Depopulation

[poorboy]

rsomer and rusty1,

What is a producer owned packing plant going to do to help save the industry? It is not going to increase meat sales at all, and that is where the problem lies. If we have more animals offered for sale than we have buyers, we have a problem. The old supply and demand economics comes into play. It says that price will decline until supply drops. Yes the US packers are fleecing us, but it is only because we are offering more animals for sale than they can sell, so they don't have to pay more. A producer owned plant will not help this. There is only so much market available for our beef right now, and the packers are filling this market. Even if the price of beef at the supermarket dropped, it would not increase meat consumption long term, as competing products like chicken and pork would eventually have to drop in price also, in order to keep their market share.

The only answer is to either increase demand or reduce supply. Since we can't increase demand without the border opening, then we should reduce supply. There are two options here, we let the chips fall where they may and we lose 1/2 of all the cows in Canada, or #2 the gov't buys the cows at a good price and either ships them as canned beef to a 3rd world country, or buries them locally.

Letting the chips fall where they may, will cause lots of farm auctions, divorces, and people jumping off of bridges. Option 2, will I think be very well supported by the public if it is explained as the only answer to an oversupply problem. In no way will food safety be a reason for depopulation, rather a drastic measure to take to correct a supply that is twice a big as the demand.

And yes, if the border opens in a month, we will have high prices on 1/2 of our herd size. In general on a cull, the older more unproductive animals will go first, so we will be sitting with a younger more productive herd if the border should reopen.

So in my eyes, a producer owned plant will put more money in farmers pockets for the 1/2 of the beef that we can sell, but it won't do anything for the other 1/2 that is oversupply and growing larger every day!

[rsomer]

Poorboy: It was my understanding that there are markets for all the bone out beef from under 30 month of age animals that we can get slaughtered. This beef is and has been moving across the border since May 20, 2003. Markets are tighter for cows but our consumer is still eating our cow beef or we really would be hooped.

Cowman: I do not know about dragging the Canadian consumer into the real world. There is some things about the cow business, especially around disposing of animals and packing plants that just about turns my stomach. Maybe it is better if consumers image of the cattle business does not go beyond the nicely wrapped packages of beef in the freezer section.

You said the border is unlikely to open. According to the Boxed Beef Report the market is starting to digest the fact that cattle may not cross the border this summer. What I am starting to digest is that we just have no way of knowing when the border is opening, could be this month, after the election, don’t know. I do have extra animals around because I kept everything that was walking rather than give it away. Kept the all the replacements I possibly could because it was pretty uncertain about letting them go into the market. I did not seed any canola but put more barley in for feed. Hope it rains.

A lot of what happens will depend upon drought and available feed and pasture supplies. You are right when you suggest governments probably won’t go for depopulation. They probably will consider assistance for feed and pasture, loans, maybe more handouts. Too bad they are not considering financial assistance to packing plants. A simple thing like the plants being assured of financing rather than taking months or longer to arrange financing themselves would really speed up how soon these plants could be built. I have heard stories of how fast some things got done in the WWII as it was in the nations interest. This is in the nations interest too and if the national will was there we could have packing plants by year end.

[poorboy]

rsomer,

I do not think that bone-out beef was allowed to cross the border until some time after BSE was discovered May 20,2003. That is part of the reason for the huge drop in prices last year. I recall that is was in Sept. or Oct when bone out beef was allowed to cross the border.

My sources in the industry tell me that there is no more market for bone out beef at the present time, so having an extra packing plant will not provide more meat demand, but just spread around differently.

At the current time, a packing plant for cull cows may be justified. The US won't allow plants that ship beef under 30 months of age to kill cull cows in the same plant.

One of our other problems in Canada is that we typically calve in the spring and have the bulk of our calves hitting market from April through July. If the border does not open we need to change so that we have a more even marketing of cattle throughout the year. Be it more backgrounded animals or calving at different times. This used to occur more often 20 years ago, but with the big US demand, it didn't pay to background animals in last 10 years so most calves went right on feed.

Either our demand needs to rise for beef or our supply needs to drop. If you are correct, that we can increase beef sales by building our own packing plant, then by all means lets get going. Personally, I do not think that the numbers on this are there, but just a good job of salemanship. If the beef sales can't be increased then we need to reduce supply.

No matter which path is correct, it is important that we start on something, as soon as we can, or else the problem of over supply is going to get worse and worse. Just throwing ad hock aid money at the industry is doing nothing to help with the long term problem.

[kato]

There's one part of the depopulation scenario that needs to be addressed.

What happens when a few thousand (or million?) acres of hay and pasture are broken up and planted to grain? You don't have to drive very far from our yard to add up about 8 to 10 thousand acres alone!

Remember why this cattle expansion happened in the first place? THERE WAS NO MONEY IN GRAIN!

The ONLY reason that the grain farmers in Canada are no longer on the brink of bankruptcy as they constantly seemed to be for a few years is that we have done for them what the depopulation of cattle will do for us. We reduced supply, and made it possible for those still in the grain business to survive.

Ask a grain growing neighbour if the canola market can handle another million acres?

The grain industry doesn't even have the infrastructure to handle the extra grain that would be grown. All the small elevators are gone, and the rail tracks are pulled out.

We are not in this alone. We need the help of the grain industry. They stand to lose just as much as we do if the cattle industry goes down.

Our rural economy evolved into what it is with a lot of pain and hardship along the way. Do we really want to go through that again while re-inventing ourselves as grain farmers who will go just as broke?

[whiteface]

A VERY good point to consider, kato and one that I certainly hadn't thought of since I don't grow one kernal of grain but of course am strongly affected by the industry just the same. A great number of people have been affected directly or indirectly by BSE and we need as many of them as possible banding together to create the solutions needed to hold us together. Most of which DO NOT include just whining and waiting for a border to open that sure looks like it will be an awfully long time yet, but working toward pounding the crap out of the people "above us" that will give us funding to build and/or legislation to test and market and get ourselves out of this mess. We don't need handouts necessarily, we need freedom to make choices for ourselves.

[cowman]

Whiteface:While I totally agree than somehow we need to do something...the fact is there is nothing we can do? We can make lots of noise but remember this...the federal government is locked into a trade agreement that doesn't allow us to basically do anything? On top of that, who do they listen to? The duly elected representatives of the cattle industry, which are the CCA and the ABP. And what are they telling the feds?...no testing, no cull, no support for producer packing plants, no condemnation of Cargill/Tyson?
People on this site have me pegged as some kind of really pessimistic guy, and I have to admit that is true! I really can't see a whole lot of postive things here for the Canadian beef industry. And reading between the lines I see a lot of pain and frustration here? It isn't pretty and I doubt it will get a whole lot better!
My day is done in this industry...it was before BSE...but that dosen't mean I don't feel the pain others are going through! I have one more ugly hit to take...and thats just how it is...others have it a lot worse than me.
In the grain section of this site "igconito" says it very well...when you are in a losing situation, you cut your losses and walk...ugly but true?

[whiteface]

Some people, including myself, might say you're a realist, cowman, not a pessimist. I think our situation looks grim, very grim as well and many, many of us are going under before this thing is sorted out, some by choice like yourself and perhaps in the end because you made your own choice rather than than the US or anyone else, you'll come out on top with your dignity intact rather than the way I may come out, broke and with my tail between my legs. But I know that no one ever erected a statue for anyone who followed the status quo and one of the whole reasons I have purebred cattle is because I think of myself as an innovator, a leader, if I may say it proudly yet humbley and as a leader who also desires independance and improvement I simply cannot just give up and die without knowing that I tried every possible option out there and gave it 1000% in the process. Then and only then, will I say okay US, you win but taking my last breath, I will know that I gave it everything I had, that I exhuaseted every possible angle and maybe just maybe, I ( and WE ) achieve something that no one thought was possible and then you see your name on a statue, or in a history book, or maybe just a thank you from someone who really needed you but was just a little too tired to go that extra mile. Or maybe you just look in the mirror and like yourself just a little more than you did yesterday knowing you accomplished something really tough...but really worthwile. This is what winning big shows are like for me and ridiculous as it may be to some people the feeling that I get having not been born into this and not marrying into it...having done it all myself and being good at it, has only encouraged me to do more, and that's exactly what I'm trying to do here, with our BSE plight. I'm not being stupid or stubborn or unreasonable, I think we have a real shot here at making something great out of something that sure isn't and not just simply surviving but making our lives even better than before BSE. That would sure be better than simply laying down and dying and letting the government or anyone control you and make you feel hopeless. We can't make it rain but we actually CAN do something about this. Be at Grants meeting on Monday, tell everyone, non-stop we need the right to slaughter, test and market our own product. No is not a good enough answer. We will all die with a no.

[cakadu]

Remember the movie Jerry McGuire? There was a sign on the locker room wall that said "Success is getting up one more time than you've been knocked down."

By giving it your all whiteface (and everyone else) if worse comes to worse - and I sincerely hope that we all somehow manage to have a choice in how we stay or go - you will still leave with your dignity intact and I would say without the tail and leg thing going on. If you know you've done your best, then that is good enough.

[cowman]

Whiteface: I can surely respect your opinion and the way you have chosen to deal with this problem. In this life there is no "right way" and no "wrong way" just whatever works for you.
I was planning on phasing out over the next few years anyway and BSE actually stopped that process. If the boy hadn't come home in 2001 I would have sold everything anyway. I was very sick and I almost didn't make it, and didn't expect to. I gave my son just about everything. For now I have my condition under control, but I still get extremely tired sometimes and I have trouble keeping my weight up. My doctor says I need to slow down and quit trying to do a million things...which has been difficult!
And by the way I totally understand about the feeling you get leading that bull through the ring and the bidding just won't quit...better than any drug ever invented! I just doesn't get any better than that!

[whiteface]

Thanks for the encouragement cakadu and cowman and good luck with your health cowman. I've been there too when the bidding just doesn't stop on my bull in the ring but having good friends is a pretty darn good feeling too. Thanks. :-)

[cowman]

And hey Whiteface, I can at times feel your frustration...and that is okay. These are extremely trying times and I know you are hurting. Somehow, I come across at times as arrogant and uncaring...and I will admit sometimes I am that way! Probably my biggest sin?
This world can be an ugly place and it is very frustrating when you go to the well and bust your butt and nothing seems to work! But be assured that these things will pass, and that tommorrow the sun will come up, and things will eventually change. Bad stuff doesn't happen forever! Things will turn around and you will be a better person for it! I know it is very hard to see this when everything looks bleak and you see no way out...but I have every confidence that you will do well! Life is not all rosy and we all have our bumps along the way. Deal with the hard times by knowing that the good times are right around the corner!
I also note your name...Whiteface...I presume you are of the Hereford persuasion? Although I've slipped and sinned over the years...I'm still a Hereford man at heart!

[whiteface]

Absolutly warmed my heart cowman to have you savvy enough to "read between the lines" with my comments of having purebreds and then noting the name I coined for myself on this forum. I think you are an amazingly observant person with your insights on cost of production and now having detected my breed of cattle. Thanks for noticing, yes they are. Nice to know that your roots had some Hereford influence and while many people got away from them for a while, if I dare say, humbley yet proudly, I've changed the minds of some real die-hard simmental, charolais and yes even, omigod, angus commercial people with some pretty darn good hereford bulls. Every breed, like every person has something to contribute, but to have commercial guys pass up some nice-looking exotics for some of my whitefaces is quite a rush and one that I don't take for granted. I work real hard, cull real hard, market and try and be a positive leader, much like I will try to contribute to all of us as cattle breeders in this country and find a trail through this mess.

[cswilson]

We ran Angus when Angus wasn't cool but my favorite cow is still a baldie-you can breed her to a billygoat and still get a saleable calf. At our 4H show last week I told some recent Angus converts that I was Ai'ing some black cows Horned Hereford to fix their udders-talk about a stunned silence. I found another 90 straws of my udder fixer so looking forward to some good half sisters.P.S.-I'd tell you the bulls name but then I'd have to kill you. LOL Anyone want to try guessing.

[whiteface]

Thanks for the chuckle and the positive words cswilson. I actually can't possibly fathom a time when the angus weren't cool but I sure believe that you got a stunned silence when you said you would A.I. to whitefaces to get udder quality. Some guys (including myself) have worked really hard in that area (probably because the breed REALLY needed some work there!) Good for you for having some semen in the tank on some good old bulls, I can sure appreciate that you can't disclose any names, I have as much of a competitive nature as anyone ( well, actually maybe a little more...) and got a chuckle out of you having to come looking for me if I were to find out your breeding secrets!!! I go through it too! I love a baldie as well! Gosh who doesn't, but for now I love the show and sales ring enough that I stay with registered stuff. Sure helps pay my mortgage too in this high rent district of the planet (central Alberta) to sometimes have a calf worth a little more than what he would bring through the auction. Sometimes it helps pay a few bills, you know, the ones you WOULDN'T have if you were a commercial guy, registrations, advertizing, shows, I suppose we're not that much further ahead at all...maybe even behind the commercial guy, sometimes few and far between those "elite" ones that people will pay for.
But I'm having a great time doing it.

[cswilson]

It is really hard to find the right kind of Hereford cattle-so many tried turning them into exotics-big bw's,poorer udders,big frames-but there are some good ones out there yet. We used a bull out of Nebraska CJH L1 Domino 552 worked real great but he up and died and his semen is all gone. The Fraser's at Hussar have a bunch of sons on the ground look real promising. He fixed udders and sucked the BW out-two major problems.