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Forget The Westergun

Dear Editor: Re: Fastest Gun on the Range (March 22 Grainews)

For the past number of years and for sure since 2003, the year of BSE, ranchers have been encouraged to use best practices. I do agree with Mr. (Stan) Harder that the bow and arrow and other such devices (for giving injections) should be left to the caveman, however, the Westergun should be recycled and turned into pop or beer cans, which would be a much better use for the metal.

Mr. Harder states that you only get one chance for injecting antibiotics, so you get one 10 ml injection. With most products you need between three to five ml per 100 pounds, so for a mature animal you would need about 50 to 60 mls — again depending on the product. To inject 10 mls is a waste. Perhaps the syringe exploding is a better result.

In publications such as Grainews, The Quality Starts Here Program promotes best management practices. Myself and many others have taken the course. Vaccinating in the neck is the preferred location, certainly not the rear leg. The next problem I see is the damage to tissue from any of these high speed injection devices. Stating that jabbing a one-inch 14 gauge needle in the rear leg as “rather intrusive” is an understatement.

The worst part about these quick fix methods is the thought of losing a broken needle in the animal.

There may come a time in the future when any medicating or processing of livestock will need to be performed or supervised by a veterinarian. With all the focus these days on animals rights, and a safe food system, we have to take the time to treat animals in a safe manner. One or two customers finding an ulcer or a broken needle in a roast will make the news.

If an animal is in distress and needs treating, it should be done in a safe, secure and proper manner, and be given the proper dosage in the proper location.

We are all pressed for time in the farming and ranching business, but taking shortcuts could hurt us in the future.

Wayne Brost Walsh, Alberta

A DIRECT-MARKETING SOLUTION

By Iain Aitken

Many people have been pondering the question of whether there is a future for beef production in Canada. We are continually told that there is light at the end of the tunnel, that things will improve when “we” gain improved access to offshore markets, when the Canadian dollar loses value against the American currency or when recession hit consumers start buying more beef again.

These suggested solutions conveniently overlook the more obvious cause of the beef crisis — the proportion of the retail beef price returned to beef producers is at historically low levels, and rapidly declining. Whether we blame the packer or the retailer (when we should likely blame both) it is clear that “we” beef producers are not really a part of “the beef industry” — at least not when it comes to the distribution of profits. As far as I can see nothing will change as long as we look for “industry solutions” instead of farm/ranch level profitability solutions.

I feel an alternative solution to our income crisis is to direct market our products. In our own situation we market grass-fed beef and net in excess of $400 more per animal than selling fed cattle to the packers. Some might say that this is merely a “niche” market and does not provide a solution for the huge cattle numbers we have in this exporting nation. I suggest we have been suckered into export dependency and are now trapped on a treadmill of keeping more cattle to make up for declining margins. If the average margin in conventional beef production is $50/head you can replace eight of them with one $400 margin direct marketed animal. The cow-calf sector cannot survive by going the way of the feedlot, running thousands of animals for $50 margins — price of land alone precludes this. The only way I can see to break this downward cycle we are in is to become price setters instead of price takers.

We have been so focused on the “industry solutions” propagated by it’s beneficiaries that we have largely overlooked our trump card — consumer demand. In our own retailing efforts we have found demand to be growing between 50 to 100 per cent a year. We sell grass-fed beef but there are undoubtedly similar opportunities for non-implanted beef, antibiotic-free beef, organic beef, breed specific and regional or local beef. Most of all consumers are looking to reconnect with their food source — they no longer trust the corporate controlled food system and want to buy direct from a person who has cared for the animals usually from conception to plate. Movies like Food Inc. have driven consumers in ever increasing numbers to seek alternate food sources. Expansion of consumer demand for directed marketed beef need not be restricted by high price either — the margins currently being taken by processors and retailers are so outrageous they allow us to sell our grass-fed beef for 75 per cent of the Canadian average retail price and still come out $400 an animal ahead. We can supply the consumer with a product they perceive to be better, healthier and more sustainable for less money. It is a win-win situation for producers and consumers but a lose-lose situation for the big packers and retailers, which is likely why it is never advanced as a solution by our corporate influenced politicians.

Some say it is unthinkable that Canada should revert to supplying only the domestic market as this would precipitate a national herd decline of around 30 per cent. This statement however only deals with cattle numbers not cattle profitability — if we use the $50 versus $400 margin scenario it’s clear we could reduce the national herd by 85 per cent and come out ahead financially if we direct market the other 15 per cent ! I see no reason why direct-marketed beef could not supply 20 to 50 per cent of domestic demand.

There are undoubtedly hurdles to overcome before we could see such a substantial increase in the amount of direct marketed beef. The most immediate is the lack of enough high-quality, local processing-plants and staff to operate them. With time I’m sure more would spring up as those that are well managed seem to have quite a lucrative business. Not every cattle producer has the desire or skills to be a direct marketer but there are still opportunities to participate through producing cattle for someone who is able to market more beef than they can rear. There is no reason why producer levy money should not be used to educate and help producers to direct market either — how many million of dollars have been spent in the past aiding processing companies to develop new markets around the world with no benefit to primary producers?

I think the time is right, consumers are driving the demand and we should actively pursue this opportunity. If we don’t there is a real danger that the consumer demand will be met by imported or mass produced “natural beef” on the shelves of Wal-Mart and the like. Producers realizing more net income from their cattle can only be positive for rural communities, as would the increase in small processing facilities and their associated jobs. Best of all this is a solution that we can start working towards today — we don’t need to wait for Government assistance, market access to Timbuktu or Canadian currency devaluation. If we decide to help ourselves and successfully embrace this marketing opportunity I believe there is a very bright future for beef producers in Canada.

Iain Aitken is a beef producer from Rimbey, Alberta

VOYAGE OF THE ALBERTA TITANIC

By Gary Etherington

“Shortly before midnight on 14 April 1912, the ship’s maiden voyage, the Titanic struck an iceberg and sank two hours and forty minutes later, early on 15 April 1912. The sinking resulted in the deaths of 1,517 of the 2,223 (68 per cent) people on board, making it one of the deadliest peacetime maritime disasters in history. The high casualty rate was due in part to the fact that, although complying with the regulations of the time, the ship did not carry enough lifeboats for everyone aboard. The ship had a total lifeboat capacity of 1,178 people, although her maximum capacity was 3,547. The Titanic was designed by some of the most experienced engineers, and used some of the most advanced technologies available at the time. It was popularly believed to have been unsinkable. It was a great

“HEY, EARL … THERE’S AN ARTICLE IN THIS MAGAZINE THAT EXPLAINS WHY YOU’RE SUCH A SAPHEAD.”

shock to many that, despite the extensive safety features, the Titanic sank. The frenzy on the part of the media about Titanic’s famous victims, the legends about the sinking, the resulting changes to maritime law, and the discovery of the wreck have contributed to the continuing interest in, and notoriety of, the Titanic.” (Wikipedia)

I think it’s appropriate that as we mark the anniversary of that catastrophe, we compare our beef industry with the fate of that mighty ship.

Beef cattle and Western Canada have been synonymous with 86 per cent of the Canadian beef herd grown in the West, but it wasn’t until the welcome and long overdue abandonment of the non-compensatory grain freight rates that had existed under the Crows Nest Pass arrangement that allowed Western Canada to realize its full potential as a livestock producing area and this was a remarkable boon to the industry. Alberta led the charge feeding 80 per cent of these calves and processing 96 per cent of the finished animals slaughtered in Western Canada. The dollar was at $.65 and feed and gasoline were cheap. The U. S. was taking everything we could produce. Everyone was profitable. Everyone was happy and the party was in full swing. The beef industry in Alberta was unstoppable.

Then the fog moved in — BSE shrouded everything. Everyone looked to Captain CCA for advice. “Full speed ahead. Open those borders. Pay the packers, pay the feeders, pay the producers, pay the lawyers and all will be well in the morning.” The government responded with massive payouts and still the fog persisted. The cow-calf producer in the lower decks complained that the ship was taking on water, but those on the upper decks had adjusted their margins and were continuing the party. As the situation became worse, many of those in those lower decks took what they could and jumped ship. When this was brought to the captain’s attention, he replied “Good… if enough leave, the load will be lighter and we will float even higher.” He turned to the navigator for advice. “Don’t worry, I’ll look after you. There’ll be $2/# calves and $2,000 cows. Full speed ahead. All will be well in the morning.”

The government asked “How can we help?” The captain’s response was “Give the packer some more money to help with this SRM cleanup, put some money into genomics and feed efficient cattle and maybe help us grow a bigger better barley.” Little did the captain know that the packer had already factored into his margin the SRM costs two or three times. Playing with genetics will take years to perfect and the money spent on barley should be for beer research because for every truckload of cows killed, the grain producer has to find another sale for seven B-trains of that barley.

The real threat was not the fog or BSE but what hid behind it. The iceberg that will sink the ship is our high dollar, high fuel costs, rising interest rates and an American market that does not need our product.

There is a rising concern about a potential infrastructure collapse. Sorry folks, we’ve already hit the iceberg and the ship that was taking on water is sinking fast. In 2005, there were 2.25 million cows in Alberta. This spring, the count is estimated at 1.6 million. There has been very little retention of heifers since 2003 so the existing cowherd is getting very old and if prices stay above $40/cwt, they’re headed to town as well, so numbers will continue to drop. When the sell off stops and herd building eventually begins, even less numbers will be slaughtered. The system will collapse. There are not enough animals to sustain two plants with slaughter capacity of a million head per year for each of them. There are too many feedlots, too many auction markets, and too many advisors for the cow-calf producer that is doing most of the work, carrying most of the regulatory costs and watching his equity disappear year after year.

The ship is sinking and if you don’t want to be one of the 68 per cent that go down with the ship, it’s time to look at getting on a life raft and getting to another ship. For the past 20 years we’ve enjoyed an easy access to an eager commodity market, but that has changed and this industry may never go back to those glory years. When our dollar goes above par, we’ll be the Canadian

R-calf group standing on the side of the road watching liner loads of cattle coming north to fill our marketplace because of that cheap American dollar. We have to do what we do best and that’s produce a high quality beef product to a select, appreciative clientele and not be satisfied with having our good cattle priced in Colorado or Kansas at the same level as the Corriente (the first breed of long horn Spanish cattle bred in the “new” world) steer. We need to have the opportunity to develop branded products that reward producers for the value of their animals and years of genetic improvement. We need to take control of our marketing and not send our dollars to an agency like CBEF, which promotes our product and then turns the potential clients over to a U. S. marketing firm. We need to develop international markets and have potential clients invest with us in re-building this industry. Our major packers are very good at what they do, but they’ve shown us that their bottom line is far more important than worrying about our bottom line. It’s time we took care of ourselves and our families’ future. We know there’s an additional $225 differential between the Montana steer and ours and we intend to get those dollars for our producers.

We intend to purchase the former Rancher’s Beef plant at Balzac for the beef producers of this province and begin to rebuild the industry. By committing a percentage of your calf crop for delivery to this plant and paying a fee approximating your auction market commission, you could be an owner in this endeavor. By assembling an experienced team of marketing, management and operational personnel, we will build and implement a business plan that will be successful and return profitability to all those who participate.

There is hope — not for the return of the past but the beginning of a new future!

Gary Etherington is a beef producer at Dewberry, Alberta and chairman of Canadian Legacy Partners

About the author

Field Editor

Lee Hart

Lee Hart is editor of Cattleman’s Corner based in Calgary.

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