Do you remember ?

[SADIE]

Ditto Per

The last three dates (especially the last two) had a huge impact on our farm gate cattle prices.

That is why some of us have become more cautious with farm management or planning going forward from today.

What and when will be the next "HIT".

[grassfarmer]

Per,
I remember where I was watching Gemmill against
Holland in '78

and Chernobyl in April '86 when they released nuclear
contamination that blew onto the hills of Scotland and
cost our sheep sector dearly. No compensation.

Also through the late 80s watched the evolving of
BSE..... in '89 suffered our export market for breeding
stock being completely closed - to last for 17 years.
No compensation.

Remember several times through the 80 and 90s
when our sheep exports to France were shut down
illegally due to what would now be called "non-tarrif
trade barriers" on some occasions, state backed mobs
blocking the ports and torching British trucks on
other occasions. No compensation.

In March '96 remember the real disaster that was BSE
unfolded - all cattle trading, auctions and beef
consumption essentially ground to a halt for weeks
on end. Complete loss of export markets for 10
years, all live cattle and beef products. Limited
compensation.

I remember 2003 and the years that followed, we've
all lived it. Limited compensation.

You either knuckle down and get through or you can
spend your time complaining life is not fair.
Glass half full or glass half empty it's everyones
choice to make.

SADIE, I don't remember any negative effect on farm
gate cattle prices after 9/11 you'll have to refresh my
memory on that one.

[per]

You shouldn't have detected complaining or glass half full from me GF as I also said we were prepared for disaster and weathered it by being diversified. 72 never impacted the cattle industry at all just a good national boost. The stock market crash did however affect trade as did 911 with an internalization of commerce. It too did not last long. 2003 changed who we (commercial cattle industry) thought we were. Maybe it was because we were complacent or something like that but it certainly was a date to remember. It was a watershed for me in that it spurred my interest into industry governance because the way we as an industry handled the issue did not suit me.

[rkaiser]

And a couple of large companies watched things unfold as well and said to themselves, "how can we take advantage of this situation?"

It was so un Godly lopsided that I first thought that these companies must have even been behind the whole event.

Now I rather simply see how they figured out how to farm the hell out of it.

Brilliant --- and they are still working it because we simply can not get our heads together and take the industry for ourselves.

Wonder how many will pitch in once the class action pays out and buy our industry.

Pretty pathetic when I speak with outside industry investors and tell them the we could purchase, or better yet rebuild, our own packing industry monopoly for less that 1/2 a billion dollars. How much would 1/2 a billion get you in oil industry infrastructure.

Oh yes, I had a load of cull cows at the Olds Auction Mart on May 20 and had to go pick them up when they cancelled the sale.

Worst / Best memory for me was the highest prices I have ever received for fat steers in August of 2003. Had a contracted price for non commodity fats that my buyer stuck to and when I asked the folks in the gov who also paid out the big bucks to Lakeside and Cargill if I qualified for the subsidy; they said, sure thing bud.

Sold those steers for $1.05 live and can't really remember the cheque that me and Lakeside and Cargill got from the feds, but I think it was about another 30 or 40 cents a pound.

Only difference was that I did not have another few hundred thousand fats lined up and sold in the box to customers in the USA and Canada like the big boys had.

And then they told the feds to go away when they were asked to open their books.


LOL --- that's about the only thing a person can really do.

And keep pumping the BSE lawsuit --- with or without grass farmers support...LOL

[ASRG]

2003- I was planting 3800 trees! Had just came through the 2002 drought and a pretty brutal divorce.
Son had just finished university with a B of Comm degree!
Was looking forward to expanding the farm and the cow herd!
Wow! What a different world! What an adjustment!
Cowboyed through. Lost all the money I'd saved in my life (and a good portion of my Dads!)
Am I bitter...........you better GD well believe it....these bastards left us out to hang by ourselves.....I never fed any damned cows to other cows! I never imported any trash from Europe!
They sold us out.

[dluther]

Thanks to everyone that replied to the question. Perhaps on the 10th annivesary we can all get together and get this court day over with, at least let them ------- know we are still around. I only have about 15 years left I hope.I like the saying old cattlemen never retire they just calve later.

[grassfarmer]

Not sure what you mean by "left out to hang by
ourselves" ASRG? There was a substantial amount of
taxpayer money paid in compensation to the "cattle
industry". Check out the abstract from this research
document:
http://www.synergiescanada.org/journals/utp/12032
8/t245k8710031/p7r1365722134189

Of course we all know it wasn't shared equitably
between the different sectors, cow/calf sector was
likely worst affected. I wonder how it could have
been done differently?

[kato]

Cow calf operations should have been the priority. After the initial hit, the feeding sector simply adjusted to a lower cost per animal,and carried on. This meant margins were maintained, while the cow calf producer continued to absorb the loss. There were risks for the feeders, but there was profit too.

The shouldn't have allowed the packers to deny access to their books to see if gouging was taking place. This was government money, taxpayer's money, and they just thumbed their noses at the government. And the government said, "OK, whatever you say."

At the same time, the Agstability people were merrily going along digging into old claims and coming down hard on the heads of any hard up farmer they arbitrarily decided had been overpaid.

Agstability worked for the first year or two. After that, it was done. This was good enough for feeders to get over it, but sadly lacking for the long term loss in the cows.

That abstract said the cattle industry was fairly compensated. I think they should have worded that to say that the meat processing industry was fairly compensated. The ironic thing is that with the cow numbers dropping like a stone, their problems may just be about to begin.

[ASRG]

grassfarmer: I don't know how it could have been done differently. I guess if the class action law suit ever makes it's way to court we'll get an answer one way or the other?
It seems to me the USA cattleman sure never took the hit like we did? In fact they saw record prices while we were starving! Our so called "free trade deal" worked great for the big packers....not so good for us little guys.
I have grown very cynical in the last ten years. I view the government as the enemy.

[grefer]

With all due respect Grassfarmer, the amount of money I recieved from government was insignificant.We have a mixed farm so we don,t only rely on cattle.We are cow/calf producers and usually don't background our calves or others.2002,03,04,were the worst years I had ever experienced farming and until then I thought I would never survive 3 consecutive years like those.Poor crops because of drought,insects ,frost,and BSE were the perfect storm but we were fortunate and have continue to make ends meet.I feel bad for those who were in beef alone,I can't imagine what that must have been like and I due understand the anger some have with all the B.S. we were fed through the BSE crisis.Hopefully the beef industry can have a run of good years so that those who could hang in there can make back some of the dollars lost.

[kato]

We were totally 100% cattle.

However, after we got past the bunch of expensive calves we had on hand when the border closed, the feeder side of the ledger improved some. It was only through the occasional profit from those cheaper bought backgrounding calves that we are still in the business. We didn't make money on every bunch, but we always at least broke even. We never actually lost money on them. It wasn't much profit, but it kept us here.

This is where my opinion that the cow calf producer suffered the most comes from. From first hand experience. The poor guys who sold us those calves all lost money on every single calf. Our strategy was to use the feeders to keep us afloat until the cows came back to being profitable.

Ironically, now that cattle prices have improved, we can no longer pencil in a safe margin on the feeders.

The cows are back in the driver's seat, and we are so very glad we did whatever we could to keep them. We weren't comfortable with probably the last three groups of backgrounders we had, and are glad to be able to step back for a while.

That's enough stress for now.

[smcgrath76]

We returned to the farm in 2002 and went on a steep learning curve. We came out of the 2002 drought with 3/8" of
moisture from May 1st to Sept 30th. We sent a group of cows east of Weyburn for the winter, and put a bunch out
on the prairie here.
Being a glass half full kind of guy...
We sold our backgrounded calves prior to May that year as the price was well above our breakeven, so we dodged the
2003 hurt. We cash flowed OK because we sold a bunch of cows in 2002 as part of our drought management plan.
That revenue was allowed to be deferred under the drought assistance tax program. It also meant when BSE hit we
had a herd of young, productive cows (a blessing in disguise as it turned out).
In 2003 we bought feeder calves in the fall following 2 weeks of bad news. We sold them well ahead of plan
following two weeks of good news. We also bought some bred cows that turned out OK.
Since BSE and drought again in 2009, we have driven our costs down and increased our cowherd, but it has been
demanded by cash flow needs and has not been wildly profitable (but still healthy).
The mentality around here about spending money has actually driven quite a bit of profit into our operation.
There was a lot of money spent on the cow/calf side (the Set aside program was a good example), but a lot of that
was bid out of the cattle. I distinctly remember selling calves with pink floppy tags (Dad drew the short straw
and got stuck with pink) and they were ready to bid the $80 set aside payment out of the calves. That was a day
when it paid to be present. The question from the block was "Are these set asides?" and the answer was "They sure
as hell are not!". That saved us $80 a head.
We also decided to work on exiting the cattle business and enter the food business, so purchased a portion of a
packing plant. Glass half full - we learned a lot, and we are entering the food business but with a different
model.
I think a lot of cattle will continue to disappear and we may have reached the tipping point. Coming out the
other side I am grateful that we had a manageable debt load, that we have multiple generations with good
communication and willingness to innovate and that we stuck it out. Our operation is leaner and meaner than
before but we continually work to protect ourselves from the vagaries of something similar happening again. I
think there is lots of blame to go around, and I won't feel sorry when the legal battle plays out. The sad part
is that the grieving process for those who sold their cows is much shorter than many expected.