Feds present close to $1 billion in mad cow bailout

PICTURE BUTTE, Alta. (March 22, 2004) — Prime Minister Paul Martin announced a long-awaited aid package for the Canadian beef industry today — about 70 per cent of which goes directly to beef producers and ranchers who have been hammered since the U.S. closed its border in the aftermath of Canada’s first ever mad cow discovery in Alberta last May.

About $680 million of the $995 million cash bailout will be earmarked for beef producers and cattle farmers hurt by the prolonged closure of the border to beef exports and live cattle. Another $250 million will provide what Agriculture Minister Bob Speller described as “bridge’ financing to the industry through the fall. It seems that cattle haulers and other beef-related spin-off businesses are not included in the package.

Funding will be delivered as a direct payment of up to 80 dollars per eligible bovine animal on inventory as of Dec. 31, 2003. Eligible animals include all bovine animals except bulls and mature cows. The announcement comes one day before Martin tables his government’s first federal budget.

While beef producers welcomed the news, many insisted the bailout is a Band-Aid solution, and that ultimately the Canadian beef industry — which has reportedly lost close to $3 billion in exports alone — will be healed only when the U.S. border reopens to Canadian beef.

Last August the U.S. Department of Agriculture eased the ban to allow selected cuts of boneless beef. By many accounts, officials were strongly considering following up that plan by allowing live cattle under 30 months across the border by March 2004. But those discussions were iced in early January when the origins of a second mad cow found in Washington State were traced back to Canada. Instead of lifting the ban, U.S. officials extended it indefinitely. Industry and government officials on both sides of the border have since speculated the ban will be in place for many more months, if not years.

While some of the federal money will help keep beef producers afloat, many doubt beef and related industries can sustain a closed U.S. border for much longer. In an exposition on mad cow’s effect on Alberta carriers conducted by Today’s Trucking last fall, several beef and cattle haulers and industry officials indicated the Canadian cattle industry must undergo a complete overhaul if it is going to survive the crisis.

“We’re eating far less beef than we were 25 years ago,” Keith Horsburgh told Today’s Trucking at the time. “The reality is going to be depopulation of our national cow herd. Unless we depopulate, we’re going to be in the same situation next year and beyond.”

Meanwhile, Alberta Premier Ralph Klein — who scoffed that the mad cow bailout was the Liberal’s attempt to restore credibility in Western Canada before national elections — will join Alberta Agriculture Minister Shirley McClellan today in trying to convince American officials that Alberta beef is free of mad cow.

— with files from Canadian Press