Just wondering?

[cowman]

How come when Cargill and IBP use a certain situation to rip us off, we all call for their heads and the government gets all bent out of shape wanting to check out their books, but when the drought was on the grain farmers had no problem ripping off the cow guys by demanding $60 for a bale of straw?
Would you consider that "immoral business practices" or using a monopoly to rip us off? Just wondered...

[cswilson]

good point cowman !!! I was one of the 'farmers' that believed the hay brokers and allowed them to find feed for me, and I ended up paying dearly for horrible, dusty hay, that should have been burned in the field. More than one farmer in this area was foolish enough to believe that they could winter cows on fescue straw, which was bringing $50.00 a bale delivered. I bought some of it but also paid a pretty penny for decent hay and greenfeed...plus suplemented with bovalix. Cost a fortune to keep the cows over, and I can assure you I had NO sympathy for those folks that had capitalized on the drought to make a fast buck, but ended up with their hay, straw etc. still out in their fields last fall !!! I had no problem with the folks that were selling the feed making a profit but greed is another issue. One fellow a few miles away had good hay for sale and kept raising his price as the shortage became more apparent, had a different price for everyone that called him. This past year he had to buy cattle to feed his hay to, because he had two and three year old hay sitting piled up .

[farmers_son]

Tens of thousands of farmers and shortages of feed do not make a monopoly, they make a market. That really was an example of supply and demand. The marketplace was functioning to ration available supplies. During this time thousands of bales of hay were sent free of charge from farmers in Central Canada to Alberta through the Hay West program which was a very moral and charitable act. And in hindsight the smartest producers were the ones who sold down their herds and did not buy the high priced feed. No one had a gun to your head. The marketplace had options.

There is absolutely no comparison between that situation and the actions of Cargill and Tyson. Just because the Competition Bureau could not or chose not to find evidence of wrong doing that would stand up in court does not mean that wrong doing did not take place or that they were not acting as a monopoly to rip of the cattle producers of this country.

I would point out that the market disruption due to the closure of the U.S. border to Canadian live cattle did not change the supply and demand fundamentals in North America, it caused our markets to no longer function because two packers suddenly had a captive market for live Canadian fat cattle and chose to capitalize on that opportunity through price fixing. If we had had sufficient competition in this country that would have created alternatives to selling live fats to the packer monopoly, supply and demand would have worked to lower our prices only slightly due to BSE and we would have shared in the record prices for beef in 2003 and 2004.

The supply of live cattle did not change because of BSE and the market demand was still there for Canadian beef. Only the competition changed. Therefore any comparisons between the 2002 drought and the shortages of feed and the BSE crisis are not valid.

[grassfarmer]

No Cowman I don't believe they were using immoral business practices or using a monopoly. It was still a free market with plenty of options. Despite the feed shortage there were literally thousands of producers selling feed across western Canada, there was also the option of moving cattle to where the feed was. This was true supply and demand and that year cattle producers had a bad year - last year many grain growers had a terrible year with frost and the cattle producers gained.
It wasn't immoral business but in some cases it was pretty low - but that will come back to haunt the guys that did these things. I've always bought fodder in over the years and it evens out over time some years the buyer wins and some times the seller wins.
In 2002 I remember two lots of feed I bought particularily. One was timothy from the South that turned out to be very poor feed and dusty with it. The second was a load of red clover/wild oat "greenfeed" from a seed grower in the Peace that turned out great feed plus the bales weighed 1700lbs and I'd bought them based on 1200lb weights.
I know if I was buying feed again which one I'd deal with!

[les]

I have sold a lot of feed over the years and mostly to the same repeat customers. When the drought hit so bad that year I had lots of feed and sold it for basicly for the same price. my old customers bought it all and they were happy and I was happy to get it all sold fast as not to have to keep it over like a lot of guys did.

[les]

farmers_son, when someone misrepresents a product they have for sale, is paid up front for the product and doesn't give a damn what kind of a wreck the buyer has with their cattle when they feed them mouldy, dusty, crap that was promoted as 'no rain' put up early feed' I call them a crook, and no better than Cargill, or anyone else that is perceived to be making an unfair profit.

Marketing produce off ones farm is one thing but gouging, lying and cheating folks when they are in a bind is something altogether different. I know that dozens of cattle producers were in the same boat during the drought, in fact, one hay seller even ended up in court for selling hay they didn't own, and collecting the money.

[cakadu]

That is one way to make a distinction between the big corporations and the small guy, farmers_son, but pure unadulterated greed is just that no matter how big or small you are.

During the drought people were ripped off badly despite doing all of their homework. Feed was bought and in some cases paid for, only to be lost because someone else was desperate enough to pay more. How many hours did some of you spend on the phone and/or internet looking for hay?

Some people will take advantage of any situation if it means extra money in their pockets. A lack of morals is just that and nothing more.

There is never any mention of XL in the same breath with Cargill and Tyson, yet they are doing the same thing to beef producers. Those big multi-nationals could not have gotten the foothold that they did without help from government, organizations like CCA and ABP, feedlots etc.

How did ABP and CCA get to be such off-base voices for the industry? From what I've read in these threads over the years both groups have gotten away from representing those they were elected to serve. How did they do that? Again, from what I've read here, because turn-out is poor? What made turn-out so poor? Only beef producers can answer that one.

If nothing else, this whole mess has brought to light just how lop-sided the scales are and how little value the producer is receiving for what they produce. There are those that are working very long and very hard to change that, but how many are just waiting for the border to open so that they can move cattle and have it be like before?

I do hope that some of these producer plants can make a go of it and get support from producers. I also hope that before the first beef runs through whatever plant it may be that there are new markets for this beef to go to because that will be the critical element. It has to be taking place now, so that the beef that run through one of these plants have a home to go to.

[cowman]

There was a local seed grower who went out and bought a baler and thought he was going to make a killing by charging the neighbors big bucks. In the end it didn't turn out to well for him as he was considered a opportunistic scoundrel! A lot of his former cattle customers won't buy seed from him!
Also when these little pirates decided to rip off the cattlemen, in came the fusarium infested straw....something that may come back to haunt the grain farmers in a big way! Apparently there was a positive seed sample grown in Stettler county last year and one in Red Deer County the year before! This would indicate that fusarium is establishing a toehold here and when the right conditions take hold....say goodbye to the malt and milling business!

[cowman]

and that is sad cowman because of greed and lack of concern, a lot of good, reputable producers will suffer.

[smcgrath76]

I tend to agree with Farmer Son on this one. While gouging is not an ethical practice no matter who or when it is done, there is a difference between monopoly (oligopoly) and a free market.
In the drought of 2002 around here, guys were buying 2 year old straw for $75 a bale. They did not have to. Also, there were other sources of feed and people will to feed that could be sourced out. We sent cows to SE SK that year and fed them out for less than we could have done at home. Needless to say there were a lot of different options/suppliers for those willing to do the work and look for them. This was true even in the percieved "worst" circumstances.
The monopoly position of the major packers is slightly different in that there aren't several options to search out. The vast majority of cattle produced in this industry are going to have to exit the country and currently their only option is in a federally inspected box. This puts the power in the hands of very few to control the market. Because cattle are a perishable product (can't be stored indefinitely) producers may not sell at today's bid price, but they can't hold off forever. I do think more independently held packing capacity is probably the answer, with the very real fear that there was a reason for the rationalization that occured in Canada before. I hope we have evolved beyond those factors now.