Real Cost of Hamburger

[Sandhusker]

SH, "Who said trim is not valued by what can be derived from it?"

Anybody who says it is only worth 8 cents/lb.

 

[Anonymous]

Sandbag: "Anybody who says it is only worth 8 cents/lb."

It is worth $.08 per pound unless there is a source of "CHEAP" lean trimmings to blend with it.


~SH~

 

[Jason]

It's always funny how Sandhusker is always an all or nothing kind of banker. I'm sure glad I don't borrow from a guy like you.

50/50 trim has been stated to be worth 8 cents. Haven't you ever had a customer who wouldn't sell his cattle because they weren't worth enough?

How about the stockmarket. If you sell at a loss you have taken the loss. If you hold until the market rises you don't take the loss.

50/50 trim can't be held indefinately. If the packers sell it at 8 cents they sell any future gain to be made with said trim. However, if they have no market for the trim 8 cents is better than paying to dispose of it.

Markets are always in flux. Demand changes. Just because 48% of the chucks are ground now doesn't mean that will always be the case.

Just because you could make a few bucks buying chucks on sale and mixing 8 cent 50/50 RIGHT NOW, doesn't mean you could for long. Where will you sell said mixed burger? Stores don't sign on for a cheap load of grind and risk losing their steady supplier. They sign on if you can supply the quantity and quality they can sell, at the cheapest cost to them.

Step up and try your luck Sandhusker. Quit saying you COULD do it and actually DO it. Real life is far different than fantasy.

 

[Big Muddy rancher]

Sandhusker you just proved yourself wrong. Cows are worth a fraction of what they are after they are processed just like 8 cent trim is until it is processed.Tthe point is proven. Thanks Sandhusker.[/quote

A fraction? What is your definition of "a fraction", BMR? Tell you what, show us how you come up with that conclusion. Down here, any broken mouth that can walk is worth $700. What is their value after processing?

So your telling us that packers don't make any money buying cows and processing them? Gee i thought they were making $400 a head.

 

[Sandhusker]

Sandhusker you just proved yourself wrong. Cows are worth a fraction of what they are after they are processed just like 8 cent trim is until it is processed.Tthe point is proven. Thanks Sandhusker.[/quote

A fraction? What is your definition of "a fraction", BMR? Tell you what, show us how you come up with that conclusion. Down here, any broken mouth that can walk is worth $700. What is their value after processing?

So your telling us that packers don't make any money buying cows and processing them? Gee i thought they were making $400 a head.

No, I'm not saying that at all, BMR. I just asked you to tell me what value of a $700 cow was after processing - not a statement, rather, a simple question.

 

[Sandhusker]

It's always funny how Sandhusker is always an all or nothing kind of banker. I'm sure glad I don't borrow from a guy like you.

50/50 trim has been stated to be worth 8 cents. Haven't you ever had a customer who wouldn't sell his cattle because they weren't worth enough?

How about the stockmarket. If you sell at a loss you have taken the loss. If you hold until the market rises you don't take the loss.

50/50 trim can't be held indefinately. If the packers sell it at 8 cents they sell any future gain to be made with said trim. However, if they have no market for the trim 8 cents is better than paying to dispose of it.

Markets are always in flux. Demand changes. Just because 48% of the chucks are ground now doesn't mean that will always be the case.

Just because you could make a few bucks buying chucks on sale and mixing 8 cent 50/50 RIGHT NOW, doesn't mean you could for long. Where will you sell said mixed burger? Stores don't sign on for a cheap load of grind and risk losing their steady supplier. They sign on if you can supply the quantity and quality they can sell, at the cheapest cost to them.

Step up and try your luck Sandhusker. Quit saying you COULD do it and actually DO it. Real life is far different than fantasy.

If 50/50 trim is worth 8 cents, I'll take it all. I've already shown how it pencils out. Feel free to point out where my figures are incorrect. Also, feel free to point out to me how paying even $2.50 for chuck won't work. Show me that trim is only worth 8 cents. I don't beleive it.

SH claims a cow's value is based on what can be derived of that cow, but trim has to be valued as a "stand alone" commodity. Since you've throw in with him, can you explain that?

 

[Econ101]

Jason and SH, and you too, BMR, did you not understand any of the example that Sandhusker put up? I know educational systems sometimes don't measure up but you three just need some basic math.

Jason, I doubt you would ever be able to get a loan from Sandhusker.

SH, does the importation of meat into the U.S. benefit the cattlemen or does it just replace the next lowest value cut to be mixed in the grind?

BMR, I am surprised at you.

 

[Anonymous]

Conman,

You didn't even know what 50/50 trim was a few days ago and now you want to lecture on selling it? You're not qualified to sell popcorn for this discussion, step aside.


Sandbag, listen up!

When you have 100 pounds of chucks and rounds at $2.00 per pound, you have $200 worth of chucks and rounds before grinding.

If you have 100 pounds of 50/50 trim at $.08 per pound that is $16 worth of 50 /50 trim.

If you take that 100 pounds of 50/50 trim and blend it with 100 pounds of ground chuck and round you end up with 200 pounds of 75/25 lean ground beef valued at $1.50 per pound equals = $300.

$300 - $216 = $84 more than both products sold seperately.


NOW if you take those chucks and rounds and sell them whole you end up with $200.

If you import 100 pounds of "CHEAP" lean trimmings from Australia and New Zealand at $1.00 per pound to blend with your 50/50 trim, you have 200 pounds of trim valued at $1.50 per pound = $300


$200 for the chucks and rounds + $300 for the 75/25 lean ground - the $100 cost of the lean imports = $400.


NOW WHO IS THE BETTER BUSINESSMAN SANDBAG??? The guy with $300 in his pocket that ground the chucks and rounds or the guy with $400 in his pocket that sold the chucks and rounds and ground the imported lean trimmings?

You're right, the math is simple for anyone who can comprehend it!

You are defeated again!


~SH~

 

[TimH]

A Tale of Two Packers

Packers A and B are very competitive. In fact their operating expenses are identical. The prices they receive for all of their beef and by-products are also identical.
They each have identical 720 lb. carcasses hanging in their coolers. Each carcass yields 72 lbs of chuck and 20 lbs of 50/50 trim.

Packer A grinds 14 lbs of chuck to blend with his 50/50 trim in order to make 34 lbs of 70/30 ground which he can sell for $1.79/lb. ($60.86)
This leves him with 58 lbs of chuck(72-14) which he can sell for $2.00/lb.(($116.00).
Total- $176.86

Packer B buys 14lbs of lean trim for $1.00/lb. He blends this with his 20lbs of 50/50. He can sell this 34 lbs of ground for $1.79/lb.($60.86)
Since the lean trim cost him $14.00 his net is $46.86 on the ground beef.
He then sells all 72 pounds of his chuck for $2.00/lb.($144.00)

Total- $190.86

A difference of +$14.00 per head in the pocket of packer B.

 

[Econ101]

Conman,

You didn't even know what 50/50 trim was a few days ago and now you want to lecture on selling it? You're not qualified to sell popcorn for this discussion, step aside.


Sandbag, listen up!

When you have 100 pounds of chucks and rounds at $2.00 per pound, you have $200 worth of chucks and rounds before grinding.

If you have 100 pounds of 50/50 trim at $.08 per pound that is $16 worth of 50 /50 trim.

If you take that 100 pounds of 50/50 trim and blend it with 100 pounds of ground chuck and round you end up with 200 pounds of 75/25 lean ground beef valued at $1.50 per pound equals = $300.

$300 - $216 = $84 more than both products sold seperately.


NOW if you take those chucks and rounds and sell them whole you end up with $200.

If you import 100 pounds of "CHEAP" lean trimmings from Australia and New Zealand at $1.00 per pound to blend with your 50/50 trim, you have 200 pounds of trim valued at $1.50 per pound = $300


$200 for the chucks and rounds + $300 for the 75/25 lean ground - the $100 cost of the lean imports = $400.


NOW WHO IS THE BETTER BUSINESSMAN SANDBAG??? The guy with $300 in his pocket that ground the chucks and rounds or the guy with $400 in his pocket that sold the chucks and rounds and ground the imported lean trimmings?

You're right, the math is simple for anyone who can comprehend it!

You are defeated again!


~SH~

SH, You need to go on over and tell Tyson your theory of how to make more money. You are obviously smarter than they.

Who benefitted under your scenario, SH? Was it the domestic producer? What about the fact that the extra 100 lbs of lean from overseas took some of the domestic market for ground beef?

 

[Anonymous]

Conman: "SH, You need to go on over and tell Tyson your theory of how to make more money. You are obviously smarter than they."

I'll take this diversion as your inability to contradict my math. I appreciate that indirect acknowledgement.

Tyson knows how to make money and they will find a source of "cheap" lean ground beef to add value to that 50/50 trim.

Conman: "Who benefitted under your scenario, SH?"

The producer, the consumer, and the packer.

The packer for obvious reasons.

The producer because his chucks and rounds and 50/50 trim are worth more than they would be under Sandbag's senerio.
The consumer because there is more ground beef available at an affordable price. "FEATURED PRICES".

You're too ignorant to understand it so you might as well bow out now or make a bigger fool of yourself.

Conman: "What about the fact that the extra 100 lbs of lean from overseas took some of the domestic market for ground beef?"

Yet again, you display your economic ignorance to the world.

The 100 pounds of lean ground beef did not take away from some of the domestic market due to the price it was offered at ($1.50 per pound once blended). More importantly, it provided a market for the 50/50 trim without grinding up the chucks and rounds and devaluing them by $.50 per pound under Sandbag's senerio. This way the U.S. producer gets more for their chucks and rounds and more for their 50/50 trim.


NEXT!

~SH~

 

[Anonymous]

Tim H: "Never argue with an idiot........you won't win!"

You're right but we need to educate the non idiots who are reading this. Thanks for explaining the same thing I did Tim. You got it figured out.


~SH~

 

[agman]

Agman, "Sandhusker, if you think 50/50 trim is worth more than $.08 as a stand-alone then provide some proof. You always ask everyone else to prove their statement why don't you prove yours for once? In doing so you would prove SH wrong. The reason you won't is because you can't. Your last statement (b)again(b) is sufficient to demonstrate how shallow your position is."

I provided the proof. Look at my figures and tell me where I'm wrong.

Your figures are so elementary and only show your lack of understanding of the entire process. If it were only as simple as uninformed outsiders such as yourself envision.

 

[Sandhusker]

Agman, "Sandhusker, if you think 50/50 trim is worth more than $.08 as a stand-alone then provide some proof. You always ask everyone else to prove their statement why don't you prove yours for once? In doing so you would prove SH wrong. The reason you won't is because you can't. Your last statement (b)again(b) is sufficient to demonstrate how shallow your position is."

I provided the proof. Look at my figures and tell me where I'm wrong.

Your figures are so elementary and only show your lack of understanding of the entire process. If it were only as simple as uninformed outsiders such as yourself envision.

When I first presented them I said they were not perfect as I had not accounted for grinding and mixing expenses. I did offer the opportunity to show me where I was wrong. You have the floor.

 

[Econ101]

Agman, "Sandhusker, if you think 50/50 trim is worth more than $.08 as a stand-alone then provide some proof. You always ask everyone else to prove their statement why don't you prove yours for once? In doing so you would prove SH wrong. The reason you won't is because you can't. Your last statement (b)again(b) is sufficient to demonstrate how shallow your position is."

I provided the proof. Look at my figures and tell me where I'm wrong.

Your figures are so elementary and only show your lack of understanding of the entire process. If it were only as simple as uninformed outsiders such as yourself envision.

I think Sandhusker was speaking to SH's level.

 

[mrj]

While looking for something on one of the earlier pages of this post, I found some things I didn't see at the time of the posts.

I appreciate the copy of the fats research posted by RobertMac from the book by Ms. Enig. I will try to get a copy of that after New Years. No time for reading before that, for sure!

I also appreciate the reminder by Agman of the research and development and promotion of more consumer friendly beef products by Tyson, as well as the comment that Tyson does not promote one commodity over the other. Apparently, most producers are not aware of the facts, and would probably be amazed at the extent of packer investment in selling more beef. Sad, though, that many will not believe that has benefit for producers. Hatred does something to ones reasoning ability, it seems.

But the main reason for this post is that RobertMac said my disappointment with the amount of fat on a chuck roast I purchased was due to believing beef fat is unhealthy. I never said that, and it was wrong of him to imply that I did. I very clearly indicated that it was because of the economics of throwing away several dollars worth of the fat I had purchased. I doubt even a person promoting beef fat as being healthful as he does, and I do NOT disagree, actually eats the chunks of fat on the beef. That plate waste is what I was lamenting!

MRJ

 

[Sandhusker]

Quote:
Econ101: "Who benefitted under your scenario, SH?"


The producer, the consumer, and the packer. The packer for obvious reasons. The producer because his chucks and rounds and 50/50 trim are worth more than they would be under Sandbag's senerio.
The consumer because there is more ground beef available at an affordable price. "FEATURED PRICES". You're too ignorant to understand it so you might as well bow out now or make a bigger fool of yourself.

You're forgetting one thing, SH. YOU HAVEN'T PAID THE AUSSIES YET. Who takes the lighter check so they can get paid?

 

[Big Muddy rancher]

Sandhusker I don't know the exact dollar a $700 cow would be worth processed. Probably Randy or ag man could come up with a close estimate. Still would a packer buy a cow without the expectation of a profit some where. Even if that cow cost $700 and they sold it for $800 the cost of the cow would be seven eights of the final price. A fraction . just what i said.

 

[Sandhusker]

Sandhusker I don't know the exact dollar a $700 cow would be worth processed. Probably Randy or ag man could come up with a close estimate. Still would a packer buy a cow without the expectation of a profit some where. Even if that cow cost $700 and they sold it for $800 the cost of the cow would be seven eights of the final price. A fraction . just what i said.

BMR, the relationship of any two numbers can be expressed in a fraction! Generally (and I think you know this :wink: ) when someone uses the term "a fraction of", they are alluding to a very small fraction. 7/8 is generally not considered a small fraction.

 

[Big Muddy rancher]

Sandhusker I don't know the exact dollar a $700 cow would be worth processed. Probably Randy or ag man could come up with a close estimate. Still would a packer buy a cow without the expectation of a profit some where. Even if that cow cost $700 and they sold it for $800 the cost of the cow would be seven eights of the final price. A fraction . just what i said.

BMR, the relationship of any two numbers can be expressed in a fraction! Generally (and I think you know this :wink: ) when someone uses the term "a fraction of", they are alluding to a very small fraction. 7/8 is generally not considered a small fraction.

You mean a fraction like when R-CALF said Canadian cattle are TAINTED?