Mike: "So are you saying we shouldn't listen to economists or professors who undoubtably spend more time on a given subject than we/you do?"
That's not what I am saying at all. I do listen to the advice of certain economists but the economists I listen to are in continual contact with beef retailers and understand the issues better than you or I. Not some economist who is catering to the blamers in our industry that think retailers are making $400 per head.
For instance, consider the case ready products with longer shelf life, that also adds to the lag time between the wholesale beef price (boxed beef price) and the retail beef price which affects price spreads.
Does the retail to wholesale price spreads consider lag time?? If not, they need to. I know Agman does!
A lot of the price spread data comes from USDA. USDA has printed a report on how misleading price spreads are and suggests that if you adjust them for inflation that retail profit margins have actually gotten tighter, not wider.
Mike: "Facts are never more than someone's opinion."
That's not true or we would never reach a verdict in court.
Facts are only as good as the evidence that supports them.
Opinions are not facts, opinions are "theories".
Mike: "May I ask where you received your Doctorate in Economy?"
I don't need a Doctorate in Economy to understand the retail beef industry. I simply search out those who completely understand it.
Mike: "Someone to blame? Isn't that the intent behind each and every single crime investigation?"
What does crime investigation have to do with the chronic bitchers in the cattle industry that blame packers, retailers, USDA, GIPSA, NCBA, Checkoff and have nothing to back their allegations but sale barn rhetoric?
Quote: "Retailers have always been careful about sharing information, and it's only going to get harder to get industry-wide data that are very accurate or meaningful."
Making accurate information from some economists more subject to questioning.
Bill Mies, national account vice president for eMerge Interactive, Inc. and former Texas A & M beef specialist: "The improved shelf life that comes with better packaging should translate to less waste, as well."
Which serves to increase the lag time between wholesale beef prices to retail beef prices even longer skewing the retail to live cattle price spreads further. Most price spread data does not consider lag time.
Brad S.: "Here SH is making an assertion about this study's methoodology, WATCH THIS, PROVE YOUR ASSERTION THAT THIS STUDY DOESN"T INCLUDE FEATURED PRICES IN ITS BEEF AGREGATE PRICES. I know SH will NEVER an I know how long never is, SH will NEVER support his attack on methoodology here."
Quote: "Part of the problem in sorting out profitability in the food chain is that the data that go into USDA's wholesale-to-retail price spread have some shortcomings. In fact, some simply dismiss the information, saying the value adding and featuring activities at retail these days render it irrelevant, if not in error. "I don't think the retail spread is really that wide because I don't believe the price series on the top side of the equation," says Cattle-Fax analyst Dave Weaber. Just as one can argue with the components of the Consumer Price Index, meat-counter indexes may need adjustment. USDA uses Bureau of Labor Statistics (BLS) data to piece together the retail value of a fed steer based on the retail price of a standard mix of relatively low-value cuts. Although the standard retail product mix today reflects more boneless and closer trimmed products than the 1970s model, it doesn't include cooked or value-added products. Neither is it volume weighted to reflect the amount of beef moved at feature (sale) prices."
Quote: "Grocery stores buy just the cuts they want to sell, in both type and quality. So the retail prices used to figure price spreads aren't likely to be a good measure of what consumers pay for beef in general or even in the grocery store."
Quote: "Retailers are quick to point to the ribeyes they recently bought for $6.98/lb. and sold for $4.98 as evidence that USDA's price spread is overstating their take. And such a sale feature can easily move 600 lb.instead of 65 lb. of ribeyes that week. In fact, in an attempt to speed delivery of retail price information, USDA's Economic Research Service now gathers such volume-weighted "scanner" data, as mandated by the 1999 Livestock Reporting Act. Alas, this new scanner information is actually slower to arrive than the traditional BLS information."
Quote: "However, were USDA to switch to scanner data, the spread would likely be less than it is presently, Hahn says."
Quote: "The continual chatter about price spread methods misses the point, according to Virginia Tech's Purcell, who has analyzed some of the new retail price scanner information. "Scanner data will likely lower the average retail price some, but not by that much," he says."
If that's not enough, read the USDA's document on retail to fat cattle price spreads where they correct the misuse of their data.
If that's not enough, search the archives for "lag time" and see Agman's comments on retail to live cattle price spreads.
Think transportation costs are constant considering fuel prices? Let's hope inflationary costs are reflective of current fuel prices.
If you are still not convinced then get your wallet out and buy a retail beef business and see how you fare. Perhaps you can consult with Mike Callicrate and see how his beef business is doing compared to the $400 per head profits he lied to us about????
R-CULT representative Herman Schumacher testified before congress that "there is no greater proof of market manipulation than the retail to fat cattle price spreads". R-CULT once again showing their ignorance to the world.
Sorry if that's not what you wanted to hear.
~SH~
