Beef Industry Conference

[BFW]

Farmer's Son being above average means doing ordinary things extraordinary well. By the way what's your hang up with size? There's a term for it I think. Ever study psycho-analysis?

[BFW]

Farmer's Son as for forming alliances with others in the value chain many of us have been doing that for at least the last 15 years. Where have you been?

[rkaiser]

Amazing BFW how perceptions are different, based mostly on fixed thoughts I suppose.

Cam Ostercamp made a point of saying that he was not blaming anyone did he not?

If you call what he did grandstanding, why would Charlie Gracey use the name of Cam Ostercamp when talking of positive change. And why oh why do none of the upper end ABP boys have nothing to offer (off the cuff) without discussing and reviewing their notes so as to not offend Cargil and Tyson.

But the reality is that margin producers bid on cattle and have no concern whatsoever for the seller. This is the system we live in now.

The concept that Ostercamp, myself and the rest of the BIG C gang speaks of would help the big feedlot players like yourself as much or more than the cow calf guy that you buy your calves from. This is not simply a co-op idea, it is about changing the Canadian beef industry.

Once again I will say that the reason this concept will fail will be our inability to convey the message to you or Ben, or any of the rest of the gang of multinational smoooshers.

This is not about little vs big any more than the border closure is about American producers vs Canadian. Canadian producers however need to wake up and deal with this Multinational takeover of our beef industry before we all become service industry workers taking smaller and smaller margins and hoping that our real estate investments give us something to retire on.

[farmers_son]

BFW: I see a number of these so called "above average" outfits that are not doing anything better than anyone else, just the government provided them with irrigation at taxpayer expense. But when it is suggested that the government in some way help the rest of the industry to excel these same "extraordinary" managers cry foul.

[gwf]

This is a very interesting topic, and one that is getting some good discussion. I was not at the Conference, but am told it was very similar to others that have been held in the past. I agree that the ABP are putting all of their eggs in the border opening. Lee Gunderson (ABM) might be right, that it does not open, all hell will break loose. We are very fortunate that we have the feedlot infrastructure that we have. Just ask those that do not have these operations in their own back yard. The border opening will give us time and will provide us with a sense of well-being as Farmer –son has said “until it closes again”.
This uncertainty is what is most disturbing.

The BIG proposal will not affect the “Kaiser Method” or that of two of the principles of the BIG organization. It will not challenge Tyson or Cargill and it will not effect most of the small operations that have just started or are on the drawing board.

It is nearly a year since the Premier Ralph, Ag Minister Shirley and the ABP were apprised of the producer funded packing facility proposal. A polite letter was received from Ralph, a letter from Shirley saying it was up to the ABP, and still waiting for a reply from the ABP.

The present system of marketing our market ready livestock production, does not give us the security and hope we need and deserve. We must explore the other options that lessen our dependence on the US market.

[rkaiser]

I get shit all the time for calling names on these sites, and oops, I did it again.

Mutinational smooshers was not very nice. If I only had one or two, or if the border opens, a few more buyers for my product I suppose I would do some smooshin too.

My wife gets pretty excited when we get another bull prospect call these days, and then another. I told her that we probably need 8 to 10 of those prospects for every bull we have for sale. This is true free enterprise. Somehow the defenders of free enterprise these days (ABP and the like) tend to forget that "next to" monopoly system that we have in the Canadian beef industry is no longer about freedom and the American dream. It is about control, margin, and profit without morality.

I don't know about the rest of you, but I would dearly love to give my shares in a MADE IN CANADA producer owned packing industry while making a living raising these darn cows in the mean time.

I used that Made in Canada quote because of the way ABP/CCA uses it when proclaiming their own Made in Canada solution. I added a few words to theirs on a napkin at the conference.

ABP/CCA Made in Canada Solution, financed by American Mutinational money, and driven by harmonization with the AMI led USDA.

[BFW]

Randy, I said it before I admire the effort that all involved with BIGC have put into this. I just don't agree with the idea of the check-off funding. Also you don't have to convince any of us multi-national smooshers of your concept, there are too few of us to make a difference politically and we have used up our political capital pretty much the last couple of years anyway. For the BIGC concept to fly you have to get a good piece of those 100,000 primary producers on side.

[gwf]

BFW: How would you propose to fund it then?

[BFW]

Fund it like any other business with a combination of equity and borrowed funds. I believe that is what the other plants being proposed are doing.

[gwf]

BFW: Are you going to put up the equity and sign the note at the bank for the balance?

[rkaiser]

I wonder what your reason is for not wanting a checkoff/share to build competition for the existing non competitive marketplace BFW?

[BFW]

Not for any of the proposals currently on the table GWF althought we almost did.

[BFW]

Randy, I cannot get my head around why any levy type funding is required for this undertaking. First of all I believe any business that is any good should be able to assume debt and repay that debt from after tax profits generated from operations. I know that this is where the problem lies in convincing the lending institutions that a venture such as this will be profitable. Secondly my understanding is that this plant will kill exclusively OTM cattle (or at least mostly OTM cattle)yet expects to collect a levy on cattle of all ages at every point of sale the same as the ABP does now. I feel that this is very unequitable. Finally and most importantly the BIG plan calls for this plant to be leased to an existing packer or some company with packing and marketing experience (which is a good idea I think). Presumably then the terms of the lease and the annual lease payments would be such that sufficient income would be generated to service the debt and provide a reasonable rate of return to the company shareholders. If this is true then why is any type of levy funding or government bridge financing required?

[blackjack]

BFW...I imagine there was talk about how many packing plants could be built before there would be more capacity than cattle...and if or that ended up being the case...would american cattle be brought up if the Canadian dollar continues to rise to fill the void...while us cowcalf guys like to point our fingers at the two American multies...they are actually now paying over the 10 year average in the market place for fats... my question for BFW even if we build more packing space for the OTM here in Canada...with the OTM still closed to the states what makes the industry think the local packers will pay anymore to the producer...

[farmers_son]

BFW: Fair enough if you cannot get your head around why funding is needed. Help me with this. I made a comment earlier in this thread about how government provided assistance to a priviledged few producers in this province so they could have irrigation on their land. Is the Western Irrigation District a purely business venture or at some point in its development was government support in the form of grants and loans or actual construction of damns and water works necessary? If government support was necessary then why would you deny the same support for producers wishing to add value through a producer packing plant?