Is the spike in the price of beef hurting Alberta beef producers?

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Alberta’s NDP says the massive year-over-year increase in the price of beef at Canadian is not benefiting the province’s beef producers and the party is calling for an investigation.

Heather Sweet, the NDP critic for agriculture, forestry and rural economic development says the federal and provincial governments need to explore who is actually benefiting from the beef price spike.

“These price increases are pushing an important source of protein out of reach for families and they are harming Alberta’s beef producers as well,” said Sweet in a statement released Friday. “So who is benefiting from these high prices? Where is the money going?”

Provincial data shows the price of cuts of beef is currently 11 to 43 per cent higher than they were in the summer of 2021. Mainstreet Research’s Food Insecurity – June 2022 survey found slightly more than 20 per cent of Canadians are simply eating less food due to the high price of groceries.

Callum Sears, president of the Western Stock Growers Association, says the price of live cattle is not keeping up with the jump in the price of beef, and the trend began years back.

“We need to know why that is,” said Sears. “Consumers are paying high prices without knowing the breakdown of where their dollar is going. This is a disservice to both the consumer and the beef producer.”

Sweet is calling for the investigation into “an important part of Alberta’s economy” as the price disparity is part of “something (that) is not working properly and that’s harming families and producers.”

Beef producers in Saskatchewan called for a similar government investigation last week.

COSTS ‘INCREASED DRAMATICALLY’

John Smith with Plateau Cattle in Nanton says while the value of a calf is up compared to last year, so are a lot of costs.

“Our inputs have increased dramatically. I would say that gain in there has been used up in fertilizer and diesel, increase in living as we all experience,” he said. “At the end of the day the chain gets smaller and smaller on the way down and when you’re on the bottom like us really you take your calves to town and do your best to market them.”

Many costs tied to the rising costs of beef can be accounted for including inflation, and increased costs for labour, transportation and energy but experts said there are some grey areas in the industry not just in Alberta but across Canada.

“All of these elements have gone up, so to operate a plant it cost more money,” said Sylvain Charlebois, a professor of food distribution out of Dalhousie University. “But is there an element of greed-flation in packing? It’s a possibility but we don’t know for sure until we get into the numbers and we can’t get into the numbers until we launch an investigation.”

PRICE TRANSPARENCY

Industry leaders are exploring the issue of price transparency in the market.

The provincial government is helping fund an Alberta beef competitiveness study lead by the Alberta Cattle Feeders’ Association, the Canadian Cattle Association and the Alberta Beef Producers.

“Research in this area will hep industry and government understand the best approach to diversify, and build capacity and resiliency for Alberta’s meat processing sector. It will also address concerns around price discovery and transparency,” said the Alberta Beef Producers.

Results of the study are expected later this year, which can’t come soon enough to some ranchers and producers with the cost of beef forecasted to spike again in the fall.

“Hopefully some trickle down starts to happen to keep the producers in it because with the current economics, no intelligent business man would do what we’re doing,” said Smith.

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