Economic Sustainability

Economic sustainability is dependent upon the health of all sectors along the supply chain – between producers at the cow/calf level, the feedlots and the processors. The people who operate Canada’s 68,500 beef farms and feedlots understand that sustainable management is essential for good beef and good business. The decisions made by producers in this regard include management decisions that protect the land resource and work with it in a beneficial way to sustain cattle production for the long-term.

External factors such as fluctuating exchange rates, input costs and labour costs must be factored into the cost of production. As input costs rise the ability to compete internationally on the cost side becomes increasingly important. While the cost structure at the cow/calf level determines if the industry expands or contracts, feedlot costs determine where cattle will be finished and costs at the packer level determine where cattle will be processed with value added to the carcass.  The long-term sustainability of the Canadian beef industry is contingent upon the health of all sectors along the supply chain and ensuring the vast majority of cattle are processed in Canada.

Ecosystem services (ES) are another area which may contribute to the economic sustainability of the cattle industry. ES are the benefits that society derives directly or indirectly from healthy functioning ecosystems, including air, water, soil and biodiversity. The minimum value of payments in Canadian environmental markets is estimated at between C$462 million and C$752 million annually however currently payment to beef producers is virtually non-existent and minimal for other agricultural industries. The CCA is working with other Canadian agriculture organizations to establish their policies and principles on ecosystem services, and exploring ways to see some of the benefits returned to producers.

Canada’s beef industry contributes $33 billion worth of sales of goods and services either directly or indirectly to the economy. Every job in the sector yields another 3.56 jobs elsewhere in the economy. For every $1 of income received by workers and farm owners, another $2.08 is created elsewhere. Either directly or indirectly through induced income effects, the beef sector generates 228,811 jobs.

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