Livestock Market Digest – Fall Marketing Edition 2020 by Livestock Publishers

SALERS

More Live Calves Means More Profit

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= More Profit! w w w. S a l e r s U S A . o r g

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it’s called

heterosis. Beefmaster Calf, West Texas

A lot of ranchers are missing the benefits of heterosis – or hybrid vigor – and the opportunity to produce calves like this.

“The Beefmaster calves we have marketed appear to outperform our straightbred calves about 75 to 100 pounds. That’s like getting about an extra calf for every eight calves you produce — for free! We’ve been real pleased with that on the steer calves we go to town with.” – Dr. Bob Evans, Tecumseh, Okla.

And on top of losing calf performance, they’ve sacrificed health, fertility, survivability, longevity and feed efficiency. Indeed, the Beefmaster is an American original, the first breed designed to infuse maximum retained heterosis into cow herds. So if you’re giving up ground in the traits that matter — and want to raise calves that look like this — take a look at a Beefmaster bull.

Beefmaster: Built for Heterosis.

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2020 Fall Marketing Edition

Livestock Market Digest

2020 Fall Marketing Edition

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Livestock Market Digest

2020 Fall Marketing Edition

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Livestock Digest

Fall Marketing Edition

MARKET

September 2020 Volume 61, No. 9

Gross Profit

BY LEE PITTS

(ISSN 0024-5208)

(USPS NO. 712320)

is published monthly by Rainy Day, Inc. P.O. Box 7458, Albuquerque NM 87194 Periodicals Postage Paid at Albuquerque, New Mexico, and Additional Mailing Offices. POSTMASTER, send change of address to: LIVESTOCK MARKET DIGEST P.O. Box 7458, Albuquerque, NM 87194 For advertising, subscription and editorial inquiries, write or call: LIVESTOCK MARKET DIGEST P.O. Box 7458, Albuquerque, NM 87194 505/243-9515 • fax 505/998-6236

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The Worst of Times... and the Best of Times BY CAROL WILSON . . . . . . . . . . . . . . . . . . . . 12 New Opportunity to Learn About Direct Meat Marking BY COLTER BROWN, NORTHERN AG NETWORK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Why Can't Ranchers Sell Meat Directly to Consumers? BY HEATHER SMITH THOMAS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Subscription price: 1 year - $25 / 2 years $35 Single issue price $10 Subscriptions are Non-Refundable Deadline for Advertising & Editorial copy changes and cancellations is the last day of the month prior to publication.

The Westerner BY FRANK DUBOIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Open Letter: Questions from The Brand About the 50-14 Legislation CERTIFIED ANGUS BEEF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Advertising rates available upon request. www.aaalivestock.com

US Cattlemen's Association Respond to Open Letter From Certified Angus Beef . . 25

Editorial & Advertising Staff

What Consumers Want BY MADI BAUGHMAN, ANGUS MEDIA, EDITORIAL INTERN . . . . . . . . . . . . 26 US Meat Packing Industry is Heavily Controlled

PUBLISHER:....... Caren Cowan PUBLISHER EMERITUS:....... Chuck Stocks EXECUTIVE EDITOR:....... Lee Pitts LIVESTOCK MARKET DIGEST SALES REPRESENTATIVE:....... Randy Summers

by Foreign Interests BY HEATHER SMITH THOMAS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Smithfield's Sullivan Blasts Senators' Report on Meat Companies Response to COVID-19 BY LISA M KEEFE, MEATINGPLACE.COM . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Chinese-Owned Wind Farm in Devils Rivers, Texas, Threatened Power Grid & More BY BONNER COHEN, PHD, CFACT . . . . . . . . . . . . . . . . . . . . . . 33

Production Staff PRODUCTION COORDINATOR:....... Carol Pendleton A DVERTISING & EDITORIAL DESIGN:.. Kristy Hinds

Meat Export Challenges — How Farm Finances Have Changed in 2020 . . . . . . . . . 35 Riding Herd BY LEE PITTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Year-Round Marketing Yields Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Beyond Meat Not So Transparent BY KATE GIBSON, MEATINGPLACE.COM . . . . . . . . . . . . . . . . 37 View from the Backside BY BARRY DENTON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 On the Edge of Common Sense BY BAXTER BLACK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

On the Cover

Benefit of Hedging Sale of Live Cattle BY PAT MELGARES, K-STATE RESEARCH & EXTENSION . . 37

Larry Schnell Installed as LMD President for 2020-2022 Term . . . . . . . . . . . . . . . . . 40 Australia Losing Beef Market Share in US BY LISA M. KEEFE, MEATINGPLACE.COM . . . . . . . . 40 Crouching Tiger, Hidden Dragon BY CAREN COWAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Auction Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Real Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Alternative-Meat Startup is Hoping a 3D-Printed Steak Can Upend the Meat Industry BY EMILY HAGER & MARK ABADI / WWW.BUSINESSINSIDER.COM . . . . . . . . . . . . 52 Ad Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

“DISTANT THOUGHTS”is a drawing by renowned cowboy artist Tim Cox. For information on this and other work by Tim, please contact: Eagle Creek Enterprises, 891 Road 4990, Bloomfield, NM 87413, 505.632.8080, Fax 505.632.5850, scox@timcox.com, www.timcox.com 2020 Fall Marketing Edition

By LEE PITTS

Gross Profit

by Lee Pitts

here are two books I remember reading from high school that had a profound effect on me. The first, and most important, was a book written by what you’d call today a far-right-wing conservative by the name of Ayn Rand. The book was called The Fountainhead and it literally changed my life. Ayn was born and educated in Russia before moving to the United States where she wrote about the dangers of socialism and communism in several books. I read them all. The other book was written by a person exactly opposite Ayn Rand on the political spectrum. Upton Sinclair was an avowed socialist and would probably be described today as a “commie pinko.” Sinclair’s writings fueled the flames of a movement called progressivism and its practitioners were known as “Progressives”. Sound familiar? Upton Sinclair wrote nearly 100 books, won the Pulitzer Prize and was best known for his classic muckraking novel The Jungle which exposed labor and sanitary conditions in U.S. meatpacking plants. Like Ayn Rand’s books, The Jungle is still in print. The two books made me a devout follower of capitalism, but The Jungle also made me aware of the dangers and the extremes some greedy men will go to if allowed to form monopolies, engage in price fixing, mistreat their workers and cheat the public. THE JUNGLE REVISITED

Sinclair called his book The Jungle because he believed capitalism led to a world in which people preyed on each other just as animals do in the jungle. The Jungle has sold millions of copies, was translated into dozens of languages and cemented Sinclair’s reputation

Livestock Market Digest

as a crusader for social justice. Despite all the attention the book received, Sinclair felt that readers had missed his point, they had focused on the health risk aspects associated with unsanitary stockyards and meatpacking facilities, while he considered his main theme to be the dehumanization of employees and the brutal treatment of animals. “I aimed at the public’s heart,” he said, “and by accident I hit it in the stomach.” Shortly after The Jungle was published, the President of the United States, Teddy Roosevelt, started receiving thousands of letters demanding that he clean up the meatpacking industry and break up what Sinclair referred to as “The Beef Trust”. It was today’s version of The Big Four: JBS, Cargill, Tyson and Marfrig/National Beef. The biggest difference is that today two of our four major beef packers are owned by Brazilian firms. Roosevelt despised Sinclair and grew tired of his telegrams and told Sinclair’s publisher, “Tell Sinclair to go home and let me run the country for a while.” During Teddy Roosevelt’s presidency the American public was growing tired of monopolists like John Rockefeller, the railroad monopolists and The Beef Trust, so in 1902 he directed a couple underlings to investigate Sinclair’s claims. They confirmed Sinclair’s accusations and so Roosevelt told his Attorney General to bring a lawsuit against the Beef Trust on antitrust grounds using the Sherman Antitrust Act of 1890. In 1905 the Supreme Court ruled in the landmark case called Swift & Co. v. United States, that the “Big Six” leading meatpackers (Swift, Armour, Morris, Cudahy, Wilson and Schwartzchild) routinely engaged in a conspiracy to fix prices, divided up the market for livestock and meat in their greed for higher prices, blackballed any competitors who failed to go along, used false bids, and accepted rebates from the railroads. The Supreme Court ruled that it was The Commerce Clause that allowed the federal government to regulate monopolies if they had a direct and deleterious effect on commerce. The Court’s decision eventually did halt the price fixing by Swift and its Beef Trust buddies and in 1906 Congress passed the Pure Food and Drug Act and the Meat Inspection Act. And all this was inspired by one book written by a socialist/communist. Here’s the important takeaway from history: when Roosevelt divided up the Beef Trust the top six firms controlled 82 percent of the U.S. beef market. Today The Big Four corporations control an estimated 85 percent and many ranchers feel they are price fixing, cheating and gouging the consumer.

IN THE SICK PEN

Since its rebirth in 1983 this newspaper and this writer have been warning ranchers about the dangers of captive supplies, monopolist packers, foreign packer ownership by multinational corporations, the sellout of our national organization and the merger into the National Cattlemen’s Beef Association (NCBA), the theft of checkoff dollars by them and their staunch backing of the packers at the expense of ranchers. Now America’s ranchers are like a chronic steer and find themselves in the sick pen once again. Not that some brave souls haven’t tried to fix our many problems, R-CALF, the United States Cattlemen’s Association, the Organization of Competitive Markets and several upstart state organizations have tried to gain traction but their voices are drowned out by the NCBA with their checkoff dollars. Or, more correctly, your checkoff dollars. A couple years ago R-CALF filed suit alleging antitrust violations and have sought damages for ranchers. R-CALF alleged that The Big Four began coordinating in 2015 to reduce the number of cattle they slaughtered and the animals they bought directly from ranchers in the cash market in order to depress cattle prices. “For several years now the beef packers have been capturing unprecedented margins,” said R-CALF CEO Bill Bullard. “Cattle prices remained unresponsive to increasing beef demand.” You can say that again! During the recent COVID crises the price of boxed beef doubled while the price to ranchers fell 20 percent! Continued Bullard, “Why cattle producers and their conventional trade associations would remain complacent, indeed silent, while this inexplicable circumstance exists is mindboggling to say the least. But, then perhaps the entire beef industry, along with the beef industry’s favorite media outlets, have thoroughly conditioned America’s cattle producers to follow their lead by exclusively focusing on increasing beef demand. It is time for some serious, critical thinking about the structure of the cattle market by cattle producers . . . before it is too late,” warns Bullard. CATCHING COVID FEVER

Bullard cites 2018 as a good example. “According to the beef industry, increasing beef demand means good prices for retail beef, which will, like water, trickle down to reward every sector of the beef supply chain, including the live cattle producer. But that did not happen. Instead, fed cattle price fell nearly five percent during the same period

that beef demand increased 15 percent. This is an inverse relationship – exactly opposite of what a competitive market would dictate.” Then a watershed event occurred. A fire in a Tyson Kansas plant led them to close the beef plant. Judging by the reaction, you’d have thought the beef industry was all of a sudden sicker than a 105-year-old rest home patient who came down with COVID 19. At this point I don’t think even Tyson realized what a stranglehold the Big Four had already gained on the beef industry. The most recent wreck in the cattle business had its origin a few years ago when beef numbers had dwindled and the packers realized they had excess capacity, and that’s no way to run a monopoly. So they started shuttering plants. When they saw their gross margins and net profit skyrocket after the closure of just one plant in Kansas, they started really squeezing. Then the beef industry, along with everyone else in the country, caught the COVID 19 fever. The packers used the virus as an excuse to shutter even more plants and slaughter dropped dramatically to 435,000 head from 650,000 per week and a million head of over ripe cattle backed up in feedlot alleys across the Midwest. At the dreariest point there was even talk about euthanizing overly fat cattle as they did with pork. The price for fed cattle sank to as low as $93 per cwt, down from $116.35 at the beginning of this year. It was a level not seen in recent memory. At the same time, the USDA reported that the average price of boxed beef doubled. At the end of February, 100 pounds of boxed beef cost $205. A couple months later the price was $410. According to Politico, “The meatpacking industry—in this case we’re specifically talking about beef—is absurdly consolidated,” summed up Politico. This at the same time that beef was selling for record prices at retail and in many cases the meat cases were bare of beef due to a self-created shortage. Meanwhile the packers were making up to $700 GROSS profit and more per head, and once again the academia apologists and the packer-backers at the NCBA pointed to the rising costs for packers like electricity etc. As if ranchers costs haven’t gone up as well! In April, using the Defense Production Act to ensure meat remained on grocery store shelves, President Trump had to order the packers to keep their facilities open, during this national emergency. And just like Roosevelt, Trump also called for an investigation for potential anticompetitive behavior in the beef packing industry.

A KINKED CHAIN

wouldn’t bet the ranch on it.

Apologists for the meat packers at universities and at the NCBA say the supply chain for beef is “kinked” and is especially vulnerable to the spread of the coronavirus because beef processing is increasingly done at a handful of massive plants. Well, who’s fault is that? Ben Lilliston, the interim co-executive director of the Institute for Agriculture and Trade Policy said, “The closure of these large meat processing facilities, and any resultant supply shortfalls, is what happens when a small number of multinational companies control the food supply. They have proprietary information about how much food is out there that no one else has. In early March, there were a whole lot of stories about a surplus of meat. If they say it’s a shortage, maybe it is, but no one really knows.” Finally, “Cargill Inc., JBS USA, Marfrig/ National Beef Packing Co., and Tyson Foods were accused in Minneapolis federal court of conspiring to inflate the price of beef through an industry-wide scheme that’s coming to light thanks to federal investigations prompted in part by shortages during the coronavirus pandemic,” said Bloomberg Markets. “The proposed class action accuses the four meatpacking giants, of leveraging their ‘gatekeeping’ role atop the concentrated, inelastic wholesale market ‘to collusively control both upstream and downstream beef pricing.” “Before 2015,” continued Bloomberg, “cattle and beef prices predictably moved in tandem, given that beef is simply processed cattle. But the meat packers allegedly conspired starting that year to widen the ‘meat margin’—the spread between what they paid for cattle and what they got for beef.” The Big Four had reduced their slaughter amidst heavy demand for beef to unprecedented levels by reducing purchases and running their plants at below capacity. If by chance the market for cattle was to rally the multinational packers could just stop it in its tracks by dramatically increasing imports of both beef and cattle. There are some pretty heavy allegations being leveled at the packers today, but amidst the coronavirus pandemic they will be extremely difficult to prove. Especially with the biggest cattleman’s organization, the NCBA, testifying on behalf of the packers. And you can expect a parade of academicians who will also back the packers. The packers can just say their workers refused to come to work. It’s a long shot but if proven the impacts on the beef industry could be as far-reaching those steps taken in 1905. But I

DIVIDING UP THE BEEF PIE

There appears to be a desire on the part of poultry producers to rein in their packers. A federal grand jury in Colorado has charged four executives from two U.S. poultry companies with conspiracy for chicken price-fixing. Prosecutors say the poultry packers worked to raise prices for chicken sold to restaurants and stores from at least 2012 to 2017. Then in May, after state attorney generals from 11 states launched an investigation into possible collusion by beef companies, the U.S. Justice Department and the USDA also launched investigations. Unfortunately, we’ve already gotten a glimpse of how all this will shake out. The USDA has already absolved the packers of any wrongdoing in a recent preliminary report. But Senator Chuck Grassley, an Iowa Republican insists, “There’s evidence that something isn’t right in the industry.” It’s really easy to prove that Grassley is right. All one needs to do is look at the share of the beef dollar that producers receive historically, versus that received by the packer and the retailer. The trend since the 1980s has been that the retailer and packer shares have increased rapidly at the expense of the rancher. According to the NFU beef producers earned just 22 cents of the retail food dollar in April 2018 compared to 44 cents in April 2014. And the trend line has continued down since 2018. Recently the price of top sirloin in the grocery store was $9.99 and the rancher received $1.75 of that. That’s roughly 15 percent! All of agriculture is in similar dire straits. According to the USDA, for every dollar spent on food the farmer/rancher is receiving just $14.8 cents. And with beef it’s getting worse very quickly because of the monopolistic packers. For example, the fed cattle price that feedlots received last year was 12 percent lower than 2001. Ben Gotschall, interim director of the Organization for Competitive Markets, said, “As a result of all this consolidation and control of the market, the profit of the product has just been squeezed away from the people producing that product.” The question is, how low will you go before you’ll get mad enough to actually do something? Or will you just quietly go away?

▫

2020 Fall Marketing Edition

The Worst of Times ... and The Best of Times by Carol Wilson

ook around. We think because we are all a part of the cattle industry, we have similar goals and values. But we don’t. We aren’t even all in the same boat. Cattleman’s boats are taking on water and sinking. Feedlot boats are secure on the water with full lots and cattle hedged. Packer boats are in the harbor, getting rich with beef flying off the shelves at the highest prices in recorded history. And they aren’t sending lifelines back to producers. Though we’ve been in different boats for years, the 2019 fire in a packing plant in Kansas and the 2020 COVID-19 pandemic put a spotlight on the glaring differences: the Kansas fire took 6,500 head a day out of production and revealed that we had a broken cog in the wheel, making cattlemen very vulnerable. The pandemic was graphic, as we saw empty meat shelves in stores while we had pens full of fed cattle that no packer was bidding on. During the pandemic, Industry experts estimate packers were making $600 to $2,500 per head while ranchers were losing as much as $400 on each animal they produced. Those who care about the history, tradition and future of the livestock industry have been sickened by the carnage wrought by the beef industry upon the cattle industry, and are acting to save the cowboy, the small livestock producer, the backgrounder and the sale barn, the order buyer and the feed salesman, and work for a future in the livestock industry. Corbitt Wall of DV Auction is the articulate spokesperson for like-minded cattlemen, many from the Midwest, who have spearheaded the push for market transparency and cash values. Using his popular Feeder Flash, a daily market video which garners approximately 10,000 views per day, Wall is calling for robust price discovery in which packers have to buy a minimum number of fed cattle on a cash market, bidding on finished cattle just like every other part of the industry. Cattlemen have long realized that their calves and feeder cattle sell in a competitive market, yet fat cattle sell in what is essentially a non-competitive market. Contracts, cattle bought on futures, confidentiality agreements and buying behind a curtain of secrecy protect packers and feeders. It results in a captive market…because the packer can fill his daily quota

Livestock Market Digest

without ever competing with other packers to buy cattle on a cash market. Packers and feeders both love this arrangement. But it is hell for the small producer who feeds cattle and for whom a good price for finished cattle might mean the difference between him staying in business or not. “Think of the difference it would make if the packers needed a few hundred finished cattle to make their quota each week and had to get out and bid on a competitive market to get them,” Wall stated. “It is all about trying to preserve as many players in the industry as possible,” Wall noted. “We want to keep small communities alive, keep the rancher able to pay taxes and keep their land investment. We want to save the industry and we realize we are vulnerable. If the packers had to get cattle on a cash market each week, get competitive with bids, it would really help.”

“

Is there a rancher who is not concerned when the price of boxed beef that packers sell to retailers goes up 100% while cattle prices go down 30 percent?” The cash market is important for more than just one transaction. Cattle futures are based on the cash price, and the feeder and yearling markets are both based on and dependent on the cash price of finished cattle.

A PUSH FOR POLICY

Midwestern cattlemen tried to resolve concerns and lead the industry to more robust price discovery at the National Cattlemen’s Beef Association’s Live Cattle Marketing Committee at the end of July. After considering several proposals aimed at encouraging greater volumes of cash cattle trade, the minimum cash policy that had been originally presented was so watered down that nothing was achieved. According to Wall, “NCBA said they would hire a research analyst out of academia who will look at the trade to see if there is enough cash trade to make market transparency. We know there isn’t. In the Texas panhandle feedlots in 2015, only three percent of the cattle sold were cash. That means 97.4 percent of the cattle sold on some type of formula or contract. How hard would it be for the packers to manipulate less than three percent? Yet everything else is sold off of that three percent value.” Wall continued, “if we don’t achieve robust

price discovery, then the NCBA says it will pursue regulatory or legislative solutions. But that will entail a series of hoops that we will have to jump through get back to where we are now.” The push to get NCBA behind at least a 30 percent minimum cash market in a 14 day delivery period was important, according to Wall, because the government considers NCBA the voice of the beef industry. “They only set policy, but if their policy gets behind things, those things get done,” according to Wall. Even though, according to NCBA’s own figures, their paying membership of 25,000 is about three percent of the estimated 700,000 beef producers and feedlots in the nation, NCBA is still much bigger than other industry organizations and their voice carries a lot of influence when change is proposed. BEEF INDUSTRY OR CATTLE INDUSTRY?

How could the NCBA fail to support a minimum cash requirement which would benefit the cow-calf producers, yearling operators, and backgrounders? It is all about votes, and the Texas Cattle Feeders Association (TCFA) and Kansas Livestock Association (KLA), whose combined feedlot capacity make up half of the fed cattle in the nation, had the volume and the checkoff dollars to outvote the state affiliates who represent the cattlemen. “It is ridiculous how many states would have to vote together just to outvote TCFA and KLA,” noted Wall. “NCBA is the voice of the beef industry,” noted Wall. “Selling beef and selling cattle are two different things. This push for minimum cash market caused the NCBA to tip their hand and show everyone who they are made of, and who they would support. We found it was the corporate feedlots and the packers, not the ranchers. They don’t represent rancher Joe or rancher Bob, even though they collect their money from ranchers in the form of the Beef Checkoff.” BUYING THEIR BULLETS?

As the National Cattlemen’s Beef Association clearly isn’t representing cattlemen, some have called for a referendum on the Beef Checkoff, which is funded by cattlemen but is now part of the NCBA (the organization was originally just the NCA, or National Cattleman’s Association, before they merged with the checkoff and incorporated Beef to become the NCBA). “I don’t blame you people if you sign that referendum for the checkoff,” noted Wall in his Feeder Flash. “Selling beef and selling cattle are two different things, but our trade association is together. How can they speak for both of us? How can they represent the beef

industry, which was gouging prices, but also for the cattleman, who was losing money?” WHAT ABOUT THE FEEDERS?

operator won’t rock the boat with the packer, because that means the packer won’t buy from him next week.

paid accordingly. Or that they had dark cutters. Or that their cattle graded poorly. Because the cattle are sold on the grid and the packer determines what they are inside the packing plant, there is no recourse.

Wall warned cattlemen not to look to the TAKE DOWN THAT TWEET! feedlots to protect their interests. He stressed, Feeders who are brave enough to post “The typical commercial feedlot, 30,000 head about packer concentration or abuse of power ADVICE FROM UNITED STATES or bigger, doesn’t care what the cattle market on social media have been contacted by pack- DEPARTMENT OF AGRICULTURE is. It is immaterial to them whether their feeders and told to take down the post or tweet. When the United States Department of er cattle cost .60, or $1.60, or $2.60. They buy Only after the offending post is taken down Agriculture (USDA) was tasked with invescattle that they can hedge and put them on will the packers return to the feedlot to buy tigating the packers actions, they basically feed. They charge feed and yardage to those cattle. returned with a blueprint for the cattle induscattle, which makes the feedlot work. They “The packers have so much power, because try to bring about accountability and robust feed for 150 days, and when they are ready to so much of their supply is captive that they price discovery in the market. That blueprint move them out, they put them on a showlist. don’t really have to bid competitively,” Wall includes using the mandatory price reporting, It is easier for them to move cattle if they are noted. “They are like the mafia who stroll into which is already law and requires packers to already contracted to a packer.” a store and say, ‘awful nice store, be a shame report their purchase twice a day, to enable The feedlots have no leverage in the trading is something were to happen to it.’” minimum cash requirements. relationship; they take what the packer offers. The feedlot operators aren’t the only ones “It is kind of embarrassing for someone like They don’t want to rock their boat. They want bullied by packers. “My father used to say that the USDA to have to tell us how to fix our to buy cattle cheap and hedge them, making the only difference between selling cattle on own industry,” Wall noted. “They said that their money from feed and yardage. But the the rail and being robbed is that if you sell anti-trust is hard to prove, and they won’t man who is leasing ranches, the man turning on the rail, you pay the freight,” noted Wall. be prosecuting the packers. But they said cattle out to graze, the man who ponies up the “We can’t travel to the packer and peek in that if we were unhappy with the gouging and money to feed a group of cattle through the window and see how our cattle perform. We manipulation of prices, we could use their feedlot, needs a real price for his cattle, and are at their mercy.” mandatory price reporting to easily facilitate the money he gets for his cattle is the differFeeder/Owners all have horror stories… the accounting needed for the minimum cash ence between staying in the business or losing men who know their genetics and know how market requirement. However, the NCBA just the ranch. Even when he knows the packer is their cattle grade and yield are told that their thumbed their noses at the USDA.” manipulating prices to the rancher, the feedlot young cattle were over 30 months of age and

2020 Fall Marketing Edition

A LEGISLATIVE FIX

Though the COVID-19 pandemic highlighted the brokenness in the cattle markets, Senator Charles Grassley (R-Iowa) has been trying for years to clamp down on meatpackers and increase competition in the market. He first introduced legislation in 2002 to bring more transparency to cattle pricing, and again introduced legislation on May 12, 2020 with this same goal. The bill is cosponsored by both Republican and Democratic Senators and aims to amend the Agricultural Marketing Act (AMA) which is up for renewal in September. The timing may be perfect. The Grassley bill requires packers to acquire no less than 50 percent of the cattle they will process within 14 days through spot-market cash sales from nonaffiliated producers. Sales agreements will be, “under circumstances in which a reasonable competitive bidding opportunity exists.” Wall admitted that it goes against the grain for some people to consider government involvement in markets, but asks, “Who else can force the packers to cash markets?” The government is already involved in inspection and grading of cattle, and controlling how much weight can be hauled to market. “Why not include the government?” queries Wall.

“We can ask packers nicely to buy on cash markets, and they won’t.” As price reporting modifications are possible every five years, the Grassley bill will not be a piece of stand-alone legislation, but should go hand in hand with mandatory price reporting, which is up for renewal in September. However, the 50/14 bill has been stonewalled by Pat Roberts, the chairman of the Senate Ag Committee, who won’t bring the bill before the ag committee. “Call your two state senators,” Wall instructed. “Let them know that they need to support the Grassley bill to save the rancher, the tax payer, the school systems, rural America. The bill isn’t for the packers or the feeders, it is to save the ranching industry.”

market, there are just screaming differences in boxed beef prices and what producers are being paid,” Peterson explains. “Let’s have a look and ensure that the fundamentals are better aligned for the industry. You have to have a certain minimal number of cash trades to base a market on and reflect the true value for cattle. We don’t have that right now.” National Cattlemen’s Beef Association (NCBA) says no to the Grassley Bill. South Dakota rancher Todd Wilkinson, policy division chair for NCBA, says the industry doesn’t need a government mandate. A better longterm solution to thin cash markets, Wilkinson believes, is encouraging more regional packers with increased capacity. Ranchers-Cattlemen Action Legal Fund (R-CALF) has wanted to see Grassley’s bill KNOW WHO REPRESENTS YOU adopted since 2002. “We have long recogIt goes without saying that the various nized that meat packers were systematically groups who are supposed to represent the shifting large volumes of cattle out of the cash cattle industry have different thoughts on how market and placing them into captive supplies price discovery should be handled. Below, in where no cash discovery occurs,” said Bill a nutshell, are three of those views: Bullard, chief executive officer of R-CALF. United States Cattlemen’s Association “Just eliminating confidentiality agreements (USCA) Senior policy analyst Jess Peterson won’t restore lost bargaining power between says USCA wants to clarify price reporting, producers and meat packers.” adding that USCA has made price reporting a key emphasis for more than 10 years. “When THE BEST AND WORST OF TIMES we look to the fundamentals of the cattle Packers and feeders use alternative marketing agreements which cut their costs and drive up profits, and they do so at a cost to cash market price discovery. This is a double-edged sword, as their confidential, non-disclosed agreements use the cash markets as a benchmark for determining price…so the lower they drive the cash market, the better off they will be. And the worse off the producer will be. While packers have increased cash trades in recent weeks due to increased scrutiny, four foreign owned packers still collectively control more than 80 percent of the U.S. slaughter market for beef, and past behavior clearly indicates a willingness to gouge, control and manipulate the market. It is time to act. The Agricultural Marketing Act (AMA) is up for renewal in September. The Grassley legislation should accompany that act. Contact the industry organization which aligns with your values and support them. Reach out to Senator Charles Grassley’s office. Contact your two state Senators and ask them to support the Grassley bill. Contact your representatives, — a similar bill is going through the House. Contact the candidates for office in your state. Be informed. Be educated. Be heard.

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2020 Fall Marketing Edition

Why Can’t Ranchers Sell Meat Directly to Consumers? by Heather Smith Thomas

discriminatory regulations because we don’t allow a state-inspected beef plant to ship across state lines, even though that state-inspected plant essentially does the same thing as the federally-inspected meat plants,” he says. “Even though we don’t have federal inspectors in foreign packing plants (Brazil, Australia, etc.) we allow foreign beef to cross our border and then go anywhere in the U.S. The state-inspected plants are thus being discriminated against and held back from competing in the national market. They are limited to their state market, which limits the size of their operation. If they wanted to engage in interstate commerce, they had to meet stringent regulations that didn’t even apply to the smaller operations,” Bullard says. “We have been trying to address this for over a decade. In the 2008 Farm Bill we succeeded in getting a provision to allow state-inspected meat plants to ship beef across state lines, but the USDA wrote the regulations in a manner that was so cumbersome that very few states could comply. So the problem persisted.” Then the COVID pandemic hit, and for the first time in our lifetimes, consumers who went to the grocery store could not buy the food they needed for their families. This raised more alarm signals.

anchers and consumers have been frustrated in the past several decades with growing regulations that impede direct marketing. Every community used to have local meat markets and butchers; there was always access to locally-grown meat. Today America’s consumers no longer have this source; all meat has to be state inspected if states have inspection systems, and to cross state lines it has to be federally inspected, and there’s a shortage of federal inspectors; they only service the large packing plants. This issue dramatically became apparent during the COVID pandemic in early 2020 when meat was unavailable and/or very high priced at grocery stores and consumers were trying to find alternative places to buy it. Many producers had beef animals they couldn’t sell, and consumers had no dependable source of beef. How did this huge disconnect evolve? Bill Bullard, R-CALF USA (RanchersCattlemen Action Legal Fund) says that back in the 1980s there were hundreds of meat ROADBLOCKS TO SELLING DIRECT TO packers who distributed meat across the U.S. CONSUMERS and hundreds of thousands more cattle proWe currently have a huge shortage of cusducers—and tens of thousands more feedlots, tom butchers across rural America; there’s and hundreds more local auction yards. “We had a very robust disaggregated sys- usually a waiting list to get an animal butchtem that could continue to operate even in ered. “America is just now realizing this, even the face of a crisis. Even if there was a crisis though this shortage has been in existence in one area of the country, we had enough packers and processers to pick up the slack for the past two decades,” says Bullard. “Congress, and all of the trade associations from other areas,” he says. “Then through the 1980s and into the early were inattentive, and now they are forced 1990s we went through what even the USDA to address the issue, and they are doing described as merger-mania. The largest pack- so—which is very promising. We need more ers were merging and acquiring smaller and custom butchers, and more packers, which mid-sized packers. Then they centralized the means more competition,” he explains. This packing industry in the high plains region of may be the silver lining in the black cloud of the U.S.—basically six states. So we have the COVID pandemic. “Also, when consumers went to the beef about 75 percent of our packing capacity and about 80 percent of our feedlots all located in cases at the grocery store and found them Nebraska, Kansas, Oklahoma, Texas, western empty, it made them wonder where their Iowa and Minnesota, and eastern Colorado. beef was coming from. This created a revival in demanding mandatory country of origin Everything now is centralized,” he explains. There are federal regulations in effect to labeling. In April we put a petition out on our ensure or attempt to ensure that these huge website and now have more than 393,000 packing plants are producing safe food, in a consumers and producers who signed it, calling on the president and Congress to require sanitary manner. “This takes more regulations than for mandatory county of origin labeling for all small plants, but there was no distinguishing beef, pork and dairy products sold in the between the size of the plants. Thus we have U.S. This is a positive move that has come

Livestock Market Digest

out of the pandemic.” It seemed so illogical that there wasn’t enough beef in the grocery stores to meet the demand (and the limited supplies were high priced), and yet ranchers or feedlots couldn’t sell their animals. The system is broken. Jay Platt, a third-generation cattle rancher near Saint Johns, Arizona says there are several problems with trying to sell direct. “Our family is trying to start an e-commerce business with meat. We don’t want to just sell a half beef or whole beef; we want to use e-commerce and basically do what Amazon does. You can order from us and there will be a box show up on your doorstep—attractively packaged and exactly what you ordered,” he says. “We’ve looked at a lot of models, of people who are doing this, but the problem when you do e-commerce is that you must have a federally-inspected plant to process the meat, and there are not enough of those around the country to do it. In Arizona there is only one that does custom, federally-inspected processing—at the University of Arizona meat lab—but I am a five-hour drive from there, to get that inspection,” he says. “There are actually four federally-inspected plants in Arizona but one is owned by JBS and they don’t do custom processing. Two others are small plants that similarly do not custom process. The fourth is the University of Arizona —the federally-inspected plant that will do custom processing. We also have seven state-inspected plants, one of which is only 50 miles from me, but with state inspection we cannot ship meat across the state line,” says Platt. “There are other plants that will do a custom kill for you, but you must sell the live animal to the customer and then they have it processed. I was on a phone call with a number of people with our Arizona Department of Agriculture in mid-June to discuss this problem. Apparently there are 22 states right now that have state-inspected facilities that are trying to get regulations changed so that state inspection will enable you to cross state lines. They have not been able to get this through,” he says. “One of the fellows who was on this call runs the inspection service for Arizona for these state-inspected plants. He said that all state inspections have to follow identical standards that USDA follows. I thought this was interesting. If it’s a foreign meat packer, it has to be an equivalent standard and not an identical standard, but if it’s a state plant, it must be identical, and yet you can’t ship interstate! We are harder on our own country’s producers than we are on foreign

meat producers! I sent an e-mail to our State Director, but haven’t heard back yet, asking what exactly is the reason why we can’t have state inspection cross the state line. I want him to tell me what that is, and he hasn’t done so yet,” says Platt. “If there are 22 states with state-inspected facilities, and they are indeed identical to USDA standards, there’s no reason why we shouldn’t be able to send beef across state lines. Rather than trying to sell a half or a whole beef to someone (which is expensive, and they need to have enough freezer space), we could sell not only across state lines but it would be easier to sell meat because people could buy just the cuts they want. If people understand that the state inspection is the same as the USDA inspection, they’d have the comfort level they want,” he explains. Many consumers want to buy just a few cuts of meat at a time, and there’s no reason the rancher can’t sell it that way. “I think that the packing industry doesn’t want this to happen. There has been a big upswing in people wanting to buy meat direct from the producer. The consumers want to know who produced it, how it was produced, fed and processed. This is one thing we ranchers can offer that a meat packer can never do.” More people today want to know where their food comes from, and how that animal was produced and handled. “I think the packing industry is smart enough to realize that if we can ship meat and have local customers, and sell them packages of meat that’s state inspected—which is just as good as USDA inspected—we’ve basically beaten them at that point. That empowers us and gives us the ability to do the one thing that they can’t do, and that’s provide consumers with the information they really want.” Ranchers can also provide the actual product they want, rather than some unknown entity at the grocery store. They don’t have to wonder where that piece of meat came from. Is it Brazilian? Canadian? Mexican? And how was it inspected? “This is something that absolutely needs to happen. If it does, and assuming we can’t break up the meat packers through antitrust action, if we can just solve this problem on selling direct, that would be the next best thing that we can do to ensure our survival.” There have been a number of articles recently on these topics. “I saw one in Forbes magazine and it was predicting that 25 percent of food sales would be e-commerce by 2023 but we hit that point already this year in 2020 and the year is not even over. The thrust of the article was that this is the wave of the future because consumers want to know

where their food comes from,” says Platt. “When you couldn’t buy toilet paper or meat, people were frustrated and are now saying, ‘That will never happen to me again!’ They want a source where they can always get meat.” There was already a growing trend toward direct marketing, and the pandemic ramped it up and showed the need for it. Dr. Lora Bledsoe, a large animal veterinarian with a practice in eastern Colorado, has lobbyed in her state to try to help cattle producers. There are some differences between state rules and federal rules, and the federal government always seems to make things more complicated. “Marketing meat locally has been a challenge because we don’t have enough meat inspectors, and for the smaller plants it’s very expensive to employ federal inspectors or even get them to come out to rural areas,” she says. The problem with government is that it tends to make things more complicated, instead of a more realistic approach. “I think they need to look more realistically at how they could be more efficient. That’s never been the trend of government, however; they always want to have more rules and more money. They never want to try to do better with what we already have,” she says. “I think the roadblocks to getting more independent packing houses is just another example of this. They don’t want to think about loosening up control and subdividing the control. There’s no reason why we can’t have state inspectors trained better or have the standards more consistent among the states. Then everyone could kind of agree and move on, rather than having a complicated soup of different requirements and then the federal government saying they can’t trust the states to adhere to the federal standards, and that they need to make more standards on top of the state standards. In the same way that slaughterhouses need to be decentralized, control of inspection also needs to be decentralized, so we can have more outlets for meat. There is tremendous demand, at least in our area, for more independent slaughterhouses. Right now the waiting time to have a beef animal custom butchered in Colorado is nearly two years out. In essence you’d need to call for an appointment the day the animal was born!” says Bledsoe. Many people would prefer to buy their meat from a local processer and producer and know the full history of that animal. “This would create a lot more niche markets for producers and might lead to a little more decentralization of power by the four big packers,” she says. Having more small processors around the

country would be a healthier situation than what we were faced with in the recent pandemic. There wouldn’t be such a bottleneck and there would always be meat available, if the process was not so centralized. “This really did highlight the weaknesses in our food supply. If we still had a lot of local meat processors, maybe a few of them might have been affected and have to shut down, but it wouldn’t have affected all of them. With all the eggs in one basket, it showed the chokepoint in this industry,” she says. HOPING FOR LEGISLATIVE RELIEF

R-CALF asked Congress and the President to streamline the process, to allow state-inspected plants to engage in interstate commerce. “Since our request, we now have legislation that has recently been filed, to do just that. The Senate filed a bill; Senator Mike Rounds from South Dakota and several others introduced a bill to expand the ability for state-inspected plants to market beef outside their borders,” says Bullard. Then in mid-June Congresswoman Liz Cheney from Wyoming introduced a similar version in the House. “If passed, this legislation would free up the constraints that regulators have imposed on our state-inspected plants and this should provide the opportunity for entrepreneurs to enter this industry for the first time in several decades,” he says. Another effort currently underway is called the PRIME Act. Congressman Thomas Massie from Kentucky introduced a bill that would allow custom slaughtering to be subject to state jurisdiction. “This would allow them to sell beef within their state—even though they don’t have the same inspection process as the state-inspected beef plants. So there are efforts to free up the constraints imposed on the smallest and mid-size packing plants,” says Bullard. Meanwhile, several states are taking it upon themselves to loosen up some of their own rules. The Maine Department of Agriculture, Conservation and Forestry added three new processors in an effort to increase the supply of locally-raised meat available, and authorized 90-day grants of inspection to custom-slaughter operations in Crystal, Etna and Alexander, starting June 1. State agriculture commissioner Amanda Beal stated that this move will relieve extended wait times to schedule USDA-inspected services, and that inspected meat processing will be available in two underrepresented areas of the state. The facilities will be restricted to in-state sales, however. The Arkansas Beef Council invited 26 2020 Fall Marketing Edition

processing facilities to participate in a survey (conducted January-March) to examine retail beef production practices in their state, which included questions about wait time and capacity for serving small producers selling beef locally in Arkansas. Fourteen responded, and there was quite a bit of interest in growing their businesses either to support more producers selling locally or to add a retail component to their own businesses. The survey was part of a project that also intended to provide an overview of program policies and costs in states that maintain a state-level inspection program. Arkansas relies on USDA to inspect beef for retail sale. As of May 2020, the USDA Food Safety and Inspection directory listed only three Arkansas businesses as having USDA inspectors for beef. A number of processing facilities in the state offer custom-exempt services. Meat processed under the custom-exempt process is not USDA inspected and can’t be sold in stores or across state lines. Examples include beef grown on a family’s ranch and processed for family use, or cattle sold through local food networks for private use. Producers feel there are not enough slaughterhouses and processing facilities in

Arkansas that cater to small-scale producers for providing local beef. Demand for beef has increased since March, resulting in longer wait times for an appointment for slaughter and processing. Prices have also increased since then. Survey participants said marketing was a twofold problem—the challenge of making the public aware that local beef is a viable alternative to buying meat at the grocery store, and marketing their services to potential producers. The North Carolina state legislature is discussing a bill that would provide $25 million in federal CARES Act (Coronavirus Aid, Relief, and Economic Security Act) funding to boost production at smaller meat processors and help livestock producers. The bill states that it will provide financial assistance to small and independent processors who specifically serve small livestock producers, in order to “reduce disruptions in the supply chain for fresh meat and to help small producers get their product to market.” The $25 million will go towards “facility expansion, fixtures, on-site job training, or equipment that will expand animal throughput, processing capacity, the amount or type of products produced, or processing speed,” and will only be used for plants that

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meet both of the following requirements: The plant contracts with independent livestock producers to process animals owned by the producers. The USDA contracts with Department inspectors to conduct federal inspection activities at the plant, or the plant is a State-inspected facility. If passed, the bill would distribute funds by Oct. 1, 2020. On a national level, six Republican congressmen, led by Jim Jordan of Ohio, are urging Secretary of Agriculture Sonny Perdue to ease regulations on small processors. In a June 9 letter to the Secretary, the congressmen stated that the high cost of complying with meat processing laws has made it hard for smaller processors to compete and has led to significant consolidation. Changing regulations would increase competition and make the market less susceptible to shockwaves such as occurred in April, with forced closures of dozens of large plants. The letter called for changes in HACCP (Hazard Analysis and Critical Control Point) regulations, which need to be more flexible for smaller processors, and for clearer guidance to processors on labeling of meat products. It called for expanding USDA’s CIS (Cooperative Interstate Shipment) program to more states, so more small processors can sell outside their state, and for increasing flexibility and lessening the expense of small processors that need to hire USDA inspectors beyond normal hours. This letter followed Department of Justice (DOJ) announcement of indictments of four current and former poultry industry executives for price fixing and the DOJ civil investigative demands (similar to subpoenas), to Tyson Foods, JBS, Cargill, and National Beef in a probe of alleged antitrust violations Then on June 23, 2020, a bipartisan group of senators sent a letter to Secretary of Agriculture Perdue calling for USDA to modify regulations that create impediments to a diversified meat processing industry. The letter reiterated points made by Congressman Jim Jordan and other Republicans on the House Judiciary Subcommittee on Antitrust, Commercial, & Administrative Law, when they called on USDA to ease restrictions on small and mid-sized meat processing operations. The senators said 80 percent of the beef market is controlled by four processing companies and this market structure exhibited its weakness during COVID-19, adversely affecting the supply chain from ranchers to consumers. At the same time, a new law was introcontinued on page 20 >>

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MEAT DIRECT

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duced by U.S. Representatives. Dusty Johnson, R-S.D., and Henry Cuellar, D-Texas. The Direct Interstate Retail Exemption for Certain Transactions (DIRECT) Act of 2020 would amend retail exemptions under current law to allow meat processed under state-inspected establishments to be sold across state lines through e-commerce, providing beef producers and local processors with more options to market direct to consumers. Currently, many states have State Meat and Poultry Inspection (MPI) programs approved by USDA’s Food Safety and Inspection Service (FSIS) as “at least equal to” standards set under the Federal Meat Inspection Act (FMIA) and Poultry Products Inspection Act (PPIA). Under the existing framework, state-inspected products can only be sold interstate if approved under the Cooperative Interstate Shipping Program (CIS). The DIRECT Act would amend the retail exemption under the FMIA and PPIA to allow processors, butchers or other retailers to sell normal retail quantities (300 lbs. of beef, 100 lbs. pork, 27.5 lbs. lamb) of MPI State-Inspected Meat online to consumers across state lines. Because DIRECT Act sales are e-commerce, sales are traceable and could easily be recalled. The DIRECT Act would allow states operating under the CIS system to ship and label as they are currently doing today. Then on July 2, 2020, the House Ag Committee Chairman Collin Peterson of Minnesota and former Chairman Frank Lucas of Oklahoma, joined several other House members to introduce the Requiring Assistance to Meat Processors for Upgrading Plants (RAMP-UP) Act. This legislation would establish a program to make grants available for facility upgrade and planning, for existing meat and poultry processors to help them move to Federal Inspection and be able to sell their products across state lines. The legislation would also require USDA to work with the States and report on ways to improve the existing Cooperative Interstate Shipment program. The RAMP-UP Act would provide grants to help rural small businesses meet market demands, wherever their customers live. The Act gives processors the tools to become federally inspected, which widens their customer base. It would help defray costs of attaining federal inspection for meat and poultry processing facilities, and give local producers more options--easing the strain on our meat and poultry industry by cutting red tape.

Livestock Market Digest

This bill would help small processors at local locker plants. increase their capacity and provide more “The local plant in Oakley is state-approved options for livestock producers to get their for inspection but not federally approved/ product to market. By supporting local meat inspected. They can sell meat within the state processors, we would safeguard our food but can’t ship anywhere else. We are not far supply and stimulate rural economies, and from Colorado Springs and Denver where help accelerate recovery of our beef industry. there would be a great market, but can’t ship The RAMP UP Act addresses supply chain anything across state lines. When COVIDissues by ensuring cattle producers access 19 came along we asked the government to to new markets regardless of where their let these guys do some kind of emergency livestock is processed. Over the past several action and ship it over. They couldn’t do that, decades, we’ve come to rely on fewer and yet people could drive here from Colorado larger facilities to process all our meat—a Springs and pick up our product and take system vulnerable to disruptions. Small and it home! Some of that was happening when medium-sized plants can ensure greater resil- people in the cities couldn’t get meat at their ience and food security in times of crisis, as grocery stores,” says Hemmert. well as flexibility in marketing for farmers “Our local locker plant applied some time and ranchers. By helping meat processing ago to be able to ship meat, and I’d like to plants cover the often prohibitive cost of do some business with them because I sell a federal inspections, the RAMP UP Act would lot of fat cows that could be made into hambolster a strong and reliable meat supply burger, but the government won’t let them do chain for farmers and consumers. that because they are not federally approved and inspected.” PRODUCER CONCERNS Brett Kenzy, a cattle rancher in South Ranchers and consumers have been frus- Dakota, says he doesn’t think it was any trated about the regulations that impede direct accident that our industry continued to have marketing. George Wishon (a rancher who more regulations. “Big corporations say they summers cattle near Colville, Washington don’t like regulations, but they throw up and winters them between the Tri-Cities and plenty of regulations until they control the Hermiston Oregon) says selling direct to the market. Once they have that control is when consumer has many benefits. they don’t want any regulations. We saw that “There could be a lot more beef sold that in pork processing. Now we let those plants way,” he says. “We have a handful of animals inspect themselves, which has led to several we sell to friends and family, but it’s difficult problems.” to get them scheduled for custom butchering. There’s increased interest in farm-to-fork Local butchers are booked up and it’s hard food production, getting away from all the to get anyone to process even one or two middlemen and letting farmers sell direct to fat animals. Halves and quarters need state consumers. This interest accelerated when inspection,” he says. people couldn’t buy meat at the grocery store “We need a lot more small custom pro- and wondered why they can’t just buy it from cessing facilities. Government regulations are a local farmer. tough for them, and many of these processers “The pandemic was a boon to local procesare thinking about retirement. We need more sors, but they can’t keep up. We have a shortyoung people going into this, but there’s not age of small processors, and I hope this might much incentive,” says Wishon. spur more investment. Some of the CARES “There are many legislative acts in the Act (Coronavirus Aid, Relief, and Economic works to try to help producers get more Security Act) money may now be going to food directly to the consumer. I think they some of the states, and several of those states, would help, but there is still such a labor like Missouri, may be going to invest some of shortage that we’ll still have some of the that money into local processing,” says Kenzy. same problems. Selling direct to consumers “It’s not the answer to all problems, but is a great idea, and it works—and we could there is no one answer. There are many difdo a lot more of it—but there are not enough ferent answers, many things that could help, processing plants. It takes a lot of capital to he admitted.” develop these small plants; the desire is there The PRIME Act (Processing Revival but there is also not enough labor to operate and Intrastate Meat Exemption Act) would them in an efficient manner.” It will take a amend the Federal Meat Inspection Act to while to get more of these going,” he says. expand exemption of custom slaughter from Kyle Hemmert has cattle and also runs a federal inspection requirements. This would sale barn in Oakley, Kansas, and says there give individual states freedom to permit are long waiting lists to get a beef butchered intrastate distribution of custom-slaughtered

meat such as beef, pork and lamb to consumers, restaurants, hotels, boarding houses, and grocery stores. “We also hear about other bills that would allow state-inspected meat to move across state lines. I think there are 27 states that have state inspection, and I hope this would spur the other states to get state inspection so they can take part in this commerce, as well,” says Kenzy. “What the small operations have going for them is a personal touch. Americans have gotten used to mega-companies, huge corporations, supermarkets and monopolies, but the average American has an inherent distrust of huge global corporations. If you can buy beef from your local butcher shop you get to see, with your own eyes, more of the operation and how it is harvested,” he says. The big plus is being able to have confidence in the product. “You know you are getting single-source ground beef. It isn’t a blend from many different animals that may have come from multiple places or foreign countries. You know it’s from a healthy, wholesome animal,” says Kenzy. Selling direct from farm to market is always preferable. “It seems better to have a real animal, processed by a local business within your community. It’s been said that a dollar spent locally circulates five times through the local economy. Just from an economic standpoint, and future of the local community, it makes sense to buy local. One of the most exciting things is that for so long we’ve had cattle producers and beef consumers widely separated, with the corporate monopoly in between. If we can sell more direct, it starts those conversations between the beef producer and the consumer. This will certainly be a healthier situation,” he noted. There’s been too much disconnect between producers and consumers. “We have radical animal rights people and radical environmentalists putting out false narratives (to turn consumers against farmers and ranchers); if people can see the reality, it would be much better. They could see that farmers and ranchers eat what they grow and live where we grow it. This means we take care of the animals and the environment,” says Kenzy.

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Efforts To Sell More Meat Direct To Consumers

“W

hen R-CALF first saw the reports in mid-March regarding shortage of beef in the stores, we developed an internet platform that allowed producers who could sell beef directly to consumers to include their contact information. We sent that information to consumers, to tell them they could come to this website, and find a producer in their area who can sell beef directly to them,” says Bullard. Some of these producers may only be able to sell in their state, some may only be able to sell the live animal to be butchered on behalf of the person who

bought all or part of the live animal, some may be federally inspected and can ship anywhere, but they could list whatever they were wanting to sell—so consumers could order from them. The requirement for listing on this website is that the beef has to be born, raised and harvested in the U.S. “We now have more than 450 producers in 43 states who are on this internet platform, to connect consumers with America’s cattle producers. Thus consumers could buy beef even when they couldn’t get it at the grocery store,” he says.

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Tactical Operations Center (TOC), Forward ❚❚ That former BLM Special AgentOperating Base (FOB), a media site, and a In-Charge Dan Love purposely ignored “free speech area.” federal and state recommendations, “in I and many others have written about order to command the most intrusive, what transpired during the so-called standoff oppressive, large scale and militaristic and there is no need to repeat it here, as our trespass cattle impound possible.” interest today is in the court case. Suffice it to BLM Agent Wooten also say his investigasay the feds backed down and left, handing a tion found, “excessive use of force, civil rights major victory to Bundy and his supporters. I and policy violations.” Further, Wooten says, vividly remember both the surprise and joy I “there was an improper cover-up in virtually personally experienced at this outcome. every matter that a particular BLM SAC parHowever, in March of 2016 a feder- ticipated in, or oversaw.” al grand jury indicted nineteen individuals, It also became apparent that important including Cliven Bundy and his two sons, evidence had been withheld by the feds. The Ammon and Ryan, for a slate of federal presiding judge held a series of hearings in crimes, including impeding federal officers, November of 2017. Based upon those hearthreatening federal officers, and extortion, as ings the judge found the following pieces of well as conspiracy to commit those crimes. evidence were withheld from the defense: Trial began on October 30, 2017, and that ❚❚ Records about surveillance at the is when the government’s transgressions and Bundy ranch abuses started coming to light. ❚❚ Records about the presence of govDuring the trial a bombshell memo from a BLM law enforcement officer to the Dept. of ernment snipers Justice was made public. In the memo, BLM ❚❚ FBI logs about activity at the ranch Special Agent Larry C. Wooten stated, “I rou- in the days leading up to the standoff tinely observed, and the investigation revealed ❚❚ Law enforcement assessments data widespread pattern of bad judgement, lack ing to 2012 that found the Bundys posed of discipline, incredible bias, unprofessionalno threat, and ism and misconduct, as well as likely policy, ethical and legal violations among senior and ❚❚ Internal affairs reports about missupervisory staff at the BLM’s Office of Law conduct by BLM agents Enforcement and Security.” In total, it came to 3,300 pages of eviWooten further stated these issues, “… dence withheld. As a result the judge said made a mockery of our position of spe- this represented “outrageous” abuses and cial trust and confidence, portrayed extreme “flagrant misconduct” by the prosecutors. The unprofessional bias, adversely affected our judge declared “a universal sense of justice agency’s mission and likely the trial regard- has been violated” and dismissed all charges ing Cliven Bundy…” and “put our agency against the Bundys “with prejudice”, meaning and specific law enforcement supervisors those charges cannot be brought again. in potential legal, civil and administrative Unbelievably, President Trump’s Justice jeopardy.” Department appealed this decision to the Some of the actions taken by certain BLM Ninth Circuit Court of Appeals, the most officers are simply too crude to include in this liberal circuit in the nation. publication. However, Wooten did report: On August 6 of this year the Ninth Circuit rendered their decision and I’m pleased to ❚❚ Conduct that was, “discriminatory, report the government’s CYA appeal was not harassing and showed clear prejudice successful. against the defendants, their supporters The court affirmed the prosecution was and Mormons.” guilty of “flagrant misconduct”, with such a ❚❚ Uncovered comments where BLM finding necessary for charges to be dismissed agents “bragged about roughing up Dave “with prejudice.” Bundy” and “grinding his face into the The court affirmed that the withholding ground.” of information about the surveillance camera ❚❚ That BLM employees, “didn’t prop- “was willful rather than merely inadvertent.” erly turn in the required discovery materi- The court also stated, “Rather than looking into the request and locating the documents al (likely exculpatory evidence)” before trial began, the government chose to ❚❚ That one BLM Supervisor, “instigatfight rather than respond to the request.” ed the unprofessional monitoring of jail On the withholding of evidence concerncalls between defendants and their wives, ing the government’s use of snipers, the court without prosecutor or FBI consent.” stated: “Of particular concern is the governE-MAIL

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Bundy Boondoggle

The Ninth Circuit recently affirmed the mistrial in the Bundy case

he saga of Cliven Bundy and his battles with the feds over livestock grazing go back many years. From a strictly administrative/legal basis, here is a quick summary:

❚❚ In 1993, BLM sent Bundy a notice of trespass and an order to remove his cattle ❚❚ In 1998 a federal district court permanently enjoined Bundy from grazing livestock within the Bunkerville allotment. Bundy filed an appeal and in 1999 the Ninth Circuit Court of Appeals denied his appeal and affirmed the lower court’s order. ❚❚ In 2011, BLM sent Bundy a notice of intent to roundup his cattle. ❚❚ In 2013 a federal district court ordered Bundy to remove his cattle within 45 days and authorized the feds to impound any cattle that were not removed. Bundy appealed and lost. ❚❚ In March of 2014, BLM issued a notice of intent to impound Bundy’s cattle, and on April 5, 2014 the roundup began. This was a large operation for the feds, as the court recently summarized: BLM made extensive preparations for “Operation Gold Butte Impound.” Coordinating with agents from the National Park Service and Federal Bureau of Investigation, BLM anticipated resistance from Bundy and his supporters. It planned to escort the contractors in and out of the area each day. BLM established a Listening Post/Observation Post (LP/OP) “strategically placed at elevated positions around the Bundy residence each evening” where agents were outfitted with binoculars, spotting scopes, night-vision goggles, and thermal-imaging devices. The LP/OP personnel were to have “agency-issued rifles with them at all times.” BLM also established a Livestock Market Digest

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ment’s handling of evidence related to the presence of snipers. This was a hot-button issue… The government said the Bundys’ claim of “snipers” was “false” and “deceitful,” yet the government’s own documents referred to its agents as “snipers.”…”In short, the government had to know the import that any evidence regarding snipers, or agents who looked and functioned like snipers, would have in this case. Nevertheless, it withheld a slate of information…” The court also found the government’s position this evidence was irrelevant to be “preposterous and reckless.” With respect to the threat assessments, the court said, “…the government failed to turn over beneficial information speaking to Bundy’s potential for violence. These documents could have helped bolster the defense’s claim that the government had engaged in an overmilitarized impound operation that the Bundys claim fueled their fears of being surrounded by snipers. But irrespective of the theory defendants were to put forward, these documents should have been released. They, at the very least, provided impeachment evidence because some of their findings contrasted with the 2014 threat assessment used as the basis for planning the impound operation, and they undermined the prosecution’s opening statement.” There is more, but in all instances the appeals court affirmed the lower court’s decision. There are still many questions concerning the design, implementation and costs of this government boondoggle. Shamefully, neither political party has seen fit to conduct a complete investigation and report on this operation. That failure increases the odds that similar abuses will occur in the future. Until next time, be a nuisance to the devil and don’t forget to check that cinch. Frank DuBois was the NM Secretary of Agriculture from 1988 to 2003, is the author of a blog: The Westerner (www.thewesterner.blogspot. com) and is the founder of The DuBois Rodeo Scholarship and The DuBois Western Heritage Foundation

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Open Letter

Questions From The Brand About the 50-14 Legislation Fellow Beef Industry Stakeholders:

o suggest U.S. beef producers are facing difficult times egregiously understates the extent of challenges thrust upon cattlemen during the past year. Yet, times like these often are the catalyst for ideas and innovations that bring meaningful improvements for a more sustainable future. While it has been a topic of keen discussion for decades, the call for change in fed-cattle marketing and price discovery rarely, if ever, has been louder than it is today. The idea of creating more robust price discovery and competition in the marketplace is easy to support and can create obvious shared benefits for stakeholders. Cattlemen widely agree that growth in beef demand means more dollars transferred back to the production sector. Yet, history proves it’s difficult to find agreement among cattlemen on how this is best accomplished. The debate around how producers share in the financial benefits of growing beef demand often focuses on the ratio of cattle sold in the negotiated spot (a.k.a. cash) market versus alternative marketing arrangements. To this point, Senator Chuck Grassley’s recently proposed 50-14 legislation centers on mandating an adjustment to an imbalance, requiring multiplant packers to purchase at least 50 percent of their cattle needs for each plant in the negotiated spot market. Owned by the American Angus Association and its Angus farmer and rancher members—whose opinions vary on the proposed 50-14 legislation—the Certified Angus Beef® brand exists to create demand for the high-quality beef sold under our label and therefore the Angus genetics and cattle that supply it. The brand is not a political or policy-driven organization but still very much vested

Livestock Market Digest

in where the beef industry migrates on foreign-born cattle excluded from the profed-cattle marketing and how such mech- posed 50 percent spot market purchase anisms influence the flow of economic requirement and how do these excluded signals from consumers to producers. populations factor into the 50 percent spot While there are still obvious challenges market purchase calculation for a plant? in the beef industry, arguably, the busi❚❚ What will the impact be on valness is responding far better than ever ue-added programs such as age-and-source to the demands of the consumer, clearly verified, GAP-certified, NHTC, etc., and demonstrated by the significant growth of associated feeder calf prices, if a feeder’s high-quality beef demand since 2010. The ability to secure a fed-cattle market is not economic signals drove this improvement assured prior to placing the cattle on feed? and the emergence of grid premiums have We are confident there will be much been essential to recent gains in quality more discussion on this topic in the months and helped producers reap rewards for ahead. Independent of what is ultimately responding to those signals. decided in Congress and across the indusAnnually, cattlemen earn more than $92 try, our team at the Certified Angus Beef® million in Certified Angus Beef® brand grid brand will continue to focus on building premiums for cattle accepted for our brand consumer beef demand more than politalone. Based on what we understand today ical and policy matters outside our area about the 50-14 legislation, eliminating of expertise. Yet, we remain interested the Certified Angus Beef® grid premiums because the brand will be impacted, regardcurrently paid on a large portion of cattle less. We feel it better to ask questions now would muffle the consumer-driven signal for the sake of expanding perspectives for the industry has benefitted from and could our brand and the industry of which we limit a producer’s ability to maximize car- are a part. cass value and economic return. We appreciate the opportunity to share There are advantages and imperfec- our perspective and your consideration of tions to any fed-cattle marketing system. our questions. If you care to visit about Arguably, more negotiation could poten- this topic in more detail, please feel free to tially enhance cattle values as determined call or email using the contact information through grids given the influence on base provided below. price determination or premium/discount Thank you and take care. structure. That’s why the Certified Angus Sincerely, Beef® brand is not for or against any single John F. Stika marketing method over another. We simply President, Certified Angus Beef LLC want producers to have the incentive and opportunity to be paid what their cattle are Bruce Cobb worth, not having to take an average price Executive Vice President, Production, where the better cattle subsidize the rest. Certified Angus Beef LLC To that end, we have questions regarding specific language in the 50-14 legislaJohn Grimes tion. We have listed them below with the Chairman, Board of Directors, Certified goal of gaining a wider understanding of Angus Beef LLC the requested changes and potential outcomes. As a stakeholder engaged in this discussion, we hope you can help us do so or merely give these questions some additional thought as you engage the industry in this conversation.

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❚❚ How will negotiated grids be handled under the proposed requirements: considered part of the negotiated spot market given prices can be negotiated weekly without a written or implied contract with a packer or excluded from the spot market due to their grid structure? ❚❚ Why are dairy and dairy crossbred cattle, cattle over 30 months of age and

U.S. Cattlemen’s Association Responds to Open Letter from Certified Angus Beef

Dear Mr. Stika, Mr. Cobb, & Mr. Grimes;

n response to your letter addressed to “Fellow Beef Industry Stakeholders” and regarding Questions from The Brand About The 50-14 Legislation, the United States Cattlemen’s Association (USCA) offers the following for consideration regarding the legislation in question (S.3693 and H.R. 7501): 1. How will negotiated grids be handled under the proposed requirements: considered part of the negotiated spot market given prices can be negotiated weekly without a written or implied contract with a packer or excluded from the spot market due to their grid structure? The Livestock Mandatory Reporting Program (LMR) provides definitions for ten types of livestock transactions. (Congressional Research Service, Livestock Mandatory Reporting Act: Overview for Reauthorization in the 116th Congress, (June 19, 2019) https://fas.org/sgp/crs/misc/R45777.pdf) Negotiated purchases are those that are a cash or “spot” market purchase by a packer of livestock from a producer under which the base price for the livestock is determined by seller-buyer interaction and agreement on a delivery day. Cattle are delivered to the packer within 30 days of the agreement. Negotiated grid purchases are defined as the negotiation of a base price, from which premiums are added and discounts are subtracted, determined by seller-buyer interaction and agreement on a delivery day. Cattle are usually delivered to the packer not more than 14 days after the date the livestock are committed to the packer. Other purchase types for cattle include forward contracts, formula marketing arrangements, and packer-owned stock. Given these definitions, the bill as proposed would not include negotiated grid purchases as “spot” market purchases. However, the enhanced true price discovery that results from the negotiated cash price will help drive the negotiated grid price. 2. Why are dairy and dairy crossbred cattle, cattle over 30 months of age and for-

eign-born cattle excluded from the proposed 50 percent spot market purchase requirement and how do these excluded populations factor into the 50 percent spot market purchase calculation for a plant? Dairy and dairy crossbred cattle, cattle over 30 months, and foreign-born cattle do not represent the high-quality cattle that our members, and producers under the Certified Angus Beef label, raise. Further, these cattle types not eligible for delivery against the CME Live Cattle Futures Contract, which is why they are sorted into different reporting categories within LMR. The downward pressure placed on the market due to these cattle are excluded from spot market purchase calculations to provide U.S. cattle producers with a transparent and accurate picture of current marketplace conditions. Apart from the 50-14 effort, but still a consideration under the LMR program, is the non-native cattle reporting loophole. Feeder Cattle are sold based on origin, breed, quality, and value. Divisions for feeder Cattle price reporting include Canadian, Mexican, Brahma Cross, and Split Load among others. However, Live Cattle MPR reports are based only on gender and dairy influence in breeding and include no distinction for non-native cattle. This allows non-native Live Cattle to be delivered straight to the packer, while the pricing of imported cattle is reported independently from the USDA MPR system. The Chicago Mercantile Exchange (CME) contract policy now requires that producers who deliver live cattle to a CME delivery point sign an affidavit certifying that the cattle were born and raised exclusively in the US. Under these new contract changes, CME live cattle price reporting is now based solely on the prices for US born and raised live cattle. CME reports serve as a guide and benchmark for producers in determining their sale decisions, access to current and accurate pricing is essential. Packers now require that cattle feeders sign affidavits indicating that Feeder Cattle originating from Canada and Mexico were on feed for over 100 days. This requirement serves as an industry-led tracking system for non-native live cattle, ensuring health requirements are adhered to, and those with Mexican origin, and often sold at a discount price, are accurately reported. Currently, MPR divisions only report imported live cattle as “steer” or “heifer”, leaving out crucial origin information. This severely impacts the transparency and true price discovery within the livestock market and represents an additional loophole outside

of the 50-14 effort that needs to be addressed. Year-to-date, the U.S. has already imported 745,000 head of cattle from Mexico, up four percent from 2019, and 370,000 head of cattle from Canada, down 10.6 percent from 2019. (2 Beef2Live, Cattle Imports, (August 12, 2020) https://beef2live.com/story-cattle-imports-249- 107553#:~:text=The percent20United percent20States percent20has percent20imported percent20745K percent20head percent20of percent20cattle percent20from, percent2C percent2 0down percent2010.6 percent25 percent20from percent202019) The non-native loophole allows these cattle to enter into domestic production, potentially under the Certified Angus Beef brand. 3. What will the impact be on value-added programs such as age-and-source verified, GAP certified, NHTC, etc., and associated feeder calf prices, if a feeder’s ability to secure a fed cattle market is not assured prior to placing the cattle on feed? One of the main reasons the 50-14 bill was introduced is to eliminate anti-competitive packer feedlot relationships where packers favor large feedlot operations who agree to sell only to that packer. The system rewards quantity over quality and gives the packer pricing leverage when large quantities of cattle are committed on formula-based contracts. We currently have a system where large feedlots with lower quality cattle receive a higher price than smaller feeders receive for their high-quality cattle filling the sale barns and yards in the upper Midwest. Family feeders should be rewarded for quality, not size. As an example of how quality can be degraded, consider the hog market. After the pork industry vertically integrated, the incentive for producers became focused on throughput, and no producer incentive remains to develop genetics and animals that yield a higher quality, more flavorful product. The 50-14 mandate is great for producers wanting to raise quality cattle, like the Certified Angus Beef brand is known for, and provide an exceptional consumer eating experience. Thank you for the opportunity to provide clarification on this pending legislation, and USCA’s Marketing and Competition Committees would certainly welcome further discussion on the above points. Sincerely, Dr. Brooke Miller, M.D. President, U.S. Cattlemen’s Association

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2020 Fall Marketing Edition

What Consumers Want

Research shows areas of concern for consumers regarding beef production.

by Madi Baughman, Angus Media, Editorial Intern

hen it comes to beef, consumers are growing more concerned with animal welfare issues in beef cattle production along with the product’s taste and nutritional value than ever before, said Shawn Darcy, director of consumer market research for the National Cattlemen’s Beef Association (NCBA). Darcy presented “Consumer Market Research — What They Say They Need, and What They Want” in June 2020 at the virtual Beef Improvement Federation (BIF) Symposium. Based on the Beef Checkoff Program’s consumer beef tracker of 1,500 consumers balanced to census each quarter, Darcy said

Livestock Digest

67 percent of consumers say they are eating beef on at least a weekly basis. Along with tracking their consumption habits, they also ask consumers what factors they consider when choosing the meat products they consume, he added. While consumers’ main decision factors are still taste, affordability and ease to prepare, Darcy noted that factors regarding production aspects of raising animals are growing in importance. Examples include raising animals responsibly, using environmentally friendly practices, and trusting the people who raise the animals. “We do need to have some communications out there addressing these things (production processes), because there are more people, more than ever, that are starting to think of these items along with things like taste and things like health,” Darcy explained. LOW LEVEL OF KNOWLEDGE

“Consumers are further away from food than they have ever been,” said Darcy. “So, when they are thinking about production and they hear a negative story or a positive story, they don’t necessarily associate it with one direct area in agriculture; it’s kind of spread across multiple areas.” Though 67 percent of consumers are con-

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cerned about cattle production, they admit to being unfamiliar with the process, Darcy said. Of the consumers surveyed, only 27 percent claimed to understand the operations involved with raising cattle. About a year and a half ago, Darcy said, he hosted nine focus groups in cities in different regions and did a quantitative study to understand how consumers felt about food. ❚❚ 43 percent of consumers believed cattle are raised in confinement their entire lives. ❚❚ They felt a large part of the industry consisted of corporate farms focused on money. ❚❚ They saw family farms as a “dying breed” and associated them with organic, grass-fed operations. ❚❚ They saw family farms as higher-quality and providing better conditions for the cattle. BQA MESSAGE

Knowing all of this information, Darcy said they wanted to see if the Beef Quality Assurance (BQA) program could be a platform to educate consumers on industry practices. It revealed a large knowledge gap, which offers opportunity, Darcy explained. “A lot of things they were associating with these smaller family farms within niche markets, those were things we know were true for the entire industry.” Seeing a brief explanation of what BQA is and five to six facts about the program, many consumers said, increased their confidence in beef production. In light of this information, Darcy and the Beef Checkoff Program created a video to inform consumers about BQA. Consumer Beef Tracker data indicated a positive response, with an increasing percentage of consumers feeling positive about beef and how it is raised. To access the archived presentation slides and webinar session, visit www.bifconference. com/bif2020/newsroom.html . Editor’s note: BIFconference.com is a meeting coverage site provided by Angus Media. Coverage is made possible through the generous contributions of our site sponsors, including American Angus Association, AngusLinkSM, Albrecht Ranch, Branch View Angus Ranch, Cattle Visions, Connealy Angus, Deer Valley Farm, Express Ranches, Fink Beef Genetics, Genex, Krebs Ranch, Nichols Farms, Penz Angus Ranch, Pollard Farms, Select Sires, Spur Ranch, Sydenstricker Genetics, and Yon Family Farms.

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U.S. Meat Packing Industry is Heavily Controlled by Foreign Interests by Heather Smith Thomas

n the past several decades there’s been a growing trend of foreign ownership and control of American industries, including beef. Our beef market is heavily controlled by the packers and now some of our largest packing companies are Brazilian based. This is alarming for U.S. cattlemen, with grave concerns for the future of our industry. Bill Bullard, R-CALF USA (RanchersCattlemen Action Legal Fund) says that when the Chinese came to America to buy Smithfield Foods, this was a huge concern. “We argued that this was contrary to national security interests of the U.S. We urged the Justice Department and CFIUS (Committee on Foreign Investments in the U.S.) to reject or deny this acquisition, but they allowed it to go through,” he says. Leading up to that purchase, ever since 1990, 75 percent of all hog producers in the U.S. have gone out of business. “We’ve lost 200,000 of them. We are now down to about 68,000 hog farmers, and there is far less economic activity in rural communities all across America. That vertical integration process, where government regulators have allowed these multinational corporations to capture the entire hog supply chain from birth to plate, kills competition. As a result we have a new American farmer in the hog industry. That new farmer is led by Wan Long who is CEO of Smithfield Farms. He is from Communist China and has a salary of about $291 million. That’s the new American farmer that our country has allowed to evolve, because we’ve lost sight of the need to preserve, protect and strengthen our own American family farm system of agriculture that has been the envy of the world,” says Bullard. This is now happening with the beef industry. In 2007 a relatively unknown Brazilian company, JBS, came to America and acquired Swift and Company—one of the top five beef packers. “We hoped we might block this sale because we didn’t want foreign interests to control a major part of our meat packing industry. But again, the Justice Department and CFIUS allowed that sale to go through. Suddenly we had a Brazilian firm among the

largest meat packers in the U.S. They were ranked third.” This company was very aggressive, acquiring more packing plants and processing facilities. “Within a year of JBS acquisition of Swift and Company, they tried to buy Smithfield Beef Group (our fifth largest packer) and tried to buy National Beef Packing Company— our fourth largest packer. So we went to the Senate Judiciary Committee and urged them to conduct hearings to block the sale,” says Bullard. Senator Herb Kohl from Wisconsin agreed to hold hearings. “We testified and argued strenuously that we should not allow Brazil to come in and acquire these meat packing facilities. We said JBS was a bad actor and that Brazil had cited JBS previously for violation of Brazil’s antitrust laws and for harming farmers in Brazil. We did not want to allow that to occur here.” The Judiciary Committee recommended that the sale be blocked, but the Department of Justice chose only to block the sale between JBS and National Beef Packing Company. “They allowed the Smithfield Beef Group sale to go through, and that gave JBS the largest cattle feeding company in the U.S. which was

Five Rivers Ranch Cattle Feeding. Thus JBS suddenly became the second largest meat packer in the U.S. and the largest packer in the world,” says Bullard. “That was in 2008, and 17 States Attorneys General joined in the enforcement action of our antitrust laws to try to block that sale. Upon initiation of litigation, JBS withdrew its request and decided it would not acquire National Beef Packing Company. That meant our industry still had four packers controlling 85 percent of the marketplace instead of only three packers controlling that amount,” he says. Jay Platt, a cattle rancher near Saint Johns, Arizona, says the packer concentration (more and more of the cattle being processed by fewer and fewer packers) has evolved over time, but accelerated with JBS acquisition of Swift. “This Brazilian company has some worrisome issues. The Batista brothers own and control JBS, and they have run afoul of the law in Brazil for bribing two presidents and scores of politicians. There were also problems with them bribing meat inspectors, so they don’t have a very good track record and are bad actors. I think they have now moved from second to first place in size in the U.S.

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One of the interesting things about Brazil is now appear to be heavily engaged in accumu- 60 days. Reports indicate that these could that when we had the coronavirus situation lating more captive supply, just like the big number more than 700,000. We have proand a number of meat packing plants closed, four packers are doing. We continue to lose ducers who have cattle to sell but no market Brazil stepped up and said they could supply competition in the industry, and at the same to sell into, yet the meat packers continue all our needs,” says Platt. time we continue to allow foreign interests to to import tens of thousands of cattle from “One of the problems with that is when control the most important market in both Canada and Mexico, including cattle that you talk about food safety, foreign nations the hog and cattle industries and that’s the are going directly to slaughter. Thousands of Canadian cattle are being imported and going are not subject to identical USDA standards. competitive cash market,” he explains. They are subject to what are called equivaOur domestic industries are not being pro- to slaughter every week, displacing American lent standards. The Food Safety Inspection tected; foreign interests control our markets cattle, blocking our cattle producers access to Service over time has decreased the fre- and our country is importing meat from other their own market,” says Bullard. R-CALF has led the industry in calling for quency and number of inspections they do countries as well. at foreign meat packing plants. Instead they “America is becoming more dependent on investigations by the Department of Justice rely on HACCP (Hazard Analysis and Critical imported beef. Today approximately 20 per- and other government regulators since 2015, Control Point) which is basically a bunch of cent of all available beef in the U.S. is derived when our cattle prices first collapsed. “In paperwork where they have to dot the I’s from imports. We import beef from more early 2016 we went to the Senate Judiciary and cross the T’s and say they are basically than 20 countries including Honduras, Costa Committee and called for investigation. Then doing the same thing we are doing in the U.S. Rica, Nicaragua, Uruguay, Argentina, Brazil, in September 2018 when we realized that There is still some inspection but it’s not as Australia, New Zealand, Mexico, Canada and the cattle futures market was operating in a frequent as it used to be,” Platt says. even some countries in the European Union,” dysfunctional manner, we filed a complaint “Now we also have Marfrig which is he says. “Meanwhile our own producers and request for investigation with the commodities futures trading commission. The another Brazilian company and the second struggle to survive.” largest meat packing company in the world. With the COVID pandemic and packing regulators and the rest of the industry did not It started out acquiring 51 percent interest in plant shutdowns and slowdowns, we still support our requests for enforcement action,” National Beef. This gave them a controlling had cattle that needed to be slaughtered that he says. “When we realized that the government interest, and then they acquired another 30 are now backed up and still waiting in the percent so they actually own 81.7 percent pipeline. “We have fed animals that have was not inclined to enforce our antitrust of National Beef. So two of the four packers been ready for slaughter for the past 30 to laws and protect the competitiveness of our industry, we were up against the wall. What (that together process roughly 85 percent of do you do, when the government refuses to the beef in the U.S.) are Brazilian controlled. enforce existing laws to protect the competiJBS is totally owned and National Beef is tiveness of an industry? We had two choices. 81.7 percent controlled or owned by Marfrig,” We could throw up our hands and give up, or says Platt. we could go it alone. So that’s what we did.” “Now we have a situation where there are In April of 2019, R-CALF members filed only 24 meat packing facilities in the U.S. an historic national class action antitrust lawand mainly concentrated geographically in suit against the big four packers, alleging that six states. So when we have a situation like they had conspired to artificially depress price. the coronavirus, there is a devastating effect “We took action and called for an investigabecause there are so few of them and they are tion, long before the August 2019 Holcomb, concentrated in such a small area,” he says. Kansas fire at the Tyson plant that prompted National Beef Packing Company is the USDA to call for an investigation, and a year fourth largest packer in the U.S. “We have before the COVID pandemic caused all levels two Brazilian companies among the top four of government to call for investigation. This beef packers, and those two control about 40 included State Agricultural Commissioners, percent of the fed cattle market,” says Bullard. 11 State Attorneys General, members of both “That raised alarms to CFIUS (Committee on the House and Senate in Congress, and the Foreign Investments in the U.S.) and should President of the United States. We have never be raising concerns about national securiseen such an intense focus and concern over ty—with Communist China owning and conthe dysfunctional cattle market as we are trolling the largest pork producer in the U.S. seeing today,” says Bullard. “It took a drastic and Brazil’s JBS and Marfrig now in control situation to finally get people’s attention.” of much of our beef,” Bullard says. “This grave concern is the first step in “About the time Marfrig acquired conachieving needed reforms in our industry. trolling interest in National Beef Packing This has never occurred before, except 100 Company, National Beef Packing Company years ago when Congress passed the Packers acquired a regional packer called Iowa and Stockyard Act of 1921, and the year Premium—one of the important packers conbefore that had entered into a consent decree tributing to price discovery in the beef induswith the major packers requiring them to try, because they primarily purchase in the divest of their control over the industries’ competitive cash market,” Bullard says. market channels,” he says. Here we are, a “Upon this acquisition and control, they

Livestock Market Digest

century later, going through the same thing, fighting the same battle. “There has been an overall resurgence in strengthening domestic manufacturing in the U.S. We are seeing a beginning of a reversal of the offshoring that has occurred, and the food industry is among those manufacturers. We hope that this reversal of the 25-year trend of globalization is finally nearing an end.” Many people are waking up to the fact that it hurts our country. A Senate investigation was begun in June, led by Senators Elizabeth Warren and Cory Booker, looking into the recent business practices of Tyson Foods, JBS USA, Cargill and Smithfield Foods. This investigation will examine the apparent divergence between local meat supplies and exports to other countries. Smithfield’s Kenneth M. Sullivan and John Tyson had stated that the U.S. was “perilously close to the edge in terms of our meat supply” and that “the food supply chain is breaking,” yet the U.S exported more than 1.3 billion pounds of beef and pork from March 20 to early June. This raises questions about the packers’ honesty with the American public about the reasons for higher food prices, and their commitment to providing a safe, affordable, and abundant food supply for the nation. Warren and Booker wrote a letter to Tyson, JBS USA and Cargill to that effect, and the letter concluded with 10 questions for meat packer executives, ranging from their responses to COVID-19 on worker safety measures to specific numbers on meat production, exports and prices. PRODUCER CONCERNS

Cow-calf ranchers, stockers-backgrounders and feedlot operators worry about the future of our beef industry. George Wishon, a rancher in southeastern Washington State, says it is very concerning that JBS is Brazilianowned. “We know the corruption of the Brazilian government and the Batista brothers, the mess in South America, and Marfrig (owner of National Beef). It is a huge concern that a strong share of the fat cattle process is Brazilian. There’s also the FMD (foot and mouth disease) issue, the tainted beef issue awhile back, and shipping. Our government isn’t protecting our domestic beef industry,” he says. “The Brazilians recently said that if there’s any problem in the U.S. of not having enough beef, they can just bring in whatever we need. It’s alarming to realize that much of such a vital industry is controlled by foreign nationals around the world,” says Wishon.

If our own industry can’t survive because of all the cheap beef coming in, then our consumers are at the mercy of someone else. “We can’t compete against Brazil. We’ve talked with people who have gone down there, who looked at the prices their cattle are bringing, their labor costs, etc. and we can’t compete with their cheap labor, good climate, etc.” It’s frustrating because our government doesn’t seem to want to protect our own beef industry. “They simply want cheap food for consumers, but importing it will put many our producers out of business and then we are at the whims of all these other countries to provide a vital protein source to our consumers.” There is no guarantee that it will be a safe source, or a continuing source. “It’s a long ways to transport beef to the U.S. from Brazil and there are animal health concerns in that country. Yet we see Brazilian beef in our grocery stores. Right now it’s just processed meat, but it won’t be long until its fresh beef,” says Wishon. Many government officials are shocked to learn that we are importing beef from more than 20 countries across the world. “Canada doesn’t seem like a dangerous source, but when you look at South and Central America,

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the health concerns are much greater. Our government requires people to have all sorts of vaccinations before we travel to those countries; there are human health concerns in those countries along with animal health issues, yet we are importing beef from them.” There is a lot of market manipulation, and health issues when dealing with foreign countries. Kyle Hemmert has cattle and runs a sale barn in Oakley, Kansas. “The federal government has not done a good job of enforcing the Packers and Stockyard Act of 1921; they should be watching all these mergers and how this affects competition and antitrust efforts. They’ve let the mergers continue and now we are stuck with four packers that control 85 percent of our market,” he says. Foreign ownership and control is alarming. “In Brazil, the Batista brothers who own JBS were caught bribing officials in their own government and selling questionable meat. Recently there was another recall of meat that came from a foreign country. We import meat from 22 countries including a small North African country called Numidia. In Africa there are areas that have Foot and Mouth Disease, and now they are letting people bring meat here. The first shipment from Numidia came in April to Philadelphia,” says Hemmert. “When COVID 19 hit and there wasn’t enough meat in the grocery stores because of the bottleneck at packing plants (due to people not showing up for work at the plants), JBS said, ‘Don’t worry. We can send you lots of meat that we can import from all these other countries! The fact that some of these big packers are foreign-owned should bother everyone in this country, after what happened with COVID-19. This was a worldwide epidemic and they have a stranglehold on us. They could decide to not send us any products and send their meat somewhere else. Food security is a big issue. People should realize this, after they went to the supermarkets and the shelves were empty.” It will take a lot of complaints to get the government’s attention. “We need mandatory country-of-origin labeling. R-CALF is not political. It does not lean toward Republican or Democrat, but when Trump came along with his goal to “Buy American, Hire American” we thought we’d found our man, but he’s not getting input from the right cattle organization. NCBA is all about having imports because that’s how the packers make a lot of money—off the backs of ranchers, using our name,” says Hemmert. “The day Trump announced the COVID financial assistance program payments to 2020 Fall Marketing Edition

farmers and ranchers, he asked why we are importing from countries that don’t want to do business with us. He wondered why we were importing beef from other countries when we have plenty of beef here.” We need to protect our own producers. Brett Kenzy, a rancher in South Dakota says COVID-19 has moved the topic of food security from the back burner to the front of the argument. “Food security can mean many different things. Processing capacity can play into this, as does foreign ownership. Yet people have different views on this. They either subscribe to the idea of ‘America First’ or they don’t. They either believe in the sovereignty of America or they are a globalist. I believe in putting America first and am excited by hearing that the World Trade Organization is going to be challenged,” he says. “Whether our senators and congressmen will vote to remove the U.S. from the World Trade Organization, I don’t know, but at least we’ll be having those discussions.” We need to protect our own industries and production or we become too dependent on sources that are fickle. “As producers, we are very trusting, and believe in the goodwill of mankind, some-

times to our detriment. Sometimes we mistakenly place trust in our government, but our government has allowed foreign countries to come in and buy up our slaughter capacity,” says Kenzy. “These companies are corporations and don’t operate on goodwill. It’s all about money and their responsibility to return profit to corporate shareholders. That’s what guides them; they have no moral compass other than whether something is legal versus illegal, and what they can get away with. Foreign companies are even worse because they owe no allegiance to any of us,” he says. “We hope the issues that came to light during the recent pandemic can be a wakeup call, but humans tend to slip back into the same old ruts. I hope we can define the problems, find solutions, and follow them through, to get our markets back.” We now have an all-time record low in terms of the producers’ share of the retail dollar. “Why is that? This is what we need to ask the politicians. We should quit giving them the answers and having them tell us those won’t work. We need to ask them what their answers are, and make them address these hard questions,” says Kenzy.

Depending On Foreign Governments Is Unhealthy

global economy is always precarious, and it’s unwise to trust that we can always get the things we need from other countries and not have to protect our American sources and industries. Our basic needs (food, raw materials, medical supplies, etc.) should be met by our own industries. “With China supplying many of our medical supplies, rare earth materials, and other necessities in various supply chains, people are starting to realize we need to reverse this trend. There’s been a new way of looking at this and wanting to produce more things domestically, including our meat,” says Platt.

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Smithfield’s Sullivan Blasts Senators’ Report on Meat Companies’ Response to COVID-19 by Lisa M. Keefe, meatingplace.com

eeking support for a couple of workplace-reform initiatives, Democratic Senators Elizabeth Warren of Massachusetts and Cory Booker of New Jersey excoriated major meat processors in a report of their findings of an investigation into how meat companies performed in the first few months of the COVID-19 pandemic. In a release outlining their conclusions, and calling for an “Essential Workers Bill of Rights” and passage of the Farm System Reform Act, the senators accused Tyson, Cargill, Smithfield and JBS USA of using the pandemic as “cover while they failed to protect workers, dramatically increased prices for American consumers while exporting record amounts of meat abroad, and

Livestock Market Digest

successfully lobbied the President with a false pretext to sign an executive order that gave them cover to continue operating in an unsafe fashion.” The report also said the companies, in statements provided in June at the senators’ request, “evaded most of the questions sent by the senators.” The findings include statements from meat plant workers and labor advocates. It also included the responses that the senators received from the four companies in their entirety. Cargill, JBS and Tyson submitted responses that ranged from three to five pages long. Smithfield Foods’ CEO Ken Sullivan’s submitted a 14-page response that, like the other documents, outlined the steps that the company has taken to manage the pandemic while still maintaining operations. Sullivan’s submission, however, stood out for its pointed criticism of the exercise itself, saying “the aggressive and accusatory tone of your letter suggests your offices have already formed conclusions without an attempt to speak with us or understand the industry,” that the senators’ letter “is fraught with misinformation about our company and industry that appears to be strictly gleaned from media outlets that have made statements and infer-

ences that grossly mischaracterize us, our values and response to COVID-19” and “a fundamental misunderstanding of our food supply chain, the agricultural sector and the role exports play in a healthy farm economy.” Sullivan also complained about the “partisan” nature of the inquiry, saying “We have no interest in being a political pawn for either party. ... We are apolitical in our determination to fight through this crisis, and we wish representatives in Washington could unite on the need to feed Americans during a national emergency.” Smithfield’s response included another 86 pages of Smithfield employees’ names and titles who “hereby express their support for our company and this response,” the document said.

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Chinese-Owned Wind farm in Devils River, Texas, Threatens Power Grid & More

officer and former chief of station with the CIA, says Mr. Sun “is Xi Jinping’s stalking horse dispatched to exploit Texas’ dearth of regulations and bureaucracy especially related to purchasing property.” Writing in the Washington Times (August 14), Hoffman points out that “GH America would use the cover of a windmill farm by Bonner Cohen, Ph. D. renewable energy business venture to spy on behalf of China’s ruthless dictatorship.” he push for renewable energy through a Hoffman is correct in noting that Texas’ mix of federal, state, and local subsidies short-sighted embrace of renewable energy and mandates is not only putting the has been an open invitation to troublemakers. U.S. at risk of becoming perilously dependent Indeed, the proximity of the Devil’s River on intermittent wind and solar power for its site to Laughlin Air Force Base is, as the electricity. It is also providing a glide path old Bolsheviks were wont to say, “no coincifor a hostile foreign power to mess with the dence.” Officials at Laughlin are wary of havnation’s power grid and damage our critical ing 700-foot Chinese-owned wind turbines energy infrastructure. sprouting up on hilltops overlooking the Houston-based GH America Energy base, where 300 pilots are trained each year. is a wholly owned subsidiary of Chinese Pointing to the threat China’s wind power Guanghui Industry Investment Group, which, venture poses to Texas’ critical infrastructure, since 2015, has purchased about 140,000 Hoffman says the Chinese would have the acres in Val Verde County, Texas. The capability to overload the electrical grid and Xinjiang-based parent company is a massive cause power outages. conglomerate with extensive holdings in real “The enemy is not at the gates but has estate, liquified natural gas, transportation, gained entry inside them, albeit through a and chemicals. Guanghui’s billionaire found- Trojan horse real estate acquisition rather er, CEO, and Communist Party member, Sun than a kinetic attack,” he notes. Guangxin, wants to erect hundreds of wind turbines and perhaps several giant solar arrays on his West Texas acreage, a plan that is running into stiff resistance from residents and national security experts alike. Located about 200 miles west of San Antonio, the Devils River area of Val Verde County would be site of Mr. Sun’s renewable energy mega-project. The sparsely populated area is home to a few Texas-size family ranches, lots of wildlife, and Laughlin Air Force Base in nearby Del Rio. French and Middle Eastern companies already operate the sprawling Rocksprings Val Verde Wind Farm, a complex covering 15,000 acres within 15 miles of the Devils River. The thought of having even more wind turbines, soaring hundreds of feet into the air, further disfiguring West Texas’s rugged but picturesque back country has long-time ranchers on edge. “It’s a total crisis. We depend on ecotourism. The turbines will affect the deer. They will kill the birds. And we’re on the flyway for the monarch butterflies,” third-generation rancher Alice Ball Strunk, 63, told the San Antonio Express-News (August 2).

Texas is now saddled with a problem of its own making, and its consequences will reverberate far beyond the borders of the Lone Star State. Politicians in Austin have been promoting renewable energy for two decades. Texas is the nation’s leading producer of wind power, with some 15,000 turbines scattered among 160 wind projects, heavily concentrated in gusty West Texas. And more are on the way. County officials in Texas lack the authority to regulate, much less block, wind projects. Val Verde County Commissioner Beau Nettleton believes the threat the Devils River project poses to Laughlin may ultimately be its undoing. “My position, and probably the county’s, is that if it at all affects Laughlin Air Force Base and hampers their ability to perform their mission, we are going to oppose it,” he told the San Antonio Express-News (August 2). Right now, the only thing standing in front of Mr. Sun’s wind project, which may have little to do with wind, is the U.S. Department of Defense. GH America Energy will have to reach an agreement with the military on a plan to mitigate interference with flights from the base. But even if such a plan is agreed to, the risks posed by the Devils River project go far beyond interference with flights. IMPLICATIONS OF CHINA’S 2015 NATIONAL SECURITY LAW

China is a party state. Chinese companies, especially those with a presence in foreign countries, do not operate independently of the powers that be in Beijing. Hoffman reminds us that China’s 2015 National Intelligence Law gave the Communist Party of China sweeping powers to exploit Chinese domestic and overseas companies: “Any organization or citizen shall support, assist and cooperate with the State intelligence work in accordance with the law, and keep its secrets known to the public. The State protects individuals and organizations that support, assist and cooperate with national intelligence work.” DOD should pull the plug on the Devils River wind project now.

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STALKING HORSE

But there is more going on here than renewable energy’s inevitable environmental degradation and noise pollution caused by giant wind turbines’ spinning rotors. Daniel N. Hoffman, a retired clandestine services 2020 Fall Marketing Edition

Meat Export Challenges by Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist

he U.S. is on track for record production of beef, pork and broilers in 2020. Before COVID-19, it was recognized that meat trade would be critical for markets in 2020 and that certainly remains true at this point. After the severe disruptions in the first half of the year, expectations for meat trade have been revised and there is more uncertainty about global meat markets going forward. Pork exports through June are up 27.4 percent year over year, led by a 335.6 percent year-over-year increase in pork exports to China. China has replaced Mexico as the top pork export destination, with Mexico down 2.8 percent for the year to date. Number three pork export market Japan is up 2.8 percent so far in 2020, following a 23.2 percent year-over-year decrease in June. Broiler exports are up 4.2 percent yearover-year thus far in 2020, with latest data for

June showing a 1.1 percent decrease from one year ago. Mexico remains the largest broiler export market with year-to-date exports up 2.0 percent following a 6.0 percent year-overyear decrease in June. China is the second largest broiler export market accounting for 7.6 percent of total broiler for the first half of 2020. The sum of broiler exports to China and Hong Kong, a better measure of total broiler demand in China, is up 173.5 percent year-over-year in the January-June period. Year-to-date beef exports are down 7.6 percent for the January-June period, following a 33.0 percent year-over-year drop in June and a similar decrease in May. Japan remains the largest U.S. beef export market and is up 5.6 percent year-over-year in the first half of 2020. However, this follows a 20.7 percent decrease in June and a 23.6 percent year-overyear decrease in May. Number two South Korea is down 7.4 percent year-over-year through June following double-digit monthly decreases in April, May and June. Mexico, the number three market in recent years has seen monthly decreases averaging 66.9 percent in the second quarter, dropping Mexico to the fourth largest beef export market with a year-to-date total down

37.7 percent from one year ago. Canada, currently the third largest beef export market, is up 12.0 percent in the first half of the year. China remains a small beef export market (1.4 percent of total exports this year) but is up 70.9 percent for the year-to-date. Hong Kong is down 8.0 percent so far this year and the combined total of China and Hong Kong is up 0.2 percent for the year-to-date. With a weaker global economic situation, meat trade forecasts have been revised. Total pork and broiler exports are still projected higher year-over-year but beef exports are now projected to be lower year-over-year. China will continue to be a major driver of global protein trade, especially pork. Mexico remains a major concern with dramatic economic weakness expected to continue. Four of the five largest beef exports markets dropped sharply in the second quarter; and will be watched closely for recovery in the second half of the year. China will remain a minor beef export market in 2020 but is likely to continue growing, barring major geopolitical disruptions.

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How Farm Finances Have Changed in 2020

Shifts in the economic landscape and farmer sentiment.

t the start of 2020, sentiment among American farmers was generally optimistic. The first phase of the U.S.China trade agreement was underway, with the United States-Mexico-Canada Agreement (USMCA) right behind it. Farmer sentiment reached a record high in February and Agriculture Secretary Sonny Perdue stated that Market Facilitation Program (MFP) payments would likely not be needed this year. Then a global pandemic came along and flipped those projections upside down. Commodity prices experienced fluctuation across the board — some sectors hit harder than others — as businesses closed and people stayed home. Supply-chain disruptions reverberated through the agriculture industry, and farmer sentiment declined by more than 40 percent between March and April. Although the COVID-19 pandemic has shifted the economic landscape that was originally predicted at the start of 2020, optimism is slowly beginning to return as farmers reassess the financial structure of their operations and adjust their business plans to compensate for factors that could drastically affect their profitability in 2020. The five major factors that farmers are monitoring include: ❚❚ farm labor shortages;

end of the second quarter of 2020. Now is not the time for big expenditures, but rather conservative action and preparation. Having cash on hand to stay operational is crucial in times of economic upheaval. “Cash is king right now. Look at your balance sheet, and if you don’t have what you feel like is enough potential working capital, talk to your lender about your line of credit. Think ahead rather than wait until the last minute and hope. Plan for it, right now. Farmers have to have cash on hand and available credit to weather the storm,” says Brian Philpot, CEO of AgAmerica Lending.

FOCUSING ON THE NEEDS OF AMERICAN CONSUMERS

The uncertainty in global trade and border closures is causing many farmers and ranchers to focus their efforts internally. The renewed appreciation for agriculture across the country has also ignited a cultural movement to support American-grown products in local areas. Community-supported agriculture programs are thriving, and farmers are connecting directly to consumers now more than ever before.

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Editor’s note: This article is from AgAmerica Lending via the AJ Daily

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2020 Fall Marketing Edition

RIDING HERD by Lee Pitts

Legs And Eggs

ithout getting too personal, I will tell you that for the last 40 years I haven’t had a proper functioning pancreas. Whereas the average person eats the poundage equivalent of six elephants in their lifetime, I will hopefully end up eating one. I have to “eat” the exact same thing at the same time every day, and have for over 30 years. To digest my intake I have to swallow eight pills daily that cost $30 apiece and are composed of powdered pig pancreas. Isn’t it ironic that someone whose entire life has been connected to beef can’t live without swine? I’m just glad it’s not chicken or I’d never live it down! If I did backpeddle on my diet I’d end up in critical condition in the hospital. It only took me three or four times to get that message. In retrospect, I’ve been a picky eater my whole life and my stomach always was easily agitated. You’ve heard of people who have an “iron stomach”, well mine is made of tissue paper. Even back when I could eat I had a very discriminating palate. I never drank coffee, have never tasted espresso and have only been in a Starbucks once and that was to use their bathroom. I always hated the taste of beer and wine. Back when I could eat I couldn’t stand the taste of yams, Brussel sprouts, oatmeal, lima beans, Fig Newtons, watermelon, anchovies, chipped tuna on toast, cooked carrots, the “fish” in fish and chips, rutabagas, turnips, prunes, mushrooms, raisins, or spinach. I also didn’t like any vegetable that wasn’t its natural color, such as red lettuce, red cabbage, golden beets, or yellow bell peppers. Come to think of it, I didn’t like them in their natural color either. I never liked cucumbers or dill pickles but I loved my Mom’s sweet pickles. Speaking of my Mom, she was always trying to sneak things in on me that I detested, such as eggs, which made me gag. It didn’t take me long to find out that French toast was just an egg on bread. I didn’t eat eggplant for fear it had egg in it. I was also suspicious of anything that was all mixed up, such as sausage, hash, hot dogs, stew or Lobster Newburg. Not that we could afford lobster. I preferred plain foods and always kept them separate on my plate. The broccoli on my

Livestock Market Digest

plate was never allowed to even barely kiss the meatloaf. As a result of being forced to eat liver at an early age I became a firm believer in the concept that internal organs were never meant to be eaten by humans. This would include kidneys, gizzard, heart, brains, intestines, bone marrow and sexual organs such as mountain oysters. I’ve often watched in amazement as diners in Basque restaurants wolfed down tongue. Don’t they know that the mouth is full of nasty stuff? I feel the same way about pickled pigs feet and chicken feet. Do they not know what the chickens and pigs were walking in their entire lives? This is one major reason why I hate eggs, because of where they came from. (I hope I don’t have to draw you a visual.) You’ll never catch me begging for legs or eggs! All this talk about food has made me hungry, and yes, there are many foods I’ve always loved. I’ve never tasted a bad potato in my life. Baked, fried, scalloped, you name it, I love potatoes. In fact, it’s one of the half dozen foods I can still digest now. I’m sad because I can’t digest milk and all the products made from it because they are so delicious. I would have made a great old time cowboy because prior to getting sick I lived on the four “B’s” at bull sales: beef, bread, bacon and beans. Although I don’t think beans should ever be served for dessert. But the beans will have the final say on that, as they always do. I guess you could call me a “meat and potatoes kinda guy” because if I could eat one last normal meal it would be a cheeseburger, fries and a chocolate shake. Please note that the fries come from potatoes and the cheese, beef and milk all come from a cow.

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Tom Robb & Sons T

Registered & Commercial

POLLED HEREFORDS Tom 719-688-2334

719/456 -1149 34125 Rd. 20, McClave, CO robbherefords@gmail.com

Year-Round Marketing Yields Success

attle producers who work year-round to set their animals up for success — through nutrition management, for example — strive for the best possible outcome. The same is true when it comes to marketing. The American Hereford Association is equipping members with knowledge and tools they need to be impactful marketers in all market conditions. Mark Johnson, Hereford breeder and livestock marketing agent, shared advice during The Brand Marketing Summit last fall. Step one, he says, is knowing your operation and what sets it apart. “One important thing is trying to define who you are as an organization,” Johnson says. “What are your strengths, and once you identify that, how to tell people about it.” Each operation runs differently. Finding and employing the best marketing strategies can change the way an operation performs in a very competitive industry. “There is never ‘one size fits all,’ in my opinion, and there are so many different segments within the Hereford industry on how you can market cattle,” says Jason Barber of Superior Livestock. “Some people can sell horned and polled bulls for a lot of money and volume. Some people have just a handful of cows and they need to market some calves or some show heifers. Just try to offer [your customers] a marketing product that might fit their business models and help them on sale day.” Building relationships, providing top-quality customer service and keeping the genetic program top-of-mind should all be yearround goals for today’s seedstock producer – along with seeking marketing support. “Consistent effort yields consistent results, in my opinion,” Barber says. “There’s all kinds of ways to promote sales and there’s a lot of people that are professionals in this industry that’ve dedicated their lives and their professionalism to help other people be successful.” At the end of the day, it’s about relationships. “No matter what you are marketing — whether it is fed cattle or feeder cattle or purebred livestock or whatever widget you might be selling — when you’re working with someone, just treat them fairly,” Johnson says. “Develop relationships that you can fall back on when times get tough. If you have a strong brand, you can have a few setbacks and people will still rally around you rather than just focusing on your product.”

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Benefit of Hedging Sale of Live Cattle Ten-year study analyzes outcomes of hedging via futures markets. by Pat Melgares, K-State Research & Extension

Kansas State University (K-State) ag economist has completed an exhaustive study on hedging cattle prices, which he says could help producers manage their economic risks — perhaps especially so in times of crisis. Brian Coffey looked at the average price of steers and heifers sold in Kansas between 2010 and June 2020 to determine if hedging — a strategy to lock in prices using futures markets — is a reliable strategy for selling live cattle. “One thing that came out of this will be surprising to a lot of people,” Coffey says. “If we look just at the average price that live cattle would have been sold for from 2010 to 2020, the hedged prices are lower, but they are only 48¢ per hundredweight (cwt.) lower than unhedged sales, on average. In other words, the risk-management benefits of hedging come at a fairly lower cost per hundredweight, on average.” “A lot of times,” he continues, “people have in mind that to get the risk-management benefit of hedging, you take a pretty big hit on expected average returns. But over the long term, we’re just not seeing that.” Hedging can help cattle producers protect against adverse price changes in markets by locking in futures prices. Hedging helps to protect against adverse price changes in the markets by allowing a producer who is feeding cattle to establish an approximate selling price now and be protected if prices decline by the time they market those animals later. “In given weeks or months, you can definitely give up potential gains in some of those extreme times when cash prices rally unexpectedly,” Coffey says. “But you also avoid extreme losses in weeks or months when cash prices decline unexpectedly.” Coffey notes that more detailed information on hedging is available at AgManager. info, a website managed by the K-State Department of Agricultural Economics. In his study, Coffey assumed a feeding period of 160 days while comparing what a producer might have earned on live cattle sales had they hedged those sales instead. “A lot of times, people have in mind that to

get the risk management benefit of hedging, you take a pretty big hit on expected average returns. But over the long term, we’re just not seeing that.” — Brian Coffey “Basically what I assumed was that a producer would hedge cattle immediately upon placement, then immediately lift the hedge when those live cattle are priced or sold,” he says. “It’s a very disciplined and systematic hedging routine.” While he found a slight average-price decrease when hedging during normal times, Coffey says hedging can provide huge benefits when disaster hits the industry — such as has happened twice in the past year, once due to a plant fire and once due to a pandemic. In fall 2019, a fire destroyed a packing plant owned by Tyson Fresh Meats in Holcomb, Kan., which had a daily capacity of 6,000 head — or about 6 percent of the United States’ slaughter capacity. Coffey compared live cattle prices for 23 weeks, between July and October 2019 to see what effect hedging would have had on producers’ profits. “What I saw was the hedged price, on average, was about $10 per hundredweight higher,” he says. “If someone was marketing fed cattle week after week through that same time period, having those cattle hedged was worth an extra $10 per hundredweight higher.” Put another way, the average weekly value of gain for hedged cattle was $123 higher per head than for unhedged cattle. More recently, Coffey also looked at the effect of the COVID-19 pandemic, comparing prices between February 2020 and the end of June. Again, hedging proved to be a successful strategy during crisis..“The hedged value of gain averaged about $221 per head higher,” Coffey says.

“The take-home lesson from both of those instances,” he says, “is that hedging can protect from scenarios that can, frankly, end a business. Hedging protects against catastrophic losses.” Coffey’s full report, titled “Hedging Kansas Live Cattle: A Summary of Outcomes over the Past 10 Years”, available online at Agmanager.info

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Beyond Meat Not So Transparent by Kate Gibson, meatingplace.com

eyond Meat pitches its plant-based protein alternatives as a way of doing less damage to the environment than its meat-based rivals. But a recent report finds the startup is far less transparent on the topic than mainstream rivals such as Hormel and Tyson Foods. The analysis by Trucost, a part of S&P Global Market Intelligence, found the maker of plant-based burgers and sausages has not disclosed the amount of greenhouse gases it emits or how much water it discharges. Although Tyson and Hormel are far larger emitters of pollutants, they are also more forthright about their operations, found Trucost, which tracks how clear companies are via weighted disclosure ratios. Beyond Meat’s weighted environmental disclosure ratio — the percentage of its environmental impacts disclosed — came in at zero, while Tyson drew a weighted ratio of 98 percent for 2018, and Hormel disclosed 99 percent of its impacts. Both Tyson and Hormel received a weighted disclosure ratio for 100 percent for greenhouse gas emissions. Beyond Meat did not immediately return a request for comment. A Beyond Meat spokesperson told S&P Global Market Intelligence the company is “starting the process of conducting a carbon-footprint assessment aimed at identifying opportunities to strengthen our environmental commitment and further reduce our impact.” It also cited a 2018 analysis — conducted by the University of Michigan’s Center for Sustainable Systems and commissioned by Beyond Meat — that found making one Beyond Burger consumed significantly less water, greenhouse gasses and energy than a quarter-pound beef burger..

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2020 Fall Marketing Edition

VIEW FROM THE BACKSIDE by Barry Denton

Kamala & The Cow

(The views expressed in this column are not necessarily those of the New Mexico Cattle Growers’ Association or this publication.)

’m confused now brown cow. I’m just guessing here, but it seems that the new Democrat vice presidential candidate Kamala Harris has been secretly hired by the environmental extremist lobby to destroy beef intake in America. “I love cheeseburgers from time to time, I just do,” Ms. Harris said. “But there has to be also what we do in terms of creating incentives that we will eat in a healthy way, that will encourage moderation, and that we will be educated about the effect of our eating habits on our environment.” This sounds about as un-American as you can get. Since when do you want a self proclaimed “savior” or former government employee telling you how to eat? I think it is astounding that this ol’ gal thinks so highly of herself. Corporate lawyer Andrew Yang is also running for President on the Democrat ticket and agrees with Ms. Harris. According to Yang, “Certainly, meat is an extraordinarily expensive thing to produce from an environmental sustainability point of view. So I think it would be healthy on both an individual and societal level for us to move in that direction.” I heard just last week KH was working with KFC, just kidding. What is true is AOC, being one congresswoman Alexandria Ocasio Cortez, is introducing a new bill in Congress known as the “The Climate Equity Act” which is considered part three of “The Green New Deal”. There you have it a bill conceived by the bar passer and the bartender that will save America from that evil known as “beef”. The scary thing is that one hundred years ago you would have paid a nickel to see these two ladies in a carnival act, and now it’s possible they could be running the country. My first question to Kamala would be just how did a lawyer become an expert on cattle? How many cattle has Kamala raised and just how much beef has she produced? What was

Livestock Market Digest

her environment like prior to cattle raising part is pretty hard to believe, but you can do and how much did her environment change anything with Photoshop these days. after cattle raising? How painful was this The farmer himself looked quite abashed. experience and how long was she hospital- What a great photo-op for Kamala, but I ized during this period? heard that she refused to be photographed Am I to drive down the road, see a cow, with a cow. After all it would not be dignified and just know I’m going to die from it? For to be photographed with the bovine enemy some reason “cancer” in this country appears that is destroying the earth. to be a much larger problem than cattle Amanda Radke of Beef Magazine wrote grazing or is it me? I do realize that cattle that, “Harris called for changes to the occasionally get in the road and might be a “Dietary Guidelines of Americans”. Once health issue if you are driving too fast. again she is telling us she is an expert in yet It appears that there are a host of other another field. issues that Kamala is against besides just Since we are already in a time of crisis cattle. There are several reports of her being concerning COVID Kamala knows that this anti fracking, anti gun, anti Catholic, and is a great time to present herself as the answer anti Indian. to the country’s ills. Scaring people when they According to Acee Agoyo of Vision Maker are vulnerable is a great way to gain control. Media, during Kamala’s stint as Attorney Politicians just love a crisis and will try and General of California she opposed at least 15 create one where there is none. Don’t be a tribal land-into-trust applications. sheep, be a cow and let’s moo Trump right “Her actions undermined the ability of back to the White House. Indian nations to reclaim lands they lost to theft, fraud, and other negative policies. Using her position as the state’s top legal official, Harris also went up against tribes in two prominent sovereignty cases. Her arguments put her out of step with legal doctrines that were reaffirmed by the nation’s highest court in a historic decision just last month.” by Anna Flávia Rochas, meatingplace.com Alright, I’m trying hard here to look on the bright side and come up with something BS S.A. is resuming preparation for nice about Kamala. To her credit, she does an initial public offering in the United appear clean in public settings. I do realize States, said CEO Gilberto Tomazoni in that not everyone loves cows and steaks the way I do. Then it dawned on me, who does conference calls with analysts. Tomazoni said that JBS had been focused this silly chick remind me of, none other than Nancy Pelosi the speaker of the United States on the challenges related to the COVID-19 House of Representatives. The resemblance pandemic, especially in ensuring the safety of its employees and operations. is so close that she might even be a clone. “Now things are more under control and To be fair, I did see a recent photo of Kamala with an alleged farmer in his field we are returning to addressing the listing,” and she appeared to be listening to him. That he said during the conference call in English. “We don’t have a deadline, but we are taking all the necessary steps for this process.” Tomazoni said during a separate conference call conducted in Portuguese that the IPO “will certainly not occur this year,” but in 2021. Questioned about mergers and acquisitions, Tomazoni said JBS is always evaluating growth opportunities through acquisitions or greenfield projects. He said that JBS’s long-term strategy is focused on expanding the share of processed foods and value-added products contributing R.L. Robbs to its revenue. 520-507-2514 JBS announced earlier this week that its 4995 Arzberger Rd. subsidiary Plumrose USA will invest $200 Willcox, AZ 85643 million to build a new Italian meats and charWillcox, AZ cuterie production facility in the U.S. osonegro@powerc.net

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JBS Resumes Preparation for US IPO

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that would ensure at least one percent, 0.1…1 of New Mexico’s laws regarding consumer percent, is devoted exclusively to the ag rural protection. The labels had, after all, been market. approved by USDA before they could be used, Like ag publications and ag radio, ag tele- and so already have been determined lawful by Baxter Black, vision is part of what holds all of our ag com- at the federal level. BaxterBlack.com munity together. To those of us in ag media, The cases were dismissed with prejudice it’s not just a job. I think it has something to — meaning they can’t be refiled — prior to do with our souls. their being appealed. The plaintiffs sought compensatory and If you want to help, contact your Representative punitive damages treble the compensatory or Senator about passing HR 2682. damages, and an injunction barring packers HR 2682: Agricultural News and Rural Content from continuing the alleged consumer decepAct of 2020. This bill requires certain video “The farmer has always been a peasant.” programming distributors, such as cable providers, tion and requiring them to disclose the origin – Richard Blinco, Idaho to use at least 1 percent of their channel capacity of products from foreign cattle. to transmit channels of programming that serve The litigation reflects the heart of the the needs and interests of rural areas.. hen the market crashed in 1975, mandatory country-of-origin-labeling debate. Richard had a ranch, feedlot, Proponents say consumers should know what dairy, potatoes, alfalfa and a packthey’re paying for and independent U.S. cating house. tlemen deserve fair prices for their U.S.-born Here we sit 45 years later and not much animals. Opponents say, and the World Trade has changed. Today less than 1.3 percent of Organization has agreed, that it’s a protecthe American population, (and 7 percent in by Lisa M. Keefe, meatingplace.com tionist measure that discriminates against Canada), is involved in production agriculforeign-born livestock.. wo lawsuits brought against National ture. We, who are left with the responsibility Beef, Tyson, Cargill and JBS USA over of feeding the ever-growing population that packages of their beef labeled “Product now stands at 331 million people. We do it. It of the U.S.” — which is an issue in counis lots of work. We have an enormous amount try-of-origin labeling — have been appealed of scientific, technical, medical, and mechanto Settle Allegations it to the U.S. Court of Appeals for the 10th ical research and dedication looking over our Overcharged for Meat shoulder as we break the ground, plant the Circuit, according to court documents. The separate lawsuits, filed in February by Lisa M. Keefe, meatingplace.com wheat, brand the calf or drive the truck. Imagine a ‘Nóngmín’ bent over in a rice in U.S. District Court in New Mexico, were almart Inc. has agreed to pay up field a thousand years before Christ came, brought by a cattle producer in the one case, to $9.5 million to settle a putative not much different than a farmer bent over and by a consumer in the other, and subseclass action lawsuit filed in Florida a furrow, feeling the soil today. What is quently consolidated. Both parties alleged that accused the retail of systematically overour motive…inspiration? Do we say, “We’re that labeling beef products “Product of the charging for certain weighted retail meat prodfeeding the world”? “I’ll get famous!” “The USA” misleads consumers, because the label ucts, according to documents filed in the case. can be applied even if the animal itself was big money”? In the case, filed in U.S. District Court for raised and harvested in another country. The No. It is as simple as “It’s what I do.” the Southern District of Florida in February meat needs simply to be further processed in There are people who have a deep heart, 2019, a consumer, Vassilios Kukorinis, alleged the U.S. for the label to apply. have a conscience, are dedicated to those we that Walmart advertised deceptive unit prices Recently, the District Court judge agreed work for, are close to God, maybe have guilt, for weighted goods that were placed on sale as with the defendants that the federal law that or just kindness and care. They don’t think ‘money first’. Occasionally, the consumer has allows such labeling supersedes the state they neared their respective expiration dates. Beginning in 2015, the case documents said, a chance to make farmers’ lives easier, nicer, the transaction amount ultimately charged for more satisfying. the beef, pork, poultry, fish and other types of Let me suggest…their own television weighted, packaged goods did not match the channels. Television waves are controlled by sale price advertised on the label. a handful of global companies. They have Walmart had moved to dismiss the case, brought wonderful communication worlda motion that was denied in June 2020. wide with hundreds of channels. 99.9 percent Although the Kukorinis case was based on are dedicated to the majority polled, which examples of overcharging at stores in southare suburban folks. ern and central Florida, the retailer ultimately The ag rural television, which is not ‘about agreed on a settlement that would cover conus’ but ‘for us’, are limited to pillars like US DAVID AND sumers nationwide. FARM REPORT and Orion Samuelson and AVANELL SILER some local weeklies that are an hour long. P.O. Box 3 The amount of the settlement in the class action Doole, Texas 76836 RFDTV Channel is the only exception; suit is estimated to be between $4.5 million and $9.5 million, depending on the number of 325/483-5449 RFDTV contents are exclusively rural and consumers who come forward with appropriate agriculture, 24 hours a day. They are leading dsiler@simtex.net documentation. Walmart also has promised to the effort to have Congress vote on HR 2682 change its pricing practices.. THE EDGE OF COMMON SENSE

David & Goliath of Television

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COOL Case vs. Big packers Appealed

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Walmart to Pay Millions

SILER

Santa Gertrudis Cattle

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2020 Fall Marketing Edition

Larry Schnell Installed as LMA President for 2020-2022 Term

ing Department of Justice (DOJ) and U.S. Associations. Schnell is a former team Department of Agriculture (USDA) packer and calf roper, hockey coach and Elder at investigations. Evangelical Christian Church in Dickinson. “At this time, the most important industry He is also an avid golfer and adult bible issue we face is the finished cattle pricing school teacher. system and how to make it more equitable,” Schnell said. “LMA has been very strong in supporting USDA’s and the DOJ’s investigations looking into the pricing system and arry Schnell of Stockmen’s Livestock seeing if there is anything illegal or unfair. We Exchange in Dickinson, North Dakota, was installed president of the Livestock need to find a competitive pricing mechanism Marketing Association (LMA) at the 2020 that better serves the cattle producers and Annual LMA Membership Meeting, held vir- cattle feeders our members work so heavily tually on Sunday, August 23. Schnell will with.” Additionally, Schnell looks forward to complete a two-year term leading the nation’s by Lisa M. Keefe, meatingplace.com largest, livestock marketing trade association serving his two-year term as president, and that represents more than 800 local livestock continued involvement with LMA and its members. auction markets and allied businesses. urrency fluctuations and trade “I look forward to working with the other Schnell’s family holds a strong history in disruptions threaten Australia’s the livestock marketing industry. In 1937, committee members, and especially our mem— and to a lesser extent New Schnell’s grandfather, Ray, founded Schnell’s bers across the nation, on topics important to Zealand’s — share of the beef import Livestock Auction Market in Dickinson, N.D., the cattle industry,” Schnell said. “I believe market in the United States, according using chicken wire fence for a sale ring. In that LMA is a very effective organization for to a report by Beef Central, a daily news1977, Schnell became partners with his father the industry and we hope to keep it that way.” letter of the Australian beef industry. Aside from LMA, Schnell is also involved and two other individuals, taking over as genThe U.S. imports little of the beef eral manager in 1985. Currently, Stockmen’s in a variety of other organizations and activconsumed in the market, but of those Livestock Exchange has two locations in ities. He was formerly the Chairman of the amounts imported much of it has come Dickinson and is owned by Larry and his North Dakota Beef Council, Regional Vice from Australia and New Zealand, espePresident for the Federation of State Beef partner, James Erickson. cially to fulfill demand for grass-fed beef. As LMA President and a market owner, Councils, President of the North Dakota But the Australian dollar has appreSchnell is actively involved in several live- Auctioneers Association and President of ciated 12.5 percent against the U.S. dolstock industry issues, including the ongo- the North Dakota Livestock Marketing lar in the last three months, reaching its highest value since February 2019, Beef Central reported, sending prices for that beef higher. This, as beef production within the U.S. has regained its footing, damping down domestic beef prices that had soared in May and June. For ALL Your Feeding Needs Meanwhile, the U.S. is importing We wean, background and grow calves, develop heifers more beef from South America. Imports & bulls, feed cows through the drought from Argentina have been on the rise, We are also a hay farm, growing & selling alfalfa, and those from Brazil are poised to bermuda grass & teff grass hay. grow, as well. Three large JBS plants Giving the Ranchers Options! in Brazil and Argentina were recently Jason Barnard • 520 507-3332 approved to supply Burger King in the Find us at WhiteBarn Farms on P.O. Box 123, Rodeo, NM 88056 U.S., the report pointed out. Facebook to learn more about us. whitebarnhayandcattle.com South American beef costs 15 cents to 17 cents less per pound than Australian beef does, Beef Central pointed out. Much of what the U.S. has been importing has been trim, for grinding. Ongoing absences among the U.S. meat processing labor force means that more domestic product has been shipped as bone-in cuts, with fewer resources available to process further.

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Australia Losing Beef Market Share in U.S.

WHITEBARN

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Livestock Market Digest

Walmart Works Toward Sustainable Beef Supply Chain by Tom Johnston, meatingplace.com

almart officials said the company aims to source fresh beef products “more sustainably”

by 2025. As part of a new push to meet 2025 objectives on a number of commodities, the Springdale, Ark.-based retail giant is prioritizing soil health, animal welfare and responsible use of antibiotics in beef production, executives said. The effort will include working with suppliers to improve grain sourcing and grazing practices. Moreover, Walmart is pushing suppliers to better understand the entire beef production cycle, using a science-driven process help from the Nature Conservancy to improve sustainability efforts. “With this in place, we aspire to source from fresh beef suppliers who have a tech-enabled supply chain to measure sustainability impact at scale,” Walmart officials said. “The infusion of modern technology may help beef suppliers measure the benefits of grazing and grain best practices, adaptively manage and offer a more accurate way to trace impact. It can also help support beef suppliers’ efforts to better understand the environmental footprint of their supply chains, for instance using geographic and greenhouse gas indicators.” In order to measure, track and understand which efforts work, Walmart is asking suppliers to participate in annual reporting initiatives like its “Project Gigaton” initiative and “Thesis” performance assessments. Walmart is partnering with the U.S. Roundtable for Sustainable Beef, the Midwest Row Crop Collaborative, and Field to Market in the supply chain effort. “Overall, we see an opportunity for a whole-system transformation and continued progress across the beef supply chain,” Walmart said. “That is why we focus on sustainability in our sourcing decisions and work to drive action in policy, advocacy and philanthropy both globally and domestically.”

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Brazilian Packer Launches Carbon Neutral Beef by Tom Johnston, meatingplace.com

n late August Brazilian meatpacker Marfrig launched a new brand of carbon neutral beef products. Marfrig invested some $1.8 million to create the Viva line, which is certified by the Brazilian Agricultural Research Corporation (Embrapa) as carbon neutral beef (CCN). CCN is a certification for cattle raised using integrated livestock forest or integrated crop livestock systems. Viva will be sold starting this month exclusively in 10 select stores of Pão de Açúcar in the city of São Paulo, and later

rolled out throughout Brazil. Viva products are derived from cattle raised within a livestock-forest production system that neutralizes methane emissions under a protocol developed by Embrapa. This emission offsetting is guaranteed by the certification and by the verification via independent audits. The protocol also guarantees unique, high-quality products and that all animal welfare principles are complied with in the production system. “By encouraging sustainable production, we create value for the company and the business chain. In addition, the development of carbon neutral beef, in partnership with one of the most renowned research and innovation centers in agribusiness worldwide, Embrapa, reaffirms our commitment to four of the 17 Sustainable Development Goals (SDGs) of the UN Agenda 2030,” said Miguel Gularte, CEO of Marfrig.”

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The Finest In Corriente Cattle!

SPIKE RANCH Robbie & Pam Sproul Turkey Creek, Arizona 520.824.3344 520.444.4939 Robbie cell 520.975.2200 Pam cell pamsproul@gmail.com

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2020 Fall Marketing Edition

Crouching Tiger, Hidden Dragon

let their dues speak for them with little real If you have never heard of a guy named knowledge of what is happening. Patrick O. Brown, you need to become aware There are, of course, countless county, of him. He is the nearly 66-year-old founder state and regional groups who have the best and CEO of Impossible Foods. interests of the cattlemen and their families According to a 2019 story on CNBC.com, at their heart, but their reach is limited and when Pat Brown was working in his research sometimes stymied by the all-knowing nation- lab in 2009, he had “zero” intention of startal groups. Additionally, how many dues can ing a business — much less one that would any rancher pay especially when the feed win United Nations backing and investment bills are high and calves, stockers or feeders from the likes of Microsoft founder Bill Gates. aren’t bringing what they cost to produce? No, his goal then was “simple.” by Caren Cowan How much time and money does he or she “I basically decided I was going to look for have to travel to seats of government to speak the most important problem that I could have e’ve seen bad times before… we with their own voices… even if they live in a the opportunity of solving,” he told CNBC have survived the droughts over state that hasn’t been in lockdown for near- Make It. But when the former the centuries. We have survived ly six months? pediatrician-turned-Stancyclical markets for pretty much the same New Mexicans We all need to cowboy up and ford professor discovtime. The price of feed, energy, transportation have been under and everything we need has never stopped a shelter in place figure out what organization(s) ered what that problem order since late was — namely the “catclimbing. we expect to carry our voices to astrophic use of animals So what makes today seem so unsettling March. It has long in our food system” — as we move forward, maybe at a different the federal government ... but he realized he had to go pace, to do what we have always done? There been my belief we better be looking at the wolf “all in.” are a few things that come easily to mind… that the largest of The California-based Daddy, Uncle Bill and Granddaddy aren’t the national orga- at the door who is spending big food company began here to shoulder the burdens or at least tell us nizations is a verbucks and planning to do away attempting to revoluhow stay hitched. Many of our families and tically integrated with beef entirely.” tionize the way we think their ranches have splintered because there association for about animal agriculture wasn’t enough room or money for the entire an industry that next generation to come home. So, there is not and won’t soon be vertically integrated, with its plant-based meat substitute, comalthough there are groups like Walmart that monly known as the “Impossible Burger,” aren’t as many of us for the battle. The learned people I have counted to keep are working as fast as they can to do their wrote Karen Gilchrist, CNBC.com reporter. He started the business in 2011 after his me straight on for the last 35 years are gone. own in-house vertical integration. I got an interesting response to my theory academic research led him to discover the And they didn’t train very many to take their places. Their offspring were off making their that one organization cannot represent every detrimental impact of meat production on own living at the time they could have been segment of the beef industry not too long ago. the planet. According to Brown and CNBC.com, with learning. This wasn’t anybody’s fault. It was a The National Cattlemen’s Beef Association (NMCB) isn’t designed for every segment of no attribution to science, meat production is sign of the times then. Many of today’s leaders didn’t benefit the beef industry, I was told. They are there considered by far one of the world’s greatest from historical wisdom or even that from for beef. While every step of the chain is part contributors to climate change, not only their own mistakes. They are high on the of beef production, there is only one place for the level of greenhouse gas it produces, flash and dash of power and short on the that beef comes out the door and thus that’s but also the water and land consumption it requires. However, despite growing awarework ethic that it takes to keep the “plow in where the focus needs to be. However, my point today is not necessarily ness around the issue, Brown noted that the ground.” But it is high time that the tough cowboy only that we all need to cowboy up and figure education had done little to curb consumers’ up, get the flash and dash out of the way. Not out what organization(s) we expect to carry insatiable appetites for meat. So, bailing on his academic career — and only is the beef industry struggling within our voices to the federal government. That is because leadership is weak, without vision, a given, but we better be looking at the wolf colleagues — the then 56 year-old set about and tied to the almighty dollar, but we have at the door who is spending big bucks and creating an alternative product that could give the same experience as meat. detractors that our forefathers could have planning to do away with beef entirely. “The only way to solve the problem is to never dreamed up. HERE’S YOUR TIGER… give consumers what they know they want, According to the US Department of These folks have learned that the vegan and make it our job to find a better way to Agriculture (USDA) and the last census there and vegetarian movement didn’t get them produce it and find a better technology than are about 700,000 cattle raisers across the very far. Meatless Mondays weren’t a big hit cows and other animals,” said Brown. nation, including feed yards. As near as I so now these anti-cow and anti-meat people A few years later, the Impossible team can figure, there are way less than 40,000 of are trying to cater to Americans who love believed they’d discovered the solution in a those ranchers (and farmers) who are actualmolecule called heme. Found in abundance ly paying dues to a national organization to beef. But make no mistake this isn’t about a in both animals and plants, the molecule speak for them or represent their interests. Some of those members also do the bidding diet — its about control of the land and cli- is responsible for carrying oxygen in living organisms and giving blood its red color. By of the national groups, but the vast majority mate change.

Livestock Market Digest

“

augmenting the molecule in plants, research“There’s so many things that you have to ers found they could create a product that get right — and the dominant thing is delilooks and tastes like meat. ciousness. The second most important thing, And so, in 2016, the Impossible Burger I think, probably is versatility, and then, of was born. course, nutritional value,” said Brown. By using plants rather than traditional In late August Lightlife Foods launched meat, Impossible Food’s website claims pro- a marketing broadside against Beyond Meat duction of one of its burgers saves the equiv- and Impossible Foods, calling them out in alent of 75 square feet of land, one half tub of full-page newspaper ads for being overly probathwater and 18 miles of emissions in a car cessed and including too many synthetically compared to a regular beef patty. produced ingredients. Having developed that technology, Brown In what the company is calling the “Clean said his company had to be the one to get it Break” campaign, Lightlife President Dan out to burger lovers — in spite of his own Curtin said in an open letter that his company lack of business experience. is making a “clean break” from other “food “I didn’t want to trust that just some reg- tech” companies in the meat analogue space, ular business would do it right,” said Brown. saying Lightlife is “a real food company” that Fortunately for Brown, however, inves- uses “simple ingredients and methods to tors saw something in his proposition. Over make ... delicious plant-based food.” the years, the business has racked up $396 Among the distinctions Curtin draws is million from backers including Bill Gates, between Lightlife’s burger with 11 ingreGoogle Ventures and Hong Kong billionaire dients, and the 18 to 20 ingredients that Li Ka-shing’s Horizons Ventures. Beyond and Impossible include. “People And the funding hasn’t stopped. deserve plant-based protein that is developed According to meatingplace.com in mid-Au- in a kitchen, not a lab,” the letter says. gust, Impossible Foods Inc. has brought in As of 2019, the biggest single retail brand $200 million in fresh funds from investors, in meat analogues was stalwart Morningstar according to a statement from the company. Farms. However, all brands in the space have Led by Couture Management LLC, the been racing for retail market share, especially funding will go towards Impossible’s grow- since the spread of COVID-19 has pushed ing retail business, and will help it expand retail food sales into the stratosphere. manufacturing, research and development, The COVID-19 Pandemic put its own spin and more. on the fake meat market. Until March 2020, This marks the second large-scale fund- there was big investment in the various pseuing Impossible has received this year. In do meat companies, but their market share March, the company announced $500 mil- remained low. lion in funding from Mirae Asset Global That all changed when meat became Investments and others. To date, Impossible scarce this past spring and the fake meat has raised nearly $1.5 billion from investors. market share skyrocketed by double and even According to Bloomberg News, a March triple digits. Not because of desire for the funding round valued Impossible at $4 bil- product, but because of the fear of having no lion. meat at all. Of course, Impossible Food is not the only Only time will tell if things will level back business that’s created a plant-based meat out, but based on the level of investment, alternative, CNBC points out fake meat supporters seem ramping up while Beyond Meat is one major player which the beef industry fiddles. has amassed a loyal following from its plantIn an article in the New Yorker Magazine based “bleeding” burger. Started in 2009 by in September 2019, author Tad Friend capEthan Brown, the company is a joint winner, tured just how serious Brown and Impossible alongside Impossible Foods, of the United Foods are about eliminating cattle, and meat Nations’ Champions of the Earth Award, in producing animals as well as fish from the the Science and Innovation category. Both planet. companies share a number of high-profile Opening his story Friend wrote: investors. “Americans eat three hamburgers a week, so However, despite their shared ideologies, serving beef at your cookout is as patriotic as Brown said their products differ vastly and buying a gun. When progressive Democrats he currently sees little value in collaboration. proposed a Green New Deal, earlier this year, Instead, he said the business is focused leading Republicans labeled it a plot to ‘take on research and development to improve not away your hamburgers.’ The former Trump only its burger, but also to develop new prod- adviser Sebastian Gorka characterized this ucts including plant-based steaks and fish. plunder as ‘what Stalin dreamt about,’ and

Trump himself accused the Green New Deal of proposing to ‘permanently eliminate’ cows. Who would want to take away your hamburgers and eliminate cows?” Well, Pat Brown does, and pronto. The emeritus professor of biochemistry at Stanford University, Brown is developing plant-based beef, chicken, pork, lamb, dairy, and fish. He intends to wipe out all animal agriculture and deep-sea fishing by 2035. His first product, the Impossible Burger, made chiefly of soy and potato proteins and coconut and sunflower oils, is now (September 2019) in 17,000 restaurants. Friend goes on to regurgitate all the supposed evils of animal agriculture on the planet before explaining that although Brown’s Stanford lab was publishing on topics ranging from ovarian-cancer detection to how babies acquire their gut microbiome he decided that cows and climate change were more important and noble causes. What was Brown’s plan? “Legal economic sabotage!” Brown said. He understood that the facts didn’t compel people as strongly as their craving for meat, and that shame was counterproductive. So he’d use the power of the free market to disseminate a better, cheaper replacement. And, because 60 percent of America’s beef gets ground up, he’d start with burgers. DRAGON ALERT

Now if you really want to start shaking in your boots, just google https://www. rethinkx.com/ . This is a self-appointed, but well-funded group that includes folks like Patrick O. Brown that is rethinking humanity and correcting it by disruption. They started with “Transportation” in 2017 and moved on to “Food & Agriculture” in 2019 which was written by Catherin Tubb and Tony Seba, along with a team of contributors. Their Ag plan is for 2020 to 2030. You can click the Reports tab on the left side of the site and pull up the reports as well as the SEBA Framework of the projects. The subtitle of the Food & Ag report is: The Second Domestication of Plants and Animals, the Disruption of the Cow, and the Collapse of Industrial Livestock Farming Here is how the report describes itself in the Preface: This study is built on the Seba Technology Disruption Framework. This analysis focuses on the new technologies driving the transformation of the food and agriculture sectors and the inevitable implications for the cattle industry in the U.S. The cost curves we have produced are based on limited data given the early stage 2020 Fall Marketing Edition

of the application of these technologies in will be irreversible but incomplete – so our sectors such as energy and transportation. food markets. These cost curves underpin the analysis considers a period out to 2035 to All of these disruptions are interconnected adoption and implications analysis presented provide a more complete picture. We focus on and dynamic and will affect every aspect of in this paper. cattle but have extrapolated our findings to our world – cities, organizations, markets, They should be seen as a ‘beta’ analysis cover all livestock and the impact on arable economics, finance, geopolitics, health, envior a ‘first pass’ and we will update them ronment, and more. as more evidence emerges. We welcome Even better reading is the disclaimfeedback that will help in developing er: Any findings, predictions, inferences, Legal economic sabotage!” Brown this analysis. The pace of development of implications, judgments, beliefs, opinions, said. He understood that the facts new technologies and their adoption and recommendations, suggestions, and simdidn’t compel people as strongly the processes that drive the concurrent ilar matters in this report are statements collapse of industrial farming depend on of opinion by the authors and are not as their craving for meat, and that many interacting factors, including policy statements of fact. You should treat them and social responses to the disruption, shame was counterproductive. So as such and come to your own concluresponses that are inherently uncertain sions based upon your own research. The he’d use the power of the free and difficult to model. content of this report does not constitute market to disseminate a better, Clearly, the further out in time the advice of any kind and you should not model runs, the less certainty there is, cheaper replacement. And, because take any action or refrain from taking but we believe our proven framework, any action in reliance upon this report or 60 percent of America’s beef gets methodology, and findings capture the the contents thereof. This report includes direction of travel and the complex pro- ground up, he’d start with burgers.” possible scenarios selected by the authors. cesses involved. The exact timing of the The scenarios are not designed to be comdisruption may shift by a handful of years prehensive or necessarily representative of depending on the choices made across society. crop farming, global agriculture, and beyond. all situations. Any scenario or statement in Our core model runs to 2030. By then, our Given the magnitude of the disruption, this report is based upon certain assumptions central scenario shows that the disruption society should be prepared for the dramatic and methodologies chosen by the authors. changes to an industry that has not seen this Other assumptions and/or methodologies scale of disruption in thousands of years. We may exist that could lead to other results and/ will continue to track the disruption of food or opinions. and agriculture as well as disruptions in key Just one more tidbit from the Executive

“

FARMERS Livestock Market 209-847-1033 Steve Haglund

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Livestock Market Digest

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Summary before we close: The impact of this disruption on industrial animal farming will be profound. By 2030, the number of cows in the U.S. will have fallen by 50 percent and the cattle farming industry will be all but bankrupt. All other livestock industries will suffer a similar fate, while the knock-on effects for crop farmers and businesses throughout the value chain will be severe. (Emphasis added.) While cattlemen are being blinded by industry infighting that is crucial to their survival, and disruption is taking place in our cities, this is what is going on in the background. Who is fighting this?

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Editor’s Note: Caren Cowan is the publisher of the Livestock Market Digest. She has spent more than 35 years in breed and trade association management. Today she also publishes the New Mexico Stockman magazine, is the executive director of Protect Americans Now, a non profit focused on private property rights and assists the New Mexico Federal Lands Council in their mission of protecting federal and state allotment owners and lessees.

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2020 Fall Marketing Edition

Cattle Industry Divided on Negotiated Cash Cattle Bill by: Michelle Rook, www.agweek.com Many cattle producers feel like the market is broken and that has been exaggerated even more during the COVID-19 pandemic.

egotiated boxed beef prices hit record highs during the height of the pandemic, while at the same time the prices cattle producers were receiving for cattle in the negotiated cattle market moved lower. In the northern feeding areas, producers believe it is strongly tied to the large amount of captive supply or formula cattle packers can use to fill their weekly processing needs. That means the packers don’t have to bid in the open market and can commonly offer lower prices for negotiated cash cattle. In the north, most of the cattle are procured through negotiated sales, which are based on the quality of the animals, breed and other specifications for slaughter. In the southern feeding areas, the vast majority of cattle are formula priced where the packer and feeder strike an agreement and at the time of slaughter are delivered to the packer and the net price received is the base value plus a premium. That premium is based on feedlots’ ability to deliver a large amount of cattle. Nationally, between 80 percent to 85 percent of cattle are priced in this manner. Cattle producers in the north say the lower negotiated cash cattle prices have left very little profitability for their operations, especially the last five years. This was exaggerated during the COVID-19 pandemic as many were unable to get their animals harvested because the packers used their formula cattle. At the same time, boxed beef values were at record levels, so the packers reaped the financial benefit. This disconnect in the cattle market has prompted a legislative fix. A group of senators, led by Iowa’s Chuck Grassley, have proposed legislation to require large packers to buy at least 50 percent of their weekly cattle slaughter on a negotiated basis, with a 14-day delivery. Some cattle feeders and associations in the north are supporting this legislation, including the Nebraska Cattlemen Association. Troy Stowater, past president of the group, says it’s needed to restore price discovery.

“Price discovery happens when we have enough cattle in the marketplace that we are able to establish that. We know in Nebraska we need a short 40,000 head a week and we need participation by the three major packers that have facilities in our state,” he says. Stowater adds that the cattle industry needs to get the weekly slaughter back to a Monday-through-Friday schedule because cattle producers are losing leverage with beef packers having a Saturday kill. Stowater says from 2013 to 2015, the beef packing industry lost four plants across the country as numbers declined after the 2012 drought. When producers rebuilt the herd, there were too many cattle and too few hooks for cattle slaughter and thus packers had to go to Saturday processing. Other Midwest cattle groups are backing the 5014 bill, including the Iowa Cattlemen’s Association. However, their national organization, the National Cattlemen’s Beef Association, is not in favor of the legislation. “Well NCBA is opposed to it because that’s their current policy. The Association is a policy driven organization, so current policy, whatever is on the books, is where they stand,” Stowater explains. He serves on the NCBA committee looking at cattle market reform and is hopeful that can get that policy changed at the August meeting. Todd Wilkinson, past president of the South Dakota Cattlemen’s Association, also serves on the same NCBA committee with Stowater. He agrees the cattle market is

broken but isn’t sure the bill will help the northern feeding areas, as they generally run a higher percentage of negotiated trade and some weeks already hit the 50 percent mark. “So I don’t see as how it’s going to impact us as much, but as you get into the southern part of the United States, I mean you get Kansas and Texas, there isn’t very much if any negotiated trade on a regular basis,” he says. Wilkinson, who is also an attorney, is unsure if a marketplace mandate is the way to go. “I’m concerned that a legislative fix is sometimes brings more baggage than it promises to deliver,” he says. It’s uncertain if the bill has congressional support to pass, and so far, no lawmakers from southern states have signed on.

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2020 Fall Marketing Edition

On the Plaza

ranch, commercial and relocating properties.

Donald Brown

COLETTA RAY

Pioneer Realty 1304 Pile Street, Clovis, NM 88101

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2020 Fall Marketing Edition

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2020 Fall Marketing Edition

Alternative-Meat Startup is Hoping a 3D-Printed Steak can Upend the Meat Industry

same or even better.” Ben-Shitrit is focused on creating industrial-level 3D printers that would ultimately be sold to meat distributors around the globe and become part of the meat supply chain. “The idea is to replace a cow. So each of our machines produce in a day exactly like a cow, up to 250 [kilograms] in a single day,” he said. by Emily Hager & Mark Abadi, businessinsider.com Faux meat is believed to be significantly better for the environment, requiring less water t's made by the Israeli alternative-meat start- and energy and releasing fewer fossil fuels than livestock — the CEO calls it “the best way to up Redefine Meat, and fight climate change, the technology behind it to deliver healthier is one of many contenders solutions and food to in today’s sizzling-hot interthe entire population national race to capitalize of the planet.” on the growing faux-meat At this stage market. in development, Redefine Meat isn’t Redefine Meat is focusing on alternatives to not disclosing how ground beef or sausages, much the printers but whole-cut steaks — an will cost. The plan is area of the market that has The Israeli company hopes to release to keep the price of yet to hit the mainstream. machines that can print 44 pounds of its 3D-printed steaks “There is an amazing faux steak an hour. comparable to tradiindustry of alternative meat that is focused on minced meat. And actually tional ones, which can range from $5 to $12 the meat industry is driven by the whole-muscle per pound. The company hopes to debut the steaks at cuts,” CEO Eshchar Ben-Shitrit told Reuters. “Steaks, roast, slow cooking, grilling — every- high-end restaurants in Israel, Switzerland, and thing that an animal can do we want to do the Germany by the end of 2020.

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Livestock Market Digest

Redefine Meat's 3D-printed vegan steak. 3D STEAK

The Israeli company hopes to release machines that can print 44 pounds of faux steak an hour. But it will be awhile before the printers are part of the meat industrial complex. The machines produce only up to 13 pounds of meat an hour, and next year, the company plans to release a new generation of machines that will print 44 pounds an hour. By comparison, American slaughterhouses can collectively process over 100,000 cows a day, each of which yields hundreds of pounds of beef. In the meat industry, profit margins are greatest on whole-animal cuts like steaks. The key to those profits is creating a product with the same taste and texture as traditional meat, Redefine Meat food engineer Alexey Tomsov said. “We analyzed the different components that make those beautiful cuts and . . . we identified three main components — the muscle, the blood, and the fat,” he said. “These are the components that we need to mimic in order to reach the perfect beautiful steak.” Redefine Meat’s recipe contains soy and pea proteins, coconut fat, and sunflower oil, among other ingredients. Though the full list is secret, the company says all ingredients are plant-based and vegan. The company has some competition. Israel is a hot spot for alternative-meat companies developing both lab-grown and 3D-printed food. In Spain, the startup Novameat is also working on 3D-printed steaks and recently developed a whole-muscle version of pork. Big companies including Tesco and Unilever are developing plant-based meats too. Venture-capital money is pouring in, and the global faux-meat market is projected to reach a value of $8.1 billion by 2026, according to Allied Market Research. They’re all racing to convince consumers that a lab-grown product can taste as good as the real thing. “At the end of the day, technology is important, but what’s more interesting is to have a really delicious and tasty food product that you can cut through and have a bite, and be excited,” Ben-Shitrit said..

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Montana Candidate for Governor Unveils Growth Plan with COOL Initiative

tive would encourage the support and development of local and regional state-certified meat processing facilities and expand the “Made in Montana” and “Grown in Montana” brand to meat products, according to the plan. The program would reinstate COOL for beef and pork products in an effort to provide an edge to Montana producers and give more information about the state’s products. by Chris Scott, meatingplace.com “Growing Montana” also contains provisions designed to help Montana producers n economic growth plan unveiled by and manufacturers create jobs through valMontana Lt. Gov. Mike Cooney, who ue-added agriculture in addition to supportis running for governor, would revive ing hemp as a crop by investing in a diversiCountry of Origin Labeling (COOL) for meat fied hemp processing infrastructure. In May, U.S. Senator Jon Tester, D.-Mt., products made in the state. The proposed “Growing Montana” initia- launched the first bipartisan effort to support

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COOL for beef products on Capitol Hill since mandatory COOL measures were repealed in 2015. USDA efforts to revive COOL were hampered recently when a New Mexico federal judge dismissed two consolidated cases over the issue filed by Tyson Foods Inc., Cargill Inc., JBS USA and National Beef Packing Co. The Federal Trade Commission (FTC), however, currently is accepting public comments on its own “Made in USA Labeling Rule,” which tightens foreign beef products receiving “Product of USA” labels after minor processing by U.S. companies.

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Advertiser’s

INDEX A

A & M Livestock Auction . . . . . . . . . . . . . 44, 51 AC Nutrition . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Ag Lands Southwest . . . . . . . . . . . . . . . . . . . 49 Ken Ahler Real Estate Company . . . . . . . . . 51 American Angus Association . . . . . . . . . . . . 21 American Gelbvieh Association . . . . . . . . . . 53 American Salers Association . . . . . . . . . . . . . 2 Animal Health Express . . . . . . . . . . . . . . . . . . 53

Eagle Creek Enterprises . . . . . . . . . . . . . . . . . 8 Escalon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

B B & H Herefords . . . . . . . . . . . . . . . . . . . . . . . 18 Bar G Feedyard . . . . . . . . . . . . . . . . . . . . . . . . 13 Bar M Real Estate . . . . . . . . . . . . . . . . . . . . . . 51 Beefmaster Breeders United . . . . . . . . . . . . 4 Bottari & Associates . . . . . . . . . . . . . . . . . . . . 48 Bradley 3 Ranch . . . . . . . . . . . . . . . . . . . . . . . . 41 Breckenridge Partnership, LTD . . . . . . . . . . 34 Brinks Westall . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Buena Vista Realty . . . . . . . . . . . . . . . . . . . . . 48

C Callicrate Banders . . . . . . . . . . . . . . . . . . . . . . 23 Campo Bonito . . . . . . . . . . . . . . . . . . . . . . . . . 48 Cattlegrowers Foundation . . . . . . . . . . . . . . 46 Cauthorn & Griffin . . . . . . . . . . . . . . . . . . . . . . 7 Chip Cole Ranch Brokers . . . . . . . . . . . . . . . . 51 Chisholm Co . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Circle D Corporation . . . . . . . . . . . . . . . . . . . . 34 Clovis Livestock Auction . . . . . . . . . . . . . . . . 44

D Denton Photography . . . . . . . . . . . . . . . . . . . 47 Depot Insurance . . . . . . . . . . . . . . . . . . . . . . . . 3

F & F Cattle Company . . . . . . . . . . . . . . . . . . 33 Fallon-Cortese Land . . . . . . . . . . . . . . . . . . . . 48 Farmers Livestock Market . . . . . . . . . . . . . . . 44 Fink Angus . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Scott Land Company . . . . . . . . . . . . . . . . . . . 51 Siler Santa Gertrudis . . . . . . . . . . . . . . . . . . . 39 Socorro Plaza Realty . . . . . . . . . . . . . . . . . . . 48 Southwest Livestock Auction . . . . . . . . . . . 44 Spike S Ranch . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Stockmans Realty . . . . . . . . . . . . . . . . . . . . . . 50 Joe Stubblefield & Associates . . . . . . . . . . . 50 Suther Feeds . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

I Isa Beefmasters . . . . . . . . . . . . . . . . . . . . . . . . 19

K Kaddatz . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

T&T Trailers . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

L & H Branding Irons . . . . . . . . . . . . . . . . . . . . 14

U.S. Cattlemen’s Association . . . . . . . . . . . . 30 United Fiberglass . . . . . . . . . . . . . . . . . . . . . . . 27

Murney & Associates Realtors . . . . . . . . . . . 51

NAIA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Newman Stockyards LLC . . . . . . . . . . . . . . . . 45

Valley Livestock Auction . . . . . . . . . . . . . . . . 44 Virden Perma Bilt . . . . . . . . . . . . . . . . . . . . . . 28

P Pioneer Realty . . . . . . . . . . . . . . . . . . . . . . . . . 51 Prescott Livestock Auction . . . . . . . . . . . . . 44 Joe Priest Real Estate . . . . . . . . . . . . . . . . . . 50

Weaver Ranch . . . . . . . . . . . . . . . . . . . . . . . . . White Barn . . . . . . . . . . . . . . . . . . . . . . . . . . . . Willcox Livestock Auction . . . . . . . . . . . . . . . Winfield Livestock Auction . . . . . . . . . . . . . .

35 40 45 45

R R-CALF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Tom Robb & Sons Polled Hereford . . . . . . . 36 Robbs Brangus . . . . . . . . . . . . . . . . . . . . . . . . . 38

Caren for Ag, LLC Caren Cowan P.O. Box 7458, Albuquerque, NM 87194 505.263.2015 • caren@carenforag.com www.carenforag.com Livestock Market Digest

O O’Neill Land/Agriculture LLC . . . . . . . . . . . . 48 Phillips Ranch . . . . . . . . . . . . . . . . . . . . . . . . . . 29

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Roswell Livestock Auction . . . . . . . . . . . . . . . 45 Rubber Tire Troughs . . . . . . . . . . . . . . . . . . . 52

G A

To join, mail application and payment to R-CALF USA, PO Box 30715, Billings, MT 59107

Cell Phone: ____________________________________ Daytime Phone (if different than cellphone): ____________________________________ E-mail: ____________________________________ First & Last Name: E-mail 2: ___________________________________ ___________________________________ Ranch/Company Name: Do you want Text Alerts? Yes No ___________________________________ Do you want E-mails? Yes No Mailing Address: Do you want to donate to R-CALF USA’s Yes, $ __________ No ___________________________________ Legal Fund? City, State: Pay by credit card: ___________________________________ Card #: ______________________________ Zipcode, County: Expires: _________ Security Code: _______ ___________________________________ Signature: ____________________________ AAA Livestock R-CALF USA does not share its members’ information. New Member 1-yr $50 New Member 3-yr $250 Membership Renewal 1-yr $100 Membership Renewal 3-yr $275 Do you own cattle? Yes No Do you own sheep? Yes No

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Livestock Market Digest

Livestock Market Digest – Fall Marketing Edition 2020

Articles inside

Auction Markets

Alternative-Meat Startup is Hoping a 3D-Printed Steak Can Upend the Meat Industry BY EMILY HAGER & MARK ABADI / WWW.BUSINESSINSIDER.COM

Crouching Tiger, Hidden Dragon BY CAREN COWAN

On the Edge of Common Sense BY BAXTER BLACK

Meat Export Challenges — How Farm Finances Have Changed in 2020

View from the Backside BY BARRY DENTON

Chinese-Owned Wind Farm in Devils Rivers, Texas, Threatened Power Grid & More BY BONNER COHEN, PHD, CFACT

Smithfield's Sullivan Blasts Senators' Report on Meat Companies Response to COVID-19 BY LISA M KEEFE, MEATINGPLACE.COM

The Worst of Times... and the Best of Times BY CAROL WILSON

Why Can't Ranchers Sell Meat Directly to Consumers?

US Cattlemen's Association Respond to Open Letter From Certified Angus Beef

The Westerner BY FRANK DUBOIS

Open Letter: Questions from The Brand About the 50-14 Legislation

What Consumers Want BY MADI BAUGHMAN, ANGUS MEDIA, EDITORIAL INTERN US Meat Packing Industry is Heavily Controlled

Gross Profit BY LEE PITTS