ABP Magazine

[grassfarmer]

Got the ABP magazine,sorry Alberta Beef magazine,today and was majorly disillusioned. The editorial is about how stupid the people and Government in Manitoba are to be trying to build a packing plant using checkoff dollars. On the other hand praising how smart the Alberta Government and ABP were to resist calls by "some other organisations" to try to build producer owned slaughter plants. Clearly they believe the Cowman theory that because the packers claim to be losing money on cattle they are killing at the moment there is no future in cattle processing.

How can we be so stupid - remember less than 3 years ago the desperate situation of nowhere to kill cattle and talking about digging a big hole to put cattle in. We were determined never to be in the same position again - and here we are, lesson forgotton. We still lack competition in bids for both over and under 30 month cattle.

The only bright light they highlighted was the new Balzac plant built by free enterprise Albertan's with deep pockets. Fair enough, I'm pleased for this independant plant but I still think it is wrong that several ABP directors bought their $100k stakes in this and sat at the same time and voted down any possibility of everyday Alberta producers having a chance of a stake in a packer owned plant. They are entitled to their views but I think that was a conflict of interest and they should not have been participating in the debate.

I think this magazine is a disgrace and owes a big apology to the likes of Cam Ostercamp and co. The same magazine that ran stories on Mark Purdies BSE theory, the case for BSE testing, Gunnerson was even the person who posted Ostercamps article on his personal website before most of us had even heard of him. What happened? was all that just a cheap attempt to sell more magazines? So much for their constant claptrap about old time values and loyalty etc etc.

[cowman]

I did not read the article, but I don't see where there was a problem if you WANTED to invest in a plant? There were several proposals out there? The only reason they didn't go was because people would not invest their money in them?
I believe Manitoba producers were invited to invest? They chose not to? And now their government has decided they will be forced to? Doesn't that ring a few warning bells about that whole deal?

[coppertop]

cowman, I suspect that not too many cattlemen have had extra dollars to invest. eg: the CAIS payments that were used to pay loans and operating expenses and are no;w supposed to be paid back.
I have heard a rumor from a reliable source that the AB. government is considering putting seed money into a biofuel plant which will utilize agricultural products, and will in a roundabout way help the ag industry, but, I am having difficulty understanding the difference between putting seed money into that sort of plant and a slaughter plant. On one side it will help the grain and oilseed industry, on the other it would have benefitted the cattle industry. Mind you, this is only at the rumor stage so maybe it will not materialize.

[rkaiser]

I only wish I had the time to continue this arguement.

The magazine speaks of a group wanting to up the checkoff to fund slaughter capacity. Did any one of you ever see or hear of a group like that? I never did.

What i DID SEE WAS A GROUP FIGHTING TO CREATE A CANADIAN WIDE LEVY (seperate from the multinationalpackerasskissing ABPCCA) TO BUILD SLAUGHTER CAPACITY THAT WOULD BE OWNED BY THOSE VERY PRODUCERS THAT PAID THE LEVY. And Yes, I supported a mandatory levy as it could have made major changes to the industry that would have and could benefit all of the producers of this country. The group that I am speaking about supported and suggested BSE testing for export marketing potential. We supported and suggested stopping the captive Canadian, and or North American salmon run market by taking beef off of this continent.

But as the editor of the magazine puts it, "wiser minds prevailed." Cargill and Tyson now control over 80% of the slaughter capacity in Canada and along with the other American players can keep the Canadian market right where they want it. Do they truely want to open the market to Japan or other Eastern Asian countries? I think not.

I will admit right here and now that margins in the packing industry are usually tight. Salmon runs like the fat cattle market prior to the open border to live fats and feeders, and the current cull cow salmon run don't come along that often. Cargill and Tyson know that. Therefore the need to take a chance exporting beef while they have a North American captive supply that is guaranteeing them even cowmans 21 dollar profit is too risky.

Think about it folks. Supply and demand run this industry like no other. Free marketing (at least at the producer level) is how this thing is run. The cheaper that packers can get the cattle the better. The longer there is this over supply of cattle, the longer the cheap cattle remain.

We did have a chance to take back some control of our industry, and this opportunity is actually still there. Manitoba cannot do it on their own, and the media will jump all over the negatives of the situation now. Brag about the ranchers plant at Balzac - sure, but as coppertop says, how many ranchers had that same opportunity to invest? I hope like hell they make it and plan to support them any way I can.

I will not say that the Manitoba plan is perfect. It is a lot different than what BIG C spoke of. But it sure the hell beats bending over for Cargill and Tyson the way that ABP and the supposed capitalist government of Alberta have.

Congradulations cowman - ABP - CCA etc. etc. YOU ARE THE WISE prevailing minds LOL. You got her all figured out.

[coppertop]

Excellent post Randy. I too wish the folks in Manitoba all the best in their endeavor. Hopefully some of the other initiatives here in Alberta will get up and running, particularly the one at Acheson. I know of several people in this area that invested in it, and at least four of the operations have now sold all their cattle.

[cowman]

Randy:First of all you got a few things wrong...The $21 is not my figure...it is Alberta Ags?
Secondly: The boy threw in my $100 bucks, so I guess I supported the "concept" behind BIG C! As long as that concept was this(and I thought that was what it was): A checkoff on cull cattle slaughtered at a BIG C plant...not on the cattle slaughtered at Cargill/Tyson! For every cow of mine slaughtered I would recieve a small piece of equity in said plant? Was I reading it wrong, or was this not what was being expoused?
And yes bridge financing from the government.
We had a great debate here about whether to toss the $100 into the ring. I thought it was probably a total waste of money, the boy thought we had to try? I guess I was right...but you have to let these young guys learn?
I still think Ostercamp had it basically right.

[mb_rancher]

Hey Randy,

Dont ya think we should both get a high priced job like cowman with an oil company so we could sit around and rub shoulders and praise ABP.

I supported the BIG C levy but i sure as hell dont like the way the NDP govt. is shoving this new levy down our throats. If you were considered a share member with each $2 paid then yes I could see it, but not the way it is set up now. We had already sunk a few $$ into the Dauphin plant but after the govt came up with this idea of a levy we pulled that money back out.

[blackjack]

...unless all the cowboys were willing to back a new plant it would just become the next new plant for the big two...and then they would buy(the plant thankyou very much) at their price ...take a look at the fed cattle slaughtering rate...down 35% from last year...feeder and fed cattle move to where the price is the highest...what happens if as soon as the plant is built the usa opens its doors to otm's...our biggest problem is getting rid of the beef not the slaughtering capacity ...and as long as we rely on other countries to buy our beef...we will have a noose around our necks...

[grassfarmer]

That needn't be the way of it - rkaiser mentioned the 80% of kill done by the big two. I think that's an underestimate, but regardless, many industries in many countries around the world would not be allowed to run in this way. Government would step in and order them to dispose of some of their capacity as this level of non competition is clearly very unhealthy.

[blackjack]

...it is hard not to disagree grassfarmer...but the cow-calf man has gave up most of his clout in relaying the message to the politicians...when guys like ostercamp stand up and tell how it is... and then his supposedly fellow producers ridicule him for it...you are not only up against pathetic government policy but as well as group of well oiled producers that are obviously quite happy with the status quo...