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dun

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Canadian Trade Resumption Is Anyone's Guess
Wait and see. That seems to be the consensus of most cattle producers in light of USDA's proposed rule that would open the Canadian border to live cattle trade March 7; that rule issued on the same day Canada announced finding the first of two new cases of BSE within a month.

Based on visiting with producers, and an exclusive BEEF magazine reader survey conducted two weeks ago, it seems the majority of producers support resuming trade with Canada, but only when the U.S. is sure cattle and beef from there pose no additional health and market risks to folks on this side of the border.

On either side of this opinion you have those who believe isolationism is a market's best friend, and at the other extreme, those who say, "Damn the torpedoes and full speed ahead!" Mixed in among these groups are those who would also like to make Canadian trade resumption contingent upon resumed beef export trade with Japan, which of course, is a whole 'nother story. Speculation and news reports on that front continue to swing from optimistic to hopeless.

Despite lawsuits, ubiquitous industry caterwauling and podium pounding from some legislators, so far USDA shows no overt signs of budging from its rule. In fact, according to DTN reports, soon-to-be former Ag Secretary Ann Veneman said last week there was no reason to delay opening the border. Of course, any statement you make carries less water than a flea's thimble when you've been shown the door.

Incidentally, Leo McDonnell, R-CALF president, sent a letter to Jan Lyons, president of the National Cattlemen's Beef Association (NCBA), inviting NCBA to join them in the lawsuit R-CALF filed against USDA to force the agency to withdraw the rule. In her reply, Lyons explained, in part, "...We do not support litigation as the preferred means to reach a solution... Our firm belief is cattlemen should determine how to proceed -- not a single judge far removed from agriculture. At this time, we do not support your litigation as a means to resolve this issue."

Lyons also pointed out,"...It is not in our producer members' interest to align ourselves with an organization that continues to question the safety of beef sold here in the U.S., as you have done as recently as Jan. 16 in your press release. Nor will we align ourselves with activist groups whose intent is to remove cows from the land and beef from the dinner plate."

At various times, we've been accused of being both NCBA lovers and haters. In this case, all we can say is, "Bravo, President Lyons!"

In the meantime, both USDA and NCBA had trade teams conducting investigations in Canada last week. While the list of concerns was long, the most pressing for many producers is getting to the bottom of Canada's compliance with the ban on feeding ruminant protein. The concern was magnified with the knowledge that the latest BSE case was discovered in an animal born after the ban was put into place, and renewed focus on reports in a Canadian newspaper claiming a Canadian Food Inspection Agency inspection last summer found the majority of vegetable-only feed samples to contain animal protein.

Two things are certain at this point. First, the USDA rule is on the books. That means that unless the agency changes its course, the border is set to open March 7. Second, as evidenced by markets the past two weeks, any hint or innuendo will continue to add volatility.

Our crystal ball is no more transparent than anyone else's, but we find it difficult to believe USDA's rule won't at least be delayed in the name of domestic consumer confidence. Wait and see.
 
Ironically, wait and see is something that we've become very expert at doing. Personally, I'm all for doing some seeing one way or the other, and to heck with the waiting business.

Good article.

Take care.
 

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