First Thing Monday Morning

[kato]

Agri-vation . com. That's about it lately! LOL

I think what everyone is getting at is that we've been pounding the "based on science" aspect for almost a year now,and gotten absolutley nowhere.

Even though we know the beef is safe, and the protocols are working, the fact of the matter is our market is not functioning. Not at all.

We need change and we need it soon. Now, what to do? Waiting for the Americans to welcome us with open arms is a waste of good time we could be spending finding ways to live without relying on only one market.

There are a lot of creative minds in our industry, and it's time to get together and come up with a plan. The producer owned plants that are starting up are a really good start. But they need market access. If it means testing for export, then so be it. If it means testing everything over 30 months and/or under 30 months, so be it.

The biggest danger with random testing is the horrific swings in the market when one is found. Just look at last Friday's futures in the States with a "rumour" of a cow that may or may not even have existed, being sent for BSE testing.

It's fine for the government to say, "Random testing is just to assess the level of infection in the herd, it doesn't really mean much in the big picture" That's all very true, and we all know it. Tell that to the guys who have cattle sitting at the auction mart the day they find another one. We all know what will happen to the price that day and for a month or two after!

Anything has got to be better than what we are going throught now.

[cakadu]

Do we have the guarantee of a market if we test 100%? The Japanese have said that they want 100% testing, but that does not in any way shape or form infer that they will buy the product.

Let's find the markets BEFORE we start onto the additional slaughter capacity. Everyone seems to be focusing on the cattle that have to get to market - what about the resulting meat that will have to be moved? Otherwise what will happen is we will have all this meat with no place for it to go. It's not like wheat or canola that can sit in the bin until prices come up - once it's slaughtered, it has a finite shelf life.

I think that starting up these plants for competition, better service, working within a value chain so that producers can get their fair share of a return are all worthwhile endeavours. What I wonder about is the fact that we seem to have several proposed plants that are wanting to do the same type of beef i.e. hormone free, natural, organic - what have you. Each are going to have enormous start-up costs and will end up competing with each other over the long run. What would happen if we focused all the energy and resources into establishing one plant that could become the successful working model for others to start? From what I can see in the plans, none will be up to full capacity right away. Wouldn't it make more sense to make a go of one and then branch out?

In the spirit of cooperation and collaboration, I would like to see the competition out of it right from the get-go. Work together as one collective entity instead of several smaller ones that the big boys could take out with little problem. How could you see that working?

[whiteface]

I love those ideas cakadu. I've been talking and writing until my tongue and fingers were ready to fall off and my goal was to inspire, anger, frusterate, motivate as many people into action as I can. Several bunches seem to ageee or sympathize but does anyone know out there what it will take to put some of these thoughts into action. I will certainly be in the game because I believe in all of us and our business...I don't know where to turn now after barking and barking and although people all around me seem to agree at least in part, how do we spring to action? Bark some more? Any further ideas than harrassing the crap out of the politicians. I have definatly done a fair amount of that and will continue to do so.

[whiteface]

Cooperation and colaberation right from the get go, cakadu. If you are anything like the rest of us Canadian or American ranchers, I bet you are an independent cuss. If I don't remember who I am, some mornings I can hardly take orders from myself.

Competition is good. Look beyond the frustration that all of us voice from time to time,(and cowman voices constantly) and you will find a group of people (including cowman) who have survived and will survive because their industry has always been competitive.

I see no harm in smaller groups with vision starting value chains etc. The ones that make it and grow will force the pirates to take notice.

Oh and by the way science shmience. We have used this BS for a year and it has gotten us nowhere. When I mentioned Mark Purdey to a communication expert at our provincial Ag Ministers office the other day, he said," that's the guy who talks of cows geting BSE from eating dirt". That's the scientific explanation our Ag office gives for a theory that revolves around chemical imbalance. One that makes as much, or more scientific sense, as the current Prusiner crap. But Prusiner won the nobel prize, or something, for his work, that he stole from someone else anyway. Prusiner is a quack, and we all suffer for it.

Yes we may need to find markets for our BSE tested beef. We have wasted a whole year already so lets get to it.

The Texas cow is a perfect example of the progress we have made in our integrated North American effort. Shook the hell out of the markets. Positive result, and we are right back to square one.

[cakadu]

RP - yes, to a great extent what we do around here is independent and we haven't played in the "normal" marketplace and likely have been the better for it over the years i.e. stable price while the price fluctuates all around us - steady customers with word of mouth selling more - putting the majority of the money in our jeans instead of someone else's.

Having said that though, we need to become interdependent, which isn't to say that our independence goes by the wayside in favor of working that way. Smaller groups working together can collectively go after bigger and more varied markets, responde to customer demands more quickly and keep on top of the changing tides of consumerism.

Why do you think it is that the monopolies are able to control what they can - they divide and conquer. If we all have to do it our own way, then how far can we get when things take off?

We cannot be all things to all people, so we need to find those that can assist us into becoming that well functioning whole. Not all of us are marketers, so find the people that can market; find those that can read the marketplace and be proactive when it comes to getting the next thing going. Believe me, when you've got a good idea, then the competitors start to come out of the wordwork, so you need someone who can stay one step ahead of the competition in that regard.

Yes, we need to start doing something - of that I have no doubt. We need to be able to focus the energy and resources into making the first one a success, so that others will believe in it enough to risk getting involved. As you can probably tell, there are a number of skeptics out there. What better way to quell the skepticism than to have a plant that is a resounding success and forms the basis and the mechanism to replicate that success. Not that they all need to be cookie cutters but the formula can be used to create other similar successes.

Nothing will kill the optimism for this idea of producer owned plants faster than if several start up and they aren't successes. When I think about how much capital has to be raised to build and operate each plant, wouldn't it be better to ensure some modicum of success before spending all of that money. For example, if you need $4 million just to build the plant, you need double that or another $8 million to operate it. That is a huge amount of money to be raised in this cash strapped, low optimism environment that seems to be prevailing. Show people it can be done and help to sway the attitude that it will never work, or will only work in a very limited way.

[rsomer]

A note about U.S. District Court Judge Cebull. It is not election time for him either. Judge Cebull was recommended for U.S. District Court Judge by Republican Montana Senator Conrad Burns and Republican President George W. Bush made the actual nomination for the federal judgeship. The nomination was confirmed by the Republican majority U.S. Senate.

I would question whether we have gotten nowhere by pounding the "based on science" aspect. Canada was exporting beef 4 months after the May 20 positive BSE cow. That was based on science. It could have even been quicker if the politics at the time between the U.S. and Canada had been different. I think most would agree if it were not for the Washington Holstein we would have been exporting live cattle to the U.S. before now. Canada has managed quite well in the last eleven months. We are exporting beef to a number of countries, the U.S. and Mexico and others as well. The International Review Panel’s recommendation was for the most part favourable to Canada. Other than Canada not having sufficient packing plant capacity to slaughter our own production and being too dependent on live cattle exports we have done quite well.

I think the U.S. sees very, very clearly that if the border doesn’t open up real soon that there will be a dramatic and rapid shift in packing plant capacity from the North West U.S. to Alberta and the rest of Canada. That is the real threat that is being made to the U.S. that will get the border open. If Canada were to threaten 100% testing if the U.S. doesn’t open the border to live cattle that would be perceived as an empty threat by the U.S. The recent comments by Shirley McClellan that no beef should leave Alberta to the U.S. except in a box is an effective threat to the Americans as it offers a realistic future of the beef industry if the border doesn’t open in the very near term.

If the U.S. looses its packing plant industry in the North West U.S. they will have no one to blame but themselves.

I note the comments to the effect that those that feel the border will open soon are fooling themselves. I guess there are a lot of fools out there because there are buyers purchasing all the feeder calves that have been coming onto the market. The markets in Canada and the futures in the U.S. all seem to anticipate live Canadian cattle entering the U.S. market sooner rather than later.

[grassfarmer]

There were a lot of fools buying the same feeder calves last December only to unload them in February when the banks were leaning on them.
Yes, rsomer I hope the border opens soon but I'm not staking any of my money on it.

[grassfarmer]

I love it when our government officials try to take credit for the open border to boxed beef. Especially when they say it was based on science. Simply a matter of money and greed. An opportunity for the three big American packers to steal cattle from Canadian producers. I guess things could have been worse for the big three, and ultimately for the producers if we had no exports, but a different scientific approach could have changed things far more dramatically and could have produced profits for producers as well as packers.

Great to hear that you are so sure we will have open and free access to the American consumer once again rsomer. Do you really beleive that the packers have not taken advantage of their position and ravaged the Canadian Cattle Producers? Do you think we should just go back to business as usual when this is all over?

[blackjack]

grassfarmer... since you have seen the results of BSE in the old countries ... I think I'll take your advice and stay out of the buying market .

[rsomer]

Canada’s crisis is not the same as Great Britain and comparisons will lead to wrong conclusions.

Of course the packers have taken advantage of the lack of competition. And it won’t be business as usual when all this is over, if that is this month or next year as some suggest. Changes will take place but there will still be cows grazing the grass. It appears that government is committed to a feeding industry in this country and risk protection schemes will be put in place to manage further crises. Some changes that are coming are a livestock insurance plan and no doubt increased packing plant capacity in Canada. How much packing plant capacity is increased will be determined by first how long the U.S. delays opening the border and how effectively the risk of feeding cattle on one side and killing the animals on another side of an international border can be reduced through insurance plans, safety nets and other risk management strategies.

Yes, another BSE cow could be found in Texas or Saskatchewan, Ontario or Washington like last December. That is the new reality of the beef business. Still, just about everyone believes the border will open some time, the question is when. I hope the border opens soon too and I am staking money on it.

[whiteface]

Rsomer, it sounds so good the way you say it, I only wish you were the one making the decisions and we'd be out of this by now. Just tell me this, exactly why are we still not moving live cattle across the border if the situation is really as you say it is. Another question I have is really how long can you afford and are prepared to wait? What if you have more grasshoppers than grass this summer? and if you're in that good of financial shape and don't mind waiting (maybe forever) to cash in on all the money you stand to make when ( and if ) the border opens, I've got an awfully good and very expensive (although only worth barely a grand a piece at today's prices )herd of Nationally acclaimed purebred cattle that would be an absolute steal for you. Interested? You could make a killing...Balking? Yes and I know why, we all really aren't that confident of an open border and cattle eat - every day, chopping into profits like grasshoppers...
I'm not in your face with this rsomer, I would just like for all of us to have a "Plan B"...and then to put it in action sooner than later because "Plan A" ( the open border ) is really not getting us out of trouble. And incidentally, I don't want to just give them an open border anyway. They made tons of money at our expense, only to just resume to "business as usual" I don't think so. Now we make money with their rejected Japaneese market maybe at their expense. What goes around comes around.

[rsomer]

Why is the border still closed to live cattle? Because they found the Washington Holstein. The U.S. is moving forward with their regulatory requirements at a pace that is slower than we would like but the process is still moving forward. After December 2003 I thought there would be an announcement on opening to live cattle before May 20, I see nothing substantial to change that. I am not worried that we haven’t received the good news yet, even though I wish it were so.

How long can I wait? How long I can wait depends as much on how much hope I still have on the border opening in time. If I did not see the border opening until November, I would let my calves go now but I am more optimistic than that. As for the cows, we were able to keep all our cows through the drought of 2002 so I am confident that I can see my way through. No doubt if we were to have a repeat of 2002 (drought and grasshoppers) with no improvement in the border situation it would be brutal. I know the industry is working on a Plan B, hope they never have to go to it. Although I am a huge fan of producer owned packing plants, that is a long term solution that offers no help for 2004 other than the threat to the U.S. that in the long term they stand to loose their Northwest Packing Plants to Canada if the border doesn’t open soon. It really is anyone’s guess if Plan A (the open border) will happen in time to get us out of trouble but I believe it will.

Balking at buying your cows...well I am doing good to hang onto what I have got. But there are people with money to invest in a risky venture and there are opportunities out there right now like we won’t see again after the border opens. I guess the rich get richer, and the poor, well, they just keep on farming. :--)

[whiteface]

You are and amazing person rsomer, I'd love to meet you. My hat is off to you, I sure appreciate a good argument and one who stands by it. I do sincerely hope you are right, I don't especially want to part with my cows, even to someone as together as you are.

[blackjack]

rsomer.... We have a major problem since Judge Cebull ruling ... packers have quit buying... the momentum that had been building in the feeder market has again been thrown out the window...how long will it take to get the market to where it was a week ago? ... anybody buying cattle in these uncertain times as far I'm concerned would have better luck with their money in Vegas !

[kato]

Well, with all that has happened this last week, at least someone is home in Ottawa. I sent Paul Martin and email, and darned if I didn't get a response THE NEXT DAY!

Not that it will make much of a difference, (oh cynical me!) but at least someone read it.

This is the reply I got.


On behalf of the Right Honourable Paul Martin, I would like to thank you
for your e-mail regarding measures to assist cattle growers affected by
Bovine Spongiform Encephalopathy (BSE).

You may be assured that the Government of Canada will continue to do
everything that is necessary to ensure the safety of Canada's food
supply and to help Canada's beef producers regain access to foreign
markets. Work continues toward re-establishing the the normalization of
trade in our beef products.

Given their responsibilities for this issue, I have taken the liberty of
forwarding copies of your message to the Honourable Bob Speller,
Minister of Agriculture and Agri-Food, the Honourable Pierre Pettigrew,
Minister of Health, and the Honourable Jim Peterson, Minister of
International Trade, who, I am sure, will also appreciate being made
aware of your views.

Thank you for writing to the Prime Minister.


P. Monteith
Executive Correspondence Officer
Agent de correspondance
de la haute direction

Isn't that something? You gotta love an election year! LOL

When I wrote to Roseanne Wowchuk in January, it took until last week to get a reply.

As for the markets this week, I think it's safe to say that the market is going to resemble a rollercoaster ride more than anything for the next while. You just have to try and guess when to get on and when to get off!