Jan Swan Wood

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November 30, 2009
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R-CALF's Bill Bullard speaks on cattle business in crisis

Belle Fourche (SD) Livestock Exchange was the host for a rollover auction to benefit R-CALF USA. In conjunction with the South Dakota Stockgrowers, the rollover raised $7,500. The two-year-old heifer that was auctioned was donated by the Don Fish family of Hot Springs, SD.

A huge crowd was in attendance for the rollover auction and the presentation by R-CALF USA's Executive Director, Bill Bullard of Billings, MT. After opening remarks by Larry Nelson, past president of SDSGA, Bullard took the floor and briefly explained what R-CALF is concerned about in the cattle industry. The issue of the declining market price for cattle was at the forefront and reasons for that decline were outlined, and an interview following the presentation filled in the details of that and several other points.

Having the live cattle market controlled so thoroughly by the meat packing industry has impacted the price of cattle from birth to slaughter, and the meat packers have historically been immune to the Packers and Stockyards Act that has been on the books for decades.

Bullard said, "The U.S. cattle industry is the last frontier. It's the last industry not vertically integrated from birth to plate." He added, "If producers don't want the cattle industry to go the same way as pork and poultry, they need to prepare for an aggressive fight, with a comprehensive plan and the cohesiveness of the producers.

"The meat packers have captured control over the industry. They control cattle genetics, marketing and prices paid to the producers," said Bullard. He added, "We are where the meat packers and trade associations want us. R-CALF has been the new voice and we're fighting to change the course of the industry." Continuing, he said, "We must take the tools back from the meat packers that are controlling every aspect of the beef industry."

The blatant lack of enforcement of the Packers and Stockyards Act also exhibits just how deeply rooted the meat packers are in Washington, D.C. Bullard states, "The administration and congress are just too cozy with the meat packing industry. The meat packers are one of the most powerful forces in Washington today.

"Due to continual pressure from R-CALF, for the first time in history the Dept. of Justice and the USDA are working together to investigate the competitiveness of U.S. markets," said Bullard, continuing, "It's our opportunity to finally see enforcement of anti-trust laws that prohibit anti-competitive practices by the packers. The laws have been ignored for decades at the expense of the independent producer."

A hard fight was made by R-CALF to prohibit JBS Meats from acquiring National Beef, and though the packers claimed it was simply baling out the floundering National Beef, the mega-merger didn't happen and, oddly enough, National still showed a tremendous profit.

Bullard pointed out, "In 2007, $6.4 billion was lost off the cattle feeding industry, and feeders lost over $150 per animal in 2008. Yet, consumers were paying record or near record prices for beef."

The bleeding by the industry hasn't yet stopped, as Bullard explains, "With the horrendous losses in the feeding sector, we are afraid we've lost tens of thousands of our farmer feeders. Fewer feeders means less competition at the market place for cattle and lower prices for the cow/calf producers across the country."

Other issues that R-CALF is working on include NAIS, USDA's 30-month rule on imported cattle, and WTO.

In February, a letter to U.S. Agriculture Secretary Vilsack, R-CALF requested that NAIS be scrapped in its entirety due to lack of quantification of the alleged benefits of the program, the high cost of compliance, government expense, no food safety benefits, and an unfair burden being placed on family farms/ranches and sustainable operations.

The letter also asked that USDA reverse the over 30 month rule, which would allow cattle older than 30 months to once again be imported into the U.S. (despite proof that BSE is still in existence in Canada). A pending lawsuit filed in South Dakota District Court on the over 30 month rule is yet to be heard. R-CALF was joined by SDSGA in that filing.

Lastly, the letter asked that USDA take immediate steps to end captive supply by meat packers in our market. So far, none of the requests have been acted upon.

In October, both Canada and Mexico filed complaints with the World Trade Organization (WTO) that challenge the U.S. COOL law. However, in a letter to Sec. Vilsack and U.S. Trade Representative Ron Kirk, from 17 R-CALF officers, directors and committee chairs, those countries cannot claim that COOL has caused them any economic harm.

During the past five years, the U.S. accumulated a $6.6 billion deficit in the trade of live cattle, beef, beef variety meats and processed beef in its trade with Canada and Mexico, representing an annual average loss in U.S. cattle sales of $1.3 billion. The U.S. imported nearly $1 billion in slaughter cows, bulls, steers and heifers from Canada and Mexico in each of the past two years. These trade policies not only cost the U.S. cattle industry billions, but threatens the U.S. cattle herd with diseases that have either never existed or have been eradicated in the U.S. For the past five years, USDA has lowered disease standards for BSE and tuberculosis, both brought into the U.S. by Canadian or Mexican cattle.

Bullard reminded the crowd, "When R-CALF blocked the border for two years during the initial BSE outbreak in Canada, we had the highest prices ever received for our cattle."

He continued, "We are truly at a critical juncture in the industry. We have the smallest herd size and calf crop since 1950. Prices today reflect prices of decades ago. Its terrible to have an industry shrinking during a time when consumption has grown."

R-CALF sent a letter on Oct. 29, 2009 to the President, Vice-President, USDA and Department of Justice, explaining the cattle industry crisis, losses of $6.4 billion, and cattle producers exiting the industry. The letter questioned what is going to be done about the situation and requested answers. A reply has not been returned at this time.

The cattle industry's problems are not news to those in the thick of them. The producer must step up and take part in the work of saving their business. R-CALF encourages producers to get involved and make the collective voice of the industry heard.

Those waiting for "somebody" to do something, need to be that "somebody." If not, will the last one to go, please close the gate on their way out?


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Tri-State Livestock News Updated Aug 14, 2012 03:47PM Published Nov 30, 2009 10:48AM Copyright 2009 Tri-State Livestock News. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.