Sunday November 23, 2014




Competitiveness difficult to maintain

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The most recent edition of ‘Agriview’ a publication of the Saskatchewan government, there is a headline which caught my eye; ‘Competitiveness: one of the three pillars of the livestock strategy’.

The idea of competitiveness is an interesting one in terms of agriculture.

Producers have long understood they need to be competitive not with their neighbours down the grid road, but farmers around the world.

The agriculture sector is one where a buyer of wheat will as happily buy from Australia or Ukraine, or a dozen other sources, as from Canada, given the ability to meet their requirements at the proper price point.

In terms of competitive advantage things can change internationally almost overnight, and certainly producers here have seen just how dramatic in different sectors in recent years.

The first which comes to mind is the fateful day in 1993 when Bovine Spongiform Encephalopathy (BSE) was found in a single Alberta cow.

Within a matter of hours Canada’s ‘competitiveness’ was lost.

Major importing countries immediately slammed their borders closed to Canadian imports, and this country was left with a glut of beef to consume nationally.

To deal with the situation the Canadian system responded. Restaurant chains began to use the fact they were using only Canadian beef as a sales tool.

We saw movement to more feedlots and processing to deal with the situation.

In the Yorkton area there was a new feedlot at Rhein which fought through the situation, along the way being the Yorkton Chamber of Commerce Business of the Year.

The BSE scare is a memory now.

And while countries now take Canadian beef again, domestically little processing plants have closed as they lacked the scale to compete with mega processors in the United States.

The cattle finishing sector has been impacted too, the aforementioned Business of the Year facility at Rhein among those to close.

The feedlots were impacted by various factors including rising grain prices and labour costs.

And that brings us to the hog sector.

It was only a few years ago mass expansion of the hog industry was touted as a way to revitalize rural economies.

On the Canadian Prairies we had the ability to grow low cost feed, a place to spread manure, and a workforce in need of work.

Then grain prices spiked higher, and have stayed higher than a decade ago.

The economy boomed and the ability to attract staff at a low enough cost evaporated.

Many large barns went into bankruptcy.

The competitiveness which had rural communities look at investing in hog barns was lost in mere months.

What does this mean for farmers?

Essentially competitiveness is fleeting, gained and lost based on commodity price shifts, disease scares, weather patterns and government policies.

As a result the agriculture sector needs flexibility to adjust its operations to function on a playing field of competitiveness which is ever shifting.

Calvin Daniels is Assistant Editor with Yorkton This Week.


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