New money rumour

[kato]

Heard on the CTV news this morning that there is about to be an announcement by Bob Speller about a feed assistance program of some type for cattle under 30 months. Probably aimed at stopping the fire sales that are going on now.

Keep your ears open. Who knows, it might be a good thing.

[almoy]

Probably be a loan guarantee. More debt to pay back with cheap cattle.

[smokey]

New money...ya right! Sounds like another carrot and stick routine...Offer the producers a few bucks then tell them the border is just weeks from opening. Have any of you heard this before? Have any of you received and government aid yet? Do any of you actually believe you will?

[rsomer]

The Alberta Government made this announcement yesterday.

Alberta Steer and Heifer Market Transition Program
How does the program work?
This program will compensate producers based on 60 per cent of the difference between the 93 cents per pound reference price and the greater of the producer's actual market price or the weekly average price on eligible animals sold between September 13, 2003 and February 15, 2004. Payments will be made per pound of net live weight sold.
The program is only open to producers who registered their animals that were on full feed on May 20, 2003. Animals not sold for slaughter by February 15, 2004 will require proof that they are legitimate May 20, 2003 'fat' cattle.
Eligible animals are steers with a minimum average net weight of 1,250 lb. and heifers with a minimum average net weight of 1,200 lb. Lighter animals are acceptable if they were sold directly for slaughter and graded Canada A or B. Both steers and heifers must have been on full feed on high energy finishing rations, in a terminal lot as part of May 20, 2003 inventory.
Animals owned by packers, or owned by businesses or partnerships that are non-arms length to packers, are not eligible for compensation under the program.

This will raise the Alberta direct contribution to the Alberta feedlots, 58% controlled by 33 feedlots, 80% controlled by 130 feedlots to $400 million since May 20, 2003. The federal contribution of $600 million would be in addition but as with the Alberta program the majority is still going to the same small group of wealthy mega feedlot owners such as Rick Pascal. The total to date would be at least $1billion dollars over half of which went to 33 wealthy feedlots owners who would have received a government cheque averaging $30million dollars each.

These are the same feedlots that are buying our calves at auction markets for $400 a head.

The remainder of the Canadian beef industry made up of 90,000 cow calf producers, grassers, and backgrounders have yet to see one penny of government aid. Shame!!!

[cowman]

On QR77 yesterday they ran the story about Bob Speller coming down with a "major relief" program for the cattle industry next week. They also had a quote from Shirley McClellan saying Alberta would not be participating in this new program as it was a 60/40 deal and Alberta had already spent $400 million and the cupboard was bare! Which was exactly what my source in Edmonton had told me back in late January...no more money from the Alberta government!
Now I'm not just too sure how the government of Alberta intends to finance the $180/cull cow thing but I believe it is coming out of some existing program? Which might explain why we've never seen any of that money?
I have no idea what the new federal program is. But I have to be impressed by Bob Spellers attempts? It couldn't have been very easy to pry some money out of the boss, the last few weeks, what with all the money scandals taking place? I don't think we would have seen Lyle accomplish this?

[cropduster]

Seems like some of those `wealthy` guys aren`t comfortable yet.Should have heard the squealing from Pascal and Van Raay yesterday in Red Deer.......

[grassfarmer]

"wealthy mega feedlot owners such as Rick Pascal."
"These are the same feedlots that are buying our calves at auction markets for $400 a head."

rsomer, I believe Rick Paskal lost $6 million in the first three quarters of 2003 - no longer wealthy. No longer buying cattle either on account of bad relations with the bank.
Sure, the cow calf man is hurting now but if we are honest we did a lot better last year than the feedlots. Personally I have no problem paying compensation to feedlot operators as they will spend that on calves given a chance. The crime here has been committed by Cargill and Tyson not the feedlots, many of whom have had their equity built up over twenty years wiped out.

[kato]

The sad fact is that if the guys who bought the calves lost money, why would they want to buy more? There is no such thing as a forward contract any more, no safety net, no protection at all.

It's a real problem. Without the calves there are no feedlots. (Unless they come from another country..gee, I wonder which one?)

On the other hand, without the feedlots, it is still possible to have fed cattle in this country...they will just be fed by the primary producer. How many cow calf producers want to go down that road is anyone's guess. We personally will do it if we have to, we've done it before.

I think the best thing in the long run for our industry is for both the feedlots and cow calf producers to get together and solve this whole thing. The packers (aka American interests) are probably sitting back and waiting for us to tear each other down, then we'll all be for sale, cheap.

[cowman]

I have to agree that we need to work with the feedlots and not against them. These guys have hung in there and provided us with a pretty strong market for calves last fall? Now they are really in trouble? If they are "squealing" it is because they are going broke?
Sure they got some money, while the cow/calf guy didn't, but then we never knew this thing would go on this long? When the government brought in the feedlot relief program we all hoped it would be a short term thing that was necessary until the markets returned to normal?
Will we all go back to feeding calves? I would say no? Your average cow/calf guy is just too old to do the work, make the long term investment, or take the risk? In fact I suspect if the government set up a program to provide the average cow/calf guy a way out the stampede to leave would be impressive?
But maybe the government won't need to put up any money? If it is dry this year the stampede could be impressive anyway? Get your ammo bought and book the trackhoe?

[rook]

Cowman, I respectfully ask what would a program look like that lets cattlemen leave the industry? Isn't that three phone calls - auctioneer, bank, and real estate agent? What exactly do you mean by a program to leave the industry?