Here's one to ponder

[rusty1]

Do you know how many dollars they expect to be able to net per head?

[cakadu]

What sort of mechanisms will have to be put in place in order to avoid seeing what we are seeing now in terms of "price fixing"? In other words, how do you see these plants not doing what the current plants are doing in terms of getting their inputs for the lowest possible price that they can? After all, business is business and even producers who put money into a plant will want to see some sort of return beyond being able to kill so many head per year.

The opposite of that is also going to be true. For example if a producer has the right to kill 50 fats a year and the plant is counting on having those animals to fill the markets that they find, what are you going to do to ensure that you continue to get those animals? After all, business is business and if the producer can get more money for those 50 fats elsewhere, how are you going to convince them to stay?

What is being done to ensure that loyalty works both ways?

[pmckenna]

In response to your last message, Cakadu, I think that although price will govern, that still can foster favourite suppliers - genetic thru retail. Many people do not trust the RFID program - but to build trust is to have data - and this system is impartial, with the exception of some errors that apparently included a double billing, or other unfortunates like that. But by and large, producers will come to demand from feedlots and packers, a reportability for sales at retail. Grading, yield, which brand it was is part of a dynamic, well run industry showing the world its best. Feedlots and packers, and retailers will want or need to engage. Sorry to repeat the same statement, but the lack of these programs held the industry back for too long.

[pmckenna]

What if co-operation (independent value chains) means prices are about the same from one to the next? They're costs may be similar. Will we say it is price-fixing? Because those prices may be in the nature of honest competition. Any comments from anybody?

[rusty1]

cakadau - are you a govt. employee?

[rusty1]

Rusty, where is your plant going to be built ?

[cakadu]

Ahhh, rusty you make me smile. No, I am not a government employee. What I am is someone who has been around for a while and witnessed the proposals for other processing plants in the diversified livestock sector. As many know, we raise lamb, so are even more limited in processors than you are in beef. Believe you me, I have asked these questions all along and even learned a few more to ask along the way.

It's not that I don't believe in the ideas, in fact, I've been promoting a lot of these various ideas for a long time. My strongest desire is to see them succeed and be sustainable.

[cowman]

I've asked this question before, but I've never gotten an answer.
How come these various plants are going to cost $200, or $333, or whatever, while the plant in PEI costs $60? How come we can't do it for that?
I will also note no ground has been turned here while the PEI plant comes on line this September? What are they doing that is obviously working?
I wonder how many producers would be more than happy to buy that "hook space" at the PEI prices? $20 down and a forgivable loan? I suspect you couldn't keep them from beating down the door?
If PEI can swing this(with absolutely no federal money) then what is the problem here?

[cowman]

Ponder this.

The plant to kill cows proposed by BIG C is propsed to be built with bridge financing from the federal government. Producers will become shareholders in lew of the levy suggested over time. This plant will be built as cost efficiently as possible and will be run by the best management that can be serched out. Of course these two points can and will be argued, but let's be realistic. Every business venture will and has made those same two points over history.

Once this plant is built, some sort of reality is put back into a marketplace that has become extremely disfunctional. IF IF this plant cannot make money. We have all lost some checkoff money while trying to solve a crisis. (Sound familiar). Only difference being. Even if another private company buys this infrustructure for 20 cents on the dollar, we have solved one major part of our problem, Packing Plant Capacity.

As our Ex Premier Peter Lougheed said yesterday,"We could work out the details while the bricks are being laid".

Sure planning is important, but every now and again "action without fear" also works.

[cowman]

I wonder how the whole thing would work? Would this money come out of the regular checkoff or be an add on? Actually do all cattle producers even pay the checkoff...I thought it was refundable or something in Manitoba? Would producers in Ontario, Quebec etc. be expected to pay a checkoff for a Sask. plant? I doubt they would be keen on that idea?
And finally would Cargill/IBP be expected to pay a checkoff on the cattle they own and slaughter in their own plants? Seems to me that isn't very fair? I mean why would they want to finance the competition, right? I wonder what the courts might say about that?
Not knocking the idea...just trying to understand!

[rusty1]

Atlantic PEI packing plant. Phone them yourself and ask the real questions. Ask for Kirk Magrath 902-437-2727

They won't talk to me?

[rusty1]

Checkoff would be seperate from ABP checkoff but taken off in a similar manner. Every animal sold. Once packers own the animal, however, they would not pay on the next change of hands. Yes, it would not be fair for them to pay, nor would you want packers to have control of this new plant when levies become shares. Working on the 4 western provinces at the moment. Remember, we used to ship live cows to Colorado to be killed. Transport to Saskatchewan would be a fair bit for some, but certainly no more than a Colorado freight rate.
Thanks cowman

[BFW]

RPKAISER
Are you proposing that every animal slaughtered, be it steers or heifers, cows or bulls, have some sort of levy attached to it to help fund a cow only slaughter plant? If so I have big problems with that or am I missing something?

[BFW]

I expect that lots of folks will have a problem or two to discuss. That is what discussion groups like this are for.

Not every animal slaughtered, but every animal sold, just like the current levy that goes to ABP etc.

[BFW]

Sorry BFW, should have added that each levy dollar contributed becomes a share in the company.

Read the first draft of the proposal on the BIG C web site:

http://beef-initiative-group.com/