Cattle Economics

Let Free Market Work In The Cattle Business

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Innovation is fueled by need, but it’s born through freedom.

Ponder anything in the cattle business long taken for granted.

  • Expected progeny differences (EPD) and the estimated breeding values (EBV) before them were developed to more accurately assess the genetic merit of breeding stock.
  • Growth implants were developed because of the need to increase cost efficiency, as well as the ongoing need to feed more people with the same land and cattle resources.
  • Even the ubiquitous cattle trailer is a relatively newfangled innovation. As Harry James, DVM of Pond Creek, OK, explained at this year’s Wheatland Stocker Conference, cattle trailers were still a rarity in the 1960s. As they became more common, so did local sale barns and haul-in veterinary practices. James continues to practice in the same clinic he built 50 years ago.
  • In this issue of BEEF (page 18) you can read about this year’s Trailblazer Award winners, Troy and Stacy Hadrick of Faulkton, SD, a couple who embraced the innovation of social media to become pioneers of modern-day industry advocacy.

In each example, individuals and companies innovated to meet a need and they were able to do so because they had the individual freedom to take the chance.

That same freedom is required for the chance to achieve and maintain economic sustainability.
“The biggest barrier to sustainability in our industry is that we must now absolutely defend the opportunity for consumers to choose from a variety of beef products, and the opportunity for beef producers to utilize a variety of management systems to provide those products,” says Tom Field, National Cattlemen’s Beef Association executive director of producer education. You can find more perspective on industry sustainability on page 36.

That’s why sweeping, shortsighted, cure-all regulations like those proposed by the Grain Inspection, Packers and Stockyards Administration deserve harsh rebuttal from anyone who believes the independent cattle business is worth preserving.

Those in the cattle business who support the rule seem to come from the same camp that backs other market-restricting legislative proposals over time, like banning packer ownership of fed cattle, country-of-origin labeling (COOL) and prohibiting agricultural operations based on size.

They can squeak all they want. I’ve read the heartfelt proclamations of presumed injustice. I’ve even tried to chalk up to honest ignorance the false math used to support such arguments. But it’s like listening to someone swear up and down that the bull with the questionable birth date was born Sept. 31, no doubt about it. You can’t argue if they truly believe such fiction is reality, nor would you want to.

The fact is you cannot make the cattle business, or any other business, stronger by limiting innovation and stifling freedom.

In this case, there’s no logical way to suggest that adding customer liability and market risk, while also erecting more barriers to cost efficiency, will increase the price of cattle or the economic wherewithal of individual producers. In fact, there’s every reason to believe such constraints will have the opposite effect.

It’s not retaliation, either; it’s economics – just like industry consolidation and concentration are not a grand conspiracy hatched in dark alleys in the name of some new world order.
It’s economics. It’s capitalism. It is folks having the freedom to create in the name of meeting needs. It is folks having the chance to succeed beyond their wildest dreams, which also means they have the chance to fail in spectacular fashion.

USDA is accepting public comments on the proposed rule until Nov. 22. Submit them via e-mail to comments.gipsa@usda.gov; by hard copy via mail, hand delivery or courier to Tess Butler, GIPSA, USDA, 1400 Independence Avenue, SW, Room 1643-S, Washington, DC 20250-3604; by fax to 202-690-2173; or via the Federal eRulemaking Portal at http://www.regulations.gov.

What's Cattle Economics?

Wes Ishmael provides tightly focused analysis and commentary on specific beef quality and marketing issues of practical importance to beef producers.

Contributors

Wes Ishmael

Among the industry’s most insightful thinkers, Wes Ishmael concentrates on industry price and market perspectives for BEEF magazine. Along with his monthly “Cattle Economics” column...

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