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U.S. likely to re-open border to beef: Cellucci

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    U.S. likely to re-open border to beef: Cellucci

    U.S. likely to re-open border to beef: Cellucci
    CTV.ca News Staff

    Although it's unclear whom Prime Minister Paul Martin will be dealing with at the White House, the U.S. Ambassador to Canada says he's confident the American border will re-open to Canadian beef.

    "There will continue to be some opposition in the United States, but I think there's light at the end of the tunnel on opening that border for Canadian beef," Paul Cellucci, a former Republican governor of Massachusetts, said on Canada AM.

    In the meantime, the two countries will continue to operate their shared border as normal.

    "Certainly the day-to-day stuff between Canada and the United States continues," Cellucci said. "I think on some of these larger issues, we should get back to the negotiating table."

    He mentioned that U.S. President Bush and the U.S. Department of Agriculture "support a role that will open up the border for live cattle trade."

    That's good news for Canadian cattle farmers who have been struggling since a single case of BSE was discovered in an Alberta cow in May 2003. The U.S. Announced it was closing its border to Canadian beef days later, virtually paralyzing Canada's beef industry.

    Cellucci noted that one of the people who strongly opposed the re-opening of the American border to Canadian beef -- former Democratic Senator and Senate Minority Leader Tom Daschle -- lost his re-election race in South Dakota.

    But some observers doubt U.S. officials will make this country's needs a priority. "I think what we have to keep in mind here is that Canada is a pretty small blip on the radar screen of the American government," said University of Lethbridge sociologist Trevor Harrison. "They have far more pressing issues to deal with."

    Harrison also says that because of lobbying in the U.S. against the border re-opening, he thinks it'll be a "fairly slow process. It doesn't matter which candidate is elected," he says.

    While Canadians wait for official American election results almost as eagerly as their American neighbours, Cellucci says the relationship between Canada and the U.S. remains "quite sound."

    "It's in each of our national interests to work together. That's exactly what we will continue to do," he added.

    When it comes to Canada's support of the U.S. missile defence program, Cellucci says the U.S. will take things one step at a time.

    "We think it would be a good thing if Canada supported missile defence, but it's certainly not a deal breaker," Cellucci said. "That's a decision for Canada."

    #2
    CattleAnnie - If the US opens the border to life cattle soon and we don't get our Western Canadian packing plants owned by producers first then you children (assuming they take over the farm/ranch) will be receiving their monthly pay checkes from eith Tyson or Cargill. Mark my word!

    Comment


      #3
      Charlie;

      I was a little surprised by this comment;

      Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. It has been our experience that electronic trading provides additional functionality to
      our commodity risk management activity. In particular, it has been our experience that electronic
      trading can offer superior results for options and spread trading relating to agriculture futures when compared to open outcry execution. In addition, the hours of trading can be extended in
      the electronic trading environment when compared to the more limited hours currently offered for open outcry trade….

      As a participant on the WCE, we utilize the WCE's contracts for risk management of our producer pricing options. The maintenance by the WCE of liquid, transparent and fair markets is important and the conversion to electronic trading is a good means to achieve this objective.

      Yours truly,
      original signed by
      Ward Weisensel
      Chief Operating Officer"

      So why can't the CWB provide competitive hedges on feed wheat and barley for us... if they are aleady using WCE risk management tools?

      Comment


        #4
        Understand the point you're making.

        However, I'm at the point of not being able to afford to buy feed for my cattle, much less my children.

        Not complaining. Just reality here.
        Sure hope something changes for the better soon.

        On the plus side, it's been chinooking here for the last couple of days. Gotta love it!

        Take care.

        Comment


          #5
          The US cattle herd numbers are way down. and in this country we have sold off the heifer calves for the past two calf crops, one of these days both countries are going to wake up and realize that there is a severe lack of breeding females. My take on this is that one the border opens for live cattle, those heifer calves and bred heifers are going to be worth a lot of money to producers who have been able to hang on to them. After saying that, I shipped the best set of heifer calves I have ever had yesterday !!!! Gotta pay the banker !!!

          Comment


            #6
            I think we need to keep in mind the effect our rising dollar is going to have on our prices. Yes breeding females may be in demand but our dollar has appreciated 30% and is still rising. The heifer that was going for $1300 in the early spring of 2002 will now bring $1000 if everything else were the same, without BSE. Make that $900 if our dollar rises to 90 cents. Allow for some BSE related costs to the industry such as removal of SRMs and lower cull prices and the value of breeding heifer declines further.
            It is very unlikely that we will be sending down live breeding animals to the U.S. for quite a while. Willowcreek has pointed out in another thread that there needs to be a lot of progress before that happens.

            CattleAnnie: Things are getting pretty tight here too. Hopefully there is some light at the end of the tunnel and it is not an oncoming train. Still find participating in Agri-ville offers some solutions and optimism. Hope you find it the same.

            Comment


              #7
              One more factor that may play into this- I don't know how far USDA has gotten developing a policy for the border reopening- But there has been a lot of talk about Ag Secretary Ann Vennaman not coming back in a second term. Yesterday even some of the Ag-radio broadcasters were talking about it. Then last night on FOX news it was being discussed that many of the first term cabinet may not come back or may be replaced.
              A changeover in the leadership of USDA could cause a delay-- On the other hand they may release the new policy, let Anne take all the heat, and then replace her.

              Comment


                #8
                Your figures are pretty pessimistic farmer_son.
                All things are not the same, but, a 1200 pound fat heifer in today's disfunctional market is still worth about 80 cents a pound, which makes $960.00 in my books. With an open border, and a more reasonable spread, let's say even close to pre May 20, and an 85 cent dollar, we could be looking at well closer to $1100.00. With a little optimism cow calf guys could start to hope for $600.00 five weight calves again next fall. This kind of calf market saw lots of $1300.00 bred heifers, in the past.

                As far as I am concerned, the drastic rise in the dollar counld not have happened at a better time. Yes we will not see the prices we could have, but any increase right now should be seen as positive......not?

                Comment


                  #9
                  Also, it's not so much the Canadian dollar going up as the American dollar going down.

                  That could be how we maintain incentive to develop new markets. By not always selling in American dollars, we may be able to gain a bit more return on our beef. Selling to the U.S. could very well be not as favourable as to elsewhere.

                  It would be nice to come to the point where the sun does not rise and set on the value of the Canadian dollar as compared to the American one. If the exchange factor was spread amongst the yen, euro, and whatever, it would be a more stable market, in my opinion.

                  Comment


                    #10
                    Very good points, rpkaiser and kata. We need incentive to keep of market here. By reducing our dependence on US and exploring other markets whose exchange rate is more stable to CDN$ we would lessen our dependence of US$.

                    Comment


                      #11
                      Having just got that onto paper, however, I realize that the reduced value of the US$ would give them the advantage we have enjoyed in the export market; giving them a leg up in competing for the same markets we are.

                      Comment


                        #12
                        Very true. Oh what a tangled web! I'm sure we can deal with it, we've dealt with everything else so far.

                        Still, it is like having a diversified portfolio, as the rich folk say. The farther abroad the markets are spread, the 'average' will help with stability.

                        If the American dollar promoted their exports, and they do export a lot, their exports would improve their economy and raise their dollar. Then their dollar goes up and their value of exports goes down. And on and on.....

                        That's what has happened to us. We're just farther along in the cycle than they are.

                        Comment


                          #13
                          Tom,

                          You seem to be missing the point again. Ward Wiesensal said

                          "we utilize the WCE's contracts for risk management of our producer pricing options. "

                          You said

                          "So why can't the CWB provide competitive hedges on feed wheat and barley for us... "

                          You can purchase hedges for whatever purpose you like. The CWB does not provide hedges for anybody but their own risk management. It sounds like you expect the CWB to use some sort of volume purchasing power or insider knowledge to get you a better deal on your hedges. It doesn't work like that. The purchasing of hedges by the CWB is a very straight forward process driven by the volume of PPO contracts and the daily pricing on the commodity exchanges.

                          Comment


                            #14
                            I am not going to get into the match above...

                            Of all the barley that is priced/sold/hedged by the CWB, how much is offset at the WCE? The MSC will be the only ones that can answer that to see if the letter from Ward holds any weight.

                            In an another life, the excuse I heard day in, day out that the CWB would be too transparent in the pit at the WCE.

                            What's changed?

                            Comment


                              #15
                              The critical component to what you are saying is to find NEW markets and then ship the beef that we have processed here to those new markets.

                              Capturing the value here and spreading it amongst the players in the chain is what is important. Information has to be exchanged all the way along so that everyone will benefit, the producer included.

                              Comment

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