HOLSTEIN — Fifteen years ago, a single case of bovine spongiform encephalopathy (BSE) was found in a cow in Alberta. That one case closed the border to the U.S. for both cattle and sheep producers. While the border eventually re-opened for beef, sheep farmers haven’t been as lucky as the border still remains mostly closed to this day.
Jay Lewis, a sheep producer at Holstein in Grey County, used to send sheep to Michigan before the border closed. Lewis received about US $1.60 per pound shipped to the U.S. Back then, the Canadian dollar was about US 65 cents.
With the border closed indefinitely, Lewis had to change tactics, focusing more on the Ontario market, but it wasn’t easy. He had to weed through the sheep industry here to find good people to deal with. After the drop in prices due to the BSE case, Lewis was selling sheep in Ontario for about CDN 80 cents per pound. It took Lewis about a decade to recover from the border closure. He figured he lost over $500,000 that first year, but received around $60,000 to $70,000 from support programs.
“It took a long time for me to recover, financially, mentally and physically,” he said. “You had all your financial commitments based on your projections and on your cash flow that you had, and all of a sudden, it’s all gone. We really had to reshape our business. ”
He considered leaving the industry, but he figured he had too much money in the game and he had to try to recoup some of his losses.
While the beef industry went through a decade of low prices and a U.S. border that didn’t fully re-open for five years, the sheep industry saw its plummeted prices rebound within a couple of years, but the U.S. border remains partially closed to this day. It’s still not open for sheep 12 months or older.
While sheep inventories have stayed pretty much the same since BSE, the number of sheep farmers has not. According to the Census of Agriculture, 3,119 Ontario farms reported having sheep and lambs in 2016, down from 3,569 in 2011 and from 3,978 in 2001.
In 2003, Rob Scott was a power lineman for hydro, and was planning to leave his job to become a full-time sheep producer. He was shipping his lambs to Toronto, but that market “died overnight,” he said. After BSE, Scott stayed with his off-farm job for another 10 years.
“We always should be aware in agriculture that the commodity prices can drop, but when things are going good, you don’t see that,” said Scott, who is now chair of Ontario Sheep Marketing Agency.
In an effort to re-open the border, Scott said the best course of action is to improve relations with the American Sheep Industry.
“If we had this relationship, I don’t think the border would have been closed to us,” said Scott. “When you know the enemy, they’re not your enemy anymore. That’s the approach we’re trying to take on it.”
Lewis is angry that sheep wasn’t included when the border re-opened to beef. He said he can now buy a sheep from the U.S., bring it to Ontario, feed it, but can’t send that sheep back to the States to get killed. “There’s no logic behind it.”
The borders have been slowly re-opening. About 14,000 sheep were sent to the U.S. in 2016, up from 5,509 in 2015. However, that 2016 number is only 10 per cent of what it was in 2003.
The world-wide market has a big influence on sheep prices, and prices the last few years have been at all-time highs, said Scott. Prices across almost all weight categories are up this year compared to 2017, and are significantly higher than the five-year average.
“Prices have just been ridiculously good,” said Scott. “We’ve emptied our feedlot. There’s such a demand for lambs there’s just not enough margin between the lighter lambs and the heavier lambs.”
At the time of BSE, the sheep market in Ontario was considered a cottage industry and there were few who made a full-time living. Since BSE, the domestic market has grown, much of it due to more immigrants from countries where lamb is a popular food choice.
The biggest issue for the industry now is the same facing all farming, rising land prices makes it difficult to expand and for new producers to enter the industry.
“There are not too many places in Ontario where you can buy and set up a farm for under a million dollars anymore,” said Scott, adding he believed there will more expansion for the sheep industry on marginal lands.