Canada’s beef and pork sectors want mandatory price reporting.
Representatives from several organizations made a case for the practice similar to that in the United States during recent testimony at the House of Commons agriculture committee.
“The current information gap is preventing our industry from realizing its full long-term potential,” said Canadian Pork Council chair Rene Roy.
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He said the correlation between the Canadian price and the U.S. benchmark is a critical issue for the industry.
“Too often, the price paid to Canadian producers decouples — is not aligned — from the reference market without any clear way for producers to identify the structural causes,” he told the committee.
Roy said setting up price transparency in advance would protect Canadian producers in the event of a foreign animal disease challenge.
He also said this would allow Canadian producers to understand their own value chain.
“We are often told that Canada is globally competitive, but without verified data we are essentially navigating by guesswork,” he said.
Clear data makes the sector more attractive for investment and a new generation of farmers. He said a system similar to that of the U.S. Department of Agriculture, in place for about 25 years, would include retailers.
Roy’s Quebec counterpart, Louis-Phillippe Roy said the committee’s study offers hope of obtaining fairer business relationships between producers and processors, as well as better trade relations.
“It will also correct certain price distortions, which happen too often between producers and processors,” he said.
WHY IT MATTERS: The Canadian and American pork and beef sectors are highly integrated but sometimes the American reference prices don’t accurately reflect the Canadian market. Price information in the U.S. is aggregated and shared by the USDA.
Louis-Phillippe Roy said American prices dropped between 2015 and 2019 due to a production surplus, and Quebec producers saw those same decreases, even though production was lower than the province’s slaughter capacity.
Stephen Heckbert, CPC president and chief executive officer, said Canadians should have sovereignty over the Canadian price.
“The fact that this system already exists in the United States and that we are entirely dependent on it means that if there is an outbreak of African swine fever in the United States, it would be worse than if it happened in Canada,” he said.
U.S. processors were initially reluctant to provide data, but it has become an important industry tool that uses cutout prices, said Rene Roy.
The Canadian pork sector has never had price reporting, but there is some history in the beef industry. It began in 2003 after BSE and ended in 2020.
“We have tried a number of ways to bring it back,” said Brenna Grant, executive director of Canfax, a division of the Canadian Cattle Association.
“The greatest concern from the packers has been confidentiality, given the limited number of players in the market.”
Grant said she believes it could be done, noting that in the U.S., data is suppressed when a limited number of packers report. Or, she said, only certain cuts could be reported.
CCA executive vice-president Dennis Laycraft said he wasn’t sure if mandatory reporting would benefit beef producers because processing competition is much smaller than in pork.
Calvin Vaags operates True North Foods, a federally inspected plant in Manitoba that processes about 180 animals per week. He said price discovery begins in the U.S. market, and that’s not necessarily a bad thing.
“Having said that, when it does come and get converted to a Canadian price, there’s basis considerations with freight, regulation and many things there. Those things, perhaps, we could look at to get better transparency.”
Thomas Beretta from Alberta meat packer Beretta Farms said more transparent pricing would work, but data collection has to be done by an independent third party.
Vaags said the information supplied through the previous Canfax program arrived too late to be helpful. A new system would have to be more robust and timely.
Donald Boucher, director general at Agriculture Canada’s sector development and analysis branch, said the government supports industry-led efforts to improve price transparency.
