Third Black Swan event

Help Support CattleToday:

OP
HDRider

HDRider

Well-known member
Joined
Jul 25, 2011
Messages
5,979
Reaction score
520
Location
NE Arkansas
It’s Worse Than Even We Predicted R-CALF USA Radio Segment May 4, 2021

In our last segment we discussed how the fed cattle market has had three Black Swan events in less than two years – three times that wholesale beef prices rallied hard and three times that fed cattle prices collapsed.

We’re witnessing the third Black Swan event right now. Wholesale beef prices have been climbing since mid-April and yet fed cattle prices are inexplicably falling.

We’ve warned for years that the multinational beef packers, who long ago perfected their vertical integration models in the poultry and hog industries, are now working to do the same thing to the U.S. cattle industry. That is, they’re capturing control of the live cattle supply chain away from producers and away from competitive market forces.

The model they perfected in the hog industry has at its core a strategy of shrinking the cash market to a level where it is certain to no longer function to establish competitive prices. This was accomplished by shifting large volumes of hogs out of the cash market and placing them under the packers’ control through formula contracts and other alternative marketing arrangements, collectively known as captive supply arrangements.

They’re doing it now to the cattle industry.

Read the rest here
 

ccr

ranch hand
Joined
Jul 6, 2017
Messages
795
Reaction score
209
Location
ne texas
Thanks HD, but if there isn't the cow/calf producer how could even the big packers make it?

Doesn't it all start with the cow/calf producer? If the cow/calf producer is wiped out where's the beef for the packers?

I may not be smart enough to understand exactly what Mr. Bullard is talking about.
 
OP
HDRider

HDRider

Well-known member
Joined
Jul 25, 2011
Messages
5,979
Reaction score
520
Location
NE Arkansas
Thanks HD, but if there isn't the cow/calf producer how could even the big packers make it?

Doesn't it all start with the cow/calf producer? If the cow/calf producer is wiped out where's the beef for the packers?

I may not be smart enough to understand exactly what Mr. Bullard is talking about.
We do need packers.

We do not need packers that have complete end-to-end control of the market
 

Ky hills

Well-known member
Joined
Feb 4, 2016
Messages
3,711
Reaction score
1,435
Location
Clark County, KY
Thanks HD, but if there isn't the cow/calf producer how could even the big packers make it?

Doesn't it all start with the cow/calf producer? If the cow/calf producer is wiped out where's the beef for the packers?

I may not be smart enough to understand exactly what Mr. Bullard is talking about.
My guess is the big packers are still counting on having cow/calf producers, just not American cow/calf producers.
 

ccr

ranch hand
Joined
Jul 6, 2017
Messages
795
Reaction score
209
Location
ne texas
So when Bullard says the cow/calf producer will be wiped out, he's referring to live cattle coming from Brazil or some where other than here, which I don't understand how can it be more profitable to transport live cattle to the U.S. and be less expensive than raising beef here. Or is he saying importing processed beef into the U.S.?

Not trying to be argumentative with Mr. Bullard, but trying to understand exactly what he's talking about.
 

Pete392230

New member
Joined
Jun 14, 2021
Messages
3
Reaction score
1
Thanks HD, but if there isn't the cow/calf producer how could even the big packers make it?

Doesn't it all start with the cow/calf producer? If the cow/calf producer is wiped out where's the beef for the packers?

I may not be smart enough to understand exactly what Mr. Bullard is talking about.
It will be like the chicken and hog producers , they starve out the producers buy up the larger ones for pennies on the dollar , hire workers to work the ranches long enough to put the independent producers out business then the big 4 can control the mass of the market and charge what ever price they want from beginning to end prices even overseas beef will be coming in from places with no regulation or oversight, the feed gain bussiness will be next. Why does Bill Gates own more farm land in the US than anyone else???
 

gusea305

Member
Joined
Jul 8, 2017
Messages
21
Reaction score
21
Location
Coast Range Mountains- Pacific North Wet
Let them have the mass market. Small producers should band together outside of the angus industrial complex. We should be raising beef from conseption to consuption. We need USDA inspected niche slaughterhouses. There is plenty of work out there to hire people and raise families. We need to get people selling by the lb at farmers markets or to their friends and familes. That word of mouth will go through the roof. I know that the grass fed and finshed market in the PNW can handle at least $7 per lb for burger, 8 lb for roasts 10 lb for sirloin, 12 new yorks, 15 ribeyes and 18 tenderloin. Any overabundance of burger can be sold to niche restaurants at more of a wholesale price, and the sirloins and topline will be our bottom line.

High quality forage and haylage is important to finish them, and it takes a good 120 days.

Another way to go would be like what Burgerville does. They have tons of small producers all over the PNW who are part of a consortium. They go out and pick up the animals and take them back to Hermiston if i remember right. The owner of the animals owns them untill slaughter. Burgerville has found that they get the right fat content by feeding potato and pea residue for 60 day i believe. Then they purchase the animal. If you are out this way contacting them might be a good idea for you.

I know that Oregon State Extension Services puts producers together and discusses ranching etc. They also have many programs people can get into to help themselves. Check your local extension services.

Grow a product that brings people to you . Stop selling at auction houses until there is recognition from the market as to what our product is rather than what it is not. The difference between what a small producers can do vs. industry is not even comparable. Our products can be far and away higher quality.

Lobby your representatives at all levels, cause you know the big boys are. Watch out for legislation from big beef and fight it.

It will take the people to do this. But i would rather grow a product i can stand behind rather than a cookie cutter animal that the general public will eat because they do not care what they put in their body enough to find out the difference. Who will pay attention? The people wanting a greener world. Maybe we can bring them along via "Conservation" rather than "environmentalist" ideas, because it isnt going away. We must adapt.

What else could be accompilshed? Right now the big thing is cattle production causing the offgassing of greenhouse gasses. Some try to blame beef farts. They are uneducated and need reeducating. The methane being released is not from the cattle. It is from the production of urea from natural gas. That urea is used as feed, fertilzer, etc. We can let the big boys keep using that to their hearts content in vast quantities where we use targeted fertilization in our fields. This will drastically reduce the amount of urea used to produce our beef and we can show how we are helping the environment by doing what we do, and let them blame big ag.

If you think this is bs ok, but the people are believing it so we must adjust our marketing tactics and buisness plans to these ideals.

We can win but we must stick together. We can raise small producer income and raise out families better on fewer animals.

These are just my ideas and that is all they are worth, but please chew on it a bit.
 
Last edited:

Ky hills

Well-known member
Joined
Feb 4, 2016
Messages
3,711
Reaction score
1,435
Location
Clark County, KY
There’s a lot going on and the folks that have been supposed to be working for us are at best asleep at the wheel or more likely in the pockets of the big packer monopoly. I’ve been seeing advertisements on tv for the stupid fake chicken nuggets, where the he77 is the beef cattle association. At least dust the cobwebs off the 30 year old Beef It’s What’s For Dinner slogan or something other than just ttheir members what all they are doing on their behalf.
We as producers need to come together and come up alternative ideas other than the conventional feeding the machine production style so to speak.
I don’t think the USDA is interested in changing their business model of inspections because the packers are influencing the government agencies and politicians.
I used to think state inspections as opposed to relying on USDA inspectors would be a viable option, but honestly that would not be any different or any more accommodating. I believe we should able to sell the meat either privately or possibly through a coop that could accommodate larger local customers such as restaurants and schools. They have those kinds coops for larger volume vegetable growers. I definitely think individuals should be able to market end product locally without the red tape of inspections.
We were a part of a local farmers market for a while selling vegetables and eggs. There were meat vendors there but a limited amount of customers. I’ve heard that other larger markets in bigger cities had a lot more people coming to the markets however the price for being a part of those is pretty expensive in itself and quite a bit of competition for vendors vying for acceptance in them. Ours was small yet still more expensive to be a member than it should be and a lot of state regulations and requirements as far as selling certain things and especially home based processed items. Then there were the rules both written and unwritten gentlemen’s agreement type rules by the local market board that were often ridiculous. There is a lot to be taken into consideration when working with or within a group of folks.
 

shaz

Well-known member
Joined
Jan 9, 2010
Messages
2,084
Reaction score
385
Location
Middle Tn
My guess is the big packers are still counting on having cow/calf producers, just not American cow/calf producers.
The cow/calf sector is basically the industry bottleneck. You need a lot of land. I don't think imports can completely run us out of the business due to the lack of land available.

Sure we have a packer problem but domestic consumption is the REAL problem.
 
OP
HDRider

HDRider

Well-known member
Joined
Jul 25, 2011
Messages
5,979
Reaction score
520
Location
NE Arkansas
Let them have the mass market. Small producers should band together outside of the angus industrial complex. We should be raising beef from conseption to consuption. We need USDA inspected niche slaughterhouses. There is plenty of work out there to hire people and raise families. We need to get people selling by the lb at farmers markets or to their friends and familes. That word of mouth will go through the roof. I know that the grass fed and finshed market in the PNW can handle at least $7 per lb for burger, 8 lb for roasts 10 lb for sirloin, 12 new yorks, 15 ribeyes and 18 tenderloin. Any overabundance of burger can be sold to niche restaurants at more of a wholesale price, and the sirloins and topline will be our bottom line.

High quality forage and haylage is important to finish them, and it takes a good 120 days.

Another way to go would be like what Burgerville does. They have tons of small producers all over the PNW who are part of a consortium. They go out and pick up the animals and take them back to Hermiston if i remember right. The owner of the animals owns them until slaughter. Burgerville has found that they get the right fat content by feeding potato and pea residue for 60 day i believe. Then they purchase the animal. If you are out this way contacting them might be a good idea for you.

I know that Oregon State Extension Services puts producers together and discusses ranching etc. They also have many programs people can get into to help themselves. Check your local extension services.

Grow a product that brings people to you . Stop selling at auction houses until there is recognition from the market as to what our product is rather than what it is not. The difference between what a small producers can do vs. industry is not even comparable. Our products can be far and away higher quality.

Lobby your representatives at all levels, cause you know the big boys are. Watch out for legislation from big beef and fight it.

It will take the people to do this. But i would rather grow a product i can stand behind rather than a cookie cutter animal that the general public will eat because they do not care what they put in their body enough to find out the difference. Who will pay attention? The people wanting a greener world. Maybe we can bring them along via "Conservation" rather than "environmentalist" ideas, because it isnt going away. We must adapt.

What else could be accomplished? Right now the big thing is cattle production causing the offgassing of greenhouse gasses. Some try to blame beef farts. They are uneducated and need reeducating. The methane being released is not from the cattle. It is from the production of urea from natural gas. That urea is used as feed, fertilizer, etc. We can let the big boys keep using that to their hearts content in vast quantities where we use targeted fertilization in our fields. This will drastically reduce the amount of urea used to produce our beef and we can show how we are helping the environment by doing what we do, and let them blame big ag.

If you think this is bs ok, but the people are believing it so we must adjust our marketing tactics and business plans to these ideals.

We can win but we must stick together. We can raise small producer income and raise out families better on fewer animals.

These are just my ideas and that is all they are worth, but please chew on it a bit.
Good ideas. Big money makes sure they don't pan out. The meat oligarchs worked long and hard to get where they are and will fight hard to stay there
 

Ky hills

Well-known member
Joined
Feb 4, 2016
Messages
3,711
Reaction score
1,435
Location
Clark County, KY
The cow/calf sector is basically the industry bottleneck. You need a lot of land. I don't think imports can completely run us out of the business due to the lack of land available.

Sure we have a packer problem but domestic consumption is the REAL problem.
I don’t think it would ever be total importation, but as another person pointed out that’s a leverage. The packers want a vertically integrated system like hogs and chickens. I may be wading out into a reach with this comparison but I believe it has some similarities to the tobacco industry. Years ago about all the farms around here raised tobacco. Some folks just a few thousand pounds others 50,000 or more. That was all under the quota system, and sold through auctions. lots of folks leased in more pounds to expand. The various lawsuits were blamed but eventually the quota system ended and the companies started contracting directly with growers over time the companies were mostly operating from global offices and redefined their marketing to focus more on production and sales in other countries. The US growers got fewer and fewer contracts and production is now very rare except on fairly large scale.
I’ve often heard the justification for importing beef was that we produced a higher grading product as a whole and that there wasn’t enough domestic ground beef. That doesn’t make sense it can’t both be not enough and a lack of demand for the product. There is a slight of hand going on and it’s such that those who could and should ferret it out must have plenty of incentive not to.
 
OP
HDRider

HDRider

Well-known member
Joined
Jul 25, 2011
Messages
5,979
Reaction score
520
Location
NE Arkansas
There’s a lot going on and the folks that have been supposed to be working for us are at best asleep at the wheel or more likely in the pockets of the big packer monopoly. I’ve been seeing advertisements on tv for the stupid fake chicken nuggets, where the he77 is the beef cattle association. At least dust the cobwebs off the 30 year old Beef It’s What’s For Dinner slogan or something other than just ttheir members what all they are doing on their behalf.
We as producers need to come together and come up alternative ideas other than the conventional feeding the machine production style so to speak.
I don’t think the USDA is interested in changing their business model of inspections because the packers are influencing the government agencies and politicians.
I used to think state inspections as opposed to relying on USDA inspectors would be a viable option, but honestly that would not be any different or any more accommodating. I believe we should able to sell the meat either privately or possibly through a coop that could accommodate larger local customers such as restaurants and schools. They have those kinds coops for larger volume vegetable growers. I definitely think individuals should be able to market end product locally without the red tape of inspections.
We were a part of a local farmers market for a while selling vegetables and eggs. There were meat vendors there but a limited amount of customers. I’ve heard that other larger markets in bigger cities had a lot more people coming to the markets however the price for being a part of those is pretty expensive in itself and quite a bit of competition for vendors vying for acceptance in them. Ours was small yet still more expensive to be a member than it should be and a lot of state regulations and requirements as far as selling certain things and especially home based processed items. Then there were the rules both written and unwritten gentlemen’s agreement type rules by the local market board that were often ridiculous. There is a lot to be taken into consideration when working with or within a group of folks.
You see here on HT how we can't agree on squat.

Getting independent people to row the same boat is hard, and then you have big money and big government making sure the little guy is shut out
 

Latest posts

Top