Up until the Comprehensive Economic and Trade Agreement (CETA) was signed with Canada, little thought was given to them as a major beef producer. However, inclusion of a 45,000 tonne tariff free quota in the free trade agreement signed by the EU, has brought Canada very much into the mind of Irish beef producers, with a strong view that the EU couldn’t accommodate any more beef. So what is the Canadian beef industry like and how much of a threat is it to Ireland?

Canadian landscape

At the 2011 census, Canada had 68,400 farms that kept cattle and as is the case everywhere, these vary greatly in size. The average cow herd is 63 but almost two-thirds of farms have less than 47 cows with a quarter of farms having between 47 and 122 cows. Over half of Canada’s cows are kept on just 13% of farms with these all having over 122 cows.

Cattle population

The Canadian cattle population is just less than 12m of which 3.8m are beef breeding cows. In 2015, the kill was 2.5m, about 800,000 more than the Republic of Ireland and six times more than Northern Ireland. That makes Canada the eleventh largest beef producing nation in the world. Beef contributes $15bn (€10.7) annually on average to the Canadian economy since 2011.

Only a small portion of the carcase likely to be targeted to an EU market

Imports and exports

Like its bigger neighbour, the US, Canada is both a major exporter and major importer of beef. In 2015, they exported 322,000t of beef but in the same year imported 204,000t. Their major trading partner is the US who took 71% of Canada’s beef exports followed by China on 10%, Mexico on 6% and Japan on 4.5%.

On imports, the US is also the major trading partner accounting for almost 60% of all Canadian imports followed by Australia who supplied 20% and New Zealand on 13% and Uruguay on 7%. Canada exports mainly manufacturing beef to the US, while importing higher value hindquarter and steak meat which the US has a huge surplus of, such is its demand for manufacturing beef for burgers.

Ireland and Canada

Ireland sold 450t of beef to Canada in 2015, and expects to grow this business in 2017 once the free trade agreement takes effect which is expected to happen on 1 April. Canada will likely see Europe as an alternative market to the US for its higher value cuts but volumes aren’t expected to be high as Canada has accepted the EU requirement for beef shipped to the EU being hormone free.

With only a small portion of the carcase likely to be targeted to an EU market, it is likely that most Canadian farmers would choose to continue to use the approved growth promoting hormones and forsake access to the EU market. With the US reopening its battle with the EU on lack of access for hormone beef again, this agreement with Canada for only hormone free beef is one attractive feature.

A further interesting feature of the Canadian beef industry is the prices that farmers receive. Currently top quality steers and heifers are trading at the equivalent of €3.95/kg to €4.00/kg, comparable with the US and Australia and 25c/kg ahead of Ireland.

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