Canadian Retail Prices

[Anonymous]

Rod: "Unfortunately, you got the wrong one SH."

Why's that Rod? Because it didn't say what you want to believe? If you don't believe your own government's study, then why don't you come up with something that contradicts it? At some point you have to determine what is truth.

Who really is served by bad information just because it allows a "scape goat" for lower cattle prices?

This study did an excellent job of breaking down the carcass for you and the related values. What part of it are you not understanding? What part of it do you question or not want to believe?

When you Sandhusker or Conman this by making a feeble attempt to discredit it, it only reflects on you.

Rod: "What you're reading is an Ag Canada summary report thats left most Canadian cattle producers scratching their heads, wondering where they came up with the drivel. The ABP report is the one that actually details everything out."

Sure it has blame driven producers scratching their heads because that's not what they wanted to hear.

Drivel? Hahaha! Your bias screams. This is a detailed breakdown on retail beef. What part are you not understanding?

Either refute the data with opposing facts or suck it up and accept the facts as they are rather than how you want them to be.

Rod: "And I forgot you don't know the difference between gross and net profits. They paid $1.40/lb and got three times that back, therefore the gross margin was twice the purchase price or 200%. Thats a plain old fashioned raw gross."

Hahaha! I totally understand the difference between gross and net and that's precisely why I differentiated between the two. A 200% gross doesn't tell you a damn thing if you don't know what the costs are. Now if you want to be critical of where packers could cut more costs and increase their efficiency therefore being in a position to pay more to producers, hey, that's a valid discussion.

If you are going to dummy up and try to create an image of excessive profits within the context of "gross margins" without discussing expenses, you'll only reveal your own bias.

Rod: " C'mon BMR, cattle producers aren't idiots. They can add and subtract. They know what they're receiving for money, and they know what the store charges for their product. Most also know that the store is certainly not getting rich selling their undervalued animals. That leaves one place, and one place only thats making money."

I'm going to have to file this quote away somewhere. This statement says more about your depth of knowledge of this industry than anything you have ever stated. HOW TELLING!

Do cattle producers know what they are getting for their cattle? Of course they do.

Do cattle producers know what they are paying FOR CERTAIN RETAIL CUTS in the store? Of course they do.

Do "MANY" cattle producers know what the retail profit levels are? NO!

Do "MANY" cattle producers know what the retail expenses are, what the processing expenses are and what packers are actually making? HELL NO! NOT EVEN CLOSE.

WHY? Because they do you simple math and skip over the detail presentation I just posted because it's not what they want to hear. Blamers want to blame.


In your statement above, you mention the difference between gross and net margins but you really pull your pants down when you state "That leaves one place and one place only that's making money".

HOW THE HELL WOULD YOU KNOW UNLESS YOU KNOW THE EXPENSES??

Discussing "GROSS MARGIN" doesn't tell you a damn thing about "WHO'S MAKING MONEY". Nice job blowing your damn foot off. Good grief.

I thought you were smarter than that but you have bought into the same packer blaming rhetoric that R-CULTers believe AND CAN'T PROVE EVEN IN A COURT OF LAW.

Facts are facts Rod! If you can't refute this study with contrasting facts, then you stand their with your coffee shop, blame based arithmetic.

Rod: "And you may want to hit to a coffee shop every now and again. It'll give you an idea of how the common cattle producers feel these days, not just your SSGA members. Perhaps alot of the information is heresay, but I think you could benefit from just listening to the feelings of the producers. I know I certainly miss it since I've been helping a couple producer-driven concerns with their business plans."

That depends on the accuracy of the information that is forming cattle producers opinions. Heck, I hear cattle producers blaming imports for the market now WITHOUT EVEN CONSIDERING THE ADVANCE IN CORN PRICES.

In the US, corn prices have advanced $1.00 since last year. Do the math. The rule of thumb is that each $.05 change in a bushell of corn affects feeder cattle prices $1.00. That's a $20 change per cwt. There it is. Heck, I have a computer program that I used a few years back to figure ration costs and I can plug the corn prices in and come up with the same figures but still the import blamers BLAME YOU CANADIANS. Should I listen to what they are saying? Should I join them in blaming you for bse? I don't listen to packer blamers or import blamers because neither have a clue what they're talking about. I listen to market analysts that know what the hell they are talking about and you should too.

"Gross margin does relate directly to profitability."

Rod (in response): "Perhaps maybe you should read your own stories? A 200% gross margin is incredible and 99% of firms would kill for that kind of gross."

A 200% gross margin doesn't tell you a damn thing about expenses. Who would kill for a 200% gross margin if the expenses were higher than the 200% gross margin? Good grief Rod, think about what you are saying.

Now if you want to shoot holes in your own government study, step up to the plate and refute the data with hard facts to the contrary.

You blew your cover with your 200% gross margin "DRIVEL" which doesn't tell you a damn thing about "NET PROFIT" and expenses.


Go ahead and take your shots Rod, you really laid it out in this post. "Well ah ah here's what I got for my cattle and ah ah here's what I bought T-Bones for. Heck if you take that times a 750 pound carcass, LOOK AT THE GROSS MARGIN".....ROTFLMAO!

What about fat?
What about bone?
What about cut out waste (lesions and bruises)?
What about chuck and round prices?
What about ground beef prices?
What about discarded product?
What about featured prices to move product?
What about fabrication costs?
What about transportation?

Duuuuuuuuuuh! You don't know a damn thing about beef fabrication do you?

Rod, you really disappoint me. I honestly thought you were smarter than that.



~SH~

 

[DiamondSCattleCo]

Why's that Rod? Because it didn't say what you want to believe? If you don't believe your own government's study, then why don't you come up with something that contradicts it? At some point you have to determine what is truth.

No SH, its because the study you quoted was an old one, long refuted. You're basing your information on outdated articles. Like I said, you know nothing of the current Canadian packing landscape. Until you learn something, go find another thread to prattle on mindlessly about.

Drivel? Hahaha! Your bias screams. This is a detailed breakdown on retail beef. What part are you not understanding?

Because the figures were incorrect and the report was refuted by producers, by the opposition party, and by Canadian Agricultural Journalists who have more years under their belts than you do. I can make up a report with fake retail prices too. Today only, steak $100/lb :roll:

Either refute the data with opposing facts or suck it up and accept the facts as they are rather than how you want them to be.

Didn't you read any of the ABP report that Randy posted? I'm not going further in this thread until you do. You're wasting my time.

Do cattle producers know what they are getting for their cattle? Of course they do.

Do cattle producers know what they are paying FOR CERTAIN RETAIL CUTS in the store? Of course they do.

Do "MANY" cattle producers know what the retail profit levels are? NO!

Do "MANY" cattle producers know what the retail expenses are, what the processing expenses are and what packers are actually making? HELL NO! NOT EVEN CLOSE.

See, this is why I think you're lying about being a producer, or knowing any producers. Cattle producers certainly do know what the retail margin is. Its reported constantly by Canfax, and I see it referred to in ag magazines. And while cattle producers don't know what the costs are to a packing plant, they certainly know how much it costs to take an animal to the local butcher and get it cut and vacuum packed. And it sure as hell isn't $2.00/lb. So what you're saying is that it costs the packer $2/lb to cut, wrap, and dispose of the excess? So much for your grand idea that bigger is better. :roll:

So SH, I want YOU to detail out the costs for me. We'll use the Ag Canada break downs on the cuts if you desire. I want to see every last penny of that $2/lb gone. I want you to display your great knowledge of the industry, SH.

Put up, or shut up. You're wasting my time, and I'm not going to stand for it anymore. You spew packer drivel, yet you have no idea what the costs are that are associated with cutting and processing. You think trucking is a big expense (did you do the math, SH? Didn't think so.)

I'm done SH, until you actually display some knowledge. Refute me. Show me that packer expenses are equal to or greater than the 200% gross margin.

Rod

 

[Tam]

Why's that Rod? Because it didn't say what you want to believe? If you don't believe your own government's study, then why don't you come up with something that contradicts it? At some point you have to determine what is truth.

No SH, its because the study you quoted was an old one, long refuted. You're basing your information on outdated articles. Like I said, you know nothing of the current Canadian packing landscape. Until you learn something, go find another thread to prattle on mindlessly about.

Drivel? Hahaha! Your bias screams. This is a detailed breakdown on retail beef. What part are you not understanding?

Because the figures were incorrect and the report was refuted by producers, by the opposition party, and by Canadian Agricultural Journalists who have more years under their belts than you do. I can make up a report with fake retail prices too. Today only, steak $100/lb :roll:

Either refute the data with opposing facts or suck it up and accept the facts as they are rather than how you want them to be.

Didn't you read any of the ABP report that Randy posted? I'm not going further in this thread until you do. You're wasting my time.

Do cattle producers know what they are getting for their cattle? Of course they do.

Do cattle producers know what they are paying FOR CERTAIN RETAIL CUTS in the store? Of course they do.

Do "MANY" cattle producers know what the retail profit levels are? NO!

Do "MANY" cattle producers know what the retail expenses are, what the processing expenses are and what packers are actually making? HELL NO! NOT EVEN CLOSE.

See, this is why I think you're lying about being a producer, or knowing any producers. Cattle producers certainly do know what the retail margin is. Its reported constantly by Canfax, and I see it referred to in ag magazines. And while cattle producers don't know what the costs are to a packing plant, they certainly know how much it costs to take an animal to the local butcher and get it cut and vacuum packed. And it sure as hell isn't $2.00/lb. So what you're saying is that it costs the packer $2/lb to cut, wrap, and dispose of the excess? So much for your grand idea that bigger is better. :roll:

So SH, I want YOU to detail out the costs for me. We'll use the Ag Canada break downs on the cuts if you desire. I want to see every last penny of that $2/lb gone. I want you to display your great knowledge of the industry, SH.

Put up, or shut up. You're wasting my time, and I'm not going to stand for it anymore. You spew packer drivel, yet you have no idea what the costs are that are associated with cutting and processing. You think trucking is a big expense (did you do the math, SH? Didn't think so.)

I'm done SH, until you actually display some knowledge. Refute me. Show me that packer expenses are equal to or greater than the 200% gross margin.

Rod

I read it Rod and I would like you to tell me where in the full 58 page report it breaks down the cost of production like the article that SH posted, What page Please?
If that was the ABP Packer Profit margin report don't you think the words packer profit margins would have been printed in it at least once in 58 pages? Are the additional costs to packers that Randy posted here on this thread right or wrong according to the full report? Just trying to see if you really read it Rod.

 

[Jason]

The ABP report does state that producers are getting less for cull cows. That is obvious.

It does NOT say the packers are getting the difference. It doesn't even imply that.

Retail beef prices I posted don't tell anything other than chicken and pork are cheaper than beef at retail.

Trying to imply that packers get rich because beef sells for $5 + a pound is as stupid as saying all farmers get rich if barley hits $3 a bushel.

 

[DiamondSCattleCo]

I read it Rod and I would like you to tell me where in the full 58 page report it breaks down the cost of production like the article that SH posted, What page Please?

:roll: Of course I've read it Tam.

And lets see if you can follow some thought processes here:

1) Producers lost approximately $500/cull cow. This was based on market price before BSE, and market price afterwards. Tell me Tam, do you deny this? Do you deny that producers have lost massive amounts of money on cull animals?

2) The report also states that packers had an increase in costs of $50/animal. So lets see, they were able to buy product for approximately $500 less (from 1), yet it only cost them approximately $50 more to process them.

3) Retail prices during BSE only fell 20%. I don't recall if the report mentioned retail price drops or not, and I'm too lazy to dig it out this morning. However Canfax did report it. 20% of retail doesn't come CLOSE to the $450 from 2).

Now please, someone dispute those numbers. Work out numbers that shows me that packers were only making a few bucks/head during the salmon run. It hasn't gotten much better now either. Culls are selling in that $400 range.

Rod

 

[Denny]

Hmmmm, well lemmesee:

1) $5.23/lb comes from Jason.

2) 20% profit margin at retail comes from long term Canfax reports, verfied by store keepers. Retailing sucks. 20% is barely enough for them to pay employees and keep the lights on.

3) Trucking amounts to a few cents/lb. (engage brain SH. 50,000 tonnes per load. Trucking from feedlot to packer only, since the retail store pays the freight from packer to them)

4) Any industry that has a 200% gross profit after the purchase of raw material has a healthy gross. Most companies would kill for a gross like that.

SH, its you that has no clue. The packing industry WITHIN CANADA, which is what this thread is (notice the subject heading?), is making a helluva profit off the backs of producers.

Y'know something else? You always ask questions, and yet don't bother with answers of your own. Why is that? Perhaps its because you don't know either?

You can consider that last question rhetorical, SH. I'm well aware of your knowledge level. Now go away SH. This is a thread about CANADIAN BEEF PRICES, a topic you have no knowledge of and as such, have no useful information to contribute.

Rod

Another thing you could check which I bet is the same as here.

The feedlots here pay The trucking to the packing plants.Or at least the Feedlots that have bought our calves.Those fat prices are delivered prices.

 

[Sandy]

It takes a good grain feed cow to bring 20 cents here right now. That puts a 1400 pound cow at 280 bucks. Somebody is making good money off that cow and it sure ain't the guy selling her.

 

[blackjack]

... well bmr... since these cows weighed all most 1600 lbs that works out to 25 cents a pound ...most bred sales i attend there is usually a packer buyer to buy the culls or to pick up the cutouts... it just seems sad to me that is all that they are willing to pay...

 

[DiamondSCattleCo]

The feedlots here pay The trucking to the packing plants.Or at least the Feedlots that have bought our calves.Those fat prices are delivered prices.

Denny, thats a good point. Its a mixed bag up here. Some feedlots pay the full tilt, others have negotiated a 50/50 split. I am unaware of any packing plant that pays for full shipping, however they may exist. Ranch and small feedlots pay the shipping. Of course, if the packing plant buys from the auction house, they'll pay for shipping. Hence the reason why I laugh at SH's 'trucking' as though its a massive cost to the packing plant. The cost is nil to the packer.

Rod

 

[Tam]

I read it Rod and I would like you to tell me where in the full 58 page report it breaks down the cost of production like the article that SH posted, What page Please?

:roll: Of course I've read it Tam.

And lets see if you can follow some thought processes here:

1) Producers lost approximately $500/cull cow. This was based on market price before BSE, and market price afterwards. Tell me Tam, do you deny this? Do you deny that producers have lost massive amounts of money on cull animals?

2) The report also states that packers had an increase in costs of $50/animal. So lets see, they were able to buy product for approximately $500 less (from 1), yet it only cost them approximately $50 more to process them.

3) Retail prices during BSE only fell 20%. I don't recall if the report mentioned retail price drops or not, and I'm too lazy to dig it out this morning. However Canfax did report it. 20% of retail doesn't come CLOSE to the $450 from 2).

Now please, someone dispute those numbers. Work out numbers that shows me that packers were only making a few bucks/head during the salmon run. It hasn't gotten much better now either. Culls are selling in that $400 range.

Rod

1. No Rod I don't deny the producers lost but is that not what happens when the supply side of things is way out of line with the demand side? Maybe before you blame the packers for taking advantage of the markets in Canada, you should take a look at the other side of the equation. Look at what is happening to the south. where the demand is higher than the supply. Record high cattle prices, packers going under, thousands of men loosing their jobs, all while the producers are laughing all the way to the bank. Some US producers are even taking the USDA to court to keep their salmon run going a bit long, just so they can put the screws to a few more packers and put a few more out of business and concentrate their industry a bit more.
Tell me Rod if the tables were turned and the Canadian producers had the packers over the barrel would you be laughing all the way to the bank like the US producers are or would you limit the amount the packers paid you for your cattle as not to put the packer out of business? I realize the packers were making some money but the question is DID THEY DO ANYTHING ILLEGAL? According to a number of investigation there was NO EVIDENCE THEY WERE. So unless you are willing to take a cut rate price for your cattle when the table turns stop blaming the packers for something you and I both know the producers are doing in the US and have and will do again in Canada, which is take the money and run.

2. Actually Rod what Randy posted said the total additional cost was $25 to $50 dollars but on pages 37 to 43 of the report the additional cost to packers was broke down and more in the range of $49.81 to $88.95/head based on an estimated conservative yield loss in the OTM animals. But the older the animal, the more lost yield and the higher the cost of disposal. What do you think the older cull cattle are doing to that conservatively estimated range?
One more thing the report points out is that the packers hold all the risk when they buy the live older cattle as if they are condemned the packers is out the price they paid plus the cost of disposal as with the new rules these animals can't even be made in to pet food.
BTW that additional cost was based on labor, conservative yield loss, rendering cost and MBM disposal. It did not cover any other cost brought on by BSE as in plant upgrades to handle the new regulations that these plants have to abide by if they care to stay in business.

3. Rod let me remind you where you read about the 20% It was posted by SH on Friday, November 10

Ag report shows no unfair packer pricing because of BSE
--------------------------------------------------------------------------------
March 11, 2004
Consumers saw 20-per-cent beef price reductions in 2003
________________________________________________________________________
Highlights of report:

Information available to the department does not suggest unfair packer profits.
Alberta consumers enjoyed an overall 20-per-cent price decline at the beef retail counter in the last half of 2003.

Go ahead Rod go back to the first page of this thread and read it again. As it wasn't in the report Randy posted. In fact the retail price of beef wasn't even mentioned in the report that Randy posted. Which I find strange as if this was a report on packer profit margins like you told SH it was I would think it would have at least three things. Those being the price the packer actually paid the producer for his cattle not a estimation on the loss in value of the cull cattle. The next being the full cost of processing the animals into beef, not just the additional cost put on the packers by the new regulations. And the third being the price the retailers actually paid the packer for the beef. But since this report contains NONE of these things I personally don't see how you can consider it a packer profit margin report.
And as in the Alberta Government report that SH posted it stated the reason we didn't see more than a 20% drop in retail beef was

Why aren't Alberta consumers paying less for beef?
In fact, there was a dramatic decline of 20-per-cent in average retail price of beef in the last six months of 2003. However, some cuts—such as steaks—remained in high demand, while there was little supply available. This meant that the retail price of steaks remained high.

Cheaper cuts of beef—such as ground beef and chuck—were more responsive to the increased supply available. The prices for these cuts dropped significantly.

ISn't Supply and Demand great. Our supplies out do our demand we get less IE hamburger and cull cattle, our demand out does the supply the prices stay high IE good steaks and UTM cattle. And as you pointed out Rod the price of Cull cattle has come up so that must mean the demand for them is increasing.

Just wondering Rod if there is so much profit in the packing industry why haven't you and Randy invested YOUR money in a packing plant? Could it be because they are not always profitable? :?

 

[DiamondSCattleCo]

1) No Rod I don't deny the producers lost but is that not what happens when the supply side of things is way out of line with the demand side?

2) Maybe before you blame the packers for taking advantage of the markets in Canada, you should take a look at the other side of the equation.

3) Tell me Rod if the tables were turned and the Canadian producers had the packers over the barrel would you be laughing all the way to the bank like the US producers are or would you limit the amount the packers paid you for your cattle as not to put the packer out of business?

4) Actually Rod what Randy posted said the total additional cost was $25 to $50 dollars but on pages 37 to 43 of the report the additional cost to packers was broke down and more in the range of $49.81 to $88.95/head

5) One more thing the report points out is that the packers hold all the risk when they buy the live older cattle as if they are condemned the packers is out the price they paid plus the cost of disposal as with the new rules these animals can't even be made in to pet food.

6) It did not cover any other cost brought on by BSE as in plant upgrades to handle the new regulations that these plants have to abide by if they care to stay in business.

7) Rod let me remind you where you read about the 20% It was posted by SH on Friday, November 10

8) Just wondering Rod if there is so much profit in the packing industry why haven't you and Randy invested YOUR money in a packing plant? Could it be because they are not always profitable? :?

1) One of the things that I'd hoped you might take from the report were the following lines:

"If there is a demand for a certain quantity of product at a certain price and a supplier is prepared to supply that quantity at that price then supply and demand are at an equilibrium. This requires a willing buyer and a willing seller."

"As a principle of the supply-demand concept each party to a component part of the final demand will act in their own self-interest ... As such, both will seek alternative buyers or sellers until they are satisfied with the outcome. With many participants an equilibrium point will be reached where both the buyer and the seller will be satisfied with the outcome, or if not satisfied, accept the outcome ie: Price Discovery. To reach equilibrium requires a market mechanism without artificial barriers."

In other words Tam, what we have in the cull animal market is no longer a free market mechanism due to artificial trade barriers and packer concentration. The packers are taking advantage of that and raking in money hand over fist, all while crying about losing money.

BTW, SH, pay close attention to the "Price Discovery" quote.

As an aside, Tam: I was a 10 percentile double major at the U of R. Computer Science AND Agricultural Economics. This is why I find the forums discussions of free markets to be laughable at best (especially SH's). We have nothing remotely close to a free market in either the US or Canada. Even pre-BSE, the "free market" was a joke.

2) Apples and oranges Tam. The packers are taking advantage of artificial barriers and packer concentration. The US producers are simply taking advantage of a high point in their boning cow market. The Canadian border closure is having a nil effect on the US boning cow market. The ABP report was one of the highest I'd seen at $2/cwt. Other reports fix the Canadian influence at $0.

3) Since you ask, I am opposed to any artificial trade barrier or ruling, whether it be to the advantage of the packer OR the producer and would work to eliminate it. The only time I ask for government intervention is when a market power is exercising an artificial barrier to the detriment of the cattle producer. If the high prices were a natural function of supply and demand, of course I'd take advantage of it. We're not facing that situation right now.

As an aside Tam, I am not "blaming" packers for taking advantage of the prices. I am however debating SH's claims that packers aren't making a killing during this BSE crisis. And this report has handily demonstrated it, which the Ag Canada fluff report did not do.

I am however soundly criticizing the packers for their collusion in their purchasing. Since the overall producer price of cull animals is a direct function of consumer demand (for a simplistic view, see the graph in the ABP report), we should not be seeing such a massive reduction in income from those cull animals. A 20% retail price drop should not carry with it a 75% reduction in cull animal prices.

4) Actually what Randy posted was the SRM removal costs that he made reference to in an earlier thread, not the $88 total costs in the report. I also find it interesting that you point out their high side range, but fail to mentioned that producers lost up to $547/animal average, with high side losses of $740/hd. Why is that Tam?

5) Risk? Oie. Auction markets don't ship suspect cows, feedlots aren't allowed to ship suspect animals. Shipping losses to packing plants are so slim as to be ignored.

6) Plant upgrades are an investment and as such, cannot be considered costs. Each plant will continue to make use of those upgrades into the future. Those investments also improved processing efficiency, something the report didn't mention.

7) Not quite. I read the 20% two years ago in a Canfax report. SH is posting old news.

8) How do you know I haven't Tam? The last place I'll be discussing any of my investments is on this forum. BTW, you asked a while back what I was doing to correct problems and advance producer positions within Canada? Does supporting upstart plants and helping prep business plans count?

Rod

 

[Manitoba_Rancher]

It takes a good grain feed cow to bring 20 cents here right now. That puts a 1400 pound cow at 280 bucks. Somebody is making good money off that cow and it sure ain't the guy selling her.

Sandy,

We were at a sale on Friday and tops on the cull cows was .18 most were between .02 and .13 Its sad!! And everytime I check on the price of ground beef its still the same price.

 

[Anonymous]

Rod: "No SH, its because the study you quoted was an old one, long refuted. You're basing your information on outdated articles. Like I said, you know nothing of the current Canadian packing landscape. Until you learn something, go find another thread to prattle on mindlessly about."

Refuted?

BRING THE REFUTED DATA (like that will happen)!!!!

It's not what you want to believe so you CLAIM it was refuted. I say PROVE THAT IT WAS REFUTED. Talk is cheap!

You will discredit anything that doesn't support your packer blaming bias.

This Canadian government study was conducted due to packer blamers like you whining about packers making all kinds of money off the backs of producers. It proved that packers did not profit excessively during this time and it showed the breakdown on the products.

Packer expenses went up and retail beef prices went down but that's not what you want to believe.

"Mindless prattle"?

You want to see "MINDLESS PRATTLE" Rod, here it is again............

Rod: "C'mon BMR, cattle producers aren't idiots. They can add and subtract. They know what they're receiving for money, and they know what the store charges for their product. Most also know that the store is certainly not getting rich selling their undervalued animals. That leaves one place, and one place only thats making money."

How is that for "MINDLESS PRATTLE"? This is even better.......

Rod (in response): "Perhaps maybe you should read your own stories? A 200% gross margin is incredible and 99% of firms would kill for that kind of gross."

What a stupid statement.

Why would anyone kill for a 200% gross margin IF THEY DIDN'T KNOW WHAT THE EXPENSES WERE??? HELLO????

Rod: "Because the figures were incorrect and the report was refuted by producers, by the opposition party, and by Canadian Agricultural Journalists who have more years under their belts than you do. I can make up a report with fake retail prices too. Today only, steak $100/lb"

Oh bullsh*t!

It wasn't what you wanted to believe so you CLAIM it was refuted and the figures were incorrect.

PROVE that the numbers were refuted! Bring the corrected data FOR THE TIME PERIOD MENTIONED!

Watch the diversion folks .............

Rod: "See, this is why I think you're lying about being a producer, or knowing any producers."

Think what you want, the depth of your thought process is exposed in the above quotes!

Why is it that you think that every producer who doesn't suck his thumb and blame packers is not a producer?

Rod: "Cattle producers certainly do know what the retail margin is. Its reported constantly by Canfax, and I see it referred to in ag magazines."

Yet another deceptive spin job.

I never mentioned anything about "RETAIL MARGINS" IN THE COMMENTS YOU RESPONDED TO. I said many cattle producers do not know what the retail profit levels are. A "RETAIL MARGIN" can be a gross margin or a net margin unless specified. I'm talking about "NET PROFIT MARGINS" because "GROSS MARGIN" doesn't tell you a damn thing about expenses and "WHO IS MAKING THE MONEY" as you stated.

Rod: "And while cattle producers don't know what the costs are to a packing plant, they certainly know how much it costs to take an animal to the local butcher and get it cut and vacuum packed."

Then it should be a simple matter to take the dollar amount they would have gotten for the animal live, subtract out the processing costs, then put a retail value on the packaged cuts they received shouldn't it?

Tell me Rod, what does it cost you to take an animal ot the local butcher shop and get it vacuum packed and sealed?

While you are at it, tell me how much the animal weighed going in, what you would value it at, and how many pounds of various cuts you received and we can value them. I would hope you would eventually get it figured out unless your need to blame truly overshadows all your common sense.

Perhaps if you start thinking about what it costs you to process an animal at the local locker plant, what you recieve in products, and what those products are worth you can make the connection to potential packer profit levels.

You may find it quite interesting that our local locker plant has to pay someone to haul the ofal away while the larger packer gets paid for those products and pay more for your cattle accordingly. Perhaps you'll figure out why the smaller packing plants were replaced with larger more efficient plants. PERHAPS.........

Rod: "And it sure as hell isn't $2.00/lb. So what you're saying is that it costs the packer $2/lb to cut, wrap, and dispose of the excess? So much for your grand idea that bigger is better."

What cloud did you pull that from Rod?

Don't be deceptive Rod, that's not what I said. Nowhere did I say it costs packers $2.00 pound to cut, wrap, and dispose of the excess. Those are your words. You're getting as deceptive as Conman and Sanbag. Wow, that's really something to be proud of.

If you are so convinced that there is all kinds of money in the packing industry, WHY HAVEN'T YOU INVESTED YOUR MONEY IN A PACKING PLANT??? Hmmmm???

Rod: "So SH, I want YOU to detail out the costs for me. We'll use the Ag Canada break downs on the cuts if you desire. I want to see every last penny of that $2/lb gone. I want you to display your great knowledge of the industry, SH.

I'm done SH, until you actually display some knowledge. Refute me. Show me that packer expenses are equal to or greater than the 200% gross margin."

Ok Rod, we'll do it together......

Here is our starting point......

Rod: "$5.23/lb. Producers are receiving an average of $1.40 on the rail. Knock 20% off the retail for the store share: packers are receiving $4.26/lb. So packers are getting a gross profit of $2.86/lb. Pretty healthy, given they only touch the beef for 3 weeks of its life."

That statement says it all. A typical packer blaming apples to oranges comparison.

step two...........

Before we can progress any further, I want to see how willing you are to learn something or if you want to insist on clutching to your shallow math equations?

Can you admit that the producer got paid $1.40 for the entire carcass while the retail store got paid $5.23 for 75% of that carcass?

Can you admit that? Yes or No?

If you can't even admit that you are dead wrong when you say, "So packers are getting a gross profit of $2.86/lb" due to the fact that 25% of the carcass is bone, fat, and waste, then you are not intelligent enough for me to waste anymore time on. If you can't admit that bone, fat and waste, which compromises 25% of the carcass, is not worth $5.23 per pound, then you have truly reached Conman's level of stupidity and there is no reason for me to progress any further.

So what's it going to be Rod? Can you admit that the bone, fat, and waste is not worth $5.23 or will you cling to your shallow math equation?

If we can move past this point, then we can move on to step three.......

For example, an animal that weighs 1,387 pounds at slaughter would be separated into two parts; the warm carcass, representing 60%, or 832 pounds of the total; and, the residuals and offals, representing 40% or 555 pounds of the total."

Using your $1.40 figure, we have 832 pound carcass x $1.40 per cwt (Conman, that means hundred weight) = $1164.8 that the producer receives.

Can you agree with me that much? Yes or no?

step four...........

The warm carcass will then break down into:
116 pounds—or 14 %—of hip cuts;
152 pounds—or 18%—of middle cuts;
99 pounds—or 12 %—of front cuts;
211 lbs—or 25%—of ground beef;
47 pounds—or 6%—of manufacturing cuts;
and, 207 pounds—or 25%—of waste.
In the end, only 625 pounds of the original 1,387-pound animal will end up on the retailers' shelves.

Packers dispose of the remaining 762 pounds in a number of ways. Of that 762 pounds:
182 pounds—or 24%—of waste
58 pounds—or 8%—of hide;
33 pounds—or 2.3%—of edible offal;
18 pounds—or 2.4%—of edible tallow;
and, 472 pounds—or 60%—of meat and bone meal.
Because of changes brought on by BSE, many of non-meat portions of the animal cannot be sold internationally. Instead, packers are forced to dispose of them. Not only does reduce the potential profit from the carcass, but it also generates additional costs.

Can you accept this breakdown on a fat cattle carcass Rod? Yes or No?

If you can't, then tell me where this information is flawed. From that point, we will apply CURRENT Canadian retail values to it and you can see for yourself WHO IS MAKING THE MONEY and whether or not anyone would kill for this "SO CALLED" 200% GROSS MARGIN.

Don't duck and run because you really need to learn the truth unless your need to "BWAME DA PACKAH" overshadows your common sense.


~SH~

 

[Anonymous]

Rod: "Hence the reason why I laugh at SH's 'trucking' as though its a massive cost to the packing plant. The cost is nil to the packer."

Rod, my mention of transportation costs was not at the packer level, it's the transportation costs to ship carcasses to fabrication plants from processing plants (for those plants that do not have fabrication plants attached), and the transportation costs to ship boxed beef to the retailer.

Did you honestly believe truckers shipped those carcasses and that boxed beef to fab plants and retailers for free?

YOU DID?

I'm sorry, I overestimated your intelligence again.

Geee, sure got me with that one didn't you???ZZZZZZZZZZZZZZzzzzzzzzzzzz!

NEXT!


~SH~

 

[DiamondSCattleCo]

C'mon SH, break it down. I don't need your mindless crap in between each step. Just do a profit/loss statement, breaking down the packers costs each step of the way. Each one SH. Otherwise, you're just wasting my time as usual. I already told you that we could use the Ag Canada breakdown. And remember, the $5.23 was the average price of all cuts, including cull animals that graded. The $1.40 was average of all fed steers. I'm even giving you a leg up. And while you're at it SH, do culls too please. Cull retail price average is around $3.50/lb. You can use $3.00 if you want. Producers are getting lows of 15 cents, highs of 25 cent. Go ahead and use 20 cents, SH.

Put up or shut up.

Oh yeah, BTW, this line cracks me up:

"I never mentioned anything about "RETAIL MARGINS" IN THE COMMENTS YOU RESPONDED TO. I said many cattle producers do not know what the retail profit levels are. A "RETAIL MARGIN" can be a gross margin or a net margin unless specified. I'm talking about "NET PROFIT MARGINS" because "GROSS MARGIN" doesn't tell you a damn thing about expenses and "WHO IS MAKING THE MONEY" as you stated."

When trying to calculate what the packer received for money, it makes no difference what the retail outlets net profit margin is, just what their gross margin was you can back calculate what the packer received from them. :roll: Or perhaps you think the packers pay the local Co-op to keep the lights on? :roll:

Oh wait, I forgot. You don't know the difference between net and gross.

Have you read the report I wanted you to read? Didn't think so.

Rod

 

[Econ101]

Tam, regardless of what the report said about the actions of the packers not being technically illegal, their influence on policy that allowed them to take advantage of producers is absolutely criminal.

Why do you seem to be so against producer interests?

 

[Jason]

Rod, where is the average of $3 or $3.50 for culls from?

I am seeing lean ground beef featured at $1.38/lb

I am seeing cull cows in Alberta bringing 30-40 cents.

Cargill bounces in and out of the cull market as they wish. From what I can gather, they can only kill smaller type cows so are somewhat limited in their competition for the big higher yielding cows Lakeside and XL can handle.

Cargill will be the biggest buyer one week then sit a week out of the cull market. The market owners never know when they will be buying or not, but the price in Alberta hasn't dipped much when they step out. That would lead me to believe they step in only when potential profits are there, i.e. the other guys are full and the smaller cows would tank in price if they didn't buy.

These culls take a fair bit of grain to get them to a higher yield, with barley where it is, I don't see any value in feeding them, that should put downward pressure on the cull price as the return of yield declines.

 

[Bill]

This whole "how much did they make" debate is getting pretty old. We all know the big packers DID and ARE taking advantage of an over abundance of over 30 month animals in Canada. There is no law against it and we also know that CCA and its affiliates have shown no interest in AGRESSIVELY persuing one damn thing to change it. There may be resolutions passed by provincial orgs but it has generated nothing more more than a brief bit of lip service.

Keep arguing over the amount and the problem will go unchallenged.

 

[Manitoba_Rancher]

Rod, where is the average of $3 or $3.50 for culls from?

I am seeing lean ground beef featured at $1.38/lb

I am seeing cull cows in Alberta bringing 30-40 cents.

Cargill bounces in and out of the cull market as they wish. From what I can gather, they can only kill smaller type cows so are somewhat limited in their competition for the big higher yielding cows Lakeside and XL can handle.

Cargill will be the biggest buyer one week then sit a week out of the cull market. The market owners never know when they will be buying or not, but the price in Alberta hasn't dipped much when they step out. That would lead me to believe they step in only when potential profits are there, i.e. the other guys are full and the smaller cows would tank in price if they didn't buy.

These culls take a fair bit of grain to get them to a higher yield, with barley where it is, I don't see any value in feeding them, that should put downward pressure on the cull price as the return of yield declines.

When was that price Jason, three weeks ago?

 

[Big Muddy rancher]

So Bill what would you like to see done?

What about a legislated floor price?

A government funded cull?

Come on guys lets get the options expored.