Question and Answer with John Gillespie, Ontario feedlot operator and Chairman of the Beef Information Centre:
So where do we go from here?
“We are a textbook case of a mature industry. Profitability will work its way down to the flatline where there is nothing left. Then generally it will break through that line and supplies will decrease and prices will spike. I think we’re getting close to that point now. Right now the cow-calf industry needs a signal to expand and the only way is for them to get more money.
I don’t think it will happen this year, maybe next but it depends on grain prices, the cash croppers are going to fill the bin this year, by next year we could have a surplus of grain and there will be lots of feed, calf prices will shoot up and the cow-calf guy will start to expand again.
Right now they are not getting the price signal. There is a definite feeling of pessimism in the cow-calf industry right across the country. It’s getting a little too tight, money-wise but it will turnaround.”
How do we know when we are at the bottom of the market?
“Well, you know the feeling at the top - there’s elation, enthusiasm, everything is great. At the bottom of the market you feel really beat up. You have to identify what the bottom of the market is, what it feels like.
It feels like right now.
“Convince yourself this is an opportunity. Now you can buy low. Anybody can quit at the bottom of the market, it is like quitting when you feel tired instead of quitting when the job is done.
Keep yourself going. The guys who get through this are going to be rewarded.”
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Showing posts with label Canadian Cattlemen's Association. Show all posts
Showing posts with label Canadian Cattlemen's Association. Show all posts
At home, the National Farmers’ Union of Canada (NFU) claims to be interested in advancing the interests of Canadian cattle producers. Abroad - they conspire with one of the most negative groups ever known to the Canadian cattle industry – R-CALF. NFU shares a lot in common with R-CALF – putting it bluntly, both fringe groups prey on the emotions of honest cattle producers, many in desperate situations. In NFU Canada’s February 13 news release, Neil Peacock states the best way to advance their ‘shared interests for cattle farmers’ is by “Forming a coalition to pursue common objectives and speak to governments with a common voice is a critical step toward success for all North Americans”.
R-CALF and NFU Canada advocate trade barriers so that they don’t have to worry about competition. Unfortunately their beggar-thy-neighbour mindset fails to take into account that trade barriers generate far-reaching negative consequences within our industry and for other businesses in our inter-connected economies. Rather than creating opportunities for future generations of farm families to continue to work in the industry, the R-CALF and NFU Canada approach would eliminate them.
Long-term sustainability for our industry depends on increasing market opportunities to grow demand for Canadian cattle and beef. Statistics prove that the only way to grow demand for Canadian beef is beating out the competition in our domestic and international markets. The Canadian Cattlemen’s Association (CCA) knows this and puts it into practice.
That’s why we advocate government policies that competitively position Canadian producers at home and abroad.
The discriminatory stance shared by R-CALF and NFU says only some cattle producers have a right to be in the industry. For anyone who actually succeeds in making a profit, then re-invests it in their operation, resulting in growth, they suddenly become undesirable. Both organizations have stated many times that they consider growth bad - that large operations strangle out the small guy. Shouldn’t the small guy be able to get ahead, make a profit and grow his operation? Neither R-CALF nor NFU think so.
Well - as official allies now, NFU and R-CALF deserve each other, along with other anti-prosperity, protectionist groups they recently aligned with at a two-day conference sponsored by NFU Canada in Billings, Montana. Ironically named ‘Fair Trade for All,” the conference brought together like-minded, anti-prosperity activist groups, claiming to speak on behalf of consumers and livestock organizations from Canada, Mexico, and the United States. The conference called on governments to renegotiate the North American Free Trade Agreement and address concentration in livestock markets.
The CCA believes that the conclusions of these groups are out of touch with the complexities of the world in which cattle producers must operate and compete. We encourage all cattle producers to examine their statements closely and decide for themselves.
The CCA issued a detailed response to NFU’s recent recommendations for the Canadian cattle industry. To view this, visit our website at www.cattle.ca.
A summary of CCA’s response is featured in our January 2009 Monthly Report, also available on our website. Read more!
This past year was easily the most difficult the Canadian cattle industry has seen in years, and that was reflected in the mood at this year’s Canadian Cattlemen’s Association semi-annual meeting.
CCA President, Brad Wildeman began the meeting with a report that focused mostly on the Canadian government’s inability to help the beef industry in the world of international trade.“What we want is to establish an International Trade Directorate for agriculture,” he said, adding that they have been working to get this developed and are utilizing the expertise of retired civil servants who have experience dealing in the area of international trade.
Executive Vice President, Dennis Laycraft, summarized the year from his perspective by criticizing the Canadian regulatory system for adding unnecessary costs that which in a high volume, low margin business, makes it difficult to stay competitive.
The Canadian packing industry is at a $34 per head disadvantage to the U.S., explaining why packers on this side of the border are operating below capacity. Laycraft also said regulators are slowing down the development of new feed grain varieties and approvals for veterinary drugs that could make us even with U.S. counterparts or even one step ahead.
It has been five years since BSE closed our export borders and Canada still lacks normal beef trade with key markets such as South Korea. Everyone is frustrated by the fact that even though the Canadian industry has jumped through many hoops, including—increased disease surveillance, SRM feed ban and traceability—off-shore trade remains elusive.
How important is trade?
One way of explaining the value of trade is to see each animal as a sum of its parts. While the Canadian market provides a decent price for the prime meat cuts - short ribs, tongue, liver and other cuts don’t sell well here, but are popular overseas. Limited access to those markets reduces the cut-out value of Canadian cattle by $100 a head. Upping the value of the finished product is key to bringing profitability back to all sectors of the industry.
Complicating matters is the fact that the Canadian cattle industry can’t simply go into a country to sell beef. Agreements between the trading countries’ food safety organizations must be arranged beforehand. Since all countries are different to deal with, a concerted effort must be applied before there are results.
A combination of factors are slowing down progress. Politics between countries, lack of coordination between government departments, bureaucracy and a certain level of apathy means our beef industry is having difficulty striking outside of North America. As the world continues to move forward, Canada seems to be standing still.
The CCA is asking the government develop an International Trade Directorate that would have representation from agriculture, foreign trade and the Canadian Food Inspection Agency coordinating a focused effort to develop more foreign markets.Read more!
“If the government is telling you to be productive and innovative they have to stand by what they say.” - Andrea Mandel-Campbell
One of this year’s guest speakers at the CCA conference was Andrea Mandel-Campbell, the author of “Why Mexicans Don’t Drink Molson.” She spoke on Global Competitiveness and the Canadian Beef Industry. She is a writer for the National Post and CTV’s Business News Network, specializing in global competitiveness issues.
A former Winnipegger, Campbell understands the Canadian mindset and the beef industry. Her family owns a feedlot at Stonewall. She said that our country isn’t in fact a trading nation, but one that sits back and lets the world buy its raw commodities, turning us into price takers instead of price makers. She said other countries like New Zealand understand global trade and proudly markets its products. Following the BSE discovery in Canada, Australia boldly took advantage of the fact Canadian cattle were out of the export market and aggressively ramped up their own trade efforts - with much success. Based on Andrea’s presentation, if the roles were reversed, Canada is not ready to do the same.
During the question period following her presentation, a producer from the audience outlined difficulties in working with the Canadian Food Inspection Agency (CFIA) and asked what industry/producers can do about the lack of cooperation and heavy-handed tactics, her response was simple:
“Why are so many people being held hostage by so very few?”
One definite bright spot at this year’s convention was hearing Robert Sopuck speak.
Sopuck is the vice president of policy for western Canada with the Delta Waterfowl Foundation. He is a biologist and self-proclaimed “convert” whose attitude toward the cattle industry had done a complete about-face - he now promotes how beneficial cattle are to the environment.
Email or print his presentation by clicking on the iPaper icon at the top of the document. To view at full size, click on the rectangular tab on the top right of the document page. VISIT THE DELTA WATERFOWL FOUNDATION HERE
There is a saying that the future lies in the hands of our youth. In the world of cattle production, the new generation starts by getting down and dirty feeding and raising cattle. But there’s another aspect of the industry seldom seen, because of lack of opportunity; that involve the broader issues occurring off the farm that affect every aspect of their business.
So it was with great fanfare that four Manitoba 4-H Beef Club members attended two days of the recent Canadian Cattlemen’s Association Semi-annual Convention held in Winnipeg in mid-August. It was an eye opening experience.
“I learned a lot about the cattle industry,” said 18 year-old Larissa Hamilton from Glenboro, Manitoba and a 4-H member for nine years. “It made me realize it takes a lot of people and time to get problems solved in the cattle industry.”
The quartet began their visit at the president’s reception on Tuesday night where they welcomed and met many guests, speakers and leaders in the agricultural industry including Manitoba Minister of Agriculture, Food and Rural Initiatives Rosann Wowchuk, CCA president Brad Wildeman and MCPA president Martin Unrau.
On Wednesday the group attended a day long seminar where they heard from industry experts on everything from environmental planning to what the future holds for cattle producers.
“All of the guest speakers spoke about something different but they all related to the cattle industry. They were all very knowledgeable and confident about this industry, even though we all know that there are problems. I think it kept everyone confident about owning cattle,” Hamilton said.
The conference attendees were bussed to the Hitchin’ Post banquet hall near Grosse Isle that evening for an meal and entertainment that included a live auction. The 4-H members strutted their stuff, showcasing the many donated items auctioned off by John Lamport of Winnipeg Livestock. The proceeds from the evening were split evenly between the national 4-H Club and the Manitoba 4-H Beef Club. In total, $2,360 was raised that night.
The group also had the chance to hang out and get acquainted with one another. “Also I made friends with the other 4-H’ers that were invited, we had lots of fun together, and learned more about the industry that we can take back to our clubs,” Hamilton said.
The other three 4-H members who attended the conference were Dillon Hunter, 15, from Kenton; Joe Lindal, 17, from Fisher Branch; and Matthew Riding, 18, from Lake Francis. The members were sponsored through a joint partnership between the MCPA and the CCA that covered the member’s registration and accommodation costs.
