The recent conference of the Canadian Sheep Federation (CSF) in Calgary brought to light a market situation that other commodities can only dream about – high producer prices, high demand and a declining supply.
Such an atmosphere certainly provided for an optimistic mood at the meeting, but there seemed to be some underlying angst to that optimism. Despite price records (even old cull ewes are getting $100; a few years ago they fetched $10) there seemed to be little appetite for sheep-industry expansion and eager new producers are few. This situation isn’t unique to Canada, sheep production is down in the U.S., Australia, Europe and even in New Zealand. So what gives?
Perhaps lamb production in Canada is suffering the same fate as other livestock commodities – a general sense of dejection after years of low prices, BSE, miserable markets and the loss of big chunks of equity. Add to that grumpiness about traceability, trade mischief and regulatory busybodiness and there isn’t a lot of producer confidence left in any sector of the livestock business, including sheep.
Speakers at the CSF event noted that high prices would indicate that demand for Canadian lamb remains strong even in the face of a domestic market that has a huge imported lamb presence. Interestingly,
it was pointed out that immigrants are more inclined to eat lamb and goat meat than beef. That will have positive long-term implications for Canadian lamb demand.
It was said that there is a price threshold when lamb imports would begin to increase significantly, especially with a high Canadian dollar. Be that as it may, it may not happen too soon, considering supply shortages in producing countries and their inclination to serve large markets with strong currencies in other parts of the world.
With such a long-term positive basis to lamb markets in Canada it causes one to ponder if there will be expansion in Alberta. Sheep production in Alberta has a checkered history. A hundred years ago it was a big-time industry. It has since withered from the glory days of
the big range flocks when wool fetched $1 a pound in 1917 – wool still fetches about $1 a pound today (do the inflation math; fortunes were made back then).
HIGH TECH VERSUS LOW TECH
About 35 years ago, the Alberta government took a big interest in expanding the sheep industry and spent millions of taxpayer dollars on support programs, a large extension effort, research and even owning a lamb-packing plant. The industry did expand, but not to the size that was expected for all the investment, and by 2000, government interest and support had all but disappeared.
Some of the blame rested with government specialists who favoured a high-tech, high-cost, intensive approach to sheep production, whereas what the industry really needed was a low-tech, low-cost, extensive and back-to-the-future approach. But that’s another story.
In Alberta the heart of sheep production was with Hutterite colonies. They had the sheep numbers, the labour and the capitalization to be the big players. In retrospect had their approach been favoured by government, the sheep industry might look very different today. As it was, many colonies over the years reduced numbers or exited the industry.
The result of this history is that interest in the sheep industry is subdued, but there is hope. There have been some farmer immigrants from the U.K., particularly in other provinces who have brought with them skills at managing large, low-tech flocks and have started up operations. Government experts would do well to take an interest in how they manage to operate.
The other hope is that after all these years, governments might consider researching and creating cost-of-production benchmarks for various-size sheep enterprises. Other commodities long ago established such benchmarks, but the sheep industry and its government experts never made any serious attempts to develop that much needed information. The problem back in the heyday of government extension was that benchmarks back then would have discredited their high-tech, high-cost approach. But I digress.
The other much needed boost to sheep production in Alberta would be to find ways and means to reduce production drudgery. Methods have to be identified so that a single producer can manage a 2,000- head flock without a lot of backbreaking work and expensive help. It’s done elsewhere in the world, it should be viable in this province.
Lastly there is that bane of sheep producers everywhere, dealing with predators. There is hope there also, but that’s a story for another day.
Will Verboven is editor of the Alberta Farmer Express
Itwaspointedoutthatimmigrantsare moreinclinedtoeatlambandgoatmeat thanbeef.Thatwillhavepositivelong-term implicationsforCanadianlambdemand.