of 2023],” the multinational bank said in its February North American Agribusiness Review.

“Placement weights are averaging 11lb [5 kg] more than last year and fed cattle marketing’s are down 4%, resulting in carcass weights trending higher,” it said.

A new high of 990 pounds (449 kg) was set late this January, it added. This is 17 pounds (8 kg) higher than the last record, set in 2022.

The U.S. cattle herd also reached multi-decade lows at the beginning of the year. Earlier this month, the USDA reported the lowest total head since 1951 at 87.2 million–down two per cent from the previous year on drought and feeding costs.

The American herd, however, may be bottoming out, Rabobank said.

It suggested herd stabilization is possible as forage availability and drought conditions are projected to improve.

In October, nearly 48 per cent of American beef cattle were in areas of moderate or worse drought, the report said. However, winter precipitation has benefited the cow-calf sector.

The same weather has caused poor pen conditions for feedlot operators, bringing potential reduced performance and carcass weight in the first half of the year.

In December, the USDA’s weekly carcass weights reached a record high of 942 pounds (427 kg), Rabobank reported. The most recent data is 30 pounds (13.6 kg) lower, the most aggressive percentage decline on record.

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