agman
Well-known member
Econ101 said:So marketing agreements that have a base price that is determined by a dated cash price can not be used to influence the price of the cash market?
Tell the truth, Agman. Are you going to say that it is in the feeder's hands? Remember, as the recent review of the AMS report showed, they don't have all the timely market information to be able to make an educated decision, but the packers have the power over the offers in the cash market that they make.
I just want to make sure, Agman, do you in any way receive a benefit either monetarily or otherwise (this could include access to timely information) from your analysis or business from your stance on marketing agreements or anything else the packers want to push?
The answer to your first question would be valid if prices only trended lower during periods of marketing agreements or failed to advance consistent with periods of no marketings agreements. The facts clearly state otherwise. As such, I do not believe marketing agreements lead to lower prices. I in fact believe, because of the empirical evidence, the opposite is true.
Knowledge is power so the challenge is to educate oneself rather than place blame knowing only partial information. Do producers have more information than packers and retailers regarding their production, Yes? Do packers have more information than retailers and producers regarding their production, yes? Do retailers have more information than packers or producers regarding the retail business, yes? It is the challenge of each segment to learn the facts regarding each different sector. Those who spend the most time educating themselves will be the winners. That holds true for corporations and individuals. Knowledge can be, should be, and is independent of size.
Your comment that packers have control over the cash offers they make is a clear example of limited knowledge. While they have the power to bid a price, the producer has the option to accept or reject. Is that power balanced evenly everyday? No, since supply and demand factors change constantly the balance of power is dynamic-it shifts constantly within seasonal and cyclical variations. Anyone truly knowledgeable of the market knows that to be true.
The answer to your final question is clearly NO. My positions are independent due to extensive research per subject matter. Unlike many, I am not a demagogue. Anyone who truly knows me will verify that. I say what I have to say immaterial who is in the audience or whom I am meeting with. That independence, willingness and courage to speak my mind, showing the research to support that position and/or disprove a position, is precisely why I have the quality of customers that I have. Those customers run the full gamut of the beef industry from small individual producers and companies to major agribusiness and financial institutions. I am very fortunate for that unique situation. That has placed me in a position to become more knowledgeable about each segment, a rarity in agriculture. Any client worth having would not pay anyone to tell them what they want to hear. I do not need nor do I have any such clients.
Do I or my customers benefit from that knowledge? Yes, that is the explicit purpose of endless hours of research and ongoing knowledge growth. Should I or any of my customers apologize to those who do not seek to improve their knowledge of the real and numerous factors that shape the market? The answer is clearly NO.
I have stated many times that conspiracy theories, false and/or unsupported assumptions and accusations are the product of the lack of knowledge or ignorance of the subject matter. I have not seen that belief disproved one time. To the contrary, the endless stream of unsupported accusations from those such as yourself only serve to reinforce and confirm that belief. No flame intended; just a fact.