Captive supplies?

[cowman]

Now I'm not defending Cargill/IBP for how they have taken advantage of the border closure, but I'm not condemning them either! The Canadian and American governments are to blame for allowing that situation to develop and it is unrealistic to expect any company to not take advantage of the situation!
But consider "captive supplies" or packer owned cattle from a packers view?
The packers do not set the retail price? Basically they are price takers...just like the rest of us?
Now what happens when Lucerne or IGA or whoever says we are paying X amount of dollars this week for carcass beef? The packer has to figure what his costs are, and figure in a profit so he can continue to operate, and make an offer to the feedlot? Now if the feedlot decides that price just isn't good enough what can the packer do? Does he send all the workers home or does he buy the fat cattle and lose money? I guess he does both at certain times?
An efficient business needs to be up and running everyday? It needs a product that will meet the needs of his customer? And being efficient is the key to staying in business?
Captive or packer owned cattle can be fed to exactly what the customer wants and it can come to slaughter at the perfect time? Perhaps from a big overall picture all the fed cattle should be owned by the packers?
And lets not forget this...about the only buyer in the feeder market, at times, last year were the packers?

[cowman]

Never heard anyone go to that length before cowman. Packers owning all the fat cattle??? I am not quite sure where you are coming from with this. They do own all the cattle at time of "harvest" (we are told to start using this word instead of slaughter). Are you suggesting eliminating ownership in the feedlot with only custom feeding for the packers?

That would be a pretty drastic move.

Might I suggest that the packers re-look at the way they do business with the retailers instead. Packers are in the business of harvesting live cattle. Their plants are set up to process so many cattle per day. They have had such an easy time of it for the past ten years, with us advertizing for them, and a wonderflu demand for product, that they got bored. "We are garanteed a profit without working for sales that hard, why don't we up that profit on the other end by establishing some quarantees on input as well." Thus the packer ownership of feeder cattle. I will not agree that this has been a good thing, even last fall when packers bought cattle. This "buying" that took place was a direct result of money made off the backs of producers in a dysfunctional market. I am not prepared to thank anyone for that one.

My suggestion is that we reduce packer ownership somehow, and force the packers to become better salesmen on the other end. Go out and search for market share themselves, establish export markets without producer funded CBEF holding their hands. Reach out to the consumer with new product developement, and recipes like the producer funded Beef Information Center does for them now.

Our industry is extremely mixed up. Like we have said before, does Ipsco
Steel advertise for Ford.

We have opportunities to press for change and we need to excercise those opportunities.

It may not be benefitial to the packers, every step of the way, as it has been for the past 20 years, but hey, I know of a few good people who are ready to purchase plants if they want to pout and go home.

[rusty1]

Cowman - I can't believe my ears! That is the biggest load of crap I've ever heard and especially comming from an old time cowman. What Bull Shit! Either you are feeding Cargil calves since they bought them from you or youre daughter is married to a Bob Petersons son.
I agree that our govt.s have allowed it to happed - thaty's a result of greasing palms and maffia style business.
However to say that the packers are price takers is absoultly so far from the truth it's just a flat out blatent erronious statement.
Check it out. Retailers take what they get from the big packers here in Canada and in the USA. The packers tell them, including Sobey's and Safway what they will pay for their products, and there is no alternative.
I would think that you af all people would understand thatb if a packer needs a supply of cattle all he had to do is raise his bid price.
Furthermore they don't even need to own very many cattle to absoultly control the market pricing.
Go figure

[rusty1]

I should add Cowman that I suppose you're happy that you're check off dollars pay some of our beef politicians to travel first class, wine and dine in the fansiest eateries and sleep it 5 star hotels while finding markets for Cargil and IBP.
Years ago that might have been called Treson.

[Horse]

I have to agre with rusty on this one sounds like cowman is running for the ABP.

[cowman]

Well I will assure you I am not running for ABP! I don't know for sure where my calves went last fall...could have been Cargill...sold them at the presort.
Now I'm not so sure anymore how the price is set for carcass beef these days but when I was a young man I worked in a packing house and in those days the price was definitely set by the retailers in Montreal. Of course in those days about 85% of our carcass beef went on the rails down east. That may have changed as a whole lot of our beef goes to US retailers?
Still I don't believe Cargill/IBP(Canada) would have the market clout to dictate prices to the American retailers? In the big picture they are a pretty small player in the American market?
And Rusty, you know I don't support the ABP at all? I believe they should be radically changed or eliminated?
But having said that, let me explain something? I disagree with their policies, but I don't question the integrity of the men and women who make up the delegates. They believe in what they are doing and their little perks are really such a tiny part of the checkoff dollars? If people are doing the job I don't expect them to have to pack a lunch or sleep in their truck! I truly don't know of any ABP delegate who ran for the job to get rich?

[cowman]

Hey Horse, good to see you back on the forums! I was afraid maybe you were out campaigning for you buddy Ralph! LOL

[rusty1]

I don't expect them to sleep in their truck either - my point is that their oak, brass, and glass suroundings and wineing/dining lifestyle seems to put them out of touch with the grass roots and they contract "hostage syndrom" by rubbing shoulders with the govt. eschalon and eat too many steak dinners bought by the packers reps. They have lost their objectivity.

[rusty1]

I am not condoing any group that tends to be hogs at the trough, but I will say that sometimes the fancy hotels are the most economical,if they happen to be the host hotel for conferences etc. I travel almost weekly and have stayed in $225.00 a night rooms for $89.00 because that is the convention rate. As far as meals go, they don't need to be extravagant. Our organization has a set price that we cannot exceed, and hopefully ABP does as well. Someone should ask that question at a Zone meeting.