Canadian beef producers have experienced many challenges the past few years. They have tackled drought, COVID-19 related bottlenecks, inflation, supply chain breakdowns and global instability. In addition, the federal government continues to impose policies that increase costs for producers and cut into their bottom line. The carbon tax drives up costs at every stage in the supply chain. In an industry with tight margins, these costs have significant impacts. Health Canada introduced a scientifically baseless front-of-package labelling strategy, which proposed to label ground meat with a high in saturated fat warning label. Although it was later walked back in response to significant opposition led by our provincial government—in partnership with industry and the public—the impact of this proposal would have decreased demand for beef products.
These unforeseen challenges and out of touch federal policies make it difficult for policymakers, like myself, to improve the competitiveness of our beef industry. Harmonizing specified risk material (SRM) regulations with the United States (US) is one way we can make a tangible impact on the ground.
Canadian SRM requirements were established in 2003 and modified in 2007, following a case of bovine spongiform encephalopathy (BSE). The requirements aimed to protect animal and public health by preventing the spread of BSE. In May 2021, Canada achieved negligible risk status for BSE, the lowest risk level of transmission. However, there have been no changes to Canadian SRM requirements, and Canadian BSE-related costs have totalled $500 million since 2003.
I have advocated to the federal government for the need to reform SRM protocols for quite some time. I have sent letters and raised the issue as a priority topic at federal-provincial-territorial meeting tables. When the Beef Competitiveness Study, prepared by industry, identified SRM regulations as a top five processing barrier, it validated our direction to pursue SRM regulation reform. It also encouraged us to push even harder to bring meaningful change for the sector. I aim to raise awareness of the disproportionate SRM requirements that cost our beef industry millions.
The US achieved negligible risk status in 2013. Although Canada and the US share the same risk assessment, there are substantial differences in SRM protocols between the two countries. Canada’s more onerous removal and disposal regulations create a competitiveness disadvantage for the beef industry, as the cost of maintaining these protocols is significant.
For example, Canadian processors remove 58 kilograms of SRM on over thirty-month (OTM) of age animals, whereas the US removes approximately 900 grams. This equates to the removal of 18% more OTM SRM. The associated cost of SRM removal to Canadian industry is $31 million per year or $30 per head.
SRM disposal protocols impose an additional $167 per metric tonne burden on average in Canada. There is also a significant differential in SRM removal costs per head in the US and Canada. SRM removal for 500,000 head of cattle in Canada totals an estimated $6.5 million. In the US, SRM disposal costs for the same number of cattle equates to $514 thousand. That’s an approximate $6 million burden to Canadian industry that is not experienced in the US.
The cumulative costs of Canadian SRM protocols creates a significant competitiveness disadvantage. The cost is borne throughout the supply chain, affecting meat packers, ranchers and rural communities. As we look to improve the competitiveness of the industry, it is an obvious area for reform.
The Canadian Food Inspection Agency (CFIA) and Beef Cattle Research Council have funded a risk assessment to consider changes to SRM regulations. I respectfully urge the CFIA to harmonize Canadian SRM regulations with the US to support the competitiveness and resiliency of our beef sector. Our entire industry has expected this change; it’s time we do something about it.
Alberta Minister of Agriculture, Forestry and Rural Development