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HAY MAKER

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U.S. Cattle Producers Praise Effort to Limit Packer Ownership




(Billings, Mont.) – R-CALF USA commends the introduction of legislation by U.S. Sen. Ken Salazar, D-Colo., and U.S. Sen. Chuck Grassley, R-Iowa, that would prohibit packers from owning, feeding or controlling livestock for more than seven business days prior to slaughter, thus ensuring market access for both large and small producers.



Other co-sponsors of the bill include: Sen. Byron Dorgan, D-N.D.; Sen. Mark Dayton, D-Minn., Sen. Mike Enzi, R-Wyo.; Sen. Tom Harkin, D-Iowa; Sen. Tim Johnson, D-S.D.; and, Sen. John Thune, R-S.D.



“Senator Salazar said his goals with this legislation are to keep a check on vertical integration of the U.S. cattle industry, create open and competitive markets, and ensure a place for independent producers in the marketplace,” noted Leo McDonnell, president and co-founder of R-CALF USA. “We agree entirely with the efforts of this bipartisan group, which will result in increased competition for cattle, more fair-access to slaughter space for independent producers, and of course, less market distortion.”



Currently, four meatpackers control more than 80 percent of the beef market. Packers claim any loss in ownership will result in a loss of equity, loss of quality control, and even loss of the domestic cattle industry, but R-CALF USA holds those claims as false. Rather than experiencing a loss of equity, the cattle industry actually would experience an increased infusion of equity into the production chain. This increase will result from packer purchases of the same number of cattle, but at a higher cost because packers will be buying heavier fed cattle, not lighter feeder cattle.



“The packers are in business to slaughter cattle, and the number of cattle they slaughter depends on retail demand for beef, so the packer ban will only change how packers procure the cattle needed to satisfy retail demand,” McDonnell explained. “The ownership ban will require packers to purchase all their fed cattle from feedlots or independent feeders, in turn, creating an increased demand for fed cattle. As a result, feedlots and feeders will have to aggressively buy more feeder cattle from independent producers to place enough cattle on feed to satisfy the packers’ demand for enough beef to satisfy retail demand – the very essence of the free enterprise system our country was founded on.”



States such as Iowa and Nebraska have enacted restrictions on packer ownership of livestock or livestock facilities, and there has been no evidence of financial injury to either packers or producers.



“The percentage of captive supplies continues to increase, and several government reports indicate there clearly is a negative statistical relationship between the use of captive supply and the spot market price of fed cattle, and packer-owned cattle contribute substantially to that negative impact” continued McDonnell.



“Although a ban on packer ownership was removed from the 2002 Farm Bill, we’re happy to see congressional leaders bring the issue to the forefront once again,” he concluded. “If ranchers want fairer prices for their cattle, then the U.S. cattle industry should stand firmly in support of this legislation and work aggressively to ensure it becomes law.”



# # #



R-CALF USA (Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America) represents thousands of U.S. cattle producers on domestic and international trade and marketing issues. R-CALF USA, a national, non-profit organization, is dedicated to ensuring the continued profitability and viability of the U.S. cattle industry. R-CALF USA’s membership consists primarily of cow-calf operators, cattle backgrounders, and feedlot owners. Its members – over 14,500 strong – are located in 46 states, and the organization has over 60 local and state association affiliates, from both cattle and farm organizations. Various main street businesses are associate members of R-CALF USA. For more information, visit www.r-calfusa.com or, call 406-252-2516.
 

Big Muddy rancher

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McDonnell "The packers are in business to slaughter cattle, and the number of cattle they slaughter depends on retail demand for beef, so the packer ban will only change how packers procure the cattle needed to satisfy retail demand,” McDonnell explained. “The ownership ban will require packers to purchase all their fed cattle from feedlots or independent feeders, in turn, creating an increased demand for fed cattle. As a result, feedlots and feeders will have to aggressively buy more feeder cattle from independent producers to place enough cattle on feed to satisfy the packers’ demand for enough beef to satisfy retail demand – the very essence of the free enterprise system our country was founded on.”

I don't know how he figures but their is only so many dollars in a fat steer, only so many need to be processed and only so many need to be fed to meet demand. The packers take their profit when they can, the feedlots take theirs so how is the calf producer going to do any better.
 

Andy

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The only way a cow-calf guy can increase the amount he gets for his calves,long term, is to increase the demand for beef.
 

Big Muddy rancher

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Jinglebob said:
Or perhaps decrease the supply of calves, so there are fewer for the feedlots to bid on and the packer to butcher.

Well jinglebob you don't breed your cows this year and see if that helps. With our prices in canada we have to breed them all.
 

CattleCo

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If I was the Packers I would want to own them ALL!!!!!!! We have R-Calf and NCBA doing everything they can to destroy the beef cattle industry! Hell I would want to own 100% of the kill! Let's see...........we buy cattle or retain ownership in the calves we raise. We feed them at home or in a custom feedyard. We have forward contract opportunities, we can hedge them, or we can do nothing and slide into the market. Is their a law that says we have to sell them on a given day for a given price?? It looks like we have more opportunities to cover our butts than the packers! The Cattle business is not easy.............if your looking for a slam dunk, the beef cattle industry is not your game! I am not saying the packer are lily white, but how many feedyards try to slide a few on the load. I am sure we all know what 40 mph cattle are!!! I am sure Heaven is not overloaded with Meat Packer, Packer buyers, feedyard operators, stocker boys, and God knows their are plenty of empty seat for Cow/Calf producers. As for Auctioneers, and Livestock market owners and fieldmen,
I guess you will have to ask God about that one when you get there!
8)
 

Jinglebob

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Cattle Co-"I am not saying the packer are lily white, but how many feedyards try to slide a few on the load. I am sure we all know what 40 mph cattle are!!!"

I guess I've never heard that phrase before. Would you be so kind as to please enlighten me? Thank you.

And Big Muddy,
maybe you didn't read my post close enough. I said that I didn't believe it would work to not bred cows to limit supply. I think my few ol' cows will get bred this year, but they won't make a dent in all of the heifers and cows that the rich boys are going to breed and buy and start the long downhill spirle of the price of cattle, with an over supply coming on.

I talked to a man who spays heifers and he said that he hasn't hardly had any calls for spaying this spring. That tells me there are going to be lots of heifers get bred this summer.
 

mrj

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CattleCo said:
"We have R-Calf and NCBA doing everything they can to destroy the beef cattle industry!"

Cattleco, don't you owe us an explanation of exactly what NCBA is doing to harm the beef cattle industry? I think you do.
It is quite obvious what R-CALF has done to further that goal. Telling consumers beef might carry BSE comes quickly to mind.
MRJ
 

Murgen

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MRJ, and don't forget who has championed against packer concentration, while setting the environment for just that, in North America, R-calf.

Who in their right mind would argue that the big 4 have 80% of the market and then also argue to cut off the other 20% supply?
 

Hanta Yo

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MRJ said:
CattleCo said:
"We have R-Calf and NCBA doing everything they can to destroy the beef cattle industry!"

Cattleco, don't you owe us an explanation of exactly what NCBA is doing to harm the beef cattle industry? I think you do.
It is quite obvious what R-CALF has done to further that goal. Telling consumers beef might carry BSE comes quickly to mind.
MRJ
\
Another thing comes to mind, and our CW newsletter brought it up. I quote, "New public service announcements promoting a vegetarian diet to solve childhood obesity are airing in some states. The Physicians Committee for Responsible Medicine (PCRM) produced the announcements, which feature overweight kids as "the problem". These new announcements may be viewed online at http://www.perm.org/news/psas/tvhtml under the childhood obesity heading. The stations accepting these PSA's are likely not aware that PCRM is not a group of doctors and health experts, as its name would imply. Rather, this group is connected to the radical animal rights group People for the Ethical Treatment of Animals (PETA) and spends significant resources promoting a strictly vegan diet. For a complete profile of this activist group, please visit www.activistcash.com. If you are aware these PSA's are running in your state and would like assistance responding, please contact us.

SIDE NOTE: I can't help but say it - Do you think R-CALF knew these people didn't care about the beef industry when they aligned themselves with them?" Unquote.

NCBA has NEVER aligned themselves with the groups R-Calf has, and I, too, Cattleco, would appreciate an explanation on how NCBA is ruining the cattle business. I know NCBA and our stockgrowers organizations worked diligently this year since it was a legislative year, to influence the outcome of some of the "bad bills" which have come across the hearings. I, myself have given testimony to several bills for our great state of Montana and the general consensus of Capitol Hill is that our Stockgrowers and membership have gained a LOT of respect from our legislators, and they really listen when we have something to say. This is an area outside of all this debate where no one seems to care! This is what really matters, preventing some really nasty bills from being passed which would REALLY HURT those of us as beef producers. I've heard R-Calf give testimony to bills which aren't in the best interest of the beef industry as a whole. I guess this is what divides R-Calf from the rest of us, we are in the BEEF industry, R-Calf represents the cow/calf producer , (so who cares about the BEEF?) 'Nuf said.
 

Tommy

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Hanta Yo...NCBA has NEVER aligned themselves with the groups R-Calf has

NCBA has aligned themselves with Carol Tucker Foreman group and Nature Conservancy before. Do these two count?
 

HAY MAKER

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The ncba(no cattle born in america) has sided with the packers,they do not represent the cattle man as R CALF does..............good luckPS I dont believe cattleco owes you girls any thing that resembles an explanation,WAKE UP.
 
A

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For the record Hayseed, Thune rocks on most issues of importance but he's unfortunately caving to the political pressure of the "please government, save us from ourselves" R-CULTers on beef issues. How unfortunate!


What could be more communist than allowing the federal government to pick and chose who can and who cannot own cattle based on some packer blaming conspiracy theory?


Quote: "Rather than experiencing a loss of equity, the cattle industry actually would experience an increased infusion of equity into the production chain. This increase will result from packer purchases of the same number of cattle, but at a higher cost because packers will be buying heavier fed cattle, not lighter feeder cattle."

Why haven't I seen any R-CALFers stand up at the sale of their cattle and announce, "I DON'T WANT ANY PACKERS BIDDING ON MY FEEDER CALVES"???

Is this another "CANADIAN BEEF IS UNSAFE YET WE BUY CANADIAN CATTLE" R-CULT hypocritical situation?


Quote: “The packers are in business to slaughter cattle, and the number of cattle they slaughter depends on retail demand for beef, so the packer ban will only change how packers procure the cattle needed to satisfy retail demand,” McDonnell explained."

No the packer ban would change when they purchase them. It would not change what they pay for them.


Quote: “The ownership ban will require packers to purchase all their fed cattle from feedlots or independent feeders, in turn, creating an increased demand for fed cattle. As a result, feedlots and feeders will have to aggressively buy more feeder cattle from independent producers to place enough cattle on feed to satisfy the packers’ demand for enough beef to satisfy retail demand – the very essence of the free enterprise system our country was founded on.”

BULL! The essence the free enterprise system was founded on was free of government interventions like this. I should be able to sell fed cattle any way I see fit without the Livestock Marketing Police dictating to me how I sell cattle based on some bogus market manipulation conspiracy theory.

The essence of the free enterprise system IS TO HAVE THE FREEDOM TO MARKET CATTLE WHICHEVER WAY I CHOOSE!


This is LMA sanctioned bullsh*t to keep cattle routed through their sale barns and keep their commission dollars rolling in. Not only does the LMA want to sell all the feeder cattle, they want to sell all the fat cattle as well. That's two rounds of commission dollars to take away from producer profitability.

When are some of you going to wake up to the fact that the LMA represents themselves, not you.


Quote: "States such as Iowa and Nebraska have enacted restrictions on packer ownership of livestock or livestock facilities, and there has been no evidence of financial injury to either packers or producers."

Now R-CULT justifies their desire for more government intervention based on the amount of financial injury that it creates.


Quote: “The percentage of captive supplies continues to increase, and several government reports indicate there clearly is a negative statistical relationship between the use of captive supply and the spot market price of fed cattle, and packer-owned cattle contribute substantially to that negative impact” continued McDonnell."

READ THIS CAREFULLY!

Didn't R-CULT just use the argument that U.S. packers did not have access to their Canadian captive supply and now they claim that captive supplies are increasing???

This is so typical of this lying, deceptive organization.

The fact is that R-CULT does not accurately measure captive supplies because formula and grid cattle are not captive supply.

R-CULT's communist packer ban legislation would end forward contracts. Those are the same forward contracts that even the Pickett plaintiffs had willingly entered into. This would remove another form of risk management for producers because under forward contracts the packer stands the basis risk.

This industry needs to put an end to allowing R-CULT and the LMA to control this industry.




~SH~
 

Sandhusker

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SH, "What could be more communist than allowing the federal government to pick and chose who can and who cannot own cattle based on some packer blaming conspiracy theory? "

I'd say the Federal Government picking and choosing what can be marketed IN A FOREIGN COUNTRY based on a standard that THEY HAVE NEVER APPLIED BEFORE and DON'T FOLLOW THEMSELVES reeks of unneccesary governmental intervention.

SH, "This industry needs to put an end to allowing R-CULT and the LMA to control this industry."

I thought R-CALF was just an isolationist group whos days were numbered. Now they control this industry?
 

Big Muddy rancher

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Tommy said:
Hanta Yo...NCBA has NEVER aligned themselves with the groups R-Calf has

NCBA has aligned themselves with Carol Tucker Foreman group and Nature Conservancy before. Do these two count?

Tommy fill me in on your problem with the Nature Conservancy.
 

rancher

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Big Muddy rancher said:
Tommy said:
Hanta Yo...NCBA has NEVER aligned themselves with the groups R-Calf has

NCBA has aligned themselves with Carol Tucker Foreman group and Nature Conservancy before. Do these two count?

Tommy fill me in on your problem with the Nature Conservancy.

Do a search on them.
 

Big Muddy rancher

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rancher said:
Big Muddy rancher said:
Tommy said:
Hanta Yo...NCBA has NEVER aligned themselves with the groups R-Calf has

NCBA has aligned themselves with Carol Tucker Foreman group and Nature Conservancy before. Do these two count?

Tommy fill me in on your problem with the Nature Conservancy.

Do a search on them.


Yea I can do a search but I wanted to know what Tommy's problem was with them. Are they all bad or portions of their programs. I do know that they are concerned with grassland conservation. Is that the problem. They sign Conservation Easements to let ranchers protect Grasslands. Is that your problem. I was asking so why don't you guys tell me.
 

agman

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Jinglebob said:
Or perhaps decrease the supply of calves, so there are fewer for the feedlots to bid on and the packer to butcher.


What you describe is a prescription for disaster. It was this process that alluded people into thinking there was no demand problem from 1980-1998. Prices went up but it was at the expense of a shrinking industry. It is only a matter of time that such a means to raise prices, limiting supply, will eliminate you from the business. The long term solution to profitability and growth is the domain of increasing beef demand. Unless beef demand grows this industry will shrink long term.
 

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