Betty Jo Gigot, Editor and Publisher

For a feedyard groupie like me “feedlot alley” in southern Alberta is about as exciting as it gets. As far as the eye can see, mill legs, grain storage bins and silage piles grace the flat, green landscape. Silage trucks roll in from every direction, hauling the harvest for the coming winter. The cattle are not so obvious, residing behind the eight-foot fences that surround every pen – protection from the wind that whistles across the plains.

Observations on the North Country
As with feeders anywhere, Canadian cattle feeder goals are the same – get cattle and feed together as economically as possible and sell those cattle at the best price available. The struggles with BSE outbreaks seem to be behind them for the moment, but the challenges to come may be even greater.

Alberta is in the midst of an oil boom that has far-reaching effects on every aspect of life in the province. For those who lived through the oil boom in Oklahoma, the signs are everywhere. Sudden millionaires are scouring the country, looking for land to turn into weekend retreats or places to build huge commuter homes. Newspapers tell of apartment dwellers who have mushrooms growing in their carpets and landlords who don’t intend to make any improvements because they can rent, as is, for more money tomorrow. It’s estimated that 98 people a day move to Calgary and that thousands will be needed to supply the labor to pump the oil out of the ground.

Along with the pressure for land and the skyrocketing land values, finding people to wait tables, clean motel rooms and provide very basic services has become almost impossible. “Help Wanted” signs decorate the windows in almost every establishment.

In an atmosphere where it is said almost any skill will bring six figures, imagine trying to keep labor at the feedlots. Pen riders are being paid $20 per hour and are scarce at that.

Staying Competitive
Canadian cattle feeders are cognizant of their need to be able to compete with their southern brethren. They keep very close tabs on U.S. prices and markets and new industry developments.

Just as the U.S. cattle industry, in the aftermath of the cow that stole Christmas in 2003, reacted to the varied dreams and schemes of massive processing plants north of the border, the Canadians are extremely concerned about the development of the ethanol industry in the U.S. The Alberta Cattle Feeders Association has commissioned a study to determine the effect mountains of distillers grains and dry distillers grains might have on costs of gain in the U.S. Vendors are prowling the area, looking to sign long-range contracts for byproducts in Canada, probably to be used in prospectuses in the U.S.

Feeders hear about the government subsidies offered to U.S. companies to develop more ethanol capacity and they are worried. They know that is not going to be a possibility in Canada, and rightfully so. They already have about as much energy as they need and, with very little corn, would have to use feed grains for fuel for ethanol plants. In my opinion, many of the hundreds of ethanol plants that have been announced will go the way of the processing plants that were planned but not built in Canada after BSE. Capacity was added at the two major plants there and another small, state-of-the-art plant was built, but with reduced numbers, and even that capacity is not being used.

The sudden infusion of wealth has caused another phenomenon. The Canadian provinces have always had problems getting along with each other, whether Quebec is trying to pull away from the others, or, in this case, the Albertans are feeling that they are supporting the whole country. As one person said, “We don’t fly the Canadian flag. We fly the Alberta flag.”

Several people we talked to spoke of breaking off from the rest of the country. One said that if that happened, Alberta would become the richest country on earth. To that another replied, “Until they take it all back in taxes.”

If you drive just west of Lethbridge you see why the area is called “feedlot alley.” Feedlots dot every corner and, if you are looking for a Groenenboom, Herb has many cousins in the industry. Herb’s dad, Dan, was first generation from the Netherlands and came to the area to work in the sugar beet fields.

The Dutch Connection

Family central
Herb Groenenboom, who buys and sells cattle and runs the office, works with his dad and his brothers, Dan, who runs the outside operation, and Evan, who does the farming. The family farms 2,300 acres of irrigated land and 1,300 acres of dryland, raising mostly barley, which is used as silage and feed grain. Their feedlot ration, developed by their consulting nutritionist, consists primarily of barley, silage, straw and supplement.

Groenenbooms source their 800- to 900-pound feeder cattle from buyers in western Canada, including Alberta, British Columbia, Saskatchewan and Manitoba. They have several buyers working year round. Seventy percent of their feedlot cattle are heifers, even though they’re not allowed to use MGA in the rations. Finished cattle are marketed on a non-grid rail price either directly to local plants or through a broker to Swift at Hyrum, Utah, 600 miles away.

All Canadian cattle are source verified. There is also a voluntary age verification program, which Groenenboom thinks will grow if the market shows it has value.

On BSE
“The finding of BSE in Canada was, without a doubt, the most stressful event in my life,” Groenenboom said. “It was incredible. Here we all were, on a farm built by my father, and it could have all been gone. I was in the office when a cattle buyer called to tell me what had happened. To be honest, it never crossed my mind – FMD possibly, but not BSE. We all believed that the closure of the U.S. market was short term. We were told that the market would open the next week, and then the next, and that went on for two years. I thought it was going to be a temporary hiccup, but I was wrong.”

Groenenboom said they lost some cattle feeders, but the banks, Canadian consumers and the government were supportive and helped the industry make it through.

President Herb
Groenenboom currently serves as the president of the Alberta Cattle Feeders Association. Of his term in office, he humbly believes that it was “just his turn.” Over 200 feedyards and beef producers belong to the feeder group, which Groenenboom feels helps the members align and compete in a very competitive world. He was in Washington, D.C., recently where he had the chance to visit with some top U.S. officials on industry issues.

“We need to continue to grow and thrive, but you have to keep your eyes open. The cattle being bought right now are ‘under the water,’” he said, meaning that they would not break even.

Groenenboom’s immediate concerns include the ongoing ability of the Canadian industry to compete with U.S. feeders, considering the effect the developing ethanol industry may have on feed prices, and competing for labor with the oil and gas and construction companies, which have raised wages 25 to 30 percent. Groenenboom feels that for Canadian feeders to be successful, they must get the most out of their resources.

Silaging We Will Go

When I called to talk to Jack de Boer about an interview, he told me that he would be around because they were “silaging.” de Boer was serious; he was running the swather when we arrived. He grinned when he said that they don’t let him run the chopper. All together they will harvest 20,000 tons of barley silage for the long winter ahead, most of it coming from their own farmland.

Keeping it all in the family
Monarch Feeders consists of two feedyards west of Lethbridge, Canada, with a one-time capacity of 15,000 head. Built in 1983, the family – Jack and two older brothers – initially were custom feeders. They soon decided that having customers did not offer the security they needed and switched to feeding all of their own cattle.

de Boer touted the area’s good water, feedstuffs and weather. Although it gets bitterly cold at times, Chinook winds come often, melting winter snow. Because of those Chinooks, pens are bedded heavily with straw in the winter to sop up the melted snow. Come spring, excavators (Hi-Hos) scrape the mud and straw from the pens and dump into waiting manure trucks – many manure trucks. Those same trucks double as silage haulers in the summer.

The company is currently in a stage of transition as the family’s second generation takes over the reins. Jack de Boer calls himself semi-retired, but returns when they need a swather driver.

de Boer and his brothers are turning over their various jobs to their children. “My son is doing a lot of what I used to do,” de Boer said. “He is purchasing feed, working on the health program and doing the banking and legal work. My brothers and I are working on the business now, not in the business. We oversee the family operation and look for new ideas.”

One of those new ideas has turned into a family business. Their newly formed company is purchasing grazing land in Saskatchewan where they can put cattle on grass in the summertime before going on feed at Monarch, taking advantage of the much more reasonable land prices further east.

Quality assurance
The family has been working on their Certified On Farm Food Safety program for the past two years. The program sets standards for quality assurance on every aspect of the business, establishing standard operating procedures for every task.

“The program takes the guesswork out of everything we do,” de Boer said. A very exacting setup, the program has, on paper, the procedure to be used for every possible event that may happen, from a broken needle to unloading a truck.

“Everything is in this book,” de Boer said of the heavy volume on his desk. “The employees know what to do, whatever happens.” After completing the book, the company is routinely audited to ensure that procedures are being followed. de Boer is proud of the company and its dedication to this system.

On BSE
“At the time it was really bad,” de Boer said of the BSE crisis in 2003. Three times we thought that the border would open and three times it did not. I finally said, ‘Don’t tell us that it is going to open.’”

de Boer does find some positives that came from the experience. “During the closures, we all pulled together and now we manage better and have a safer product for the consumer. As an industry, we had to work together to survive.”

Working together seems to be one of the things that the de Boer family seems to do best, confident in their abilities and the generations to come.

A Man on the Go

Every feedyard we visited in Canada this trip was using Roto-Mix feed mixers, and I finally asked Why. The reply was always the same. “Rick Paskal sells them.”

On Saturday morning, we got a chance to meet “Mr. Roto-Mix.” With a firm handshake and a quick hello we were off, doing the normal checking of the state of the operation that Rick Paskal oversees. First was a quick stop at the shop to check on the mechanic. “How’s the family?” Paskal inquired of his employee. “How’s it going, eh?” and we left on a whirlwind tour.

Many interests
Paskal’s partner in part of his ventures is Cor Van Raay, well known as one of the premier cattle feeders in the province. (Van Raay was bicycling across Canada during our visit.) They own Butte Grain Merchants, which started as a grain broker in 1979. The company now is a cattle-feeding and farming company that operates two feedlots, the Roto-Mix feedbox dealership and a trucking company. Rick Paskal Livestock is the family farm, which also employs his three sons.

Paskal feeds a number of cattle himself and sells them on a negotiated price to Pascol, Wash., as well as the Tyson plant in Brooks, and the Cargill plant at High River, Alberta. Cattle destined for the U.S. must have their age established via dentition.

Not one to mince words, Paskal would like to see age verification made mandatory in Canada. “It would give the packer the opportunity to get full value out of their beef product,” Paskal said. “Everybody’s got a notion of the government knowing about our business, but if this system was in place, it would be a benefit.”

Vast country
With only ten inches of rain per year and not much snow, water is a limited resource in the Picture Butte area. Irrigation water is carried via miles of ditch system established in the 1920s by the Mormons. In order to thrive in this arid climate, every acre must be watered, usually with corner pivots.

Stringent manure management regulations create another challenge to feeding cattle at Picture Butte. That discussion brought Paskal to the new feedyard regulations. To build new pens, they have to excavate three feet down and lay a clay-packed liner for the pen.

Feeling a little over-regulated, Paskal said he could do without his government’s ban on products like MGA and Optaflexx®. “I would like for our government just to look at what the U.S. is doing and adopt their standards,” he said.

Paskal and the other Alberta feeders are closely watching to see what the new U.S. Farm Bill will offer, believing U.S. feeders are offered all kinds of benefits. “We have to compete and that is difficult with land selling for $500,000 per quarter section. The only way is to have lower input costs,” he said.

Paskal thinks that the predicted increase in U.S. availability of dried distillers grains will have a substantial impact on costs of gain. With pen riders commanding $20 per hour and no end in sight for the Canadian labor issue, Paskal thinks that they have their work cut out for them. After meeting Paskal, it looks like “challenges” could be his middle name.