GrainsWest Fall 2020

Fall 2020 grainswest.com 21 anadian agriculture has faced COVID-19 issues within every industry subset. Challenges in southern Alberta’s Feedlot Alley, the province’s central hub for feeder cattle, have piled up since early 2019 and the global pandemic was just the latest hit in a whirlwind stretch. In late 2018, the cattle feeding sector was strong and full of optimism with $1.50 per pound pricing. Many saw opportunities as the New Year inched closer, in part because China had been hard hit by African swine fever. By January, prices inched up to $1.60 per pound, a welcome number to feeders who typically need $1.50 to $1.55 pricing to break even. Shortly before China’s border closed to Canadian beef imports that June, the price sat at around $1.45 and punditry was divided on whether Canada’s interception of Huawei CFO Meng Hanzhou played a part. The price stayed static for weeks after, as well. One event that undoubtedly made Alberta cattle feeders feel the squeeze was the plant fire at Tyson Foods in Holcomb, Kansas, on Aug. 9, 2019. The plant, which processed 5,500 to 6,000 head daily, immediately rocked the marketplace. Local prices dropped to $1.36, according to Canfax, a division of Canadian Cattlemen’s Association that compiles information on the cattle and beef sectors. “[Tyson Foods] counted for six to eight per cent of the kill capacity and even that level of reduction caused quite a disruption in the market,” said Kee Jim, owner of G.K. Farms in Okotoks. “In Canada, the U.S. and Mexico, there’s barely enough capacity week-to-week to slaughter the cattle. When you get any type of reduction in kill capacity, you get a reduction in price.” Not long after, southern Alberta was walloped by a late September snowstorm and many feedlot owners laboured along. “From that point going forward, we struggled with snow and cold and wet from September all the way through into February,” said Ryan Kasko, vice-president of the Alberta Cattle Feeders’ Association (ACFA) and owner of the Kasko Cattle Company near Coaldale. “Production costs were higher than expected because cattle weren’t performing the way they normally do. I think this has been the toughest year- and-a-half. It’s more challenging than BSE.” As Alberta made do, Tyson Foods worked feverishly to rebuild, and it did so by December. The highest price all year was reached at $1.62 just prior to 2020. As the clock rolled over into the New Year, feedlots began to see small profits for the first time in months and another two cents was added to the per pound price. However, it did not take long until the bullish mood was castrated as COVID-19 fears gripped the nation. “We severely underestimated what the impact was going to be,” said Jim, who also owns and operates Feedlot Health C