Meat prices

[cowman]

Meat prices are down in the store but how come the wide differences? When they say regular hamburger what does that mean? Two packages one lean $1.99/lb. one regular $.89/lb. Looked about the same to me! Now I assume regular has some fat mixed in with the cow meat but when cows are 8 cents a pound you'd have to figure the fat must cost at least that?
The local abbatoir is selling regular hamburger for $.54/lb. Safeway $.78 and Co-op $.89! I assume they are all making a profit?

[ValueChainFX]

Cow man retail stores work on a 24 % gross margin, more common is the gross margin between 10 and 15%.

So I wonder where the money is being made here?

[cowman]

I assume the local guy is making a profit. I doubt he's doing it for his health! Safeway is making a profit and so is the Co-op...maybe Co-op is making a very good profit!
Now if Safeway and the Co-op could get their price down to $.54(all across Canada) just think how the meat might move...why we just might eat our way out of this mess! And they should still be making a profit right? I mean after all big is beautiful right? Hasn't that been the message for about the last thirty years? That the little guy can't compete with the big efficient guy? Or is this the real truth coming out...that market share and running the little guy out of business with predatory business practices is how you get in a position to gouge the public?
Screw Safeway, support your local butcher.

[ValueChainFX]

LOL, cowman you have a way of getting right to the point!

Big may be beautiful for some, but big has also put us partly in the bind we are in today! Government programs have pushed the export market, while neglecting our own markets in Canada. Several government export programs are designed to encourage us to market outside the country.

Cargil and IBP (the big guys) have set up the lines so they can be most effective in production of standard cuts! The guys on their lines have little overall meat cutting ability, they are able to stand in one spot and do the same thing 8 (or more) hours a day. The art of meat cutting has been hurt big time. Many of our so-called niche markets need some experienced cutters to make them more than a niche market.

There are people that want another plant built in Alberta .... BUT ... they want it to kill about 200 or 300,000 a year! My question is WHY? Why would we build another big plant knowing the staff turn over is as high as 85%! Why not build smaller plants that can handle product closer to the producer (easier and less costly to haul box product to a central distribution point, than to haul live animals) and to boot we could train people better in these smaller plants! Not to mention our ability to start putting back some producer infrastructure that has been taken away buy the big guys!

Big may be beautiful to the big guys! But it does nothing for the long-term sustainability of agriculture in Canada and what makes Canada a great country!

[jensend]

I agree cowman. I'm tired of seeing the big guys come in and kick the crap out of an independent trying to give value and then turn around and kick the crap out of me by giving as little value as possible for as big a gouging as possible. Needless to say the banks love the business strategy of the big guy.

[cowman]

I've always tried to support my local businessman. I really don't like big business. I like to deal with people I know, maybe for literally generations!
Am I stupid? Should I just take the cheapest(maybe not best) deal?
When you buy a truck, bull, seed grain, financial service etc. etc. do you like to know who you are dealing with? You know...like I knew his dad and he was a straight shooter or who the hell is this guy and where did he come from?
Maybe I'm too damned old but I like to deal with people I know! If my fertilizer dealer says he needs this much and some newcomer says he can undercut him by $10/ton will I go for it? If I do my old guy may not be around next year and Lord we go a long ways back! I know my old guy will not gyp me, he will do what he says!
Maybe I'm just not ready to accept this "new" way of doing business! I guess I am a "dinosaur".

[kato]

How's this for big business? Had a talk with a cattle buyer friend yesterday. He said some interesting things.

Remember when those Americans came up just before the border opening was announced for boxed beef, and bought all those heavy steers to keep on feed in Alberta? The sellers got the Alberta compensation package. The feedlot got the cattle back for a while. This sounds fine, but there might be more to this than appears. Apparently, at the time, Cargill was locking in fat steers for October 1st delivery at 70 cents a pound. This was not general knowledge at the time for most people, as far as I know. I also heard a rumour that some contracts from other places were cancelled. Just a rumour, though. MMMM....makes you think eh? Not a bad deal, buy steers for 40 cents, and lock them in for 8 weeks later for 70.

This whole thing stinks. So far, though it's all just a notch above coffee shop talk, but you know the saying, "where there's smoke, there is fire". If this was trading in the stock market, I think someone would be investigating to make sure it was all on the up and up. I sure hope it was, because if not, then we've really been screwed. There are a lot of questions I have about the last few weeks, and I don't think they will ever be answered.

"What does not kill you makes you stronger". I think we need to learn from this summer, and get a lot stronger. We haven't been killed yet!

[ValueChainFX]

The question I guess you ask is who does this deal benefit the most?

It looks like it was written by the big guys?

and from the coffee shop talk corner I have heard they are taking advantage of the system as much as they can. Guess that is how big business works eh?