CCA, Ottawa Talk Orderly Slaughter
August 25, 2004
By Barbara Duckworth (Western Producer)
Calgary bureau
The Canadian Cattlemen's Association has started negotiations with Ottawa to set up a delayed marketing program for fed animals followed by an orderly slaughter and BSE testing scheme for older cattle.
"We had unanimous support for the strategic plan," said association president Stan Eby, after three days of meetings among beef producers in Calgary Aug. 18-20.
The next step is working through the costs and implementation, which some industry officials say must happen by September when the fall calf run starts.
The federal government told the industry it supports the proposals, but some packing companies are lukewarm to a marketing plan designed to improve prices paid for finished animals.
"The encouraging thing to the CCA is government has said it wants a plan to help them move through this," said Eby in an interview Aug. 20. Meetings in Ottawa were scheduled for Aug. 23.
Most beef producers have accepted that the U.S. border is not likely to open any time soon so the industry must take care of itself. Grassroots producers are complaining too little has been done to resolve the problem of no live exports, limited meat exports and no cash on the farm.
The strategy includes tax deferrals, loan guarantees, cash advances and marketing programs to better manage slaughter until more capacity is available. The most ambitious proposal is managing cattle supplies.
"This isn't simply about cash like it was before. It is actually about managing the animals so they don't flood the market. It is a lot more work but it is achievable," said Brad Wildeman, who chairs the CCA contingency plan committee.
The set-aside program includes a voluntary delay of fed cattle and a 2004 calf crop delay.
Fed cattle in the program would be held be back from the market for up to 90 days and would qualify for compensation of feed costs. Additional cattle could be set aside as required over the minimum 24 month period the program is in operation.
Cattle enrolled in the voluntary 2004 calf crop program could not be sold as finished cattle for 12 months and would qualify for feed costs and cash advances.
Cattle enrolled in the program would receive unique identification and proof of age to move them to slaughter before the critical 30 month period.
The set-asides are designed to stabilize an otherwise poor market and deal with the largest calf crop in history, said Wildeman, a Saskatchewan feedlot operator.
By holding cattle back and selling in an orderly fashion, the producers hope packers will bid higher. With so many market-ready cattle queued up this past year, it has been common for sellers to receive no bids by mid-week because packers have enough inventory.
"If we do that for a number of weeks, we'll take off the excess supply and the packers will need to raise their prices up to some level where they are still making lots of profit and we can get a 10 or 15 percent increase in the fed price," he said.
The second plan deals with old cows past their productive lives. They would go to special regional facilities for euthanization and BSE testing. If they are free of disease, the carcasses could go into the normal rendering process and hides could be sold.
Producers could be paid up to $150 per animals to bring them in rather than killing them on farm.
These facilities could be available in 60-90 days and could help Canada meet its goal of testing at least 8,000 animals during 2004.
In subsequent years, testing levels are expected to increase to 30,000 animals per year.
Take care.
August 25, 2004
By Barbara Duckworth (Western Producer)
Calgary bureau
The Canadian Cattlemen's Association has started negotiations with Ottawa to set up a delayed marketing program for fed animals followed by an orderly slaughter and BSE testing scheme for older cattle.
"We had unanimous support for the strategic plan," said association president Stan Eby, after three days of meetings among beef producers in Calgary Aug. 18-20.
The next step is working through the costs and implementation, which some industry officials say must happen by September when the fall calf run starts.
The federal government told the industry it supports the proposals, but some packing companies are lukewarm to a marketing plan designed to improve prices paid for finished animals.
"The encouraging thing to the CCA is government has said it wants a plan to help them move through this," said Eby in an interview Aug. 20. Meetings in Ottawa were scheduled for Aug. 23.
Most beef producers have accepted that the U.S. border is not likely to open any time soon so the industry must take care of itself. Grassroots producers are complaining too little has been done to resolve the problem of no live exports, limited meat exports and no cash on the farm.
The strategy includes tax deferrals, loan guarantees, cash advances and marketing programs to better manage slaughter until more capacity is available. The most ambitious proposal is managing cattle supplies.
"This isn't simply about cash like it was before. It is actually about managing the animals so they don't flood the market. It is a lot more work but it is achievable," said Brad Wildeman, who chairs the CCA contingency plan committee.
The set-aside program includes a voluntary delay of fed cattle and a 2004 calf crop delay.
Fed cattle in the program would be held be back from the market for up to 90 days and would qualify for compensation of feed costs. Additional cattle could be set aside as required over the minimum 24 month period the program is in operation.
Cattle enrolled in the voluntary 2004 calf crop program could not be sold as finished cattle for 12 months and would qualify for feed costs and cash advances.
Cattle enrolled in the program would receive unique identification and proof of age to move them to slaughter before the critical 30 month period.
The set-asides are designed to stabilize an otherwise poor market and deal with the largest calf crop in history, said Wildeman, a Saskatchewan feedlot operator.
By holding cattle back and selling in an orderly fashion, the producers hope packers will bid higher. With so many market-ready cattle queued up this past year, it has been common for sellers to receive no bids by mid-week because packers have enough inventory.
"If we do that for a number of weeks, we'll take off the excess supply and the packers will need to raise their prices up to some level where they are still making lots of profit and we can get a 10 or 15 percent increase in the fed price," he said.
The second plan deals with old cows past their productive lives. They would go to special regional facilities for euthanization and BSE testing. If they are free of disease, the carcasses could go into the normal rendering process and hides could be sold.
Producers could be paid up to $150 per animals to bring them in rather than killing them on farm.
These facilities could be available in 60-90 days and could help Canada meet its goal of testing at least 8,000 animals during 2004.
In subsequent years, testing levels are expected to increase to 30,000 animals per year.
Take care.
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