How To Beat Cool and Make $200 More Per Calf.

[grassfarmer]

Farmers_son, you seem to be laboring under some delusions.
COOL may be ridiculous but it is also clearly a protectionist move, and a reality.
The US to all intents and purposes is a foreign and hostile country to Canadian beef imports. This is obvious from their activities since 2003. The shared "North American market" is packer speak - Canadian producers do not have free and open access to any such market.

I think you get confused sometimes as to who does what - accusing the current Provincial plan that might just create the opportunity for producers to break the packer deadlock and export beef off this continent as being for the packers benefit is nonsense.
Since 2003 who has backed the packers? who backed the cash advances to expand existing packer capacity rather than creating new capacity? -ABP. Who was delighted to back the dubious "not guilty" findings of the packer profiteering inquiry? - ABP Who fought to prevent packing plant start up plans that involved testing for BSE? -ABP. Who to this day vigorously campaigns for the right of the packers to manipulate fed cattle prices through their ownership of cattle? -ABP.

Your conclusion is right though - "We are going to have to look at doing things different if we are going to be around in five years." How about starting to learn where the money really goes in cattle production chain? If you read and understand the NFU document you would realise that you are aiming too low - treating the Cdn feedlot owner as the enemy for possibly (if they are very, very lucky) making $100 on a calf. Dreaming that you can pasture your cows in R-CALF country to qualify them as US beef and maybe get $850 for your calves. What about the $850 per fed animal that disappears between leaving the feedlot and hitting the store shelf?? Why doesn't that interest you as much?

[farmers_son]

I hope I have not given any impression that Alberta feedlots are "the enemy". In another post I tried to point out that there was money for the cow calf producer in retaining ownership of their calves. As BFW said, the market is what it is. But I need to make a dollar too.

In saying I could make pretty good money if I were to calve my cows on U.S. soil I am simply sticking with what I know best, primary production. There may very well be good money further up the value chain but I have no expertise in those areas.

The interesting thing about COOL is I can take my pregnant Canadian born cows into the U.S. and as long as I do not try to sell them there is no problem. The cows could calve and the calf is a U.S. citizen with all the benefits that brings. The cow comes back home to Canada the rest of the year. You just got to love it when you can beat the Americans at their own game.

I think it clearly illustrates two things... how stupid COOL is and how much COOL is costing cow calf producers in this country.

[wade]

I am wondering as to what the COOL label does or will look like in the grocery stores. Will it be a flag? Will it read "May or may not contain meat from CANADA, Argentina, ...? the same as peanut labels on everything now. Or will it even matter a year down the road or will some prefer Canadian or Argentina meat?

Oh, by the way, if you can make a dollar moving your cows back and forth, go for it!

[per]

Sorry to make assumptions f_s. I know that respect is an earned commodity and the our current Ag Minister has not earned yours. I do however think that more is accomplished with cooperation or at least conversation that is constructive rather than destructive. I am afraid that I am a failure at heeding my own advice as well. As far as your point with calving out in the US, it makes sense on many levels. It would work well if the rules don't keep changing to suit the winds of the day. My wife and I have looked at properties in the States but have yet to make the plunge because red flags keep popping up. If you are looking, the best production in relation to land prices is in upper New York State.

[grassfarmer]

And who for a minute thinks American ranchers led by R-Calf would allow this to happen?

[per]

F_s, sorry to be presumptuous. I posted a reply earlier but must have hit reset instead of submit as it never showed up. Your train of though makes sense and does point out the ridiculousness of the protectionist policies of our neighbour. As Willow mentioned, we are not immune to silly policies as well. The problem with your plan is that the rules seem to be quite fluid and just when it starts to pay off they get changed. My wife and I have seriously looked at opportunities south of the 49th in the past. Moving down there would make sure you were on the right side of the rules as they stand now. If you were to consider such a shift, New York state had the most production capabilities for the cost of an acre. Plus there are an abundance of good universities for the kids and grand kids and lots of direct to consumer opportunities.

[farmers_son]

What we are most likely to see happen is the Americans will realize the opportunity and come North to buy as many young bred heifers and cows that they can get their hands on to be calved in the U.S. COOL will work for them not for Canadians.

What this will do will hasten the decline of the Canadian cow herd. The term “perfect storm” was tossed around lightly in the past when referring to the challenges facing our industry. I think the worst is still to come. I wish that were not true but I am afraid it is.

Bottom line a weaned calf is worth $200 Canadian more in the U.S. than in Canada. That is fact. Irrespective of the causes of that differential, basis or “perfect storm” (whatever you want to call it a rose by any other name is still a rose) simple economics will either drive the majority of our present cow herd south or those cows will vanish from prairie pastures if there is no room for them South of the 49th parallel. It will not take long. Three years and you will not recognize the cattle industry in Canada.

COOL is a market access issue. Market access is critical for the cow calf industry. And market access is negotiated between governments not by producers. If our government does not suddenly take an interest in the cow calf industry the hand writing is on the wall for the future of the Canadian cow herd. However I am seeing a Government obsessed with CWB issues and the relevant Ministers do not have the time of day for cows.

What will probably happen is Government will wait until its too late and then negotiate reduced access for Canadian cattle similar was done with softwood lumber. Sorry I cannot be more optimistic.

[grassfarmer]

All the more reason for Canadian producers to look to markets other than the US for our future beef sales. If we can tie into higher value markets elsewhere the fact that we can only earn US price less basis (or CDN discount whatever you like to call it)becomes less important.
I question how many US producers will rush to buy Canadian cows - their own herd has been shrinking and is also dominated by low to non-existent long term profitability and aging producers.

Yes, COOL is a market access issue but in reality "market access" is negotiated between governments influenced very strongly by the packer lobby. The Federal Government has certainly been notably absent from any type of worthwhile intervention in the beef crisis but you have got to remember that Gerry Ritz, current Federal Ag minister was the individual whose vote defeated the motion to fine Cargill and Tyson $250,000 a day unless they opened their books to the Commons Committee back in 2004. Who do you think is pulling his strings?
On the other hand it has been good to see the Alberta Agriculture department take a huge interest in the crisis in the beef sector over the last year. I would think their time and effort spent on this sector of their portfolio will be unprecedented.