Alberta Ag minister?

[grassfarmer]

I don't see the relevance of pointing out that past owners of Canadian packing plants may have indulged in the same practices the current ones do. How does that affect the value of producers collectively marketing their produce to receive better returns?

I've lived through a similar experience to the CWB story in Scotland with the milk sector. Government there was forced by a vocal minority of dairy producers to deregulate the industry in 1994 - taking away the marketing boards that had been in place since the 1930's to ensure producers received a fair return from the processors. The producers that wanted this change were typically younger, heavily in debt, larger scale and had a belief that they were more efficient than the average and would be better served by a free marketplace where they could sell their milk on an individual basis to few the large processors.
The average farmgate milk price in 1994 was 24p per litre, in 2006 it was 18p per litre! By the same token store price of milk has risen from 42ppl to 55ppl.
Many, many producers have been forced to exit the industry and even the keenest deregulation advocates realise they were just wrong.
There are many examples of this type of activity all around the world in agriculture - perhaps that is the history you should be taking time to learn.

[cakadu]

It is very important to note the difference between marketing and selling. Selling cattle, canola etc. means that you are taking the commodity price, ergo the lowest price they can get you take - the operative word there being take.

In marketing your products, it means you (or someone in a group that has come together to work for the collective good of all) must do the leg work yourself. You don't just drop your production off at the auction, feedlot, elevator (or whatever they call those big cement monstrosities) and then collect the cheque.

You go out and find the market, make sure that the products you deliver meet their specifications at a price that you can make a profit at. The upside is that you make the profit and it doesn't go into someone else's pockets.

It is a lot easier said than done, but I support it wholeheartedly and have all along. I'm not quite sure where your comment comes from cowman - I have always been for the producer to be able to sell as they see fit.

[kpb]

Well I guess we should all value the freedom to go broke by selling our product the way we see fit. After all it's been working so well for the cattleman and the hog producer--we're all so much better off by marketing our own product rather than having a marketing board work for us, right?

Does anyone deny that the most prosperous farmers in this country are the dairy men? Do you guys not see a link there? We've just about lost our hog farmers, all in a span of about 10 years and we are well on our way to losing our full-time cattle producers. But that's ok because we are free enterprisers, true capitalists with an independent spirit?

grassfarmer is absolutely right in his remarks. The fact is that the multi's, in league with the government and the media, promote the idea of "independent" ranchers and farmers so that they can control us, individually, and do not have to deal with a strong collective. These corporations are not free enterprisers--they want to control the market through monopolies. Cargill, for example, in High River, is an investor in Western Feedlots. I heard yesterday, don't know if it is true, that Cargill has also made an investment in Ranchers Beef. We can expect more of this in the future as the big packers consolidate their hold on the cattle industry in all aspects. Does this seem like a free enterprise system to anyone? Do you think the best way for the individual cattleman to get the best price for his product is to try to work, individually with this monolith?

As I have said before, we need to work as a unified group to get the best price for our product. The moment is already past, I think, but we should have concentrated on our domestic market only, given up the export trade and worked towards owning our own packing plants. Every foreign market that is opened does not benefit the individual cattleman a whit-it only serves the interests of the packers.

The full-time cattleman is just about through in Canada--just look at the dispersal sales. Our industry is becoming a part-time job for people with other means of support. We may not recognize this yet but it will be seen, in retrospect, in five or 10 years time. Just like the full time hog farmers that were quite common just a few short years ago.


kpb

[cakadu]

Kpb, my statement was in fact in support of selling whatever way each producer wants to. If they want to remain part of the CWB, then that is what they should do. If they want to have the choice to go with a group of other producers to sell collectively, go for it.

If they want to be in the supply management sectors, then be part of it. If organic is your game, then get into that market.

No one way is right or wrong - it is what best suits your management style, production decisions etc.

Farmers_son mentioned in another post that when it comes to landowners getting pittances from the oil barons, that analogy can be set in the ag industry as well. We recently returned from a conference where producers were likened to surfs on the land as they were beholden to the various multi-national companies i.e. fertilizer, seed, herbicides etc.

I couldn't agree with you more Kpb, the means of production as we have known it is disappearing and likely far more quickly than what we even realize.

Unless and until we can work together, we are doomed to become a wonderful piece of nostalgia.

[cakadu]

KPB: I think you are reading the situation very well and I believe we are entering a phase that the hog farmers have already gone through? I really don't see any solution? I just don't see anything changing?
I have no problem with any farmer entering into a system of marketing collectively...on a volunteer basis? I do have a problem with being forced to join that collective!
Highland feeders has a marketing plan to add value to individual cow/calf producers? Bern Kotelko has taken this plan quite a ways? There was a write up about this system in the Red Deer Express last week? Apparently it adds quite a premium(he says 10%) for naturally raised cattle that will fit their system!
Now for the kicker! In talking to a local feedlot owner about the biodigester at Highland feeders(36,000 head) I was commenting on what a smart cookie Bernie Kotelko was. This feedlot owner said "Well he should be. Cargill owns him"! Now this was news to me! This guy claimed Kotelko was just a front man for Cargill! I have no idea if this is true or not...just what he told me!
But that doesn't detract from the marketing plan Highland has set up? I think in the near future, if you want to stay in cow/calf you will have to become integrated up the value chain? As the feedlots become more entwined with the packers, they will be cutting deals with individual cow/calf operators to produce cattle that fit into their system? Raised a certain way with genetics that fit the system?
In the big picture this is a more efficient system? Eliminate the auction mart system for marketing calve, eliminate the razzle dazzle of the purebred business, put a real value on calves based on their ability to produce the desired product?
It won't be easy and many people who can't adapt will have to go, but it will be a better system that will be better able to compete with pork and poultry.
One last thing: Eugene Whalen offered both the beef and pork industry supply management? Both industries turned him down...and it wasn't just the beef or pork "organizations" it was the individual producers! Now maybe that was a mistake...or maybe it wasn't? How long will supply management last? I would suggest...not much longer...if we want to be able to trade with the rest of the world!

[cowman]

I have no problem with any farmer joining a collective marketing system...if it is voluntary? I do have a problem with forced participation!
Highland feeders(36,000 head) has a voluntary value added program for cow/calf producers? They claim a 10% premium! Of course your cattle have to meet a certain criteria...which is pretty common for a branded beef program?
Now rumor has it that Highland is really owned by Cargill and the Kotelkos are just front men...but that doesn't detract from the fact they have a "collective" system that will produce more money for the cow/calf operator?
I agree with kpb that the beef industry is just about where the hog industry was around ten years ago! I do believe we are going to see an integration up the value chain? As packers and feedlots become more entwined the system will extend down into the cow/calf operators...just like the Highland system?
In the big picture, this is probably necessary, if we hope to compete with poultry and pork! And in the big picture...it will be much more efficient? Eliminate the auction mart system, eliminate the razzle dazzle of the purebred industry, and reward the producer who can produce the calf that will meet the industries needs?
Now to take advantage of this type of system you will have to use a certain type of genetics, a certain health protocol, a certain feeding regime, and probably certain animal husbandry ethics!...actually just like hogs and chickens!
Now a lot of people won't be able to change or won't want to? Just like a few hog farmers tried to buck the trend? Very few are left.
We may not like it...but it is coming! Just my opinion.

[blackjack]

...with the power the cargill's and tyson's have cowman you are probably right...but the hog industry is already predicting they cannot compete if the the grain prices stay high...so how stable is that...if govt want to have corps monopolizing agriculture they will have one major problem ...labor which is us...unless the plan is to import it which may also be the case...

[grassfarmer]

Great theory Cowman, the problem with "reward the producer who can produce the calf that will meet the industries needs?" is that with monopoly you don't need to reward the producer for anything. I am already selling cattle that meet Highlands specifications exactly - through the auction ring and feel I am still getting a small reward for doing so. In future I think calves produced to this specification will be the norm - all others will be severely discounted and even at that there will be continued downward pressure on the price a primary producer receives for either type of calf. I don't believe that we will get to a point through monopoly control of the beef sector when the monopoly players will suddenly decide to throw some extra cash the cow/calf producers way - why would they do that?

[cowman]

Well I agree in the end the "survivors" didn't get much of a deal and the last few are probably on their way out!
I wonder though if the beef industry is going down the same road?
If this grain/oilseed bio fuel thing is real, I suspect there could be a lot of silage/hayland going into bio fuel production? Especially if this cattle situation remains static?
It seems to me there are a lot of cow/calf guys packing it in? Now maybe that is just my area or something? Probably the largest cow/calf producer in my area (1200 cows/Kent Olsen) is dispersing this spring. Another large cow/calf operation(1200 cows/Purdys) dispersed in 2003 and now run contract yearlings. I think a lot of the 50-100 cow guys are already gone? Most of them were into grain anyway and not too hard to rip up some of the better land.
I'm not sure if this is a good thing or not? It should get our supply back in some kind of balance with demand, but it is getting awful lonely being in the cow-calf business!