Random Musings From A Random Mind

[Anonymous]

No DSCC, I do not own any interests in any packing company. I am a cow calf man that bases his decisions on factual information as opposed to a need to blame.

Sorry for the defensiveness from your suggestion but the LMA driven OCM is trying to further this agenda as we speak to try to carve more comission dollars out of the sale of fat cattle.

DSCC: "I disagree. More bidders does indeed result in more money. You've been to sales, and seen it with your own eyes. Hell, sale barns who have 10 - 15 buyers at them average 5 to 10 cents more/lb of cattle sold than smaller barns with only 3 or 4 buyers."

You are comparing apples to oranges.

Order buyers in the sale barn have much smaller orders to fill than large efficient packing companies that have their slaughtering schedules to fill.

The very reason there is only 3 - 5 major packers left is because the smaller less efficient packing companies could not compete with them. If they could not compete with them, there is obviously stiff competition.

Having 10 - 12 less efficient packing companies bidding on your cattle will not result in more money when the same 2 - 3 volume buyers with more efficiency are going to end up with the cattle because they have the money to spend. The less efficient packing companies don't. The only way they can compete is with niche markets for specialized products.

DSCC: " Eventually those 2 or 3 buyers learn that you never call anyone else, and adjust their practices to suit. Competition has now suffered. Not a rediculous argument at all."

Rod, those same 2 - 3 packing companies have millions invested that depend on a consistant supply of cattle through their plants. They are in competition with eachother and they pay up. More bidders does not necessarily lead to more money when your top 2 - 3 bidders are the most efficient packers with the most money to spend on cattle.

The fact that they can pay up and can survive on a tighter profit margin is the very reason why they exist and why less efficient packing companies have faded out.

The goal here is to get the most money for our cattle, not to see how many bidders we can get into a sale barn that are looking for a bargain. I want to work with the large successful, efficient packer who absolutely needs those cattle, not some bargain shopper.


~SH~

 

[Econ101]

Econ 101 wrote-

Tim, all market power laws should be looked at and enforced by the amount of market power one has. In your case, the "little packer" has no real market power

What does how much market power ,I may or may not posess, have to do with the fact that I am now able to buy your above average cattle for an average price? The fact remains that you had your $150/head premium legislated away.

Would it be any different if ,in my hypothetical situation, I was a large packer and you were a large feeder?? I don't think so.

The act does not disallow for premiums to be paid for above average cattle and I would never argue that case. If your neighbor raised the same embrio cattle that were all twins of your production and had all the same quality characteristics as your cattle, the packer should not be able to pay you more than your neighbor because your neighbor's cattle were "price setting" cattle as the cash market was in Pickett. Pickett showed that there was a difference in price being offered in th captive supply for the same quality characteristics in the cash market for periods of time. Normal markets may contain some differences but they would not be statistically significant. The market manipulation was statistically significant to the tune of about 5 %. This means that the cattle markets were depressed by 5% over certain periods. Not over every period, but over periods that mattered. Periods that coincided with a player that had the largest amount of substitutes for the beef industry.

Larger packer and larger feeder? How large? One packing plant out of 50 in the U.S. may not be considered a market manipulation move, even if it was the largest plant in the U.S. or world. It all depends on the circumstances. If a packer (like rkaiser's Big C) was able to convince the public that raising cattle with no hormones and no antibiotics and with Welsch or x kind of cattle, but it costs the consumers more, where is the problem? Those differences sure have an effect on my sister in law. Let her pay more. Rkaiser could buy his cattle from anywhere that fell under his standards just as the angus program does. If he keeps paying himself more for the same cattle than the others who supply cattle for the same thing, there could be a problem.

That is what has happened in the poultry business. It is against the law and yet we have a legal system that is not performing its duty. Arlen Specter is head of the Senate Judiciary Committee and so has a great deal of influence on whether or not judges get promoted to a federal seat. He also has strong ties to the poultry industry. He also sold out the poultry growers when they worked hard to get under the PSA. The law is there, it looks as if poultry is covered under the act, yet GIPSA is not enforcing the act. Poultry egg raisers are not considered to be covered under the act because of a technical definition that Spector should have solved a long time ago. What is the deal here?

 

[DiamondSCattleCo]

1) I always assumed that this was to prevent the other buyers from hearing what they were saying. Is this just an "act"? :shock:

2) I own a small packing company with a very specific niche market for a very specific type of beef. Econ 101 owns a small feedlot right across the road from my plant and produces exactly the type of cattle that I need.

1) Or it could simply be that the buyer doesn't want the mic picking up the outside noises of the market. When I'm on the tractor, talking to my wife, I cup my cell phone pickup so it doesn't get the tractor noises.

2) Tim, you do bring up some valid points and there will always be exceptions. But do we allow the good of the few to take precendence over the good of the many?

Rod

 

[Sandhusker]

Sandbag: "From what I understand, Mexican cattle get the "M" brand, so they're labeled. Aren't Canadian cattle required to be branded CAN now as well? Everything already is labeled for us. What else needs to be done?"

What an oversimplistic look at this issue. An "M" or "C" brand on the hide doesn't trace that animal into the 300 individual packages of beef it becomes. What a joke.

Sandbag: "That anti-COOL bunch tell us the packers can't keep everything straight, but then also say most beef is US, anyway."

That anti packer bunch accuses packers of hiding foreign beef behind a "USDA stamp" then trusts them to label beef without an enforceable system. Talk about hypocrisy.

Sandbag: "Don't packers keep UTM and OTM seperate?"

Those are carcasses that have already been graded "B" maturity. That is hardly comparable to tracking the 300 packages they become at the retail level. Typical ignorant R-CULT oversimplifications.

Sandbag: "What about their grid cattle? Do they pay extra for those carcasses and then just them on the rail with the burnt-out milk cows?"

Once again, you ignorantly compare tracking carcasses to tracking individual beef portions and packages through fabrication and trimming.

Sandbag: "I don't see any big problems."

From the Cody, NE bank, I don't suppose you would!


Every R-CULT member should be forced to take a course in beef processing, fabrication, and pricing.


~SH~

When I worked at Vickers, we had a number of different series of pumps and a number of different customers that had different variations on the pumps, different settings, even painted a different color. Everything had to be kept seperate and was even scheduled on certain days as part of an integrated "Just-In-Time System. It worked. No problems. Everybody stayed busy and product went out the door. You see, Vickers had a handly little tool called a "computer". I'm sure Tyson can afford a couple.

If you want to do something, even something that looks difficult, a little will and a little technolgy work wonders. Then again, if you don't want to do something, you can always make excuses, belittle, and blame.

 

[Anonymous]

Conman: "Pickett showed that there was a difference in price being offered in th captive supply for the same quality characteristics in the cash market for periods of time."

I've told you a hundred times, THIS WEEK'S CASH MARKET IS NOT DRIVEN BY THE SAME SUPPLY AND DEMAND FACTORS AS LAST WEEK'S FORMULA MARKET YOU IDIOT!

Your cash/formula market difference argument is bullsh*t!

YOU CAN'T COMPARE MARKETS DERIVED IN SEPERATE WEEKS!

This same stupid argument could be used to suggest that the formula price was discriminated against when the cash market is higher.

YOU ARE WRONG ON THIS as you are most of your phony assumptions.


~SH~

 

[Econ101]

Conman: "Pickett showed that there was a difference in price being offered in th captive supply for the same quality characteristics in the cash market for periods of time."

I've told you a hundred times, THIS WEEK'S CASH MARKET IS NOT DRIVEN BY THE SAME SUPPLY AND DEMAND FACTORS AS LAST WEEK'S FORMULA MARKET YOU IDIOT!

Your cash/formula market difference argument is bullsh*t!

YOU CAN'T COMPARE MARKETS DERIVED IN SEPERATE WEEKS!

This same stupid argument could be used to suggest that the formula price was discriminated against when the cash market is higher.

YOU ARE WRONG ON THIS as you are most of your phony assumptions.


~SH~

The supply was "bought" during the same week but the supply/demand factors were not all for the week they were "bought" in.

You make my case, SH. Thank you.

 

[Anonymous]

Conman: "The supply was "bought" during the same week but the supply/demand factors were not all for the week they were "bought" in."

WHAT A DUMB ASSED STATEMENT!

Suppy and demand factors that affect fat cattle prices change daily.




~SH~

 

[Econ101]

Conman: "The supply was "bought" during the same week but the supply/demand factors were not all for the week they were "bought" in."

WHAT A DUMB ASSED STATEMENT!

Suppy and demand factors that affect fat cattle prices change daily.




~SH~

So? (misspelled supply)

 

[Soapweed]

Where is COOL? We still don't have it.

Good. Sometimes procrastination is not all bad. I've sat on various boards, and once in a while, if you can talk the rest of the group into just "tabling" a problem until the next meeting, and then do the same at the next meeting, you can ignore something long enough for the problem to evaporate. :wink:

That anti-COOL bunch tell us the packers can't keep everything straight, but then also say most beef is US, anyway.

That's just it. COOL is an exercise in futility. So what if the label says "beef born, raised, and processed in the USA". The USA is pretty big, with as much ethnic diversification in cattle as there is in the people that live here. "Certified Angus" or "full-blooded Swede" means something. "Black cattle" or "blonde American" really doesn't mean much.

 

[Soapweed]

Conman: "The supply was "bought" during the same week but the supply/demand factors were not all for the week they were "bought" in."

WHAT A DUMB ASSED STATEMENT!

Suppy and demand factors that affect fat cattle prices change daily.




~SH~

So? (misspelled supply)

Some folks have been known to have puppy for suppy, and with any luck there is enough left for a midnight snack. :wink:

 

[DiamondSCattleCo]

I am a cow calf man that bases his decisions on factual information as opposed to a need to blame.

I also have no need to blame, however I do feel the the market is slowly breaking down based on my own observations. I have children and want to ensure that the lifestyle that I love is still here for them when they grow up. For me, that transcends market efficiency and a corporation's right to profits. I feel that the current corporate enviroment, both in the cattle industry, and in other areas of our lives is restricting our ability to 'live a good clean life'.

Order buyers in the sale barn have much smaller orders to fill than large efficient packing companies that have their slaughtering schedules to fill.

If everyone had to purchase their cattle in the barn, then the order buyers wouldn't have smaller orders then. The packer needs the same number of cattle each week, whether they get them from the barn or private treaty.

The very reason there is only 3 - 5 major packers left is because the smaller less efficient packing companies could not compete with them. If they could not compete with them, there is obviously stiff competition.

I disagree with your idea that larger means more efficient ALWAYS. Its simply not so. Larger plants are able to able to operate on economies of scale and reduce costs/animal. This is a form of efficiency, I grant you that, however I would argue that the local butcher who buys their stock direct from the producer is even more efficient. No middle men, straight from producer to consumer with only 1 middleman. And butcher meat is often much cheaper than grocery store meat, at least in my area.

And yes, I realize that my initial post would make it illegal for this to happen, but I did want to post an example of how smaller can be more efficient in some ways.

Having 10 - 12 less efficient packing companies bidding on your cattle will not result in more money when the same 2 - 3 volume buyers with more efficiency are going to end up with the cattle because they have the money to spend. The less efficient packing companies don't. The only way they can compete is with niche markets for specialized products.

Perhaps, but having more people bidding still gives us a check and balance to prevent the 2 or 3 volume buyers from colluding and driving prices down.

Rod

 

[Anonymous]

Where is COOL? We still don't have it.

Good. Sometimes procrastination is not all bad. I've sat on various boards, and once in a while, if you can talk the rest of the group into just "tabling" a problem until the next meeting, and then do the same at the next meeting, you can ignore something long enough for the problem to evaporate. :wink:

That anti-COOL bunch tell us the packers can't keep everything straight, but then also say most beef is US, anyway.

That's just it. COOL is an exercise in futility. So what if the label says "beef born, raised, and processed in the USA". The USA is pretty big, with as much ethnic diversification in cattle as there is in the people that live here. "Certified Angus" or "full-blooded Swede" means something. "Black cattle" or "blonde American" really doesn't mean much.

Soap--Here I always thought you were a straight shooter rancher --but now I see you would rather pass off Uruguain, Australian, and Mexican meat to the consumer as a US product, rather than tell them the truth...

Wouldn't want to buy a horse from someone like that....Not my idea of the code of the west......

 

[Soapweed]

I would rather buy a good horse from Mexico than a bad one from Montana. I would rather eat good beef from Canada than I would bad beef from Florida. I would rather buy a well-made shirt from China, than I would a poorly made one from North Carolina. Quality is important, no matter where it is from.

I would compliment and recommend your kid if he does a good job. If my kid screws up, it will not just be swept under the rug. Honesty is important.

Value added beef with a justifiable label, such as South Dakota Premium Beef or Certified Angus, with verification to back the claims, means something. Plain jane old USA beef could mean a downer cow with cancer eye, but she is darn sure USA beef. "USA Beef" is just too broad spectrum. Give me a label instead that designates quality.

 

[DiamondSCattleCo]

And something else to toss into the fray, and one of the reasons I began thinking about this topic:

You have to bear in mind that not all of us are big producers. As a small producer, I am economically blocked from the fat cattle market. I can't get enough animals together for a liner load, so the packer doesn't even want to talk to me. If I ship to the barn, we've already established that I'll get less money for my product, to the point where I've lost money versus selling to a feedlot as a backgrounded animal.

So I don't think we have a level playing field. Perhaps this is as simple as regs stating that packers CANNOT refuse to buy small lots of animals?

Rod

 

[Anonymous]

I would rather buy a good horse from Mexico than a bad one from Montana. I would rather eat good beef from Canada than I would bad beef from Florida. I would rather buy a well-made shirt from China, than I would a poorly made one from North Carolina. Quality is important, no matter where it is from.

I would compliment and recommend your kid if he does a good job. If my kid screws up, it will not just be swept under the rug. Honesty is important.

Value added beef with a justifiable label, such as South Dakota Premium Beef or Certified Angus, with verification to back the claims, means something. Plain jane old USA beef could mean a downer cow with cancer eye, but she is darn sure USA beef. "USA Beef" is just too broad spectrum. Give me a label instead that designates quality.

And you wouldn't buy that Mexican horse without checking it out- you would want to know as much as possible about it, including where it came from-- You know where the shirt comes from because it is required to be labeled- everything else you buy is required to be labeled-except meat...The only reason that meat is not labeled is so the Packers/Retailers can continue the fraud of passing off cheap imported meat as a US product to make bigger profits off it....

And as far as I am concerned those that oppose an M-COOL requirement are the same as co-conspirators to that fraud...

 

[Econ101]

And something else to toss into the fray, and one of the reasons I began thinking about this topic:

You have to bear in mind that not all of us are big producers. As a small producer, I am economically blocked from the fat cattle market. I can't get enough animals together for a liner load, so the packer doesn't even want to talk to me. If I ship to the barn, we've already established that I'll get less money for my product, to the point where I've lost money versus selling to a feedlot as a backgrounded animal.

So I don't think we have a level playing field. Perhaps this is as simple as regs stating that packers CANNOT refuse to buy small lots of animals?

Rod

And that they have to pay the going rate.

 

[Northern Rancher]

If salesbarns are capable of doing such a great job for the producer-how come any other alternatives ever started up.You don't need to be a huge producer to sell into a value added grid. To be quite frank with everybody I'm no packer lover but I started selling fat cattle to Cargill to replace some of the cash the local mafia barns had extracted. I worked as a buyer for a time and if you don't think there's hanky panky at ringside your for sure naieve. I always get the local barns to bid on my cattle before I place them on feed-there so busy trying to rape you on the shrink or the sortnot once have they ever wanted to check out years of pen closeouts-I'm soo sick of having them say my cattle won't finish heavy enough blah,blah,blah. It's funny how that cut back steer with a nipped ear goes from a 20 cent discount to a ten cent premium when you feed them and sell them on the grid. If were going to get the government to legislate how we can sell our product we might as well just have state farms and work for a wage-it was sure a success over in Russia.

 

[Econ101]

If salesbarns are capable of doing such a great job for the producer-how come any other alternatives ever started up.You don't need to be a huge producer to sell into a value added grid. To be quite frank with everybody I'm no packer lover but I started selling fat cattle to Cargill to replace some of the cash the local mafia barns had extracted. I worked as a buyer for a time and if you don't think there's hanky panky at ringside your for sure naieve. I always get the local barns to bid on my cattle before I place them on feed-there so busy trying to rape you on the shrink or the sortnot once have they ever wanted to check out years of pen closeouts-I'm soo sick of having them say my cattle won't finish heavy enough blah,blah,blah. It's funny how that cut back steer with a nipped ear goes from a 20 cent discount to a ten cent premium when you feed them and sell them on the grid. If were going to get the government to legislate how we can sell our product we might as well just have state farms and work for a wage-it was sure a success over in Russia.

Thanks for your input. Our PSA and other laws are not meant to stop you from selling your cattle in any way. It is meant to stop market power from being used to frustrate the normal workings of the market for the benefit of those who have market power. In your particular situation outlined, I would want to sell on the grid also. Allowing you to sell to those who give you the best price has never been outlawed and should not. The packers, however, have some responsibility with the prices they offer because they have market power. You could sell to anyone at any price because you do not have market power. No one is trying to legislate how you can sell your product. That is just a packer argument that is brought up all the time.

 

[Sandhusker]

Soapweed, "Good. Sometimes procrastination is not all bad. I've sat on various boards, and once in a while, if you can talk the rest of the group into just "tabling" a problem until the next meeting, and then do the same at the next meeting, you can ignore something long enough for the problem to evaporate. "

The problem here is that the larger group, including the President, have made up their mind and it is only a small group representing a minority interest that are blocking it.

Another problem I see is that it won't evaporate. It's just getting started. The big packers have established positions across the globe in beef raising nations and trade barriers are dropping. These folks want to sell cheaper beef that what you can provide without anybody knowing and the stars are lining up for them. Their agenda puts your operation at risk, my bank at risk, and my community at risk. I don't like that. I'm not ashamed at all to fight against that.


Soap, "That's just it. COOL is an exercise in futility. So what if the label says "beef born, raised, and processed in the USA". The USA is pretty big, with as much ethnic diversification in cattle as there is in the people that live here. "Certified Angus" or "full-blooded Swede" means something. "Black cattle" or "blonde American" really doesn't mean much."

I'll agree with COOL not saying a whole lot about the quality. I'll pay twice as much for a Nebraska steak from a baldie than I would a steak from a Florida Brahman or any milkcow from anywhere. That's where branded beef comes in. What a "Product of USA" label means to me is "The products under this label are benefitting US producers, who pay US taxes - and US taxes fund a whole bunch of things that help us all out. Feel free to buy the beef from Canada, Brazil, or Australia, but also kindly let us know what service currently being funded by taxes you no longer want funded as we will be running short"

I think we're still on for 7 if you can make it. Come early and I'll get you straightened out on COOL! :wink:

 

[Anonymous]

Conman: "No one is trying to legislate how you can sell your product."

HAVE YOU NO SHAME??????

How can anyone just lie the way you do then arrogantly pretend you didn't. You know damn well the Captive Supply Reform Act is legislation that determines HOW YOU CAN SELL YOUR PRODUCT.

STOP YOUR DAMN LYING!



~SH~