Ontario's sheep industry debates need for growth

Monday, May 17, 2010

by PATRICIA GROTENHUIS

The executive director of the Canadian Sheep Federation is warning producers that growth is essential to maintain the health of the domestic industry.

“A shrinking flock is as dangerous as oversupply,” says Jennifer MacTavish.

With its current high prices for products and an opportunity to grow its share of the domestic market, the timing has never been better for Canada’s sheep industry to expand. The Canadian industry only fills 41 per cent of domestic lamb demand.

At a time when strong demand for lamb is boosting market prices, the industry’s main competitors in the domestic market, Australia and New Zealand producers, are shrinking their sheep flocks.

New Zealand’s sheep flock has dropped to 32 million in 2009 from 70 million in 1982; Australia’s has dropped to 70 million in 2009 from 180 million in the 1970s. MacTavish says Canada could eventually loose imports because of the decreasing flock sizes since we are such a small importer worldwide.

Producers and industry experts acknowledge there are challenges to expansion.

“Producers here struggle with diseases controlled in other countries by routine vaccination.  Even the few pharmaceuticals available are often only available in small size containers,” says Delma Kennedy, sheep specialist with the Ontario Ministry of Agriculture, Food and Rural Affairs.

Where the breeding stock for an increased flock would come from is a main concern for Marg Cunningham, a sheep producer from Belgrave. Cunningham stresses the need for disease-free breeding stock.

“I think the biggest crackdown has to be who is selling breeding stock,” says Cunningham, whose flock had disease problems when she purchased it, in the end making her start over with a clean flock.

Fraser Hodgson, OSMA director and sheep producer from Forest, says there are also external factors limiting industry growth. Problems with predators made some producers leave the industry while others downsized, he says.

Costs of dealing with this problem make producers wary of expanding, he adds.

Kennedy says the domestic industry has been growing slowly overall since 1986. In January 2010, the national breeding flock numbered 184,500 sheep, up nearly 38 per cent from its 1986 size of 134,000 sheep.

Ruth Gilmour, Communications Co-ordinator at OSMA, says the current infrastructure, such as slaughter capacity, could handle a slightly greater number of sheep.  With sheep, sustainable industry growth would be approximately five per cent each year if producers continue culling responsibly to maintain high quality flocks and decrease disease risk.

MacTavish says some producers are concerned that if the industry expands, it will encounter the same chronic low pricing troubles that the country’s pork and beef industries have faced in recent years.

Kennedy says the industries do not compare. The country’s beef and hog farmers are focused on producing exports, she points out; its sheep farmers respond to domestic demand.

Hodgson notes current prices are not sustainable whether the flock size grows or not.  If current spaces at abattoirs are not filled, some may be forced out of business, which would be much worse than the effects of extra lamb on the market, he says.BF