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The "Salmon Run"

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Mike

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From the Canada Bureau of Competition Analysis:

The conclusions from the analysis are as follows:

* While there is no appreciable monopsony market power exertion by beef packers in fed cattle markets, there is significant monopsony market power exertion in cull cattle markets.
* All market power parameter estimates are well below levels that would be consistent with collusion.
* Most likely, the post-event observed price patterns are likely the result of both shifts in demand (i.e., absence of US demand for live cattle) and changes in market power exertion. Modest market power exertion at multiple stages in the supply chain likely resulted in double-marginalization which compounds the effect on price. These results are consistent with model simulations.

It is important to note that Dr. Love’s analysis relied on publically available data and, as a result, there were several quite important data availability constraints.



Isn't the "Cull Market" where Canada took such a big hit?

"Publicly available data"............ :lol: Quite an "AUDIT"!!! :roll: [/b]
 

DiamondSCattleCo

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Mike said:
It is important to note that Dr. Love’s analysis relied on publically available data and, as a result, there were several quite important data availability constraints.

Isn't the "Cull Market" where Canada took such a big hit?

"Publicly available data"............ :lol: Quite an "AUDIT"!!! :roll: [/b]

Thanks for posting this Mike. I'd meant to comment on it in the other thread where it was posted.

Every single "audit" that was performed was a joke. Due to the ineptitude of our courts, actual financial auditors were never allowed to inspect the actual books of the packers. Rather, law clerks, who are NOT qualified to make inspections, compiled summary numbers and then provided these summary numbers to the financial auditors. In every case, each of the audit documents stated this disclaimer. Just for curiosity sake, I checked the independent American audits that were performed. They either used public data, or the data compiled by the law clerks in Canadian Competition bureau's audit.

Garbage In, Garbage Out. And since I'm sure someone is going to ask me to prove wrong doing, I'm only going to say this once:

The audits purpose was to prove wrongdoing, and with the limitations imposed by the data provided to them, such a job would be impossible or close to impossible to do.

As a taxpayer, its not my job to provide proof of wrongdoing, however it is my right to point out where the courts and/or governement have failed to protect its people. This is one of those times.

Rod
 

Big Muddy rancher

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The cull market was bad and is not alot better. There was one major packer buying culls XL. Not Tyson. When they couldn't kill OTM and UTM in the same plant Tyson killed UTM along with Cargill. XL, Nillson Brothers from Alberta had most of the cow kill to themselves. The only time the market did pick up was when regulations changed allowing Tyson to kill both types in the same plant. It did show that they competed for the cattle.
 

rkaiser

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Come on Big Muddy. During the time when Nillsons were lapping up the spilled milk, Cargill and Tyson were skimming the cream for crying out loud.

I'm not going to defend Nillsons, but continuing to make Tyson and Cargill out to be angels is truley browning your nose.

The rules just happened to change at a favourable time for Tyson, don't you think? UTM cattle spread dropped and Tyson starts killing cows.

Good gravy Big Muddy, has Tam been feeding you the sugar agin.
 

Big Muddy rancher

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Read the original post Randy. You can make any senario fit your BIAS.

If you want to debate then DEBATE. leave the BS in the barn. Why did cows pick up when Tyson was able to kill cows them the rules changed back not allowing them to kill cows and the price dropped.

If cows wasn't the the problem why was Big C looking to put up a cow plant and not a UTM plant?
 

Mike

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No one answered my question on the cull prices in Canada during the "Run".

Didn't I hear some Canadians saying that cull prices were around a nickel?
 

Big Muddy rancher

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Date: October 22, 2003 Total Cattle: 198
D1 & D2 Cows Avg. 0.15 And Sold Up To 0.20
D3 Cows Avg. And Sold Up To
Triple "C" Cows Avg
(Canners/Clunkers/Cripples) And Sold Up To
Walking Dead Cows Avg And Sold Up To
Slaughter Bulls Avg. 0.15 And Sold Up To 0.20



Weren't many D3 or D4 cows sold. anything that was a canner or clunkers was sent a bill for disposal .
 

DiamondSCattleCo

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Mike said:
Didn't I hear some Canadians saying that cull prices were around a nickel?

The neighbor shipped some culls that no saled. They were fat, and when he asked where they went, the market told him they were hauled out to the slaughter plant. So there were some freebies 1400 lb animals.

Kelvington recorded some sales with 2 cent and 5 cent culls. And before anything is said, these were healthy culls. Kelvington doesn't allow skinny gummers through the ring.

Rod
 

Mike

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That's chilling. Sometimes the culls will be the money you live off of.

I remember now ya'll were saying cull bulls weren't hardly worth the trip.
 

rkaiser

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You bet Mike. A nickle would buy quite a few.

Okay BMR, I like the bias thing. You have yours, and apperantly I have mine.

Did I ever say that the cow thing was not a problem? And yes BIG C saw it as one that could possibly be solved. Yes Nillsens were cashing in, but no where near what Cargill and Tyson were cashing in on a one on one animal basis.

All OTM cattle were afected by the SRM removal thing and the value simply did not relate. 5 to 20 cent cows vs the pre BSE prices still brought less profit than the extreme profit made in fat cattle at the time.

Sure cows picked up after Tyson started to kill cows again, but that was not until after the spread on fats became tighter. Basis has changed since the border has been open to utm's due to COMPETITION from packers across the line. Cows however are still a bargain, therefore another good move for Tyson at Brooks, and Cargill at High River to move to killing cows.

Tell me when you were in the grocery store last BMR, have you noticed the cow meat in the display case. It is a pathetic situation in Canada right now. Our consumers are being fooled into thinking they are eating Prime Alberta beef when most of what is offered is cow meat that can't find it's way to America. This is an extremely dissappointing situation that is costing us consumers here at home, and folks like BMR will probably even deny that it is happening.

I guess time will tell.

The Canadian thing has been all about competition all the way through BMR. I agree that cow prices moved up and down due to the rules Tyson had to deal with. They can't control everthing after all.
 

Big Muddy rancher

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I was hauling 10,000 pounds of nice grass fat dry cows and getting$1800 dollars for the load. Used to beable to buy a trailer with a load of culls and then you couldn't buy a set of tires for one. The auctions shut down for a while that first summer. Producers used to beable to deliver direct to the plant but since Nilsons owned the auction yards and the plant they made everybody haul to the yards and pay $18 dollar assembly charge and freight to the plant. Some hauled cows 50 miles north to a yard to have them hauled 140 miles south to the plant.
 

rkaiser

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Sure got a thing for Nillsen Bros. don't you BMR. What seems to be the problem. Were they, or are they breaking the law -- or are they simply operating like their good corporate uncles, within the law and concerned for the producers of this country. :roll:

Hard to believe you can be so hard on Nillsens and so forgiving to Cargill and Tyson. What's up with that BMR?
 

Mike

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The paragraph I like in the report. Tells it all..............

"6 Dr. Love notes that, while the observed decline in cull cattle prices may be due to packer exertion of market power, the decline may also be explained in part by packer disinclination to use older cattle found in the cull market after the BSE event."
 

Big Muddy rancher

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Tyson could not kill OTM cattle in the same plant as UTM. The UTM cattle are higher valued and if they become OTM that would have hurt us alot more then keeping our culls for a while longer. Does it make good sense to kill OTM cattle with no market and tie up freezer space? Or did it help themselves(for Randy) and the industry as a whole to kill and export UTM?
 

rkaiser

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Here we go with Tyson helping the producers of Canada thing again. :roll:

Maybe you should be thanking Nillsens for taking your cows while you're at it BMR. :wink:
 

Econ101

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Dr. Love looked at market power plays. They are different from the allegation that Tyson and Cargill (maybe others) profited heavily from being able to buy cattle cheap and still sell them high to the U.S. market due to the BSE crisis. Love's analysis may have been totally accurate on market power and its influence and still not answer the questions producers were asking.

If the Alberta report did not look into that allegation accurately, the report was just a waste of time and taxpayer money.
 

Jason

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For the record, XL (Nilson's or Nielson's) had feedlots full of cull cows that didn't need feeding, but had to be "stored" somewhere until they could kill them.

I know the guys at Balog's said XL was the only cow buyer and they could have paid anything they wanted, but settled on 20 cents as a base bid. One bid, 20 cents on every cow.
 

DiamondSCattleCo

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Econ101 said:
If the Alberta report did not look into that allegation accurately, the report was just a waste of time and taxpayer money.

The Canadian study was SUPPOSED to look into it, however its awful tough to gain a true view of profitability when real financial auditors aren't allowed to look at the books. I won't even bother mentioning the 9 months it took to get them open enough to let legal clerks at them. Can you imagine how much could be hidden in 9 months, especially from the eyes of someone who isn't trained to see?

Rod
 

Econ101

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DiamondSCattleCo said:
Econ101 said:
If the Alberta report did not look into that allegation accurately, the report was just a waste of time and taxpayer money.

The Canadian study was SUPPOSED to look into it, however its awful tough to gain a true view of profitability when real financial auditors aren't allowed to look at the books. I won't even bother mentioning the 9 months it took to get them open enough to let legal clerks at them. Can you imagine how much could be hidden in 9 months, especially from the eyes of someone who isn't trained to see?

Rod

I guess they didn't want the accusation to be found true which would lead to packers under the gun for getting such a large bailout that was totally unnecessary.

Don't feel too bad about it, Rod. The USDA is just about as bad or worse.

How did our governments turn and start representing the existing power structure and not the people? Why should we have such sell out or incompetent politicians? Shouldn't we all be asking/demanding accountability?
 

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