Kansas packer Creekstone Farms Premium Beef announced that it would lay off 150 workers, "saying it made the decision after it became apparent Japan would not reopen its market to U.S. beef products anytime soon. 'What we predicted has happened - that is, we are not able to ship because we are not testing. We are not doing what the customer wants. We continue to think that is wrong,' said Bill Fielding, Creekstone's chief operating officer."
We could be selling U.S. beef to Japan right now had the USDA allowed the sale of BSE-tested beef. The USDA/NCBA are blatant hypocrites carrying water for major packers. The National Cattleman's Beef Association(NCBA) runs around telling everyone how we need to respond to consumers' demands but they don't really mean it. The NCBA picks and chooses which consumer demands they will accommodate, refusing to let the marketkplace decide.
What the USDA/NCBA are really doing is carrying water for big packers who don't want smaller packers, like Creekstone who are addle enough to be able to fill special orders, to be able to compete with them. The USDA/NCBA are aiding and abetting concentration of the beef packing industry and suppressing competition by refusing to let small packers respond to consumer demands such as BSE testing.
Why would Canadians add 37% to placements on-feed last month? Why wouldn't U.S. packers that feed cattle in Canada fill feedlots there? They can't lose. Tyson and Excel own feedlots in Canada. They believe that the U.S. border is going to reopen in early 2005 to Canadian live animals so U.S. packers will have access to Canadian finished cattle. Tyson and Excel will have as many cattle on-feed in Canada as they can find pens for to get ready for the border reopening. Risk? What risk? If the border doesn't open Tyson/Excel will just kill their own cattle in their Canadian plants and sell the beef here. The U.S. border is not closed to Canadian beef exports. U.S. packers have been making a killing off of Canadian operations. Tyson/Excel will come through the current U.S. packer margin squeeze better than the rest of their competitors here because they have profits from their Canadian operations to offset losses here that U.S. packers without operations in Canada don't have. A shakeout is ahead for U.S. packers.
Japan has been willing to reopen beef imports if cattle were BSE tested and are willing to pay for the cost of the testing. They test all their own cattle so the demand is consistent with their domestic policy. A large majority of Japanese consumers do not want untested U.S. beef and say that they will not buy U.S beef, even if their government allows untested beef to be sold in Japan. The U.S. beef industry doesn't want to sell beef to Japan badly enough to respond to the Japanese consumer. Instead, the U.S. beef industry responds by telling Japanese consumers that they are stupid to require testing.
Creekstone and other packers had business lined up in Japan willing to buy U.S. BSE-tested beef and the USDA, captured by big packers and NCBA interests, refused to allow them the right to sell tested beef. Being allowed to sell BSE-tested beef to Japan may have opened up an avenue of business for the Iowa Beef Quality Supply Co-op which like Creekstone, could have filled this niche. I don't believe that they're even close to reopening beef trade with Japan as the USDA, deluded by big packers and the NCBA, deludes others that prospects of recovering beef exports to Asia are better than they are.
The U.S. and Japan reached an agreement on a framework to re-establish beef trade between the two countries but nothing has been accomplished since except the exposure of the differences remaining. "Pretty close" only counts with hand grenades and horse shoes. That's how good beef carcass grading can come to aging animals. The Japanese government agreed to accept beef from animals younger then 20 months of age. "Pretty close" is not what the Japanese are looking for. They require 100% BSE testing because they don't accept risk of error. 100% is 100%, not "pretty close to 100%." Failure by the Japanese to accept carcass aging will mean the U.S. beef industry will have to segregate production exported to Japan, something they are resisting. US meat packing interests like it better when everybody gets the same hamburger fixed the same way with the same condiments as it's the most efficient way to make hamburgers. None of this special order stuff. The U.S. beef industry ain't no Burger King when it comes to exporting beef. They want Japan to take U.S. beef our way or not at all. The Japanese didn't buy it, failing to accept the U.S. beef aging proposal in talks last week.
Industry analyst Andy Gottschalk concluded, "The (framework) agreement is being over-hyped, pointing to surveys that have found that Japanese consumers do not trust U.S. beef's safety and to competition for the Japanese beef market from Australia and other countries and from U.S. pork." The USDA/NCBA over-hyped prospects for reopening beef trade to support their argument against selling tested beef. Of course, they are moving fast to reopen the U.S. border to Canadian cattle which big packers and the NCBA favor whole heartedly.
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We could be selling U.S. beef to Japan right now had the USDA allowed the sale of BSE-tested beef. The USDA/NCBA are blatant hypocrites carrying water for major packers. The National Cattleman's Beef Association(NCBA) runs around telling everyone how we need to respond to consumers' demands but they don't really mean it. The NCBA picks and chooses which consumer demands they will accommodate, refusing to let the marketkplace decide.
What the USDA/NCBA are really doing is carrying water for big packers who don't want smaller packers, like Creekstone who are addle enough to be able to fill special orders, to be able to compete with them. The USDA/NCBA are aiding and abetting concentration of the beef packing industry and suppressing competition by refusing to let small packers respond to consumer demands such as BSE testing.
Why would Canadians add 37% to placements on-feed last month? Why wouldn't U.S. packers that feed cattle in Canada fill feedlots there? They can't lose. Tyson and Excel own feedlots in Canada. They believe that the U.S. border is going to reopen in early 2005 to Canadian live animals so U.S. packers will have access to Canadian finished cattle. Tyson and Excel will have as many cattle on-feed in Canada as they can find pens for to get ready for the border reopening. Risk? What risk? If the border doesn't open Tyson/Excel will just kill their own cattle in their Canadian plants and sell the beef here. The U.S. border is not closed to Canadian beef exports. U.S. packers have been making a killing off of Canadian operations. Tyson/Excel will come through the current U.S. packer margin squeeze better than the rest of their competitors here because they have profits from their Canadian operations to offset losses here that U.S. packers without operations in Canada don't have. A shakeout is ahead for U.S. packers.
Japan has been willing to reopen beef imports if cattle were BSE tested and are willing to pay for the cost of the testing. They test all their own cattle so the demand is consistent with their domestic policy. A large majority of Japanese consumers do not want untested U.S. beef and say that they will not buy U.S beef, even if their government allows untested beef to be sold in Japan. The U.S. beef industry doesn't want to sell beef to Japan badly enough to respond to the Japanese consumer. Instead, the U.S. beef industry responds by telling Japanese consumers that they are stupid to require testing.
Creekstone and other packers had business lined up in Japan willing to buy U.S. BSE-tested beef and the USDA, captured by big packers and NCBA interests, refused to allow them the right to sell tested beef. Being allowed to sell BSE-tested beef to Japan may have opened up an avenue of business for the Iowa Beef Quality Supply Co-op which like Creekstone, could have filled this niche. I don't believe that they're even close to reopening beef trade with Japan as the USDA, deluded by big packers and the NCBA, deludes others that prospects of recovering beef exports to Asia are better than they are.
The U.S. and Japan reached an agreement on a framework to re-establish beef trade between the two countries but nothing has been accomplished since except the exposure of the differences remaining. "Pretty close" only counts with hand grenades and horse shoes. That's how good beef carcass grading can come to aging animals. The Japanese government agreed to accept beef from animals younger then 20 months of age. "Pretty close" is not what the Japanese are looking for. They require 100% BSE testing because they don't accept risk of error. 100% is 100%, not "pretty close to 100%." Failure by the Japanese to accept carcass aging will mean the U.S. beef industry will have to segregate production exported to Japan, something they are resisting. US meat packing interests like it better when everybody gets the same hamburger fixed the same way with the same condiments as it's the most efficient way to make hamburgers. None of this special order stuff. The U.S. beef industry ain't no Burger King when it comes to exporting beef. They want Japan to take U.S. beef our way or not at all. The Japanese didn't buy it, failing to accept the U.S. beef aging proposal in talks last week.
Industry analyst Andy Gottschalk concluded, "The (framework) agreement is being over-hyped, pointing to surveys that have found that Japanese consumers do not trust U.S. beef's safety and to competition for the Japanese beef market from Australia and other countries and from U.S. pork." The USDA/NCBA over-hyped prospects for reopening beef trade to support their argument against selling tested beef. Of course, they are moving fast to reopen the U.S. border to Canadian cattle which big packers and the NCBA favor whole heartedly.
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