BR: "In all honesty though, if you believe that corporate developed efficiencies, have ever been paid back, to the raw goods producers, you will buy anything. Who is telling you this?
That extra income goes into their pockets."
Nobody has to tell me it. It's so damned obvious. Excel, Swift, and Tyson are all in competition for the same cattle. Anyway those packers can increase their efficiency allows them to pay more for cattle than their competition. Simple economics. If you don't believe that, WHERE'S YOUR PROOF TO THE CONTRARY BEN????
Remember the $400 per head profits that the packers and retailers were supposedly making off the backs of producers according to Mike Callicrate?
What did Pickett reveal? $26 per head profits in ibp's best years to sell everything from the tongue to the rectum and you don't think that money is being passed on to producers?
If that's not the case, then how do you explain the demise of Future Beef? How do you explain the $25 patronage dividends from USPB?
YOU CAN'T! WHERE'S THE MONEY???
You have absolutely nothing to back your claim that efficiencies are not passed on to producers. If you don't believe that is the case, OPEN UP A PACKING PLANT AND MEET YOUR MAKER BEN!
Ben, with all due respect, you are just flat wrong about this and I would challenge you to prove otherwise.
Lying King: "So when do packers pass on their lower costs to producers?"
The existing packers are in place today because the smaller less efficient packers that they replaced could not compete with them. That is a damn fact. DO YOU KNOW WHAT "COMPETE" MEANS??? It means that they could not pay as much for cattle as the more efficient packer and still make a profit. THAT'S CALLED COMPETITION AND IF IT DIDN'T EXIST THERE WOULD BE PACKING PLANTS SPRINGING UP ALL OVER.
If you don't think Excel, Swift, USPB, and Tyson compete for the same cattle, you are a bigger idiot than I could have ever imagined.
Econ: So do you not think that the comparative advantages they get in hiring illegally immigrants is not in poultry processing and pork processing? If these costs are the same or more in poultry or pork, there is not a comparative advantage in relationship to the substitutes of beef, just in other packers who do not hire illegal help. The same with foreign sources of beef.
Packers always passing on savings? If your case is to be accurate, then packer profits would remain at a constant rate. They do not. Profits on substitutes, which all the big packers are into--whether foreign sources of beef, or chicken or poultry---are also not considered in your scenario.
Lying King: "They pass those lower costs to consumers so they can sell more than their competitors."
HAHAHAHA!
Another quote which will define you. I've just added that quote to the bottom of my posts.
You are such an idiot!
If they simply lowered their prices to consumers every time they increased their efficiency and lowered their costs it would reduce their profits. How can you be so stupid?
The only time they will lower their prices to consumers is if their is consumer resistance to the current price level and they need their supply to clear the hurdle. THEY SELL IT OR THEY SMELL IT.
How do you explain your logic that packers and retailers simply reduce their prices to consumers to reflect their costs savings in light of the fact that cattle prices track with retail beef prices? hmmmm????
If cattle prices were not reflective of retail beef prices, the two would not track.
Econ: This phenomena I explained only happens when packers have to compete for the sell it or smell it, as you say. It doesn't always happen automatically. It only happens with real competition. The less competition, the less it happens.
Lying King: "Unfortunately, this takes money out of the supply chain of beef. I think people should pay more for beef, not less. This money should go to the beef production chain which includes producers. "
You can think what you want but when consumers are faced with poultry, pork, and beef, they are going to buy whatever they perceive as offering them the best value. That's just how it is. Beef is not going to be priced too far out of line from poultry and pork or it won't sell.
Econ: As I explained above, prices for poultry and pork would go up too if they all had to pay higher labor costs instead of competing with illegal labor and illegal labor practices. If GIPSA would enforce the PSA in regards to poultry, beef would have another advantage. Again, I am for higher prices for beef, you are for lower prices. You are not looking at the whole picture.
Lying King: "Your argument is that we should continually lessen the amount that the industry gets."
YET ANOTHER LIE!
My argument is that increased efficiencies in the packing industry are passed on to producers in the form of higher cattle prices increasing the amount of revenue the industry gets.
You try to sell everything from the tongue to the rectum and maintain your plants at a $15 per head average profit. Heck, better yet, try to maintain that per head margin at $3.88 per head like the 5 major packers did through the nineties.
Econ: No, you just passed that savings on to the consumer. It came out of the beef supply chain. In doing so, the big packers have made a comparative advantage compared to small packers. This means less competition for them.
Lying King: "Do you not believe that beef is a worthwhile item to spend money on?"
What I believe is irrelevant. What matters is what consumers are willing to pay for beef relative to the price of poultry and pork. That is the issue.
Econ: You are right about this. The things I advocate would bring the prices of pork and chicken up higher relative to beef. All producers would get more money, not just beef producers. The packers wouldn't be able to compete by treating labor and producers unfairly, or advantaging some to cheat the whole, or concentrate the industry so much that collusion and manipulation are easier.
Lying King: "If the packers all had increased costs at the same time in the meats as a whole, that would be passed onto consumers."
WRONG! WRONG! WRONG!
Consumers have other protein choices. Increased costs in the packing industry are passed on to producers in the form of lower cattle prices just as retail beef prices track with live cattle prices.
Econ: Do you mean tofu? Believe me, the people eating that stuff will eat it regardless of the price of meats and the people eating meats are not going to willy nilly start eating tofu or soybeans because of that little difference in price. They might spend more of their paycheck on food, but that would be good for producers. The reason small towns in the country are drying up is because they are not getting enough of the economic pie and because the farms/ranchers needed to support a family are getting bigger. That means there are less families to have to buy goods from town and the economy starts drying up. Can't you learn from your surroundings?
Lying King: "You think it will always come out of producer's pockets."
Cattle prices fluctuate far more than retail beef prices. That's another fact you cannot refute.
Econ: Look at the other article I posted. Retail prices didn't fluctuate as much because the middlemen didn't make as much at times. That didn't come out of producer's pocket, it came out of the packers to retail (or restaurants). Over the longer term, it does change more.
Lying King: "The reason, of course, is that there are few substitutes for beef, chicken and pork when they are taken as a whole that consumers want."
The substitutes for beef, chicken and pork as a group are irrelevant when poultry, pork, and beef are competing with each other for which protein offers consumers the most value.
Econ: No, when they all rise at the same time, they all go up more because consumers will not have a substitute that is relatively cheaper. They all rose at the same time. There could be some very minor losses here, but they are more than made up by the increases in the prices when looking at profits.
Lying King: "Your argument is one of less money for the industry, mine is one for more."
Your argument was that reduced packing costs were passed on to the consumers.
Your exact quote was:
Lying King: "They pass those lower costs to consumers so they can sell more than their competitors."
HOW DOES THAT CREATE MORE MONEY FOR THE INDUSTRY??
LOWERING CONSUMER COSTS MEANS LESS MONEY FOR THE INDUSTRY YOU IDIOT!!!!
Econ: When poultry, pork, and chicken all go up at the same time, the industry makes more money. It gives more of the pie to that industry group and its workers and infrastructure. Please don't call me stupid or idiot when the terms more aptly describe you.
You are too stupid to see the contradictions in your own arguments.
Lying King: "With your argument, the additional costs the packers incurred from not being able to sell MBM for cattle feed comes out of the producer's pocket."
That's right!
Econ: Not necessarily. Big packers who do this have a comparative advantage over smaller packers. The lesson of bse was that the short term gains of doing this are far outweighed by the costs. You still can't get that yet, can you? The worst thing about this is that the big packers got a free ride when they were the source of bse transmission in the first place. BSE also caused a rift between Canadian and U.S. cattlemen, another goal of packers--divide and conquer (or just get your way in the meantime).
Lying King: "Didn't you say we had record cattle prices?"
We did have record high feeder cattle prices in the fall of 2005. Didn't you know that? You claim to be a rancher and didn't know that?
Econ: So this was a soley a result of MBM sales as feed? I guess you could say this because the MBM transmission helped cause the decreased supply in the U.S. Market manipulation and higher substitute prices were others.
DO YOU HONESTLY THINK MBM VALUE IS THE ONLY ASPECT OF LIVE CATTLE THAT AFFECTS FEEDER CATTLE PRICES?????
You know Lying King, your biggest problem is that you are too stupid to realize just how stupid you are.
Econ: No, I just stated as much. Thanks for asking the question because I know you have to be spoon fed to understand things. I just get tired of having to spoon feed you. You would think you would grow up instead of the online tantrums you have. Maybe you had some developmental problems as a child?
Lying king: "Were you right?"
Yes! The fall of 2005 showed record high feeder cattle prices.
Econ: So, was this a result of MBM being sold as feed (see above)?
RM: "You're a fool if you believe that...packer's profits have gone to expand their presents in protein markets around the world. This industry is easy to understand when you realize that turning a live animal into a sellable product to the consumers is where the money and the power is!"
You're the fool Robert if you can't see the relation between live cattle prices and boxed beef prices and your a fool if you don't think Excell, Swift, USPB, and Tyson are not in competition with eachother for the same cattle. The obvious is simply too obvious for a packer blamer like you.
If you think turning a live animal into a sellable product to consumers is where the money is at, how do you explain the demise of Future Beef?
How do you explain that USPB's patronage dividends were only $25 in recent years?
SHOW ME THE MONEY ROBERT!!!
What you want to believe and what facts will support are two different things.
Rod: "I'm not sure how the pro-corporate people miss the massive expansions going on, not just in the packing industry, but in industry as a whole. It takes bucks to do that, so obviously the packing industry, especially the Big 3, aren't hurting."
If they weren't making a profit, they would not stay in business. The issue here is how much of a profit and how does that profit affect individual producers.
Pretty easy Rod. The evidence was subpoenoed into court in Pickett. Ibp processed your cattle THROUGH THEIR MOST PROFITABLE YEARS IN RECENT HISTORY and sold everything from the tongue to the rectum at a $26 per head profit.
ONCE AGAIN, THAT IS THE MOST EFFICIENT PACKER IN THEIR MOST PROFITABLE YEARS.
Do you think you are entitled to more of that $26 per head? Then open a packing plant.
You assume that any money spent on expanding infrastructure comes from profits. HAVE YOU EVER HEARD OF GETTING A LOAN??? HAVE YOU EVER HEARD OF INVESTMENT COMPANIES???
Obviously not!
We know what the profits are. That data is available through GIPSA and court records. There's nothing to hide because packer blamers felt that they had a right to know.
Sandcheska: "He's just got some need to be contrary. That requires making foolish statements to back those foolish "opinions"."
No, I have a need to be factual. You have a need to blame and a need to be a part of popular blaming opinion. That's the difference and that's always been the difference.
Go ahead Rod, Robert, Ben, Lying King, and Sandcheska! Refute anything I have stated here with facts to the contrary. WON'T HAPPEN!
I said "FACTS" not "EMPTY STATEMENTS".
~SH~