I recently heard an interesting description of consultants. The person said consultants are like steers. They know what to do, act like they know how to do it, but in the end lack the balls to do it. I thought it was a funny observation, and with no disrespect to some very good capable consultants, it is somewhat accurate because there is no experience like actually doing things or having the balls to go through the process of trying to do it.
Looking at it from the outside, running a branded beef program can appear like a noble cause. It’s just like Robin Hood working with nature to raise a sustainable beef product, supported by a band of merry ranchers, and finding creative ways to kill and move boxed beef through a gauntlet of profit-obsessed retailers, and hopefully move dollars from the rich to the poor. It may sound romantic at times, but then there are days it seems more like World War One trench warfare — you make some gains, get stuck in a holding position, take heavy losses, bleed profusely, and by some stroke of luck, see an opportunity, and in the last minute make another advance forward.
I often think we will eventually reach a plateau where going forward will be an easier pedal than the uphill Tour de France it took to get where we are at today. But the reality is, the better our society has it, the more ludicrous the requirements become.
To run any business, you must do the best job possible at both marketing the product and on watching cost of production. In the value chain of the branded beef world, many have done a great job at growing the value of their products, but the reality is escalating costs and regulations, related to producing that product, are destroying advances quicker than the gains. Recently, we spent time with our partner packer — Canadian Premium Meats — looking at our kill and fabrication costs. We were working as a team at where we could improve efficiencies and reduce our costs. I knew the issues regarding many of new CFIA regulations were arduous, however, it wasn’t until we started putting the numbers to it that I found out how dumbfounding it was.
Last year alone the bottom line to our company was reduced by $120,000 simply for rendering and slaughter-waste disposal from our UTM (under 30 months of age) cattle. The cost worked out to more than $30/head! I was told, once and if, that animal was OTM (over 30 months of age) the disposal costs would have been even higher, because even the blood from these animals is considered SRM. Unbelievable! What once was a zero cost to get rid of is now taking more than $30 away from each animal’s bottom line and more if they are OTM. So I figure the next step for public safety will be to mark our cows with a hazardous material brand, because once we kill them that’s how the rest of the world looks at them!
May 2003 changed a lot of things, but mainly it created a bureaucratic monster in food safety where common sense no longer prevails. It has become a no-man’s-land battle ground that can wear down the most extreme of strong-willed individuals with all the rules and regulations that must be followed.
The worst thing about all the steps and procedures put in place is it has done nothing but cost us all money. At least that’s my perspective. For the packers, it has caused an immense pain in the butt and complications of segregation, rendering and disposal. At the farm level, additional administrative costs on record-keeping and age verification, and at the bank level, reduced returns because now we have a portion of our herd with value that drops like a stone as soon as it turns 2-1/2 years old. And to add one more perspective that will tick you off, it is making and leaving us completely uncompetitive.
Most beef imports entering Canada are not subject to the same rules and regs we are. What has happened as we increase the level of self-imposed regulations, based on food safety and opening markets, has been nothing more than an exercise in slowly tightening the elastrator and neutering our competitiveness in both global and domestic markets. And it is not slowing down.
What’s my fix? Simple. First, if it is a matter of public safety, then let the taxpayer pay for it. Second, if and when we go into negotiations, get an agreement first that says if we do this they will do that, otherwise nothing happens. Finally, we should shut the food production system down for a week and let the shelves get a little empty so the food supply is not get taken for granted. Maybe then people will think a little more clearly and let common sense prevail. But, then perhaps, again, it’s just me. But, it is also your industry, and if you do not open your mouth you will be like the steer described above — you will know what to do, but you won’t have the balls to do it.
Dr. Christoph E. Weder is a purebred Angus breeder in the Peace region of Alberta and also runs SVR Ranch Consulting. He is also a founding member of Prairie Heritage Beef Producers For additional info check out www.spiritviewranch.com.