Corporate question

[rkaiser]

SASH - You say that you would rather do something than sit around bitching like some of the folks you have labeled dreamers on this site.

What is it that you are doing?

What have you learned with your corporate experience and University education.

You say you are not here to defend the packers unethical theivery yet any time anyone uses words like that you jump all over them (me).

You can call what the packers have done since the border opened to boxed beef in Sept. 2003, legal all you want, but I call it piracy. How in Gods name was price established over that period of time. It had nothing to to with a functioning marketplace or even capitalism for that matter. It can not be compared to any of the situations you mention, which are all based on some semblence of market supply/ demand.
For all we know Cargil phoned Tyson one week and Tyson phoned Cargil the next to decide what to offer that week.


I hope that your small business/ farm is doing as well as ours has been these past couple of years, since I have no corporate experience nor University education.

If you have any questions about my operation, I would be more than happy to give you a tour, I have been taught since I was a child that speaking out for what you believe in takes a name, and I am proud to say that I hide behind nothing. Not very corporate, but that me - Randy Kaiser (403) 946 - 0228
Crossfield Ablerta Canada.

[kpb]

SASH has pretty much, once again, summed up the salient points of this argument so I won't repeat them. But I do have two questions and one comment to those who think the packers acted unethically or illegally.
My first question is why were prices for feeders so high before the border opened to boxed beef but after the first BSE finding? If the Canadian market was controlled by two or three packers, and was not functioning in a market-driven manner, as several of you have said, and if the packers are all a bunch of pirates why was anyone bidding more than, say, 10 cents a pound? If Cargill and Tyson were acting illegally then surely they could have collaborated to offer next to nothing.
My second question relates to writers who have said the packers acted illegally. What have they been charged with? If nothing, then why not?
My comment is this, there are many people who are shareholders in big corporations--these are ordinary citizens who expect these corporations to act within the law and make as much money as they can. This is a reasonable expectation and until the packers are charged and convicted I believe they have acted within these parameters.

[rkaiser]

I will answer your first question kbp, but the legality issue is all yours. I think they did act within the law.

As far as feeder cattle prices, may I suggest the eternal hope and optimism of the average farmer, along with tax implications which saw a need for farmers to either spend their money or give it to Ottawa.
Couple this with packers who now knew (as of Sept.2003) that they could be part of a functioning marketplace once again. They could now recieve American market prices, and force Canadian purchasers to pay for their product at that American price. Feeder cattle prices were thus established.

When I talked of establishing price kpb, I was talking about fat cattle.

My question to you is - How has price for fat cattle been established since the border opened to boxed beef in Sept. 2003?

[kpb]

rkaiser, yes, I think you're right in your assessment of why feeder prices stayed relatively strong. What I meant to ask is why fats stayed as strong as they did, after the first BSE and before the border opened to beef? But actually, as you point our, the same question could be asked now. The basis right now is, I think, about 24 to 28 cents. We know that there are only two or three packing plants buying so why is the basis up there? Shouldn't these packers be paying as little as they can (like next to nothing) for the fats? I don't know the answer to your question--it's one I would like to figure out too because it seems obvious to me that the packers, with a virtual monopoly, are paying too much???

[rkaiser]

Have a good story about this fat price establishment.

I have a very good friend from High School who has worked with Nielsen brothers for about a hundred years now. He has done everything from managing the market at Clyde to publishing their newspaper to touring Japanese officials through the plants in Calgry and Moose Jaw.

We have a half dozen discussions a year about the good old beef industry, and share a jug of beer whenever we get a chance.

One of our discussions led to establishment of price, and I believe it concerned the cow/bull market more than fats, but both are arrived at the same way these days.

He suggested that I should be kissing Brian Neilsen's a$$ for even offering 20 cents for cows. (This would relate exactly the same for an offer at the time for fats from Cargil or Tyson.)

I suggested that I would kiss Brian's a$$ if he were to offer the real price of maybe 1 or 2 cents per pound, or simply take the cattle from me for nothing. In that situation there would be complete transparency. The 20 cent per pound charity that Brian was supposedly giving me would then then be exposed for exactly what it was. A price to stay under the radar of the law, and a price that was substantial enough that ass kissers like my friend would think Brian a hero.

What does it gain any Cattleman in Canada to defend (oops I forgot you guys are not defending) the packers for their unethical business practices.

Oh yeah, I forgot to mention. I have sold 3 cull bulls, and 8 cull cows through the conventional market since May 20, 2003. Each of these animals has walked through the Olds Auction Mart with a huge bow glued to their back. Purple bows on the bulls last Feb. and red on the cows just before Christmas this year. If I am forced to give these fellows something, I simply like to call it a present.

Happy Happy Happy

[rkaiser]

Shoot kbp, take a look at Canfax. Our capacity is up and our fats are as close to being current as they have been for two years.

[kpb]

rkaiser, I'm not defending the packers, I just don't think they're any worse than the bankers or the big oil companies or big retailers or any of the other big multi's in our free enterprise economy...you get the picture. I see that capacity is up but presumably that is from the existing packers only. And your story about cattle prices makes sense so the packers don't cause too many waves. But I still don't get why they're paying .84 for fats when they could get them for, say .65 and still not cause a bigger ruckus than they already are. Why .84?
We really, really need a domestic packing industry controlled by producers but it's been almost two years since the first BSE and are we much closer to having our own plants? The government is more willing to write periodic cheques to producers than support a domestic packing industry. It's yet another mystery.

[blackjack]

rkaiser...did a little research on canfax... talking just Alberta here... Jan 15...42,179
Dec 11...47,792
Nov 27...51,626
Nov 6... 54,434
July 10...52,403
...maybe BFW can answer this question of where the fats went... how many feeders has there been put on the fed aside program...
... I wonder the same thing about the price the packers pay in the last year other than to keep the politicians happy...

[blackjack]

...oops...those numbers represent the amount of fats slaughtered in Alberta...

[grassfarmer]

kpb, Finally I agree with you we certainly do need a domestic packing industry controlled by producers.
As you say it really isn't happening though - I wonder why? perhaps cash strapped producers are too afraid to put their last dollars into a plant only for it to fail in it's first months of operation - because the transnational corporations will not accept competition in their monopoly and will surely crush the fledgling companies. Of course we already know the Federal or Alberta government don't have the backbone to enforce anti-competition laws. No wonder producers and even bankers are leery of investing in plants. And that's giving the Government the benefit of the doubt assuming they just aren't all that interested in seeing producer owned plants being built. Or are their corporate friends lobbying hard that they don't support such ventures? Who really is calling the shots here?