The consumer does not care......

[perfecho]

As I have commented before, we also feed and sell a few animals. It started with keeping back up 4-H projects. Our customer base is growing, even though we are not "pushing it" and it is growing because of taste, not economics. Actually I price it to discourage customers, but it has become lucrative enough I don't mind doing it. When you take in the efficiencies that we can't take advantage of, (processing)and still come out very much ahead of shipping a fat at current prices, it makes you wonder how much really is made between the farm gate and consumer plate. ( On another post, supposed beef share to producer was 24%?)
The question seems to be how many can you handle? The question should be "How many would it take to make my family a descent living and leave time for life?"

[grassfarmer]

"When you take in the efficiencies that we can't take advantage of, (processing)and still come out very much ahead of shipping a fat at current prices, it makes you wonder how much really is made between the farm gate and consumer plate. ( On another post, supposed beef share to producer was 24%?)"

Exactly my sentiments perfecho - it's once you are selling beef yourself you really see how much money is being made in the commodity system.
Your last figure of 24% being the producer share of the retail beef price is dated - that was in 1999. The figure has since dropped to 16%!!!!!!!!!
Lets all move a resolution at our ABP meetings to press for a Government inquiry into who is making money in the beef chain and how much each is taking. If the packers are making nothing as they claim it should be no problem for them to open their books this time around.

[grassfarmer]

"When you take in the efficiencies that we can't take advantage of, (processing)and still come out very much ahead of shipping a fat at current prices, it makes you wonder how much really is made between the farm gate and consumer plate. ( On another post, supposed beef share to producer was 24%?)"

Exactly my sentiments perfecho - it's once you are selling beef yourself you really see how much money is being made in the commodity system.
Your last figure of 24% being the producer share of the retail beef price is dated - that was in 1999. The figure has since dropped to 16%!!!!!!!!!
Lets all move a resolution at our ABP meetings to press for a Government inquiry into who is making money in the beef chain and how much each is taking. If the packers are making nothing as they claim it should be no problem for them to open their books this time around.

[ado089]

I have a question for you cattle guys. I sold the last of my cattle in the spring of 2003, luckly. But since I've been penciling if it would be worth my while getting back in and I always come back to the same conclusion. On average $100/head can be made, meaning 200 cows taking up my entire summer haying and fixing fence, and making a winter holiday out of the question is going to net me somewhere around $20,000. Even if I can sell 30 of them directly to the customer, barring the red tape and trying to find 60 families to buy my beef it still only just makes it worth my while and at the end of the day is pretty poor pay for having at least two jobs and no freedom. What keeps you in the buisness? At least with grain I have a chance of getting more than I expect, with calves you start with a certain number and start docking profit as things happen.

[vagabonddreamer]

profarmer...boy do i feel your pain...and though i know you were being bitterly facetious about your 1% of the consumer population comment...in actuality...1% works for me...our ranch is near a little community of 15,000 people...largely fruit/wine base agriculture...1% of the community population is 150 people...easily enough to give me a good income selling CWF meat...now...we are slowly building up to that point...i think we have around 30 permanent customers and it grows each year without advertising or marketing...but...this year we are holding back and feeding substantially more...demand seems to be growing...especially when we can invite customers to take their atv's out on range and see the cattle themselves during the summer when they are recreating...also..call me easily influenced...but when people eat the beef and take the time to phone me and extoll its virtues...its kinda cool...

like perfecho...our "feedlot" started because of 4-H...my two youngest kids did market beef/fed beef/hiefer and cow calf...that was feeding 6-8 animals every winter anyway...so whats 15 or 20 or 30 more??? other than capital cost of grain etc...(lol..kinda breezed by THAT part)...

like GF i beleive the number to be WAY in excess of 1%...but even at that..it can still work...i dont know if you saw a documentary called "Food Inc"...but that has CERTAINLY scared some more customers our way...many times i have thought of purchasing enough copies to send to everyone in my community..lol...

now to the REALLY important question that ado asked....why am i doing it???

lol...my oldest son just gave me a wink after reading your comment because he KNOWS what my answer will be...because when i am standing in the bar and a sweet little filly sashays my way and says
"hey cowboy how about a dance"...it makes it ALL worthwhile...i dont know if it would have the same effect telling her that i grow soy...lol...and besides..i know kato likes cowboys...vs

[grassfarmer]

Well that's an interesting viewpoint!! The way I look at it when we are breeding cows we are creating something every year - if we can use systems that minimise inputs our profitability should be reasonable and sustainable because we are primarily capturing solar power and water which are free. With my system I don't spend all summer fencing or making hay but I agree with you that the livestock tend to tie you to the farm especially in winter.

What I really don't understand is why anyone would want to grow grain in this country - given the erratic climate. You are totally reliant on the input manufacturers for fuel, high price machinery, seed, fertiliser, sprays and at the end of the day you have no more control over the price you receive than the beef producer has. Then for added interest your magnificent grain crop in August can be destroyed by a 20 minute hail storm and you have no crop for the year. Looking over on the commodity forum of Agriville there seem to be as many grain guys complaining as beef guys.... record high input costs then poor to average crops and slumping sale prices for their grain.
I'm happy for you if you like grain growing - i'll stick with my beef and grass system thank you very much ;o)

[perfecho]

89, it's an addiction. Seeing a newborn calf scrambling up and sucking to life within a few minutes of being born, the anticipation of breeding a champion bull to a dog of a cow, but somehow you know.....walking through the herd as big snowflakes come drifting down and the girls just look at you and say " Walk by buddy, I ain't getting up."
When your kids come along for a pasture tour and say, "Can I trade Moxi for that calf?"

As you see your genetics improve and long time cattle breeders give you some compliments even though you took your own road and stayed away from the flavor of the day. When you win a "Sweet Heart Classic" and your heifer sells for good money, even though the judge put you in the middle. It may not always seem like the numbers work, but the family life does.

I have to go round and round on my tractor to put crops in to feed the girls, but I tire of it quickly. We put up silage for forage and coupled with swath grazing we don't have to spend much time in the field during the summer. And as I am finding, less is more, cutting the numbers is working better, finacially and for life style.

Were not all cattle people 89, some are meant to spend their time with a machine....just not me. I gave up a great business finacially to live out my dream, and even though sometimes it seems like it turned into a nightmare, I still wouldn't go back.

[ado089]

Thanks guys,
I wasn't complaining or pointing fingures. It's just like I mentioned I've been out of cattle for over 5 years now and maybe I was looking for a good excuse to try again.

[perfecho]

And we have cattle for sale....;-)

[perfecho]

Also, GF, where can one look to find the info on the 16%? I assume that is selling calf at weaning with no backgrounding etc.
Thanks
Larry

[grassfarmer]

Oh no, make no mistake - that 16% is the fed steer price as a % of retail beef price. The figures were from Canfax. For a fuller explanation check out the NFU report at http://www.nfu.ca/briefs/2008/LivestockEXECSUMFINAL.pdf.

Go to page 13/32 and see graph 6 and the text below. By simply restoring the 16% share producers get today back to the 24% they got in 1999 producers would earn $550 more per fed animal than they do now. This is where the missing money goes that is bankrupting ranchers - imagine distributing $550 per animal back through the chain to feedlot operators and ranchers. We wont be greedy - let the feedlots keep $250 and let ranchers keep $300 extra on every calf or feeder animal sold - would make quite a difference to economics wouldn't it?

[perfecho]

Thanks...does make your head spin! And with age verification, they will be able to get an even better margin in some countries....but do not have to go out of pocket to purchase it.

[kato]

Opening those higher value export markets is only half the picture. Unless we have more players competing for the live cattle, there are limited benefits for us.

As long as we have only two bidders on our cattle, and our prices are set based on the U.S. market, and the U.S. futures are being used as hedging tools, we can open all the export markets we like, and the bonus money earned from them will not get back to us. Why would it? If there is no competition for the cattle, what reason would there have to be to pay more for them? That's not how business works.

What direction that beef goes out the door from the packing plant doesn't affect us at all, unless those new markets draw new players into the game to compete for the live cattle. The way our system is set up with all the extra regulations and barriers to federal status makes this difficult. We need our government to not just make it easier, but to encourage our smaller processors to expand. So far it seems there have been just as many roadblocks set up for new plants by the government as by anybody. That's just not right. If the government really means what it says about increasing international trade access, then it needs to finish the job by following up by encouraging an environment that new plants can survive in.

When the day comes that the Canadian/U.S. dollar difference doesn't affect cattle prices, then we'll know we have a made at home price for our cattle. That should be our goal.

[perfecho]

Agree Kato. With the current system we are screwed......and many have realized that, thus the exodus.
ALMS and other prov/fed programs do not address the problems, actually help to reinforce them.
It is going to be the toughest year yet, and I am not hopeful it will be easier next year....hope I am wrong. (But 89, don’t let that scare you away from purchasing ;-)

[GreenValley]

GF: as u said ur system were fine, actually is not. ie: ur some of cows ear frozen seem i think many of them, and mostly are thin from past winter. What I don't understand is that these cows are fatten in summer and then winter came in you throwing money away by thin cows from deep cold and winding blowing that drop to -60 windchill with no bedding which are facing windy with like that in open facing windy direction. These cows are shiver and cold and their back shape like arc, they could not laying down because if they laying down may get wet and getting worse and get cold stress from high windchill that may stress cows even further, also draw cow's all fatten from summer at end u losing weight. U has 2 wind break but that is not enough, need plenty of wind breaks or move cows to shelters (trees). Cows are warm blood mammel like human and u treat cows that is not humanity. I am watching u.