• If you are having problems logging in please use the Contact Us in the lower right hand corner of the forum page for assistance.

From Cow Calf weekly

Help Support Ranchers.net:

Big Muddy rancher

Well-known member
Joined
Feb 10, 2005
Messages
22,036
Reaction score
254
Location
Big Muddy valley
Trade Remains The Topic Of Industry Conversation
There is significant trepidation about the March 7 date to reopen the Canadian border to live cattle exports, as well as concern about the economic impacts. While it doesn't take an economist to figure out what opening the border without reopening export markets means to the market, there does seem to be, in general, a belief in the country that the negative impact will be far greater than what economists are predicting. Of course, in the short term the old adage of the self-fulfilling prophecy is likely to bear out.

While the industry's concerns certainly are justified, it also probably makes sense to look at the reopening of the border from a different viewpoint as well. From a timing standpoint (virtually nobody disagrees that the market will be reopened, it is just a question of when), it certainly makes sense to have our export markets open so they can offset negative price impacts. But, from a supply standpoint, it is difficult to paint a more favorable time to reopen the border.

The sad reality is that the industry finds itself in a bad situation. With beef trade already re-established and record tonnage levels already coming from Canada, the cattle industry really isn't being asked whether trade should only resume with the resumption of our export markets. Instead, we're being asked to answer the question. "Do we want Canada to ship us beef, fed and processed in Canada, or live cattle that are fed and processed in the U.S.?"

While the argument hasn't been framed in this light, and is contrary to the majority position, the way it's answered has significant long-term implications. We have already seen one packer's credit rating reduced and, no doubt, smaller packers will be put out of business. It's not hard to argue that the current situation is the absolute worst solution available.

The current status benefits the two largest packers that control the majority of the packing capacity in Canada, and may have long-term negative impacts on the northern tier of states relative to their own packing capacity and market access. Certainly, this trend will never be totally reversed. Canada has already increased packing capacity by 22% and it will be difficult for American processors to compete against subsidized state-of-the-art packing capacity, and an already highly subsidized feeding industry.

In 10 years, BSE is not likely to be a major issue in the global marketplace. However, a policy that benefited the bigger packing entities at the expense of smaller ones, that moved packing and feeding capacity north of the border, and which left the U.S. farther behind its competitors in the world movement to create source-, genetic- and process-verified beef is likely to have the exact opposite effect of what was originally intended.
-- Troy Marshall
 

rancher

Well-known member
Joined
Feb 10, 2005
Messages
1,059
Reaction score
0
Talking about subsidies "Canada has already increased packing capacity by 22% and it will be difficult for American processors to compete against subsidized state-of-the-art packing capacity, and an already highly subsidized feeding industry. "
 

Big Muddy rancher

Well-known member
Joined
Feb 10, 2005
Messages
22,036
Reaction score
254
Location
Big Muddy valley
rancher said:
Talking about subsidies "Canada has already increased packing capacity by 22% and it will be difficult for American processors to compete against subsidized state-of-the-art packing capacity, and an already highly subsidized feeding industry. "
I don't know what subsidy they would be talking about. They do irrigate alot in Alberta but not in Sask. We feed cattle in Alberta and it cost about the same as when we feed in Sask. :cowboy: The government isn't putting any money into the new packing plants.
 

rancher

Well-known member
Joined
Feb 10, 2005
Messages
1,059
Reaction score
0
So the facts are all screwed up and just shot that article out the window. :lol:
 

canadian angus

Well-known member
Joined
Feb 11, 2005
Messages
760
Reaction score
0
Location
Northwest Saskatchewan
Funny about subsidy, we just had our organizational meeting to invest into Ranchers Meats at Edmonton, Alberta.

We are only an arm of it, the other side is Ranchers Own, a new generation CO OP, with some private money. No help here, ranchers helping themselves. We have been screwed long enough time to try to take control.

SMS is working on it too. :clap:

CA
 

SMS

Well-known member
Joined
Feb 10, 2005
Messages
78
Reaction score
0
Location
Alberta
Last weekend at Athabasca Bull congress, Ivan from Ranchers own gave us an update. Constructions starts in April, first kill planned for Dec 05. The only goverment money being used in this plant is in the form of 12% loans to cover farm/rancher shares, until cows can be delivered against the amount owing on the share. 12% money....WOW that is some subsidy, when i can get 6% money at the bank. It is going to happen. :D
 

PPRM

Well-known member
Joined
Feb 10, 2005
Messages
1,951
Reaction score
0
Location
NE Oregon
wish the Cnadians well in these endeavors. One other way of looking at it is if their traceback is that good, they should have a fastrack to the Asian markets. If the border opens, Canadian beef sent overseas is beef that isn't sent here. So in a way, either country making headway benefits the other.

When the border opens, it will be interesting. My bet is it won't be the same as before, but how different will be the interesting part,
 

Latest posts

Top