Marketing Agreements - Good or Bad?

[Sandhusker]

Sandcheska: "Reality update for you, SH; Governments don't always do what their people want them to do."

Reality update for you. If Japanese consumers were wanting 100% bse tested beef, they would not be buying non tested beef.

GEE, YA THINK YOU CAN GRASP THAT ONE????



~SH~

Are you denying that some Japanese will not buy untested US beef?

 

[Anonymous]

Sandcheska: "Are you denying that some Japanese will not buy untested US beef?"

CREATING YOUR ILLUSIONS AGAIN???

Bring the damn proof that Japanese consumers want 100% testing.

Let's have it Sandcheska!

Back your position for once.

Watch this.........



~SH~

 

[Sandhusker]

Are you denying that some Japanese will not buy untested US beef?

 

[Anonymous]

Bring the proof that Japanese consumers want 100% testing.


~SH~

 

[Sandhusker]

Bring the proof that Japanese consumers want 100% testing.


~SH~

I don't have to prove anything to you. I'm smart enough to know that there are Japanese consumers that are not interested in buying untested US beef. You know it too, but admitting the obvious upsets your cart. That should tell you something about your position, SH.

Isn't it about time you told us that the truth was your only bias again? :lol:

 

[Anonymous]

Sandcheska: "I don't have to prove anything to you."

You can't prove anything to anybody because you don't back your positions with supporting facts.

Like most good little R-CULT followers, you believe what you want to believe.

Yes, the truth is my only bias. You failed miserably at trying to prove otherwise.

Which side of R-CULT are you going to support now? The Johnny Smith, Herman Schumacher, Kathleen Kelly, Callicrate, Bullard Thornsberry camp or the Dennis McDonald, Leo McDonnell, Kiker camp?

Wonder how long it will be until those camps divide?

The solution is easy, you believe what facts will suport, not what you want to believe so you can be accepted by fellow blamers.


~SH~

 

[Econ101]

Sandcheska: "I don't have to prove anything to you."

You can't prove anything to anybody because you don't back your positions with supporting facts.

Like most good little R-CULT followers, you believe what you want to believe.

Yes, the truth is my only bias. You failed miserably at trying to prove otherwise.

Which side of R-CULT are you going to support now? The Johnny Smith, Herman Schumacher, Kathleen Kelly, Callicrate, Bullard Thornsberry camp or the Dennis McDonald, Leo McDonnell, Kiker camp?

Wonder how long it will be until those camps divide?

The solution is easy, you believe what facts will suport, not what you want to believe so you can be accepted by fellow blamers.


~SH~

...or you?

The choice is simple.

 

[Anonymous]

I've made my choice Lying King and that is to stay as far away from liars like you as I possibly can. Where ever you are, that's where I don't want to be.


~SH~

 

[Sandhusker]

Sandcheska: "I don't have to prove anything to you."

You can't prove anything to anybody because you don't back your positions with supporting facts.

Like most good little R-CULT followers, you believe what you want to believe.

Yes, the truth is my only bias. You failed miserably at trying to prove otherwise.

Which side of R-CULT are you going to support now? The Johnny Smith, Herman Schumacher, Kathleen Kelly, Callicrate, Bullard Thornsberry camp or the Dennis McDonald, Leo McDonnell, Kiker camp?

Wonder how long it will be until those camps divide?

The solution is easy, you believe what facts will suport, not what you want to believe so you can be accepted by fellow blamers.


~SH~

Then why do you refuse to accept the fact that some Japanese won't buy untested US beef?

 

[Econ101]

I've made my choice Lying King and that is to stay as far away from liars like you as I possibly can. Where ever you are, that's where I don't want to be.


~SH~

What's your address, Scott? I think I will come and visit you.

 

[Anonymous]

I PM'd you my address. Can't wait for your arrival Lying King!

Then everyone will know who the biggest liar on this site is.


~SH~

 

[Anonymous]

Sandcheska: "Then why do you refuse to accept the fact that some Japanese won't buy untested US beef?"

You have no idea what Japanese consumers want or don't want. You're only armed with what you want to believe.


~SH~

 

[Sandhusker]

Sandcheska: "Then why do you refuse to accept the fact that some Japanese won't buy untested US beef?"

You have no idea what Japanese consumers want or don't want. You're only armed with what you want to believe.


~SH~

If you think you know, and you claim truth is your only bias, why can't you admit that there are Japanese consumers who won't buy untested US beef?

 

[Anonymous]

Why can't you admit that you don't have a clue what most Japanese consumers want. You only believe what you want to believe. A total lemming!


~SH~

 

[Sandhusker]

Why can't you admit that you don't have a clue what most Japanese consumers want. You only believe what you want to believe. A total lemming!


~SH~

I do have a clue to what they want. I've been paying attention to news from Japan. Why do you keep avoiding the obvious? Do you think there are Japanese consumers who won't buy US beef unless it is tested? Heck, throw in Korea, too.

 

[Anonymous]

Sandcheska: "I've been paying attention to news from Japan."

If that was the case you'd know that Japan is phasing out their 100% testing program, importing non tested beef from the US and importing non tested beef from Canada.

You never know as much as you'd like to think you do.


~SH~

 

[Sandhusker]

Sandcheska: "I've been paying attention to news from Japan."

If that was the case you'd know that Japan is phasing out their 100% testing program, importing non tested beef from the US and importing non tested beef from Canada.

You never know as much as you'd like to think you do.


~SH~

If the truth really was you only bias, you would know that the Federal Government"s decision to phase out 100% testing is meeting stiff resitance from the citizenry. Local governments are even saying they will continue testing. If you had any common sense, you would realize that it isn't the Feds who buy the beef, it's the citizens. You would then put the two together and reach an informed decision.

Your avoidance of the subject on some Japanese citizens wanting tested beef shows that you know that to be the truth. Yet you avoid that truth like the plague because it contradicts your defense of the USDA. So here we have a market that the USDA will not allow us to tap.(with your blessings) The product is legal there and effects nobody negetively anywhere. You often make smart ass comments about "saving them from themselves", but you embrace exactly that in this case.


You're a clown, SH.

 

[ocm]

Sandcheska: "I've been paying attention to news from Japan."

If that was the case you'd know that Japan is phasing out their 100% testing program, importing non tested beef from the US and importing non tested beef from Canada.

You never know as much as you'd like to think you do.


~SH~

You ALLEGE that Japan is phasing out their testing program. Come on, bring on the proof. You made the statement. Yet you show no proof that it is actually the case. Whassamata. Can't prove your own statements? Are the Japanese down to a 99% rate of testing yet? HUH HUH HUH???!!

(Sorry Sandhusker, I'm trying to do my best ~SH~ imitation)

 

[agman]

Captive Supply:
Correlation v. Causation
OCM Economics Fellow
Dr. Robert Taylor


GIPSA recently released their $4.5 million interim captive supply report, "Spot and Alternative Marketing Arrangements in the Livestock and Meat Industries." The interim report largely regurgitates previous studies of captive supply. While devoid of real analysis of hard data – they claim that data analysis will come in the final report due in 2006 – the authors nevertheless conclude that benefits of vertical integration are "clear" but that impacts on the cash market are "elusive." The report states,
"While the empirical research, on balance, suggests an inverse relationship between captive supplies and cash market prices, establishing a causal link has been elusive. (p. 3-17)"

The causal link has been elusive? Elusive? Causal mechanisms were not elusive to Bob Peterson, long-time cattle buyer and former CEO of IBP. He identified several causal mechanisms in talks to cattlemen in 1988 and 1994. In particular, he emphasized the leverage the packer obtained in the cash market with captive supplies. He stated,

"Do you think this (packer-owned or contracted cattle) has any impact on the price of the cash market? … You bet!"

"In my opinion the feeder can't win against the packer in the real fair play if
we go into the feeding and the hedging program."

"I don't know if we should be proud or ashamed but I'm telling you we started formula pricing. Why did we do it? So we have the same leverage our competition had (with packer fed cattle). And we feed cattle through the process of formula pricing."

In three lengthy speeches Peterson clearly and effectively identified how captive supplies could be used to manipulate the cash market. Yet, his warnings and threats about manipulative use of captive supply have been unheeded by economists in several USDA studies costing taxpayers
millions. It is disturbing that so many economists would continue to ignore persuasive statements from the person who would know best – the executive responsible for buying 30-40% of fed cattle during the 1980s and 1990s.

Common sense application of basic economic principles reveals numerous causal mechanisms, including:

Buyer power in a highly concentrated industry. This is undergraduate textbook stuff.
Base price in most marketing agreements is typically tied to a cash price. Such arrangements, in the presence of buyer power, depress cash price further that it would be without the agreements.
Asymmetric information favoring the large buyer over the feeder. It is well known in economics that asymmetric information favoring the buyer tends to depress price. Testimony in Pickett revealed that the head buyer had 65-75 field buyers calling in four times daily to report market information. Feeders selling on the cash market do not have much of this information.
Preferential deals for selected captive feeders. Such deals increase total supply thereby causing cash price to be lower than it would otherwise be. Hard data in Pickett revealed that Tyson/IBP paid more, on average, for captive cattle than for cash cattle, yet the cash cattle had about 10% more grading choice and prime, although captive cattle yielded about 1% more.
Packer mandated narrow trading window.
Packer control of within-week timing of acquisition and slaughter of captive and cash cattle.
Exclusive arrangements that preempt other buyers from accessing those cattle, thus making entry more difficult for potential competitors.
How was the evidence weighed in arriving at conclusions in the GIPSA study? We don't know1. Were both sides represented? Obviously the independent cattlemen were not represented. There is no mention in the $4.5 million interim report of extensive Pickett evidence. There is no mention of several common-sense causal mechanisms. There is no mention of Bob Petersons warnings.

Early studies of captive supply presumed causation. Then, in a 1996 GIPSA funded study, Schroeter and Azzam advanced a hypothesis that the negative relationship between captive supply and cash price was due to the correlation2 of captive supplies and captive feeders' expectation of price. Their hypothesis may have been well intentioned3, but there was no apparent weighting of evidence. Implicit in their report is the presumption that any argument for correlation, no matter how far-fetched, trumps any causal explanation. Unfortunately, the
correlation hypothesis has dominated the mind-set of academics, and has been a convenient excuse for USDA/GIPSA inaction.

Arguments for and against both the correlation and causation explanations should be objectively weighed. Since the captive supply issue falls under the Packers and Stockyards Act and perhaps under the Sherman and Clayton Antitrust Acts, the preponderance of evidence standard (more likely than not) is the appropriate legal standard and thus the appropriate standard for GIPSA studies. Academic standards should not apply, particularly standards that are never disclosed.

The GIPSA report claims that "clear" conclusions are reached about benefits of vertical integration. Yet, they do not report any real numbers to support these clear conclusions. It must not matter that hard evidence in Pickett contradicts most of their so-called clear conclusions.

Taxpayers deserve a final report that is based on fairly weighting the evidence – all evidence – by a clearly defined and appropriate evidentiary standard. This should not be a purely academic exercise intended to impress other academics. At this point in the captive supply debate, we need practical, common sense analyses not esoteric academic exercises.

Despite several taxpayer-funded captive supply studies spanning over a decade, only a Jury of your peers has looked at the hard facts and carefully weighed the evidence. GIPSA economists have not. Federal Judges have not. After listening to four weeks of testimony followed by five days of careful deliberation, the Pickett Jury verdict (question #4) was that "… use of captive supply proximately caused the cash market price to be lower than it otherwise would have been."CRT

A nice meaningless commentary from the man whose own research per this matter got destroyed in the Pickett case. This is the same man who is a production economist who never authored any research per the livestock industry prior to Pickett. When his own "captive supply" research was further analyzed by a world renowned econometrician it proved the opposite of Taylor's claim. Taylor 's research was so wrought with error and unsupported claims the presiding Judge outside jurors presence but with the plaintiff's attorneys stated that if he was the fact-finder he would conclude their expert witness was nuts. The case and the Judge's ruling was upheld UNANIMOUSLY by the Appellate Court and the Supreme court rejected the case.

You keep grabbing for straws that don't exist. This case is over - forget it.

 

[Sandhusker]

You bet, Agman, Dr. Taylor was the lead witness on the side that got a unanimous decision - but his testimony got destroyed. :roll: The score was Dr. Taylor 12; Tyson 0. Tyson just had the ref.