As Cost of Hay Rises, Canadian Beef Farmers Suffer

The drought that has singed Canada’s crops is also taking a bite out of its cattle sector.

For the world’s sixth-largest beef exporter, dry conditions are worsening in the heart of cattle country, scorching pastures and sending feed costs soaring. The price of hay in some areas has already doubled, and some ranchers could be forced to sell animals to feedlots early in the coming weeks if the drought persists.

“We could squeak by at best, if it started raining,” said Charlie Christie, chair of Alberta Beef Producers, who is considering pulling his cows off his farm a month earlier than usual because of poor pasture conditions. “Worst-case scenario is it dries up, and province-wide we just don’t have enough feed. You’re going to see a liquidation of the cow herd.”

Swaths of Alberta, the nation’s biggest beef producer, got less than 60 percent of normal rainfall since April 1, according to government data. The deteriorating grazing conditions sent the price of hay used as feed to as high as $153 (U.S. currency) a metric ton, twice as much as a year earlier, according to Alberta Beef Producers.

“There are guys looking for feed all over the place,” said Rick Toney, chairman of the Saskatchewan Cattlemen’s Association. “Guys are planning on selling because they can’t afford to feed their cows this winter.”

Dryness has also struck the southern plains in the U.S., forcing some ranchers this year to sell cattle to feedlots earlier than normal. American beef production is projected to swell 3.5 percent this year to a near record 27.2 billion pounds, with the growth rate slowing to 2.3 percent in 2019, the USDA estimates.   Source: Bloomberg