Goliad County Farm Bureau recently hosted a panel discussion with R-CALF USA CEO Bill Bullard and National Cattlemen Beef Association President Jim McAdams before an audience of about 100 people from South Texas.
Goliad County Farm Bureau President Pat Calhoun moderated the event. Each participant was given 20 minutes to present their respective organization's current issues. Then Calhoun took questions from the audience and gave both speakers a chance to respond.
"It was not my intention to have a debate, rather a forum where both organizations could present their policy on the issues, and give producers the chance to interact with both sides at the same time," says Calhoun.
McAdams states that NCBA believes alternate domestic protein sources are the main competition to the beef industry, not low-cost beef producing export nations. Thus, Mandatory Country-of-Origin Labeling would not be an effective marketing tool and if it were implemented, producers would endure the brunt of the cost, according to McAdams.
"The cost of M-COOL has been purposely overstated by M-COOL opponents. We can implement COOL at no cost to producers simply by requiring all imported live cattle to be marked with a foreign marking, leaving all other cattle eligible for the USA label," says Bullard.
R-CALF USA believes that low-cost beef-producing export nations present significant competition to U.S. cattle producers, and M-COOL would be a very successful marketing and promotional tool in differentiating domestic and foreign beef, thus allowing the consumer to choose.
"While we opposed the Australian agreement on grounds that it did not provide market opportunities for U.S. cattle producers, we were at least able to provide a safeguard that protects the U.S. cattle industry from price-depressing import surges, but the CAFTA agreement abandoned this important safeguard," says Bullard.
He explained that one of the key reasons R-CALF USA opposed the Central American Free Trade Agreement (CAFTA) was because the agreement did not contain the cattle and beef safeguard mechanism that R-CALF USA successfully included in the Australia Free Trade Agreement. McAdams responded by claiming that R-CALF USA did not play an active role in negotiating the Australian Free Trade Agreement.
Bullard pointed out that during the 1990s, prior to BSE in 2003, the fed-cattle price was $67 per head, as opposed to $77 in 1990. While the U.S. cattle producer was losing $10 on cattle, U.S. retail prices averaged $2.77 per pound in 1998 and $3.32 per pound in 2002. According to the Livestock Marketing Information Center in Colorado, in 1992 the packer-margin as reflected by the live-to-cutout spread was $62 per head which more than doubled in 2002 to $142 per head. Therefore, while cattle producers did not benefit from increased beef demand from 1998 through 2002, the downstream retailers and packers were capturing not only their share of their value-added contribution to the beef supply chain, but they were capturing a growing share of the producers' production contribution as well.
"U.S. cattle producers are involved in a highly competitive industry, and they are in competition with extremely powerful forces that do not share their desire to maximize the profitability for cattle producers," says Bullard. "The 18,000 members of R-CALF USA have clearly demonstrated that changes are needed to ensure that producers can effectively compete for the available profits in the very profitable beef supply chain."