Price relief for Island beef farmers

Island cattle producers cashing in on big increase in cattle prices

Colin MacLean
Published on June 24, 2014

SUMMERSIDE – It’s been a bad decade to be a Canadian beef farmer.

Cost of doing business, especially fuel and feed, has skyrocketed while the bovine spongiform enceph alopathy (mad cow) scare of 2003 sent prices through the floor.

But through all the years of doing business below cost of production the Dixon family held on. Many of their colleagues in the P.E.I. beef industry can’t say the same.

But finally, thanks to various factors here and in the U.S., things are starting to look up for the Island beef industry.

“Farming is always a struggle, no matter what, but by diversifying our farm and the (increased) price of beef we are coming around,” said Tim Dixon.

His North Tryon farm was one of several stops on a media tour organized by the P.E.I. Federation of Agriculture Monday.

Tim, along with his dad Eric, showed reporters around part of their operation, and discussed some of the challenges and triumphs they’ve faced over the last number of years.

The price they receive for their product has by far been their highest concern, they said.

According to P.E.I. Cattle Producers, local cattlemen were receiving an average of $1,600 for a fully-grown animal before the mad cow crash. In the months and years immediately after the crash, some farmers were getting $500 a cow.

The Dixons managed to survive the lean years by cutting back on expenses, branching off into some limited vegetable production and being extra careful with their herd management and genetics.

But many farmers across Canada couldn’t weather those kind of prices and P.E.I. was no exception. An estimated 300 farms on the Island got out of the beef cattle business.

That reduction in the overall herd is being credit as part of the reason prices have have been rising again – significantly.

Dixon now estimates that he receives an average of $2,000 for a fully-grown cow.

A decrease in the overall North American herd, compounded by a drought in cattle producing U.S. states, is being credit with the rising price of Canadian beef.

When the increases in cost of production are factored in farmers are roughly back up to where they were pre-mad cow.

Brian Morrison, chairman of the P.E.I. Cattle Producers, said the current upswing in prices are expected to stick around for at least the next couple of years.

Those prices are God sent for farmers who were facing ever increasing debt load, said Morrison.

Even for farmers who were able to keep a manageable debt load, most of have had to hold off on replacing or upgrading equipment, he added, so they’re hoping to start catching up in that regard as well.

Other positive factors that Dixon and Morrison mentioned included the continued operation of the Atlantic Beef Products plant in Albany and initiatives to market an Island beef.

Big picture, things are definitely looking up for Island beef producers, said Morrison.

“For the people that were able to hold on there’s a light at the end of the tunnel, and hopefully over the net three or four years they’ll be able to recoup their losses,” he said.