What do you think

[grassfarmer]

If I remember correctly they talked of needing $15 million to build a plant with 45,000 head annual minimum capacity - about $333 capital cost per head. Unfortunately all these numbers and schemes are academic unless producers and investors get behind them.
Rusty1, with your plan I note you talk of killing UTMs as well as OTMs - how likely do you think it will be that you can kill both in the one plant within say the next 5 years?

[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]

International trade is a funny business that in many ways has nothing to do with quality, or price or product safety. Agriculture products don't operate in a vacum? Everything is a tradeoff.
Japan exports massive amounts of goods into America and yes Canada, but lets face it America is the SHOW? It is perhaps the ultimate consumer market?
Japan must export or it dies? I mean they don't have any natural resources to speak of...their success has always been adding value to imports?
Now I would think the beef export agency has pretty well tried everything they could to increase our exports into the asian markets? And I do believe they had some success, but the fact is we are a very minor market for their consumer goods compared to the USA? I think Ted Haney was doing all he could to sell our beef and I think he had some moderate success? Maybe I'm completely wrong?