Meat processing backlog puts strain on Alberta cattle ranchers

A backlog of cattle waiting to be processed at meatpacking plants has put Alberta cattle ranchers in a tough position.

Too many cows mean more mouths to feed, and meat that is aging past its prime.

"We've got a backlog of cattle right around 120,000 to 130,000 head here," Kelly Smith-Fraser, chair of the Alberta Beef Producers, told the Calgary Eyeopener. 

"Those animals aren't being moved through the system. They aren't being processed. They're still in the pens that they've been living in for a while, and we really need to see them moving out and having the plants operating at full capacity."

Smith-Fraser said the backlog needs to be cleared before fall.

"By then, we're going to be needing that pen space again," she said.

"The calves that are running around on the pastures right now with their mommas, those calves are going to be weaned and they're going to need a home to go to. So we need to be able to be rotating these pens through so that we have the space."

Smith-Fraser, who raises cattle near Red Deer, said most people outside the industry don't understand the importance of timing.

"It's really important, we definitely have planned for those animals to get to market at their optimum weight," she said. "And typically with their optimum weight also comes the grading, so your Triple A steaks. But the longer those animals have to be carried over and held over on feed, they're gaining more weight, and the carcass quality will diminish."

The reduced quality also means a reduced price for the beef.

"Just as we all see at the supermarket a difference between the price of Triple-A beef and Double-A beef, our ranchers … also get that diminished price as well," she said.

There is a backlog at meatpacking plants following the temporary shutdowns and reduction in operations due to COVID outbreaks.

The Cargill plant in High River has been operating at reduced capacity after being shut down completely for two weeks, while the JBS Canada plant in Brooks was under reduced capacity for a month. 

COVID outbreaks

Both plants were hit by COVID outbreaks among workers and are only now returning to full operation. Together, the two plants normally process about 70 per cent of Canada's beef.

"Our High River facility is currently operating at 95 per cent capacity and we expect to be back to our typical volumes next week," Cargill spokesperson Daniel Sullivan said in an email last week.

The plant processes up to 4,500 cattle per day.

The Brooks plant is now back to pre-COVID numbers of about 4,200 animals per day.

"We are carefully monitoring our risk mitigation measures on a daily basis," said Cameron Bruett, the head of corporate affairs for JBS USA.

Smith-Fraser said no one can predict how long it will take to work through the backlog, and that some animals are being moved down south for processing.

"Our best guess is that we will see the backlog into fall. I've heard as long as most of 2020," she said. "But the key thing is to make sure that our major plants are able to maintain the capacity that they're at, and they're at either normal or near normal."

The extra cows have to be both housed and fed.

"That is an additional cost that our feedlot producers and ranchers hadn't anticipated last year, when you start putting up your feed piles," Smith-Fraser said. "So that definitely has been hard on our feed inventory, especially carrying them through to the summer because by then our inventories are a little bit lighter." 

 Smith-Fraser said she is confident that Cargill and JBS Canada are ready to ramp up production safely.

"I recognize that all of our major processors here in Alberta, they did a great job in and working for worker safety, and that always the No. 1 goal is to make sure those workers are confident in going into their workplace, that they know that they'll be healthy and safe."

In May, Premier Jason Kenney announced a financial aid program that would see Alberta and the federal government share the cost of a $42-million boost to help farmers and ranchers deal with the backlog.

"The livestock industry both here in Alberta and across Canada has been affected by the impaired operations of many meatpacking and food-processing plants," Kenney said. "Critical action must be taken."

Under the program, Alberta will contribute $17 million and the federal government will make up the difference, with the goal of subsidizing producers.

As far as consumers go, there may be a silver lining — lower prices at the checkout, after a recent spike due to the reduced supply.

"Albertans love their Alberta beef and I'm pretty sure on [Canada Day] we'll be seeing a lot of burgers and steaks on the barbecues," Smith-Fraser said.

"That's something that we as the Alberta Beef Producers are incredibly proud of, is how confident our fellow Albertans are in our product and how proud they are of it."

With files from The Canadian Press and the Calgary Eyeopener.