Take a moment to pity the lonely Chinese dairy cow.
She's raised in a country that is only just learning to appreciate good cheese and café latte. Chances are she's swapped her countryside backyard for quarters in a grey steel barracks, after the 2008 melamine-milk scandal brought on a complete overhaul of her industry.
And now she's got another problem: A good bull is hard to find.
With a nearly decade-long ban on most livestock imports dating from the last mad-cow disease scare, these days the best many a Chinese cow can hope for is to get knocked up with a shot of the same local seed that impregnated her neighbour, her sister and several of her cousins.
Enter the Canadian dairy stud, the sperm-bank solution for modern cows in need of a little diversity.
As China tries to modernize its dairy industry away from inefficient backyard operations, Canada has found a niche market. Alongside Prime Minister Stephen Harper, Cabinet ministers and well-heeled oil and gas executives making the rounds in China this last week was the head of the Canadian Livestock Genetics Association, promoting – that's right – Canadian bull semen.
"Canadian dairy producers have developed a cow that is profitable and that is recognized worldwide … We've got a good reliable system and our cows make money for their owners," said Rick McRonald, the association's executive director, in a phone interview last week just before boarding the plane to Beijing.
The Canadian subsidies on milk production that effectively prevent, or at least limit, dairy exports do not extend to the products of its sire bulls, which are in demand as young dairy industries abroad try to breed cattle that produce more and better-quality milk. Canadian exports of dairy bull semen have more than tripled over the past three years, according to Agriculture Canada, and more than 20 per cent of the world market for dairy bull semen is from prized Canadian cattle.
Last week, the genetics association received about $1-million from Agriculture Canada to develop new foreign markets, in part through trade missions like these.
"[The Chinese dairy industry]is growing extremely fast, but things like genetic improvement programs are very backward here," said Robert Watson, China CEO of Alberta-based Alta Genetics Inc. Mr. Watson is an Ontario farmer who has spent 14 years in China selling Canadian bull semen and embryos, while improving the genetic tracking of Chinese herds to boost their health and milk production. He counts among his clients 15 "super-large-scale" dairies with more than 10,000 cows; the largest has 110,000.
The business has potential: One dose – delicately known as a straw – of imported Canadian bull semen sells here for the equivalent of $15 to $20, nearly twice the price of their Chinese counterparts. That price can increase to $50 if it has been sex-selected to help ensure the birth of female calves. A large dairy operation may go through several thousand straws each month.
At Huazhong Agricultural University's College of Animal Science and Technology, Professor Yang Liguo said the Canadian cattle industry still suffers some stigma from the last round of bovine spongiform encephalopathy (BSE), which began with a Canadian-born cow in the U.S. in 2003. Imports to China of Canadian livestock, along with those from the United States, Mexico and most of South America, are still banned. Canadian genetics products, however, are gaining market share in China.
"They have a certain market, middle- to upper-level, and are more popular than Australia and New Zealand [bull semen]" said Prof. Yang, who is also vice-president of the China Dairy Industry Association. "The Chinese consumers' psychology has matured, they want more fresh milk … This [breeding]is needed for better safety and quality."
On this trip, the Canadian Livestock Genetics Association is focused on restoring Chinese imports of Canadian livestock, which have been banned since that BSE scare of 2003.
At present only Australia and New Zealand are exporting live cattle to China, between 70,000 and 100,000 a year, which is not enough for large dairies to revamp their operations and reassure the Chinese public of their milk's quality. Six babies died and hundreds of thousands were sickened in a 2008 scandal in which the industrial chemical melamine was added to milk to give the appearance of higher protein content.
Canadian producers are anxious to get in on the live-cattle market. "What we're most concerned about now is restoring access to live cattle," Mr. McRonald said. "Their dairy industry is expanding as fast as they can make it expand, so there's lots of opportunity there.
In the meantime, there's always the cold efficiency of science to spread Canada's dairy influence.
Nearly $500,000 in embryos and $3.3-million in bull semen were sold to China in 2010, making it Canada's seventh-largest export destination after the U.S., parts of Europe and Japan.
Among the Chinese buyers is the Hua Xia Dairy Farm, a 45-minute drive out of Beijing, in the surrounding Hebei province. A U.S.-owned and managed high-tech dairy with nearly 8,000 cows, it has an unblemished reputation and its high-quality fresh milk is purchased by top restaurants and supermarkets.
And when their cows give birth, a large percentage of those new, wobbly calves are of Canadian descent, thanks to the dairy's purchases of 1,500 straws of imported bull semen every month. "Everybody with a bull is trying to promote their genetics," Hua Xia's assistant manager, Alex Tseng, said with a chuckle. But Canadian products, he said, are generally high quality. "To date, they've produced really nice, pretty cows that produce a lot of milk."
Special to The Globe and Mail