Creekstone Chief Levels Harsh
Criticism At USDA, NCBA On BSE
By David Bowser
MANHATTAN, Kan. — To Bill Fielding, it's not a question of science. It's a question of giving customers what they want.
Bill Fielding, CEO of Creekstone Farms Premium Beef, LLC, is unhappy with the U.S. Department of Agriculture, the National Cattlemen's Beef Association and the big packers.
"I think, today, our industry is in a mess," Fielding says.
The decline in the cattle industry, he believes, has come about through a loss of exports, increased food imports and concentration.
The loss of exports, particularly to Japan over the BSE issue, hit his company hard. More than a third of the beef Creekstone Farms produced before the BSE ban was exported to Japan.
He also says a substantial amount of food is being imported into the U.S.
"I think we all have worries about concentration and what can happen," Fielding says.
He says that as the cattle inventory has gotten smaller, pork and chicken have been increasing.
"The pork business has been going up steadily. The chicken business keeps going up two, three, four percent a year," Fielding notes.
The beef herd has declined from a high of 130 million, down now to 94 or 95 million head.
"It's a serious, serious problem," Fielding contends. "If you look at Brazil, Argentina and Australia, the herds are increasing. We have lost market share in the world, and I think there are some reasons for that. Price has been a big reason."
The price would be much higher today, he says, if the U.S. still had export markets.
"Instead of exports, we have imports," Fielding says.
The export situation this year, compared to the last couple of years, is a disaster, he says.
"An absolute disaster."
Imports, however, have gone the other way.
"We imported record amounts of beef this year," he points out.
Fielding says banning the importation of live cattle from Canada doesn't make any sense when the U.S. imports beef from Canada.
"Who thinks that makes any sense whatsoever?" he asks.
Despite a shrinking cattle herd and a ban on exports, Fielding says, packing capacity has continued to grow.
In total capacity, the industry has continued to expand, even though few new plants have been built. Creekstone, he says, was one of the more recent ones. It was built about three years ago.
But all the major packers, he says, have increased their capacity.
"That concentration is continuing today," Fielding continues. "We've increased the ability to kill, and yet we have fewer cattle to process because the herd's declined."
Fielding says the future of the cattle industry depends upon a free and fair market. He says it needs to be fair, not just overseas, but here at home as well.
"We believe that we have to have a free market system," Fielding says. "We have to allow companies like Creekstone to be able to start their business and grow their business and have the freedom to do what the customer wants."
The customer's right, he says, even if the customer is wrong.
Even though steps may not be scientifically needed, Fielding says, if the customer wants it, give it to him.
"He'll pay you for it," Fielding says.
He concedes that food safety is important, but he indicates that it is sometimes used as an excuse in decision-making.
"Make no mistake at all," Fielding says, "that food safety is the most important thing, and the only way we'll get to 100 years from now is to make sure we're doing everything possible on food safety."
The latest E.coli numbers released this month are positive, he says.
The industry and academia have made great strides in animal handling and food safety, Fielding adds.
"That's been a real plus for the industry."
An related concern is the ability to trace animals back to their origins and the ability to determine their age.
Traceability is a controversial issue, he says, but he believes firmly that the industry needs to have traceability.
"There's no reason to think that we can't start out at a very low cost," Fielding says, "a paper and a pencil, and try to keep that information accurate."
He says anyone putting cattle in a feedlot needs to have the date of birth of those animals.
"If we are allowed to ship 20 months and younger cattle to Japan," Fielding explains, "those cattle may command $50 to $100 a head more than cattle that don't have that information. You need to have it."
As a direct result of improvements in food safety technology, the industry has better ways of testing and detecting problems.
"It's BSE today," he says, "but it'll be something else tomorrow. If it can be detected, the only way we can maintain consumer confidence is to be able to trace those animals back and address it quickly."
He says he's amazed that the USDA says there is no urgency when it comes to traceability.
"I think that is ludicrous," Fielding says. "There happens to be a tremendous amount of urgency. It's a lousy statement."
Fielding says, too, that there is a lot of worry in the industry over business, yet the true business of the cattle or beef industry is largely ignored.
Recently, Fielding says, he listened to a panel of executives from the pizza industry. There were the CEOs from Papa John's and Pizza Hut and Domino's.
"They were all asked, 'What are your future plans?'" Fielding says. "'What is your major objective?'"
Fielding says they all talked about financial results of the company.
"It sounded like any other business-type meeting that you go to," Fielding says, "but the Papa John's founder said one thing. He said he's looking for a better pepperoni."
Fielding says that's what they're doing at Creekstone.
"We want to give something better to our customers," he explains.
He says Creekstone is looking for quality, and is willing to pay for it when it can.
"We only started our business about a year and a half or two years ago," Fielding says. "Within six months, we had 30 to 40 percent of our business going to Japan and Korea, all at very good prices, prices that today are in the area of $200 a head to $400 a head more than what we can sell them for in the U.S."
When Japan, their largest customer, asked for BSE testing, Creekstone was ready to comply, but the U.S. government said no.
"It was extremely important, and we felt early on that we wanted to do what the customer was asking," Fielding says.
Japan is testing 100 percent of their cattle, he notes.
"All they're doing is asking us to do the same thing that they are doing," Fielding continues. "It amazes me that recently, 20 senators signed a letter sent to Japan threatening some trade restrictions if doesn't immediately start taking our beef."
Fielding questions the wisdom of threatening your biggest customer when they are only asking that you do what they are already doing.
"The global side of all this," he says, "is that to build that herd back and get the prices that cattlemen deserve and that the industry needs from the global competition, we have to do things better than Brazil, better than Australia."
Australia, he says, now has 44 percent market share in Japan.
"It's a huge problem," Fielding insists.
Within the first month of the BSE ban on U.S. beef, Fielding went to Japan to try to understand how serious the Japanese felt the problem was.
"What I saw in the store," Fielding says, "was this person with an apron on that says 'Aussie Beef' on it."
He says Australia quickly went into stores after the ban on U.S. beef, provided free samples and said their product was just as good as U.S. beef and that they were ready to serve the Japanese.
"Today, they have 44 percent market share," Fielding reiterates. "The U.S. has zero."
The customer is simply asking for testing, he says.
"If we test, we can sell them that product," Fielding stresses.
He says he was told that within two or three weeks of testing, they could be sending beef to Japan.
"The only reason we can't test is because the government will only agree to sell the test kits to themselves," he says.
The U.S. government has cited a 1913 animal health law in preventing Creekstone Farms from testing their cattle for BSE.
"In 1913, they really didn't know about mad cow," Fielding points out.
That act, he says, is designed to prevent the administration of worthless drugs or anything harmful to cattle. Testing for something, he says, is completely different.
It's pretty ridiculous," Fielding concludes.
In Japan, he says, the point of purchase displays for beef feature photographs of the people who raised the cattle whose beef is in the meat counter.
"They have a picture of the ranch-farmer there," Fielding says. "They know where that beef came from."
The Japanese have traceability.
Fielding says the Japanese reported cases of BSE while he was in the island nation.
"It didn't interrupt the demand at all," he adds, "because the consumers knew that everything was being tested. They felt good about what they had in the food chain. They didn't hide it. They didn't try to mislead anyone. They just said, 'This is BSE-tested.'"
Fielding says the U.S. should be testing, or at least allowing individual packers to test their animals.
"I'm trying to figure out why in the world the National Cattlemen's Beef Association does not support testing," Fielding says. "I've written them letters. I've talked to them. I've gotten nowhere. I've failed miserably."
Fielding says he went back to NCBA's charter and found that among their guiding principles are free enterprise, limited government and consumer focus.
"They're focused, all right," Fielding says. "It's okay to refuse to do what the largest customer wants."
Some NCBA members, he says, may not agree with his conclusions.
"But it sure appears to me that's the way it happens."
Former U.S. Secretary of Agriculture Ann Veneman comes in for a blast, too.
"I'm sure glad she's gone," Fielding says. "I think she did a terrible job. I do. I think she did a horrible job."
Veneman testified at a Congressional hearing that she didn't let Creekstone test for BSE because she thought Creekstone was making a food safety claim.
"We have letters written to her that say very clearly we are not making a food safety claim," Fielding counters. "We are only saying the beef has been tested. We are not saying it is BSE-free. We are only doing what the customer asked. She knew that, yet she still answered the question the way she did."
Other testimony, delivered by Duane Acker of Kansas State University, pointed out that rule number one between seller and buyer, whether the seller is a company, an industry or a country, is to provide what the buyer wants.
"It's clear that Japan and some other countries want beef from tested animals," Fielding says.
A year ago, Japan made it clear in a message that read, in part, that it was regrettable that the U.S. wouldn't do what they were asking.
"I guess my biggest question is who is accountable?" Fielding says.
He thinks every cattleman should be asking his politician and USDA that question.
An undersecretary at USDA predicted four or five months ago that the beef industry would be shipping product in a matter of weeks.
"That hasn't happened," Fielding reminds. "Who's holding him responsible?"
Sen. Pat Roberts, R-Kan., accused Creekstone of not telling the whole story.
"He accused Creekstone of misrepresenting what we were doing," Fielding says. "I sat in Sen. Roberts office eight or nine month ago and told him very clearly we're not making a food safety claim."
Fielding says the USDA told them they could not even put on the outside of the box a label that the beef had been tested in the U.S.
"This didn't even apply to the U.S.," Fielding says. "This is strictly for export, and yet Sen. Roberts said that we were wrong and that we would test younger cattle that don't need to be tested. He said we couldn't detect it."
Fielding insists that's not the point.
More to the point, he says, is that Creekstone could have helped the industry by testing more cattle.
"What would it hurt for Creekstone to have tested another 300,000 cattle, which we could have done at our expense over the last year," Fielding says, "and had proof that we indeed could not find anything in young cattle?"
Fielding says that reasoning apparently held little sway with Washington.
"We were told very clearly that we could not negotiate with Japan," Fielding says, "that this had to be government to government. Sen. Roberts reinforced that."
And yet the big packers, Fielding says, got in their corporate jet and flew to Japan and tried to get the Japanese to take U.S. beef.
"They failed miserably," Fielding says. "That's the kind of thing we worry about with concentration, and it should never have happened."
Fielding says Creekstone spent a half-million dollars to build a lab and a hire six people to test for BSE.
They sent their employees to Europe to learn the testing procedures.
"It's the exact same test that's being used in Europe and Japan," Fielding notes.
He says they approached the problem in a responsible way and were told they couldn't do it.
The federal government, he says, will not allow BSE testing, but will allow E.coli testing.
"E.coli testing is way more serious than mad cow," Fielding opines. "People get sick. They die."
Fielding says Creekstone can conduct E.coli testing in the plant, but not BSE testing.
The government's contention that broadscale testing for BSE is unnecessary is hypocritical, he charges.
"We lost the European market," Fielding points out, "when we refused to produce fed cattle without hormone treatment."
Today, Fielding says, even though there is no science behind it, the federal government certifies some beef as not having been exposed to hormone treatment so it can go to Europe.
"How do you figure out what is different for us to do the testing and have that certified as having been tested?" Fielding asks.
Though he has had problems with the government, he gives them a passing grade overall.
"As critical as I am of the USDA, they've done a great job of setting requirements and holding the industry responsible and making sure that food safety is what it should be," Fielding concedes.
But that's where it should stop, he insists. USDA should not become involved in marketing.
"That's not where they should be going," he says.
He admits that the government can become involved in labeling.
"If that was the issue, it would be no problem," Fielding says.
He stresses again, however, that if the customer will pay for it, the demand should be met.
Fielding says he has considered, when sending a check to a cattleman for his cattle, sending another check for $100 a head more, marked void, which would represent what Creekstone could pay if the Japanese market were open.
"We would pay $100 or more for those cattle," Fielding says.
It's the rancher who eventually could be making more money. It is also a matter of credibility.
"We have to build consumer confidence, not destroy it," Fielding says.
It's not just Japan. Fielding says the U.S. consumer cares about the issue as well.
"Consumers have to feel confident about our beef supply," he explains. "I believe with all my heart that beef is safe today, as safe as it's ever been, and the consumer should have total confidence. I worry tremendously and I'm very upset at what the government has done to us. By not testing, we raise doubts."
Criticism At USDA, NCBA On BSE
By David Bowser
MANHATTAN, Kan. — To Bill Fielding, it's not a question of science. It's a question of giving customers what they want.
Bill Fielding, CEO of Creekstone Farms Premium Beef, LLC, is unhappy with the U.S. Department of Agriculture, the National Cattlemen's Beef Association and the big packers.
"I think, today, our industry is in a mess," Fielding says.
The decline in the cattle industry, he believes, has come about through a loss of exports, increased food imports and concentration.
The loss of exports, particularly to Japan over the BSE issue, hit his company hard. More than a third of the beef Creekstone Farms produced before the BSE ban was exported to Japan.
He also says a substantial amount of food is being imported into the U.S.
"I think we all have worries about concentration and what can happen," Fielding says.
He says that as the cattle inventory has gotten smaller, pork and chicken have been increasing.
"The pork business has been going up steadily. The chicken business keeps going up two, three, four percent a year," Fielding notes.
The beef herd has declined from a high of 130 million, down now to 94 or 95 million head.
"It's a serious, serious problem," Fielding contends. "If you look at Brazil, Argentina and Australia, the herds are increasing. We have lost market share in the world, and I think there are some reasons for that. Price has been a big reason."
The price would be much higher today, he says, if the U.S. still had export markets.
"Instead of exports, we have imports," Fielding says.
The export situation this year, compared to the last couple of years, is a disaster, he says.
"An absolute disaster."
Imports, however, have gone the other way.
"We imported record amounts of beef this year," he points out.
Fielding says banning the importation of live cattle from Canada doesn't make any sense when the U.S. imports beef from Canada.
"Who thinks that makes any sense whatsoever?" he asks.
Despite a shrinking cattle herd and a ban on exports, Fielding says, packing capacity has continued to grow.
In total capacity, the industry has continued to expand, even though few new plants have been built. Creekstone, he says, was one of the more recent ones. It was built about three years ago.
But all the major packers, he says, have increased their capacity.
"That concentration is continuing today," Fielding continues. "We've increased the ability to kill, and yet we have fewer cattle to process because the herd's declined."
Fielding says the future of the cattle industry depends upon a free and fair market. He says it needs to be fair, not just overseas, but here at home as well.
"We believe that we have to have a free market system," Fielding says. "We have to allow companies like Creekstone to be able to start their business and grow their business and have the freedom to do what the customer wants."
The customer's right, he says, even if the customer is wrong.
Even though steps may not be scientifically needed, Fielding says, if the customer wants it, give it to him.
"He'll pay you for it," Fielding says.
He concedes that food safety is important, but he indicates that it is sometimes used as an excuse in decision-making.
"Make no mistake at all," Fielding says, "that food safety is the most important thing, and the only way we'll get to 100 years from now is to make sure we're doing everything possible on food safety."
The latest E.coli numbers released this month are positive, he says.
The industry and academia have made great strides in animal handling and food safety, Fielding adds.
"That's been a real plus for the industry."
An related concern is the ability to trace animals back to their origins and the ability to determine their age.
Traceability is a controversial issue, he says, but he believes firmly that the industry needs to have traceability.
"There's no reason to think that we can't start out at a very low cost," Fielding says, "a paper and a pencil, and try to keep that information accurate."
He says anyone putting cattle in a feedlot needs to have the date of birth of those animals.
"If we are allowed to ship 20 months and younger cattle to Japan," Fielding explains, "those cattle may command $50 to $100 a head more than cattle that don't have that information. You need to have it."
As a direct result of improvements in food safety technology, the industry has better ways of testing and detecting problems.
"It's BSE today," he says, "but it'll be something else tomorrow. If it can be detected, the only way we can maintain consumer confidence is to be able to trace those animals back and address it quickly."
He says he's amazed that the USDA says there is no urgency when it comes to traceability.
"I think that is ludicrous," Fielding says. "There happens to be a tremendous amount of urgency. It's a lousy statement."
Fielding says, too, that there is a lot of worry in the industry over business, yet the true business of the cattle or beef industry is largely ignored.
Recently, Fielding says, he listened to a panel of executives from the pizza industry. There were the CEOs from Papa John's and Pizza Hut and Domino's.
"They were all asked, 'What are your future plans?'" Fielding says. "'What is your major objective?'"
Fielding says they all talked about financial results of the company.
"It sounded like any other business-type meeting that you go to," Fielding says, "but the Papa John's founder said one thing. He said he's looking for a better pepperoni."
Fielding says that's what they're doing at Creekstone.
"We want to give something better to our customers," he explains.
He says Creekstone is looking for quality, and is willing to pay for it when it can.
"We only started our business about a year and a half or two years ago," Fielding says. "Within six months, we had 30 to 40 percent of our business going to Japan and Korea, all at very good prices, prices that today are in the area of $200 a head to $400 a head more than what we can sell them for in the U.S."
When Japan, their largest customer, asked for BSE testing, Creekstone was ready to comply, but the U.S. government said no.
"It was extremely important, and we felt early on that we wanted to do what the customer was asking," Fielding says.
Japan is testing 100 percent of their cattle, he notes.
"All they're doing is asking us to do the same thing that they are doing," Fielding continues. "It amazes me that recently, 20 senators signed a letter sent to Japan threatening some trade restrictions if doesn't immediately start taking our beef."
Fielding questions the wisdom of threatening your biggest customer when they are only asking that you do what they are already doing.
"The global side of all this," he says, "is that to build that herd back and get the prices that cattlemen deserve and that the industry needs from the global competition, we have to do things better than Brazil, better than Australia."
Australia, he says, now has 44 percent market share in Japan.
"It's a huge problem," Fielding insists.
Within the first month of the BSE ban on U.S. beef, Fielding went to Japan to try to understand how serious the Japanese felt the problem was.
"What I saw in the store," Fielding says, "was this person with an apron on that says 'Aussie Beef' on it."
He says Australia quickly went into stores after the ban on U.S. beef, provided free samples and said their product was just as good as U.S. beef and that they were ready to serve the Japanese.
"Today, they have 44 percent market share," Fielding reiterates. "The U.S. has zero."
The customer is simply asking for testing, he says.
"If we test, we can sell them that product," Fielding stresses.
He says he was told that within two or three weeks of testing, they could be sending beef to Japan.
"The only reason we can't test is because the government will only agree to sell the test kits to themselves," he says.
The U.S. government has cited a 1913 animal health law in preventing Creekstone Farms from testing their cattle for BSE.
"In 1913, they really didn't know about mad cow," Fielding points out.
That act, he says, is designed to prevent the administration of worthless drugs or anything harmful to cattle. Testing for something, he says, is completely different.
It's pretty ridiculous," Fielding concludes.
In Japan, he says, the point of purchase displays for beef feature photographs of the people who raised the cattle whose beef is in the meat counter.
"They have a picture of the ranch-farmer there," Fielding says. "They know where that beef came from."
The Japanese have traceability.
Fielding says the Japanese reported cases of BSE while he was in the island nation.
"It didn't interrupt the demand at all," he adds, "because the consumers knew that everything was being tested. They felt good about what they had in the food chain. They didn't hide it. They didn't try to mislead anyone. They just said, 'This is BSE-tested.'"
Fielding says the U.S. should be testing, or at least allowing individual packers to test their animals.
"I'm trying to figure out why in the world the National Cattlemen's Beef Association does not support testing," Fielding says. "I've written them letters. I've talked to them. I've gotten nowhere. I've failed miserably."
Fielding says he went back to NCBA's charter and found that among their guiding principles are free enterprise, limited government and consumer focus.
"They're focused, all right," Fielding says. "It's okay to refuse to do what the largest customer wants."
Some NCBA members, he says, may not agree with his conclusions.
"But it sure appears to me that's the way it happens."
Former U.S. Secretary of Agriculture Ann Veneman comes in for a blast, too.
"I'm sure glad she's gone," Fielding says. "I think she did a terrible job. I do. I think she did a horrible job."
Veneman testified at a Congressional hearing that she didn't let Creekstone test for BSE because she thought Creekstone was making a food safety claim.
"We have letters written to her that say very clearly we are not making a food safety claim," Fielding counters. "We are only saying the beef has been tested. We are not saying it is BSE-free. We are only doing what the customer asked. She knew that, yet she still answered the question the way she did."
Other testimony, delivered by Duane Acker of Kansas State University, pointed out that rule number one between seller and buyer, whether the seller is a company, an industry or a country, is to provide what the buyer wants.
"It's clear that Japan and some other countries want beef from tested animals," Fielding says.
A year ago, Japan made it clear in a message that read, in part, that it was regrettable that the U.S. wouldn't do what they were asking.
"I guess my biggest question is who is accountable?" Fielding says.
He thinks every cattleman should be asking his politician and USDA that question.
An undersecretary at USDA predicted four or five months ago that the beef industry would be shipping product in a matter of weeks.
"That hasn't happened," Fielding reminds. "Who's holding him responsible?"
Sen. Pat Roberts, R-Kan., accused Creekstone of not telling the whole story.
"He accused Creekstone of misrepresenting what we were doing," Fielding says. "I sat in Sen. Roberts office eight or nine month ago and told him very clearly we're not making a food safety claim."
Fielding says the USDA told them they could not even put on the outside of the box a label that the beef had been tested in the U.S.
"This didn't even apply to the U.S.," Fielding says. "This is strictly for export, and yet Sen. Roberts said that we were wrong and that we would test younger cattle that don't need to be tested. He said we couldn't detect it."
Fielding insists that's not the point.
More to the point, he says, is that Creekstone could have helped the industry by testing more cattle.
"What would it hurt for Creekstone to have tested another 300,000 cattle, which we could have done at our expense over the last year," Fielding says, "and had proof that we indeed could not find anything in young cattle?"
Fielding says that reasoning apparently held little sway with Washington.
"We were told very clearly that we could not negotiate with Japan," Fielding says, "that this had to be government to government. Sen. Roberts reinforced that."
And yet the big packers, Fielding says, got in their corporate jet and flew to Japan and tried to get the Japanese to take U.S. beef.
"They failed miserably," Fielding says. "That's the kind of thing we worry about with concentration, and it should never have happened."
Fielding says Creekstone spent a half-million dollars to build a lab and a hire six people to test for BSE.
They sent their employees to Europe to learn the testing procedures.
"It's the exact same test that's being used in Europe and Japan," Fielding notes.
He says they approached the problem in a responsible way and were told they couldn't do it.
The federal government, he says, will not allow BSE testing, but will allow E.coli testing.
"E.coli testing is way more serious than mad cow," Fielding opines. "People get sick. They die."
Fielding says Creekstone can conduct E.coli testing in the plant, but not BSE testing.
The government's contention that broadscale testing for BSE is unnecessary is hypocritical, he charges.
"We lost the European market," Fielding points out, "when we refused to produce fed cattle without hormone treatment."
Today, Fielding says, even though there is no science behind it, the federal government certifies some beef as not having been exposed to hormone treatment so it can go to Europe.
"How do you figure out what is different for us to do the testing and have that certified as having been tested?" Fielding asks.
Though he has had problems with the government, he gives them a passing grade overall.
"As critical as I am of the USDA, they've done a great job of setting requirements and holding the industry responsible and making sure that food safety is what it should be," Fielding concedes.
But that's where it should stop, he insists. USDA should not become involved in marketing.
"That's not where they should be going," he says.
He admits that the government can become involved in labeling.
"If that was the issue, it would be no problem," Fielding says.
He stresses again, however, that if the customer will pay for it, the demand should be met.
Fielding says he has considered, when sending a check to a cattleman for his cattle, sending another check for $100 a head more, marked void, which would represent what Creekstone could pay if the Japanese market were open.
"We would pay $100 or more for those cattle," Fielding says.
It's the rancher who eventually could be making more money. It is also a matter of credibility.
"We have to build consumer confidence, not destroy it," Fielding says.
It's not just Japan. Fielding says the U.S. consumer cares about the issue as well.
"Consumers have to feel confident about our beef supply," he explains. "I believe with all my heart that beef is safe today, as safe as it's ever been, and the consumer should have total confidence. I worry tremendously and I'm very upset at what the government has done to us. By not testing, we raise doubts."
