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    What do you think of this?

    Lee Gunderson of Alberta Beef Magazine has put together this one page solution for the Canadian cattle industry. This is compliments of his consultation with Scott Lees of Soderglen Ranches and the well known Canadian Dr. Bob Church. Both have thought through our complicated industry position to date and both feel this one solution could fulfill many needs simultaneously until a fully functional market for cattle is restored. - 8/27/2004
    Here is a one page solution to the BSE crisis.
    Here is a one page solution to the BSE crisis. Compliments of my consultation with Scott Lees of Soderglen Ranches and the well known Canadian Dr. Bob Church. Both have thought through our complicated industry position to date and both feel this one solution could fulfill many needs simultaneously until a fully functional market for cattle is restored. We have all been ‘walking the floor at midnight for the past year’ like Ben Thorlakson, looking for a way out of our predicament. We must acknowledge the feds are unlikely to put political/trade pressure on the US. We must wait until elections are over in Alberta and the United States. Admittedly, the Alberta Government doesn’t want to go head to head with Cargill/ Tyson competing with them by building a packing plant because it could be a billion dollar boondoggle similar to the MagCan plant at High River. Further, construction and planning and staffing would take up to two years. The Alberta Government would rather be seen as 'enablers' of private initiatives to cope with the slaughter processing capacity solutions. We cannot match the deep pockets of the Tyson/Cargill monopolies especially since they are expanding capacity. Further, it would lead to direct competition with those new plants already proposed and under construction.

    Anyone who has ploughed through the 22 page CCA proposal recently released at www.cattle.ca will note our domestic slaughter capacity should

    peak around 2006 and reduce our dependence on US exports to around one million head per year. This lengthy document hits on all the issues with some long-term solutions to complex problems. It should be noted that flexible strategies and government policies will be needed until some degree of certainty and normalcy returns to our industry if it ever does: this applies to taxes, income deferral and cash flow to producers. It sure becomes a complex mess trying to sort out who needs help and how much is needed and is fair. We're in for an economic storm of sorts.

    Simply put we need to dramatically reduce the Canadian cow herd to address our current oversupply problem. A good way to help ourselves out of this abundant supply problem, and of course others may dispute this, is to effectively reduce the size of the cow herd until some sort of border normalization occurs, or until we have a fully functional marketplace for our livestock: i.e. supply and demand meet each other at such a point that stability and profit are found for all sectors of the livestock industry.

    1. All cattle, (young or old, with a head, four hooves and a tail) that producers want to voluntarily surrender could be brought to special holding pens at your local auction market across Canada.

    2. Order buyers and auction markets would be paid (gives them cash flow) to assemble/brand/ and pay for the culls (OP brand for out of production). Let us use an arbitrary figure of $300.00 FOB the market. This will give producers some salvage value for cattle they no longer want to feed or whose reproductive life has ended (heiferettes; etc.) This could also apply to crippled animals, injured bulls or distressed calves etc.

    3. CFIA would have access to all the heads available that they need for testing. And we would have a rational, orderly and voluntary exit from the Canadian cow herd of several million cows over the course of the next year or two. If too many cows come, lower the price paid. If not enough cows come the surrender price could be raised. The subsidy paid would be realized by primary producers, it would be immediate, it would be fairly paid to those in dire need of liquidity.

    4. Those animals that have salvage value: bologna bulls, cows for grinding etc. could be processed and those that have no use in the human food chain could be used for bio-converters for fuel or be disposed of according to further plans CCA is exploring.

    This simple plan will accomplish several goals at once: attrition of the cow herd (voluntary supply management)...cash flow ....heads for CFIA....orderly exit strategy... it is a supply management solution which addresses the real immediate issue (oversupply) without throwing more hundreds of millions at band aid subsidies which do not address key issues. Nor is this to diminish CCA's strategy, at least they have a broad master plan which takes some bold steps. PLUS: the payment goes immediately and fairly to the primary producer. This eliminates a lot of tax filing and deferrals and lost time.

    Lee Gunderson

    #2
    What are these illustrious gentlemen saying? In fact aren't they saying simply...the pit!
    Well I guess now that someone with a big reputation said it, we can finally consider it?
    It is also very obvious this isn't going to happen? The politicians would be roundly roasted as complete idiots! But it makes good copy and sells newspapers!
    Does it make sense? Well yes it does!
    Kill every cow born before 1997 and bury her! Or for the squeamish we can pretend we are processing her into bio-gas or something.
    I do believe the time has come to bring the consumer into the real world? But I truly doubt it will ever happen...it just makes to much common sense?

    Comment


      #3
      Although I will never agree with killing the pre-'97 cows (as there are some real old herdbuilding cows out there, some of which grassfarmer and I own), I think a voluntary cull of animals that are absolute trash and would be of almost zilch worth (i.e. cancer eye, mastitis) is a good idea.

      Yes, in essence, these boys talk about everything leading up to but excluding, digging the massive pits and burying thousands of heads of cattle, so it isn't too hard to swallow. But I think in the short term, it would save the industry a hell of a pile more money then if we just give every producer a hundred bucks for each feeder steer he keeps over this winter.

      Heck, if we went ahead with this solution right now, we might be able to at least rid ourselves of a portion of the culls in everyone's herd before December....one less headache this winter.

      Comment


        #4
        They only talk of bio processing the ones that are worth nothing at all. The rest would be processed. My question would be where are these cows going to be made into burger. Good Idea, might need a plant to go along with it.

        Comment


          #5
          Well 15444, I guess you aren't a firm believer in the concept that the next generation is always better? Not knocking that attitude, mind you, but don't these coming eight year old cows have any calves in the herd?
          Now I assume, you probably have a few "really good old cows"...just like everyone does? But for the good of the industry, wouldn't you consider doing it? I know and you know the whole thing is a crock of BS...but that is the reality of this thing and we need to fight BS with BS?
          So stand up and take one for the industry and ice those old cows!

          Comment


            #6
            Just went through my inventory and added up my older than 7 year old cows-not all that many but some pretty good cows-but like cowman says the good ones have replaced themselves many times by now. I guess if government decides to pay out on old cows and you don't want to cull her-let her run the string out-shoot her and bury her on the ranch to keep her out of the foodchain. We do it with old saddlehorses-why not old cows-a massive age cull would do nothing but good in the long term. If you think the genetics are irreplacable-flush the old girls and collect some embryo's-the salvage price would floor the butcher cow market also so the better cows might bring some money.

            Comment


              #7
              I guess the best and only way to avoid giving them up would be to sign something that in a roundabout way says that the person will never market this animal into the foodchain, but will keep her producing calves until she is retired to a well earned grave somewhere on the farm.

              Comment


                #8
                I think it is an excellent idea. I would have the same question as rpkaiser regarding processing the good cows but other than that it is great. It is a way fancier than Cowmans idea of a pit and I think with these illustrious backers the Alberta Government will buy into the idea and have it rolling very quickly. That is the beauty of it - it can be rolling very quick and we can pull the trigger on these poor quality culls. Dispose of all the welfare cases that may occur and get the Government it's testing tally by year end. Don't forget it also means XL will have to pay $300 for every cow they want as it fixes a base price for them. An outstanding idea and one that holds much merit - and I think it will get acted on because it doesn't prevent any of the other ideas to build plants etc going ahead.

                Comment


                  #9
                  There are several projects at various stages with respect to biodigesters. Mind you, some are at the preliminary stages i.e. feasibility so it would be a while before they got up and running as well.

                  There are many by-products from the biodigester - electricity could be sold into the grid, there is water that comes out of the process that could be used to pump down oil wells and who knows what else could be generated using these things.

                  A stronger argument could possibly be made for a digester versus a plant due to the fact that there aren't the major competitive factors that face a packing plant i.e. the billions at the disposal of the big packers.

                  Comment


                    #10
                    I don't think you have to put your old cows in a pit. I think that was just an idea on how to help some people out of having to many to feed. Acording to the standands set out any thing over 30 months is a cull.
                    Just got the prices at our local sale barn from last Tuesday.
                    Stockers 201-450 26 low 87 high 63.30 avg.
                    451-600 20 low 80.5 high 59.62 avg.
                    601-950 30 low 75.5 high 52.90 avg.
                    Meat cows (including milk cows)
                    3 low 33.50 high 17.32 avg.
                    Stocker Groups
                    201-450 70 low 77 high 73.50 avg
                    450-600 no sale
                    600-950 no sale
                    I don't know want is going to happen but its getting really scarry.

                    Comment


                      #11
                      Got thinking this morning of a part 2 to this cull plan. Once it's up and running we could add in a prime cattle component for little extra running cost. Say offer 80cents/lb for prime cattle with the intention of disposal either through biogass, incineration or burial - straight away Cargill and Tyson will have to up their bids to 80 cents (and they could still make record profits at that)If I remember correctly the figures quoted in the press show about 58,000 cattle offered weekly with only kill spots for 52,000 -something like that anyway, so the Government would only need to buy @ 6000 a week or $6 million which is a fleabite in the Federal budget. Look at the effect it would have - feedlots returned to profitability and hence able to buy feeders at raised prices - we'd be back in business again! Again this would not comprimise any plans to build new plants- it would serve until they came on-line. Lakeside would still expand although they would do some huffing and puffing when it was announced. Crazy idea ? well it's essentially what has happened in the UK for the last 8 years with every over thirty month animal incinerated and compensation paid. Yes it's a waste of good beef but when we already have enough food in the world to feed everyone yet millions starve every year due to political innaction what does it matter if we waste a relatively small number of cattle? As far as cost is concerned would it be any dearer than subsidising us through CAIS and a number of other band aid solutions?

                      Comment


                        #12
                        Alicia:

                        Word from one of the biggest order buyers in Ontario is that the cow/calf guy is in for a 'rude awakening' this fall.

                        Had a guy around the area last week looking for 5-weight calves for $300 bucks straight across the board. Kinda thinking that it might have been a pretty good deal?

                        Alot of guys are thinking of holding stuff over this fall, but how does that help next spring? Eventually the fat lady has to sing?

                        Comment


                          #13
                          15444- I already sold my top steer calf and got 65 cents a pound he weighted 585 pounds.
                          I said last year I wasn't going to breed my cows this year and I went ahead and did it, so I got know one to blame but myself, if I can't even give them away next year.

                          Comment


                            #14
                            Well somehow I don't understand the reasoning behind not breeding the cow? Maybe keep them for pets or something?
                            I do not understand how so many people can keep taking a beating and still hang in there? I guess they have some pretty deep pockets or something?
                            The real scary part is a lot of these people have no concept of what their costs are and frankly couldn't care less! It's like, Oh my grandaddy gave me this land and I don't need to make anything for my labor sort of thing!
                            Which is okay I guess, but it sure is alien to how I think!
                            Is it really any wonder why we have so many young people not entering the cattle business? How do they compete with people who are just in it for the lifestyle and don't care if they make a profit?
                            We've all heard how cheap Brazil and Argentina can produce food? I would suggest Brazil will never be able to compete with some of our cattle producers! Because some of our producers will pay to raise cattle!

                            Comment


                              #15
                              Cowman: My thinking at the time was I will keep my very, very best and get rid of all the rest. Keep the numbers down so that they can keep the pastures cleaned off, and I have lots of hay in the barn to feed them till this pass and things get strainghtened around.
                              But I got sucked in by the goverment and other peoples thoughts. I breed them again, so the packers got next year out of me for cheep calfs to sell for meat at a big price.
                              May be if we all had not breed or cow herd last year. Their would of been know stockers this year or next year and I'll just bet that the prices for old cows would of been not to bad. But that is just it if we don't give or calfs away for nothing the goverment will just import more beef into the country, AND HOW DO YOU BEAT THAT SYSTEM.
                              You live out west their there is a lot of land that the people don't want for housing and development. In the east we have more people that want land for development and with the enviorment laws, natureal resourses law the people can't build houses on poor land, they have to have the very best farm land. So the goverment has to put a plain in place to take the land away from the farmer, but make it look like it was the farmers choice to move off the farm to make room for industral development. The goverment makes more money by importing food from underdevelop countrys and exporting industral good to them. I think I told you before that soom of my farm land runs right into the villeage, so they passed a buy-law that when every cow goes off my proporty or I stop doing farm activity that the proporty turns from farm land to Residental. And once its Residental that is it no more cows no more farm. GONE.

                              Comment

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