ATB Financial has always been an institution committed to Alberta and understanding its key industries. The focus on Alberta and what drives its economy is where ATB dedicates its team’s expertise. For Albertans in the agriculture sector, throughout the value chain, this is where ATB Stands out - and who better to reach our local farmers and ranchers than a deal cowboy?

Lee Irvine, Beef Segment Specialist, Agriculture & Agribusiness ATB, is a second generation cattle producer with a degree in animal science. He has worked as a cowboy in Canada, the United States and Australia. He has also worked in veterinary pharmaceuticals so he could help grow and innovate in the industry.

While my background wasn’t in banking, when the opportunity came to work with ATB in this role, my firsthand experience in cattle production was invaluable, he says. “ATB’s commitment to understanding the agribusiness space by hiring specialists like myself is truly unique, as is their dedication to developing products and services that support the industry.” 

In this position, Irvine has a very well rounded view of the issues facing the industry and how ATB can help.

“It is important to understand,” he says, “that adversity is not new to agriculture. Farmers and ranchers have always had to deal with grasshoppers, droughts, floods and fires. Over the last few years, we have seen producers shifting their mindset from a year-to-year strategy to multi-year strategies to deal with these events.”

It’s no secret that the cattle industry is feeling economic pressure.

Consumers feel it at the till as they buy beef for their summer barbeques, but Irvine says that the producers feel the pinch just as much – if not more.

“We have seen costs double, if not triple,” Irvine points out. “Diesel to run tractors, for example, has gone up significantly, as has the cost of trucks and farming equipment. It’s a struggle for the entire industry, but there’s still a need to  keep producing if we want to keep feeding the world.”

He shares something that many consumers do not know. 

“It’s important to remember that cattle producers are not the ones setting the prices. Producers get paid through price discovery – what buyers are willing to pay at auction. In other industries, such as car dealerships, they can set the price and wait for someone to buy the product. Cattle doesn’t work that way. When it is time to move the animal, the animal must move. It cannot stay on the grass; producers have to take the price the buyers set.”

Why not just hold out? 

“There are limits due to land and forage. Producers set aside forage and animal costs a year ahead of time, so in order to properly feed the animal there needs to be a plan in advance. If the producer is planning to carry the animal over, that takes years to set it up and do it correctly.”

This ties back into what Irvine said earlier about the mindset shift. As the conditions continue to change, producers are looking at longer-term strategies. However, the changes do not – and cannot – happen overnight.

“Another thing to consider,” says Irvine, “is that producers buy inputs based on the global market but sell on the local market. A recent example of this is corn in the United States. It looks like it will be a significant crop there this year, which means  buy it at a lower price. Sometimes the global markets play to the industries benefit; other times, when there is high demand,input costs go up.”

Make no mistake, however. Those in the agribusiness are not just going where the wind blows. They are planning and making changes, levering technology and innovation and doing everything they can for the industry and consumers. Seeing the results simply takes time.

Industries that support agribusiness are also invested and responding in kind.

“We are seeing a lot more risk management tools in the market, such as different forms of insurance. We are seeing producers taking on more complex strategies to mitigate risks.”

It is, as Irvine says, a “complicated beast.”

“Due to the drought, we’ve seen many producers either exit the cattle industry or decrease their herd size to maintain financial sustainability. Low cattle inventory impacts supply and demand, and strong prices may persist as we head into the fall. In the U.S., producers are rebuilding their hers since their numbers are at their lowest since the 1960’s. Fewer animals are in feedlots, which increases demand and, consequently, prices. Should beef demand drop, we’ll see prices fall as well but right now, we are seeing continued demand for beef both domestically and internationally.”

Is it hopeless? Far from it!

As Irvine points out, adversity in agribusiness is simply another day on the farm. From before the time of technology and tractors, farms and ranches were affected by weather, wars, and everything in between. Agriculture is, at its heart, incredibly resilient and as much as global and local factors are affecting supply and demand, those same factors are driving the innovations that are revolutionizing it. 

Irvine says, “We have an aging demographic in the cattle industry. Given the current conditions, some see it as a good time to retire. But we’re not seeing the next generation step in due to higher costs. As an industry, we are actively working to attract young producers back. The Alberta government has programs in place to support this effort and ATB is also exploring initiatives to help. Stay tuned!” 

The result?

A new generation of farmers powered by innovation with the ability to leverage decades of agronomy and global market data to face new challenges and revolutionize farming. Let’s not overlook the incredible progress that has already been made, and that continues to drive the industry forward.

“Today, we produce the same amount of beef on 25 per cent less land than we did in 1981 and with 15 per cent fewer emissions. This achievement is due to advanced production research and improved environmental practices. The beef industry is also a significant source of employment. Each job in the sector creates an additional 1.8 jobs in other areas of the economy, resulting in an employment multiplier of 2.8 person-years. Overall, the beef sector is directly and indirectly responsible for 81,000 person-years of employment.”

Another benefit? Long-term sustainability. An excellent example is the Canadian Cattle Association’s documentary called Reduce, Reuse and Ruminate, showing how industry is using food by-products and food waste as cattle feed.

Beef is central to the economy in many ways.

“The Canadian beef industry contributes $22 billion to the country’s GDP and $55 billion in overall sales. In Alberta, the cattle sector contributed $5.8 billion to the provincial GDP annually (2021-2023 average). Check-off dollars are used to fund research through various organizations. For example, beef producers pay a check-off that funds research through the Beef Cattle Research Council and Alberta Beef Producers that looks at how we can produce beef more efficiently.”

When the price of a steak is high and the cost to barbeque it is equally painful, don’t forget to look at the big picture. With a wealth of supportive programs and products on the rise and with innovations in the agribusiness sector, Alberta’s farmers are changing the game. The short-term pain is influencing long-term gains.

As the people driving the business go from horses to tractors, from weeding to automated sprayers, ATB keeps pace with changing needs, demands and technology, bringing in boots-on-the-ground talent like Irvine and creating niche programs to support Alberta’s farmers and agribusiness entrepreneurs.

A financial institution can’t control the weather. It can’t influence growing or herding conditions in foreign markets. It can’t stop a grasshopper plague. But it can leverage years of data, listen to its clients and hire talent that can make a difference. As those in agribusiness continue to adapt, ATB continues to support Albertans and the many diverse roles they play in helping the province grow and thrive.