New report says Canada’s beef exports have potential to expand profits

Posted on August 15, 2024 by Ryan Dahlman

By Brendan Miller
Southern Alberta Newspapers

A new report published Wednesday by the University of Calgary says there is still “considerable potential” to maximize beef exports in the province by expanding international trade.

The paper, titled “Enhancing Canada’s Beef Exports and Competitiveness in the Global Market,” says Alberta reports the highest revenues in Canada in beef cattle ranching and farming, and Canada could benefit from pursuing trade strategies in foreign markets by promoting its beef and raising production efficiency.

The paper authored by Dr.Pascal Ghazalian, associate professor and chair of the department of economics at the University of Lethbridge, states Canada’s beef exports have been generally increasing.

However, Ghazalian points to roadblocks preventing maximum profits, such as prolonged bans and restriction on the importation of Canadian beef – the European Union banned beef or carcass washed with peroxyacetic acid, and China banned on Canadian beef after BSE was detected in 2021.

Also, recent legislative attempts to bring back the mandatory country-of-origin labelling standard for beef products in the U.S., Canada’s largest trade partner in live cattle exports, threatens to “adversely affect” Canada’s exports to the south.

The report also cites the impact of higher inflation rates following the pandemic, as well as ongoing conflicts in the Middle East and Europe which have created global and regional political instability, affecting proper exporting and marketing access strategies.

Comparatively, in his paper, Ghazalian refers to preferential trade agreements between Canada and its free trade partners, which have often led to decreased trade costs by reducing barriers and enhancing business networks among member countries.

“The NAFTA positively affected trade flow of agricultural products between Canada and its NAFTA trading partners, the U.S and Mexico,” Ghazalian writes in the paper while referring to research he published in 2017. “Also, non-policy trade costs have been decreasing, driven by upgrades in transportation logistics and improvements in information and communication technology.”

Aside from the U.S., Canada is also a major beef exporter to Japan, Mexico, South Korea, Vietnam and the Philippines.

Ghazalain’s report provides general strategies aimed at enhancing the competitive advantage Canadian beef has in these international markets by promoting research and development and innovation to reduce production costs, plus expanding resources and accessibility to get more beef to market.

“Promotion of Canadian beef and sustained supply and business networks are significant pillars in raising Canada’s competitiveness in international markets.”

The 31-page report also highlights the Trans-Pacific Partnership, a trade agreement that includes partners like Japan, Australia, New Zealand, Malaysia and Singapore.

“The agreement comprises preferential access for Canada beef to large markets and it sets rules of origin for products to be eligible for this access.”

However, since the U.K. entered the trade agreement in 2023, tensions have been “stemming” with Canada, as the U.K does not fully accept the safety of Canada’s meat production and inspection system.

According to 2022 statistics, Canada stands behind the Netherlands as the eighth highest total beef exporter globally in volume of beef exported with more than 780,000 heads of cattle ($5.2 billion) and sixth in value of beef exports. Canada ranks fourth in the aggregate value of its live cattle and beef exports. Brazil leads global beef exports in all three categories.

The full report can be found online by visiting policyschool.ab/publications.