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Packers shifting operations

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cedardell

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There has been a lot of talk about our meat packers building capacity in Canada. I don't think Canada is the only place they are building capicity. Also think they have been building in Australia and South America. Maybe Tully is around and could give us a clue as to US meatpacking holdings in Australia. But the point I'm trying to make is that the packing industry is following the lead of many other multinational companies that have moved operations overseas. I was just driving by out CAT plant in Montgomery, Ill yesterday. They used to employ thoudands at good wages. I marveled at the huge parking lot being less than one fouth full during the first shift. The govt likes to put out statistics about all the new job creation that drives this booming economy that Agman boasts about, but around here it seems like they are mostly shoe shining and check out clerk jobs. With the technology we have now, these jobs are unskilled low paying jobs that don't take in enough to pay off Uncle Sam's multi trillion dept. Yes Agman I sound negative, but if all our industry is moving out of the country, and it's not just packers, how are we going to pay off the dept? We absolutly have to be able to balance trade and have a solvent govt. or we can't support our welfare system. Meat packing companies setting up operations outside the country is just a fraction of the great sucking sound Ross Perot warned us about years ago. Incidently not all farmers like our corporations running the show and squeezing them out. In Brazil now according to Yahoo news there is a huge demonstration to protest injustice that American Corporations are inflicting on family farmers there. If the whole world decides that our Corporations are a bunch of greedy businessmen bent on squeezing out the little guy just exactly where is that going to leave us. I think this South American resistance to CAFTA is very interesting. They want to give us the boot and take all our potential customers. So if Canada wants to do that they won't be the only ones. I can't really blame any of them. But my only question is where does that leave us?
 

PORKER

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There has been a lot of talk about our meat packers building capacity in Canada. I don't think Canada is the only place they are building capicity. Also think they have been building in Australia and South America. ***************
If you do a little reading you will find that Con Agri is big in South America and Austriala.Cargil isn,t far behind as the Internationals want the Walmart clout with the exchange rate in their favor .They have been spitting nails when the US dollar fell against all currencys and the price of ocean frieght doubled because of oil prices.Now that COOL happened on fish and all seafood ,they are running scared.MEAT could be next and what do you think their investors will do.Jump Ship???Packing and shipping from the remote places in the world doesn't pay like it use too.
 

agman

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cedardell said:
There has been a lot of talk about our meat packers building capacity in Canada. I don't think Canada is the only place they are building capicity. Also think they have been building in Australia and South America. Maybe Tully is around and could give us a clue as to US meatpacking holdings in Australia. But the point I'm trying to make is that the packing industry is following the lead of many other multinational companies that have moved operations overseas. I was just driving by out CAT plant in Montgomery, Ill yesterday. They used to employ thoudands at good wages. I marveled at the huge parking lot being less than one fouth full during the first shift. The govt likes to put out statistics about all the new job creation that drives this booming economy that Agman boasts about, but around here it seems like they are mostly shoe shining and check out clerk jobs. With the technology we have now, these jobs are unskilled low paying jobs that don't take in enough to pay off Uncle Sam's multi trillion dept. Yes Agman I sound negative, but if all our industry is moving out of the country, and it's not just packers, how are we going to pay off the dept? We absolutly have to be able to balance trade and have a solvent govt. or we can't support our welfare system. Meat packing companies setting up operations outside the country is just a fraction of the great sucking sound Ross Perot warned us about years ago. Incidently not all farmers like our corporations running the show and squeezing them out. In Brazil now according to Yahoo news there is a huge demonstration to protest injustice that American Corporations are inflicting on family farmers there. If the whole world decides that our Corporations are a bunch of greedy businessmen bent on squeezing out the little guy just exactly where is that going to leave us. I think this South American resistance to CAFTA is very interesting. They want to give us the boot and take all our potential customers. So if Canada wants to do that they won't be the only ones. I can't really blame any of them. But my only question is where does that leave us?

All of our industry is not moving overseas. Have you ever heard of in- sourcing? Have you looked at the growth in manufacturing output? Is it going up or down? Your observation of a CAT facility is akin to saying we have fewer farmers therefore farm output is down-WRONG. New and more efficient operations can idle any plant. Have you considered that? You still fail to answer a very basic yet pertinent question. How do we create all these jobs if we are doing everything wrong? You are so focused on negatives, which are only a particle of the whole situation, that you dismiss the obvious-envious job growth despite all your negative observations. Perhaps you are always looking in the wrong places. Please answer the question about job growth and only then prehaps you will begin to see the light.
 

PORKER

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All of our industry is not moving overseas.AGMAN ****** PLEASE tells us the names of the COMPANYS that HAVE ,or have their investments in other countries packing industrys.
 
A

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I have to post one positive that trade has done in our area- trade and the increased fuel prices....The railroads are hiring employees (engineers-conductors, brakemen, maintenance) like they never did before-- a lot of the kids are leaving the farm for the good railroad jobs - some aren't kids either-my feed store manager who is a grandfather quit last month to go with the railroad- can't turn down the chance to make a 6 figure salary-with good insurance and retirement system....In talking with a former railroad supervisor, he said most is because of the increasing overseas trade- container cars coming into the west coast and shipped east -- and an increased South and Central American trade coming into the gulf coast.....

It would be nice if we could get some of those ships going back to haul US beef.
 

Big Muddy rancher

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Oldtimer said:
I have to post one positive that trade has done in our area- trade and the increased fuel prices....The railroads are hiring employees (engineers-conductors, brakemen, maintenance) like they never did before-- a lot of the kids are leaving the farm for the good railroad jobs - some aren't kids either-my feed store manager who is a grandfather quit last month to go with the railroad- can't turn down the chance to make a 6 figure salary-with good insurance and retirement system....In talking with a former railroad supervisor, he said most is because of the increasing overseas trade- container cars coming into the west coast and shipped east -- and an increased South and Central American trade coming into the gulf coast.....

It would be nice if we could get some of those ships going back to haul US beef.


Whoa did you just say TRADE IS GOOD. I can't believe my eyes. :cowboy:
 

agman

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PORKER said:
All of our industry is not moving overseas.AGMAN ****** PLEASE tells us the names of the COMPANYS that HAVE ,or have their investments in other countries packing industrys.

I case you have not noticed this discussion is much broader than the packing industry.
 

agman

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PORKER said:
There has been a lot of talk about our meat packers building capacity in Canada. I don't think Canada is the only place they are building capicity. Also think they have been building in Australia and South America. ***************
If you do a little reading you will find that Con Agri is big in South America and Austriala.Cargil isn,t far behind as the Internationals want the Walmart clout with the exchange rate in their favor .They have been spitting nails when the US dollar fell against all currencys and the price of ocean frieght doubled because of oil prices.Now that COOL happened on fish and all seafood ,they are running scared.MEAT could be next and what do you think their investors will do.Jump Ship???Packing and shipping from the remote places in the world doesn't pay like it use too.

You have a gross misunderstanding as to why corporations relocate. The primary reason is to tap the local market. If you choose to argue this point you had better do alot of indepth research beforehand. The failure to do so will put you into a sink hole in a nono second.
 

PORKER

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Do you have some INFO,AGMAN ****** PLEASE tells us the names of the COMPANYS ( BIG Packers) that HAVE ,or have their investments in other countries packing industrys.

I found this Today and these are the little guys, The American Association of Meat Processors (AAMP), is North America's largest meat trade organization. Membership includes more than 1,700 medium-sized and smaller meat, poultry and food businesses: slaughterers, packers, processors, wholesalers, in-home food service business, retailers, deli and catering operators, and industry suppliers. AAMP members are from the U.S., Canadian provinces and several foreign countries. AAMP's Board of Directors , consisting of 20 members, have general executive powers and general jurisdiction of all business of the association. AAMP is also affiliated with 34 state, regional and provincial meat trade organizations.
 

agman

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PORKER said:
Do you have some INFO,AGMAN ****** PLEASE tells us the names of the COMPANYS ( BIG Packers) that HAVE ,or have their investments in other countries packing industrys.

I found this Today and these are the little guys, The American Association of Meat Processors (AAMP), is North America's largest meat trade organization. Membership includes more than 1,700 medium-sized and smaller meat, poultry and food businesses: slaughterers, packers, processors, wholesalers, in-home food service business, retailers, deli and catering operators, and industry suppliers. AAMP members are from the U.S., Canadian provinces and several foreign countries. AAMP's Board of Directors , consisting of 20 members, have general executive powers and general jurisdiction of all business of the association. AAMP is also affiliated with 34 state, regional and provincial meat trade organizations.

What is your point? There are 1700 members, large, medium sized and and small. By your implication there should only be large packers of U.S. origin. BTW, that many processors etcetera looks like inefficiency to me. I would look for aggressive consolidation.
 

agman

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reader (the Second) said:
agman said:
PORKER said:
There ***************
You have a gross misunderstanding as to why corporations relocate. The primary reason is to tap the local market. If you choose to argue this point you had better do alot of indepth research beforehand. The failure to do so will put you into a sink hole in a nono second.

Agman - I put this question to my brother-in-law as you remember. He is a well known economist. Let's see, he has about 20 pages of Google results and has been in charge of the major international economic instituions. He said that sometimes they relocate to capture local markets and that sometimes they relocate to cut operational costs.

Yes, I do agree there are other reasons. The PRIMARY reason is to serve the local and regional markets. I do not believe even your brother-in-law would want to dispute that with me or the Fed economists who have conducted the research per this subject. Their findings are quite clear as to the primary reason for relocation and subsequent product flows. I have already posted the data regarding relocation and how little of that foreign production ever enters the U.S. market versus the local and regional market. Until you can provide proof positive to counter the fed analysis it is best you leave this subject alone. Your mere opinion is not going to cut it per this issue.
 

PORKER

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Do you have some INFO,AGMAN ****** PLEASE tells us the names of the COMPANYS ( BIG Packers) that HAVE ,or have their investments in other countries packing industrys ? Is there a reason you don't want to answer? ARE You a stockholder?
 

cedardell

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Agman, you are right I have been focasing mainly on the negative. It is the huge trade deficit plus the idea that a lot of countries shun buying from the US. It would seem like with the huge disparity we have with China that they could buy from us. Does South America buy more Chinese goods than the US? I would think they'd like to cultivate our business by buying a little something from us. It's the same with South America, Canada, and the UK. The UK wouldn't buy beef from us even when they had to kill off all their own. If the rest of the world will not buy from us, then what? It is good to hear the bright spots, maybe things will turn around. AS for Agman's idea that our corporations set up in other countries to sell to them rather than us that really doesn't help us that much because the goods and services they sell are made there with their labor and material. We don't recover any taxes or benefits from that production. In fact we have to compete with them as far as the trade balance goes. The way I look at it a product is not a US product unless it was born, raised, and processed in the US. Just because Cargill moves to Canada to process beef and ship back to US or even to Canadians, or Japan doesn't make it US beef does it?
 

cedardell

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I'd like to know a little more about you brother. I missed out on any communication about him. What international economic institutions has he been in charge of? If in fact he has insight into world econmics his views could be very helpful to many of our discussions.
 

agman

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PORKER said:
Do you have some INFO,AGMAN ****** PLEASE tells us the names of the COMPANYS ( BIG Packers) that HAVE ,or have their investments in other countries packing industrys ? Is there a reason you don't want to answer? ARE You a stockholder?

Thanks for asking a direct question. The two most notable are Cargill (Excel) and Swift. Tyson, to my knowledge has limited interest to date. I expect that will change in the future if they are going to survive.

I expect o see alot of consolidation or joint ventures in the future. The meat processing industry on a global basis is too fragmented and inefficient to survive in the current form. I do not own stock in any of the publicly traded packing companies. There are too many better investment opportunities available.

Within 25-40 years packing plants as we know them today will likley be extinct. That may hold true for ranching and feedlots as well. The science is already in place - the politics is not.
 

agman

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cedardell said:
Agman, you are right I have been focasing mainly on the negative. It is the huge trade deficit plus the idea that a lot of countries shun buying from the US. It would seem like with the huge disparity we have with China that they could buy from us. Does South America buy more Chinese goods than the US? I would think they'd like to cultivate our business by buying a little something from us.

Respone....Once again you are missing the result in favor of an observation or impression. We have been in a trade deficit situation for most of the past 40-50 years. Is our economy weaker as a result? To conclude that you must also conclude that the economy's posting trade surpluses must have stronger economic, job and income growth than the U.S. The latter conclusion is a falsehood. The RESULTS clearly point to a stronger U.S. economy during the aforementioned period, not a weaker economy versus other nations. That is an indisputable fact-RESULTS-are what counts. The other comments are useless verbage.

Why the trade deficit? Current economic theory is squarely coming to the realization that our trade deficit is in fact the result of a very STRONG domestic economy versus other countries. Certainly Riccardo's theory of "comparative advantage" comes into play with a country such as China which has a labor cost advantage at this time. Labor intensive production will likely be sourced from that region-why sould it not be? Labor cost must be distinguished from a productivity advantage to understand the entire situation. The U.S has productivity advantages in many areas. That is so in beef production versus S. America. Other countries must export since their slower income and economic growth rates cannot absorb their own production.

China is currently unique in that it is a rapidly emerging economy. As its income and standard of living rise they too will import much more. Many of those imports will come directly from the U.S. Some economists currently believe that within five years we could be posting trade surpluses with China and other emerging economies. I believe it will take somewhat longer. Remember the that race is to the top of the economic and standard of living ladder and not to the bottom as so many mistakenly suggest. Trade elevates all participants. To get to the top they eventually will desire and will be able to AFFORD many finished goods which are produced more efficiently in the U.S. I do not have at my immediate disposal trade figures for S America versus the U.S and China-sorry.

You appear to be an individual who is open minded enough to absorb and accept new ideasand ask very pretinent questions. In short, you are not afraid to say you did not understand or were wrong in you opinion. As such, I will recommend a book to read that will shed light on globalization, its many benefits and obstacles to overcome. The author is Thomas Friedman, one of the foremost economic journalists of our time. He is truly one of the brilliant thinkers of our generation. The book, just recently released is entitled "The World is Flat".

Read it, learn and re-read the book and learn some more. Thanks for your questions. This type of discussion has merit and I hope others have the opportunity to learn from it. Have a great day. Andy
 

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