HDRider
Well-known member
Maybe you got this e-mail from
How 4 companies control the beef industry
- Thread starter HDRider
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Thanks for sharing.
Very good video, Thanks for posting. The government is currently looking into this and it's both a good thing and a little scary. The quote I heard was "we want the producers to get a fair price for their product". Not sure I like the Biden admin deciding what a "fair"price for my efforts is. Especially when they want food prices lowered. Unfortunately it's our only hope at this point.
SBMF 2015
Well-known member
Has everyone been living under a rock?! This isn't new. It's been going on since the Chicago Stockyards were built.
Cattle feeders have historically had the smallest profit margins. That's why so few of us do it.
And don't think the best industry is the first sector of Ag to go through this. Just ask someone who used to raise broilers or any farmer in the Midwest that used to raise hogs outside.
It's not going to change, and the last thing we want is more gov regulations in our industry.
Maybe you'll get $2/lb for fat cattle, but if the gov needs $.90 for environmental concerns. Then we are worse off than we are now.
Cattle feeders have historically had the smallest profit margins. That's why so few of us do it.
And don't think the best industry is the first sector of Ag to go through this. Just ask someone who used to raise broilers or any farmer in the Midwest that used to raise hogs outside.
It's not going to change, and the last thing we want is more gov regulations in our industry.
Maybe you'll get $2/lb for fat cattle, but if the gov needs $.90 for environmental concerns. Then we are worse off than we are now.
J+ Cattle
Well-known member
My prediction is that the meatpackers will eventually use some of those big profits they're making to buy out some of the cow/calf ranchers as they go out of business. Then they will control the entire supply chain from start to finish just like they do for poultry and pork. Or they will get you to be a "contract producer" where you can supply cattle to them but they control everything from the breeding decisions, health protocols and feeding. The key being they are in control and you're just an employee at that point.
Maybe you got this e-mail from
Thanks for sharing, HD.
Lee VanRoss
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There is a family I know living about 4 miles from me who have 3 big facilities for broiler chickens. I do not know their
production amount but they do ship a lot of manure. Their father and granddad used to run 250- 300 head of stock
cows along with corn, beans and hay ground. They had some land that bordered us and I like them as people.
I will not comment on the condition of their fences
production amount but they do ship a lot of manure. Their father and granddad used to run 250- 300 head of stock
cows along with corn, beans and hay ground. They had some land that bordered us and I like them as people.
I will not comment on the condition of their fences
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HDRider
Well-known member
It would take a lot of land, or some new way of feeding to vertically integrate beef like chickens or pork.
Son of Butch
Well-known member
I think you're right about contract production as their future model.
Too much risk owning the cow/calf side. Contracting will reduce their risk and liability of government regulations, while allowing them to achieve their goals. Controlling both the market and the end product.
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HDRider
Well-known member
Why would they do that when they have us raising beef at or below our costs?
As long as there is a good supply nothing changes, even 20 years from now there is no leverage. We are stuck in 1990 prices. Each farmer competes against each other and a lot of people post they are pretty happy with the price they get. Either Keep on keeping on or sell the cattle.
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HDRider
Well-known member
To repeat some of the things in the video
... so few meatpacking plants left – just 50 process 98 percent of America's meat supply
The closure of 90 percent of American meat plants over the last 50 years isn't due to a lack of knowledge or a failure to reinvest in facilities – it's due to decades of lax antitrust enforcement.
This isn't the first time the meat industry has had a problem with consolidation. When just five major meat packers controlled the market 100 years ago, Congress passed the Packers and Stockyards Act to "assure fair competition and fair trade practices, to safeguard farmers and ranchers…to protect consumers…and to protect members of the livestock, meat, and poultry industries from unfair, deceptive, unjustly discriminatory and monopolistic practices."
Drovers: Joaquin Contente: Smaller Plants Are the Answer - News.MikeCallicrate.com | A NoBull News Service
Joaquin Contente: Smaller Plants Are the Answer Joaquin Contente – California Farmers Union May 6, 2020 12:36 PM Small butcher plant worker ( David Sommerstein/NPR ) The opinions expressed in the following commentary are those of Joaquin Contente, president of California Farmers Union, Hanford...
news.mikecallicrate.com
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HDRider
Well-known member
Also talked about in the video
Today, four firms handle nearly 80 percent of all steer and heifer slaughter; just two decades ago, concentration was less than half as high.
Today, four firms handle nearly 80 percent of all steer and heifer slaughter; just two decades ago, concentration was less than half as high.
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HDRider
Well-known member
More from the video
thecounter.org
USDA looked at what's called a "price spread," which measures the difference between what processors pay for live cattle and what they charge wholesalers and retailers for a standard box of beef products. Effectively, it's a measure of the meatpackers' cut of profits, which can contract and expand depending on supply from producers and demand among consumers. For reference, the average price spread between 2016 and 2018 was $21 per one hundred pounds, USDA notes. By the second week of May this year, price spread had spiked to $279 per hundred pounds.
Bradley S. Lyle, chief financial officer of Kerns and Associates, which conducts meat market research and analysis. "Profit margins increased substantially."
The steepest increase took place within that time, when the spread spiked from $66 per one hundred pounds to over $279 per hundred pounds. "Beef packers have had good margins for the past two to three years, but this tripled it," Lyle says.
Beef packers’ profit margins reached historic levels during the height of Covid-19 plant shutdowns
Between April and May, producers saw their cattle prices plummet. Meanwhile beef prices at the grocery store nearly doubled.
thecounter.org
chaded
Well-known member
I'm sure cheap imports don't help the uphill battle we face either.
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HDRider
Well-known member
That is another lever, and an unfettered one, that can be used against uppity American beef producers.
We don't even label where the beef comes form.
I wish I could find something more current
The United States is the world's largest producer of beef but it also imports more beef than any other country. U.S. producers specialize in raising high-value, grain-fed cattle, while the beef the United States imports from other countries is mainly lower-value, grass-fed, lean product that is processed into ground beef. Overall, imports accounted for nearly 14 percent of U.S. beef supplies in 2015.
From 2011-2013, the United States was a net exporter of beef on a volume basis. However, imports surpassed exports in 2014 when domestic production declined nearly six percent.
A Review of U.S. Tariff Rate Quotas for Beef Imports
The United States is the world’s largest producer of beef but it also imports more beef than any other country.
Packers win on imports by putting pressure on producers, and on exports because they are they exporting institution.
Banner Year for U.S. Beef Exports in 2021
Son of Butch
Well-known member
Why contract with cow/calf producers?
To control product flow and quality at minimum expense.
Son of Butch
Well-known member
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HDRider
Well-known member
You think American beef has a quality problem?
Son of Butch
Well-known member
Yes sir. Do you think there is no room for improvement?
