Moisture deficits have rocked the agriculture industry in Alberta as pockets of the province are entering into their third year of drought.
The impact of the drought is being felt by those in the cattle production industry as they gear up for another year of winter feeding.
“It's really starting to impact a lot of the ranches that we buy from and even ourselves.
"We usually carry almost a year's worth of silage. We carry that over every year just in case. We lost that last year. Essentially, we have no backup,” said Keith Gregory, vice chair of the Alberta Cattle Feeders Association (ACFA) and operation manager at Cattleland Feedyards.
Data from the Canadian Drought Monitor current for September stated there were, “significant concerns for adequate soil moisture going into the winter season, especially with an already-parched landscape after consecutive years or drought and impacts to feed production and pasture conditions.”
“Significantly dry conditions over the summer led to extremely low crop yields and water restrictions in many jurisdictions,” the report read.
Exceptional drought (D4) conditions fanned across southern Alberta, while extreme drought (D3) conditions extended from Banff towards the Saskatchewan border, and the D3 conditions from the Northwest Territories have expanded down into and across northern Alberta.
The severe drought (D2) conditions across the northern part of the province have also seen a small expansion.
Central Alberta has, however, remained, “drought-free due to adequate soil moisture from previous months of significant precipitation,” the report stated.
Gregory, who hails from Strathmore about an hour east of Calgary, said this year has been slightly better than the previous, and he has been fortunate, despite not having a year’s worth of back up silage as he has extra land.
In the previous five years before the drought, Gregory said his irrigated silage land would average 12 metric tons per acre.
“In the last three years, I think we're probably averaging around five,” he said.
“We have silage land and cash crop land. We had to pull acres out of cash crop, just to get enough silage. Probably 20 per cent more acres are required to get the same amount of silage put up.
“But a lot of people don't have that option. Which is why the price of feed, mainly hay, is so high right now,” he said.
Among members of the ACFA, Gregory said he heard about feed supply issues over the last three years because of the drought.
Alberta Agriculture and Irrigation’s (AAI) Statistics and Data Development Section estimated the price of good quality hay to be $262.50 for August 2023 while the year prior, hay was priced at $212.87.
In 2022, feedlots were relying on U.S. corn exports, but Gregory said he doesn’t think that will happen this year, even though there was concern a few months ago and, "quite a bit of corn coming up from the U.S.”
But, he continued, the lack of barley exports and better growing conditions means there seems to be enough barley out there right now.
“I'm just guessing, but just judging by how the price has come down over the last few weeks I think there will be enough barley out there for us,” he said.
In a recent publication, data from Farm Credit Canada shows the 2023 forecast for Alberta feed barley is $380 per tonne compared to the five-year average of $310 per tonne.
Gregory said his members have had to get creative with the feed they have been using.
“The average feedlot diet would be silage, whether that's corn or cereal silage and then either barley or corn. Now, it seems like almost every feedlot has some sort of by-product additive in the ration and that is either to lower cost or maintain the inventory feed they have,” he said.
Gregory said the use of by-products has been a positive in the industry as it helps both feedlots and other industries. Instead of those by-products going to a landfill, they are being put to good use.
The drought over the course of the last three years may also change the way by-products are used.
“The feeding of these by-products has happened in the past. It just always seemed to be a little more regional. Like if your feedlot was close enough to a crushing plant or something like that.
And now that seems to have expanded industry-wide now. So that will change a little bit for sure,” he said.
Although cattle herd size is not the focus of his association, Gregory said members do have concerns about maintaining herd size in Alberta. A recent announcement about funding for cattle producers by the provincial and federal government to provide $165 million to support livestock producers affected by drought and extreme growing conditions is good news.
“We've seen the herd size reduce quite substantially in the last two years. There are other factors in play, but the drought is probably the biggest factor.
“We're hoping with the higher price for calves that at least we will maintain the same size of herd,” he said. The Alberta Economic Dashboard stated cattle prices in Alberta increased 29.7 per cent in August 2023, “compared to the same time period a year earlier, to $219.70 per hundredweight.”
“Even though the price (producers) can sell their calves for is quite a bit higher — roughly $1,000 a calf higher — a few producers I've talked to essentially say that they've had to spend that much more just to buy enough feed to maintain that,” said Gregory.
Gregory hopes high cattle prices will maintain the herd size in Alberta, but he does have some concerns.
“I think the average age of the rancher is like 55 or so. Some people around here are kind of using this year, the high prices this year, a good time to get out (cattle production). But I hope that it’s just a few and not an overall trend for the industry,” he said.
Overall, said Gregory, it’s been a tough couple of years.
“It's funny, I always tell everyone this year was twice as good as it was last year, but still only half as good as the average.”
