Purecountry

[grassfarmer]

As I see you have returned to the fold PC (note I said "fold PC" and not "PC fold" lol)I thought I would throw out an observation that might interest you and others. I had the opportunity to attend a couple of sessions at the Western Cdn grazing school on Thursday in Edmonton which was very enjoyable and informative. There are a lot of smart guys in that circle that are alternate thinkers and successful producers. What strikes me though is that they are almost all "survival of the fittest" and "outlast your neighbor" types. Their success is often based on getting the hay they need for bale grazing below the cost of production from the old guy down the road etc. Almost none of them choose to get involved in the politics of agriculture and attempt to better the lot of all producers. It strikes me as standing out from the holistic stance they take in their businesses. They are basing their success on a symptom - a non-functioning market, rather than addressing the base problem - lack of competition at the packer end. Another feature of these successful producers is that they almost all externalise risk - ie they feed or graze someone else's cattle often on rented ground. Now this is all well and good for their business (and I have no problem with people making money)but they have also got to realize that their policy will only work as long as someone else is prepared to take the risk and own the cattle.

[agstar77]

That's pretty much a useless statement ,without context. Also sounds like sour g****s on a lost sale.

[LWeber]

You are right again Agstar.

The United States dislikes the CWB because it sells wheat above their price time and time again driving up the price of world wheat and putting more money to the American farmer's bottom line.

The next time i see the words "CWB premium" - I'll just insert your line.

"That's pretty much a useless statement ,without context."

The CWB is a religion. You don't have to see it to know that it is divine. And it feels good.

62% of barley farmers don't feel that way. And since your beloved have grouped all their votes to to arrive at 62% - none of you left wing whacks better ever question the validity of the 62% barley vote.

[mustardman]

Larry and vise versa:
"and since all your beloved have grouped all your votes to arrive at 62% - none of you right wing hacks better ever question the validity of the 62% electoral vote. lol

[LWeber]

With regards to barley marketing - those that want choice don't apply for bulk discounts for cases of KY nor patronage dividends on said purchase from the Co-Op.

See the difference?

[silverback]

Something has gone wrong on your web page again Parsley.

The tablecloth has seized control again.

[parsley]

That pretty much sums it up.

[parsley]

I did a little work silver. But don't forget to click on the historical documents and they will download in a large print. Read them before you go to bed so you won't be up all night pacing about tommorrow's voting results.lol btw, mustard, if you read the documents you will be converted and will be hoping four choice candidates win. lol Pars

[smcgrath76]

I think you are onto something here GF. One of the issues, even for the custom type of operation is that if the overall strength of the industry suffers, then there will be less people willing to take the risk and certainly less willing to pay for the service of grazing.
There are thousands of good business models, but in the end, unless we are creating true wealth so everyone wins it is not sustainable. Just some of us will be sustained longer than others.
I don't think it is right to talk about growth without defining it. More cows does not mean more profitable, nor do bigger or smaller farms. A product that can extract value from the marketplace (including environmental, watershed protection, food quality/safety, production method, etc.) is the only way to grow the "value" of the industry and create a culture of winners, rather than screwer and screwee.

[grassfarmer]

As a perfect example I listened to one excellent speaker who is a feedlot operator owning some cattle as well as custom feeding others. His talk was about knowing your cost of production and managing risk. The intricate methods he had in place to do these were amazing to me - his level of understanding of risk, futures, basis etc. But the back stop of his whole operation was that everything he sold went by non-competitive bid to Lakeside packers due to their close proximity. The decision to buy calves and how much to pay for them started with that estimated final less all the cost,basis and risk allowances. Needless to say he thinks calves are too expensive to own at the moment.
Nothing in his speech, or seemingly his thinking reflected the fact that Lakeside are paying half as much for cattle as they were pre 1989 when corrected for inflation as revealed by the NFU.
As you say Sean - not sustainable. This type of thinking may be a good way to protect your own business in tough times but if your supplier (the cow owner)can't survive you ultimately can't either.

[kato]

That is so so true!

We buy small calves to background. Have done so for years. In times past we could buy them at what seemed like a substantial price and still expect to get out from under them with a bit of cash. Sometimes a lot of cash. but always at least some cash.

What we're finding now is that the only calves we dare to buy are going to have to be priced so low that there is no way the guy who raised them is going to make any money. We've been averaging not much more than $400. delivered this fall, and I'm darn sure the seller didn't put any cash in his pocket out of that. However, if we were to be forced to pay more, we wouldn't buy them at all because it would be just too risky. We've gotten to the age that we're very reluctant to do something that's going to put an even bigger hole in the equity we've spent so many years building up.

There is scarce room for anyone to maneuver on these calves, and I'm pretty sure that pretty much everyone in the business is thinking that the whole industry is just one wreck away from collapse. (maybe less!) There's just no appetite for risk out there any more. We just don't dare to take huge chances any more. Not until we can see things changing in a big way.

It's sad that the sellers of these calves are taking a beating, but if we spend more, we'll take the beating, and if that happens we won't be back on the market any time soon. So there will be one less bidder on their next calf crop. It's a viscous cycle, and things have to change.

[PureCountry]

Just logged in GF. You make a very good point, and one that I have discussed with many of those Holistic Practitioners. Let's take one of my first examples of applying Holistic Management(HM) to our operation - Leafy Sphurge. (The relevance will tie in momentarily) We've tried everything over the years to eradicate this weed, to no avail. Through research and much learning, I discovered that I was fighting the wrong battle. The weed is a mere symptom of a much larger problem, being severely unhealthy soils. When we take a Holistic approach, we ignore the weed, and put all of our focus on improving the whole ecosystem, starting with the soil. We stockpile the grass, giving it much needed rest, add some soil amendments, and Presto - a healthy ecosystem with greatly reduced Spurge populations.

Now, try and think of that same principle as it applies to the beef industry. Start with what GF said about packer influence and/or suppression. No matter what we do for dropping our expenses at the farm gate, we are only focusing on SYMPTOMS. The true problem, is the packer control of our industry. Anything you wish to argue on that point or discuss, can all be accounted for in those 2 words - Packer Control. GF hits it square on the head.

Kato and Sean speak of backgrounding and/or hay prices - I especially like the analogy of the "screwer" and "screwee" - and once again they are SYMPTOMS. Let's say Kato came to my place, and asked me what I NEED to make money on my calves. I respond with a price of $550, she says, "No problem. We all need to make a profit in this business." I say thanks and away they go. She feeds them for 120 days, and looks to sell them to a feedlot for finishing. They give her what she needs for them, because after all, we all need to make money in this. THe finishing guy puts his 2bits worth into them, calls the C_____L buyer and says, "I need $1.85 on the rail to make a bit on this pen of steers." The C______L buyer says, "Nope. We're only paying $1.50 right now." Finishing guy says, "But, Mr. C_____L buyer, I thought everyone in this business was supposed to make money?" Buyer says, "We will, if we get your calves at the weekly price."

THerein lies the problem. No matter what we do, everyone seems programmed and brainwashed to go by that damn market price. The only way I see that changing, is for more lobbying and an insane amount of work by a huge number of people to persuade our government to ban Packer Ownership. The other way, is to become a direct marketer.

And from the sounds of things Grassfarmer, you witnessed firsthand where most "low-cost" folks are going. Lobbying is a foreign territory even scarier than direct marketing, so they seem content to stay on the fringe or in the shadows, rarely seen in the light of day. They seem only to show themselves when they have confidence in numbers at events such as the WCGC, where they can be protected by the milling of the herd effect in mobs of like-minded folks.

I must admit, we've been anything but lobbyists this last year. So many things on the go, I've hardly kept in touch with Cam or Doug or anyone since our meetings with CBEF and such. I admire those who beat the drum and get out to the meetings GF. Nothing will ever change if no one asks for it. I'll have to call you one night and we'll form a plan to overthrow the ABP office and throw a party in that huge conference room. LOL