Agmates

Agmates Editor Steve Truman writes:

Governments World wide are finding they need to be very careful about the policies and legislations introduce that impact upon their farmers. Governments are discovering that it’s citizens are incredibly sensitive to food security.

Argentina

Striking farmers are using tractors to blockade roads nationwide in a bitter 100 day stand off with Argentine President Cristina Fernandez. The blockades have lead to shortages of eggs, chicken, beef in supermarkets and fuel across the country.

Picture #1 - Argentine farmers line up tractors and blockade roads across the country.

In March President Fernandez raised Soy export taxes on farmers by 10% to a whopping 42%. Since then farmers and protesters lead by the very powerful farmers organization Argentine Rural Society have blockaded roads and streets across the country.

President Fernandez, who took office just six months ago, has likened the farmers to ‘Coup Leaders’ who are attempting to overthrow her government in an ‘Economic Coup’. President Fernandez’s has seen her voter approval rating plummet from over 50% before the dispute to just 20%.

Argentina’s accounts for nearly 3 percent of global food exports and it is one of the world’s top exporters of soy, corn, wheat and beef.

An estimated 3-4 million Argentines took to the streets on Monday to protest against the government’s handling of a tense three-month standoff with farmers over export taxes.

There are fears that the ongoing dispute will force Argentina Latin America’s No. 3 economy into recession.

Spain

Thursday the 19th June. Thousands of Spanish farmers protest in Madrid against fuel price hikes. Soaring costs and low prices for the produce are driving them out of business. Spanish farmers are demanding lower diesel tax to cope with record fuel prices.

Spaniards are facing fuel and food shortages as a result of a nationwide strike by the country’s truck drivers who are supporting farmers in the protest against high fuel prices.

Germany, Switzerland, Austria, Italy, Belgium

Earlier this month Dairy Farmers for the 1st time in Europe banded together in a milk delivery boycott that saw large supermarkets run out of milk.

German dairy farmers began a protest action to secure higher prices for their produce. The farmers were paid 35cents a litre which was well below their cost of production and they were going broke. Farmers all over the country poured milk down drains in a boycott of dairy factories.

Swiss farmers, too, poured milk down the drains in support strike action demanding an increase for higher farm- gate prices.

Similar declaration of solidarity had come from counterparts in Belgium after Germans appealed to farmers outside Germany not to fill the shortfall. The German farmers were demanding a farm-gate price of 40 euro cents (62 dollar cents) a litre for milk.

It was estimated that 70,000 of Germany’s 100,000 dairy farms joined the boycott. The farmers blamed powerful dairy companies for depressing the farm-gate price of milk. They said they are being choked by increased costs, namely the rise in the price of fuel.

The Boycott ended after 10 days when large Supermarket chains agreed to increase farm gate prices by 10 cents for producers.

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Agmates Editor Steve Truman writes:

The United States and South Korean Governments yesterday caved into people power and agreed to revise the terms of their beef exports agreement as South Korean protesters continue to demand a ban on beef exports from the U.S.

Until now the US government had refused to renegotiate the agreement stuck on the 18th of April. The agreement gave USA beef open access to South Korea and was pivotal to a US-SK Free Trade agreement signed by Pro US Korean President Lee Myung-Bak who only came to power at the end of February.

As a result of almost daily demonstrations that grew as large as 80,000 people (pictured above), Lee replaced all his top advisers and his entire Cabinet also has offered to resign.

In the last week protesters have been calling on President Lee to resign as public confidence in his government plunges.

Protesters have been furious that their government had caved into U.S demands and had failed to consider the public concern about the health risks.

Under the revised deal, the South Korea will only accept beef from cattle aged less than 30 months. Younger cattle are believed to be less prone to mad cow disease. The new restrictions are set to start Monday.

The revised deal is good news for the Australian beef industry that has enjoyed boom trade with the 50 million beef loving population of South Korea since it banned U.S beef in 2003 following the discovery of mad cow disease in the U.S herd.

The U.S had been playing hard ball and refusing to renegotiate the deal. However unrelenting pressure from the people, that if not addressed could ultimately have lead to the down fall of the Korean government has lead them to the back down.

The U.S have until now refused to renegotiate believing any back down because it would set a precedent for other countries to back out of unpopular trade agreements and make it almost impossible to get countries like Japan to drop it’s U.S beef trading restrictions.

Democratic U.S. Sen. Max Baucus, chairman of the Senate Finance Committee, said in a press release:

“The implications of this agreement set an unfortunate precedent for U.S. beef trade with Korea and other countries.”

This is proof that populations of the world are very sensitive about food security. All governments need to be very careful about the policies and legislations they make and the impact those decisions have upon their citizens. Governments who ignore these sensitivities do so at their own peril.
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Agmates Editor Steve Truman writes:

S Kidman & Co will offer their 7,961km2 East Kimberly aggregation for sale by Auction in August.

Ruby Plains (4,808km2) and Sturt Creek (3,153km2) will be offered for sale on a walk-in-walk-out basis with approx 32,000 head of good quality Brahman cattle.

There are about 25,000 breeding cattle and full station plant to be offered in the sale.

Speaking to Agmates from kidman’s head office in Adelaide managing director Greg Campbell, said:

“We have taken the decision to offer the east Kimberly holdings as we are finding it too remote from the rest of our operation.

Kidman purchased Ruby & Sturt 25 years ago from the Quilty and Vesty organizations to supply steers, speyed heifers and cull cows to our Channel fattening country in Western Queensland.

We have invested a lot of capital in upgrading the facilities and herd there over the last quarter of a century . Now however with frieght cost escalating for the company to maximise our return we now have to turn our attention from that part of Australia to supplying the Asian markets.

We see Ruby & Sturt as a great supply base for food into Asia. However for that to happen would require setting up physical assets to produce a finished product. That would mean investing in extra finishing facilities such as country on the Ord or Mary River systems and perhaps a feedlot in Asia.

With the positive outlook for beef and food in general world wide we think the Ruby / Sturt operation may be of interest to perhaps an Asian syndicate or some of the larger world agribusiness players.”

Kidman’s expect to appoint the marketing agent/s following meeting’s in Adelaide today.

With the best international commodity prices in many years, thanks to roaring international demand and rising living standards in Asia large scale cattle operations in Northern Australia are attracting strong local and global interest.

Despite what the industry considers recent record prices, investors see Northern Australian Agricultural land as well priced on a global scale.

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Rural properties / Farms for sale

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Agmates Editor Steve Truman writes:

Agmates has nothing but praise for the lobbying that State Farming Body AgForce has done to bring about a national pasture fed certification for beef.

Central QLD Cattleman Ian McCamley, MCC Pastoral “Ganadero” Comet (Location) is the AgForce Cattle Board vice president. In that role he has been lobbying the Cattle Council of Australia (CCA) for some years for an AUS-MEAT accredited beef pasture certification.

“Finally the CCA has agreed to investigate and work towards the development of a new beef identification standard that is AUS-MEAT certified” Ian said.

Picture # 1: Ian McCamley in a yard of his pasture-fed & naturally raised prime cattle set to go off into the food chain on Thursday the 1st of May.

“Grain-fed beef has had its own certification for years. In fact in Australia it’s the only certification, all other beef we produce goes into a basket classified as ‘other’. The 3 main markets for our beef are grain-fed, grass-fed and live export.

AgForce believes it is time for grass-fed beef, which is exclusively naturally raised in the paddock, to be distinctively identified for the benefit of consumers who are increasingly interested in how their food is produced,” Ian said.

Photo # 2: Ian and his family took these photos for Agmates on the 1st of May. Below they are mustering these bullocks ‘the boys’ off natural Buffel grass pasture on Ganadero at Comet Central Queensland.

AgForces proposal is that Pasture-fed naturally raised beef will be developed as the new national standard to underpin the quality and integrity of beef that has been exclusively finished on grass.

That beef will be exported with an AUS-MEAT natural pasture fed beef stamp on it. AgForce is also are calling for MSA (Meat Standards Australia) certification and stamping to guarantee the eating quality to beef consumers.

Photo# 3: ‘The boys’ calmly strolling into the Cattle yards for drafting and trucking.

Ian Said, “Consumers are focusing more attention on how farm animals are raised, therefore we believe there is an opportunity to differentiate more of our great product.”

“We also believe a new natural beef standard has the potential to extract market advantages and price advantages for our natural and healthy pasture raised and fatten beef.”

Photo # 4: ‘The boys’ yarded at Ganadero. Now to draft out the fat’s. Shouldn’t be to hard to get a load out of these.

AgForce recently met with AUS-MEAT and Cattle Council staff to discuss the best way to develop a standard to certify pasture-fed natural beef.

“We (AgForce) are taking an oversight role on a project to investigate the market performance of a new natural-beef line and identify exactly what is likely to spark consumer interest,” Ian said.

Photo # 5: McCamley bullocks “the boys” during the draft. Raised and finished on natural pastures. They are calm and quiet to handle.

“We want to capture an opportunity to grow the overall beef market by meeting new consumer requirements for environmental or other attributes, whilst ensuring meat-eating quality through use of MSA.”

AgForce said the push for a pasture-fed beef standard in Australia follows new American USDA Agricultural Marketing Service regulations on “grass-fed” and forthcoming regulations on “natural” beef.

“We believe we can easily meet any US “grass-fed” regulations that are in place. Our competitor countries such as Uruguay already have USDA approval for their systems to be recognised.

This coupled with the drop off in volume of grain-fed beef available to markets due higher grain prices leads us at AgForce to believe Australia needs to progress this new standard quickly for producers of our natural grass finished beef to able to be truly competitive in world markets.”

Photo # 6: There thats done. Ian’s and his family are finished drafting the “the boys” and everyones happy.

Agmates wonders why it has fallen to graziers like Ian & AgForce to have to lobby CCA to implement a “pasture-fed” standard that will no doubt have many advantages in differentiating and marketing or great natural grass fed beef. Surely this should work should be done by the producer levies funded Meat & Livestock Australia?
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See Organic grazing properties available for sale on Agmates:

11,700HA (28,900 acres) A1 Organic Cattle & Sheep
21,000HA (52,000 acres) A1 Organic grazing Western QLD
Click here See all beef Grazing farms for sale on Agmates:

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Say G’day to Ian, leave a comment or question, I’m sure he’ll be happy to answer any on this topic.

Agmates Editor Steve Truman writes

Brazilian owned JBS is on the verge of being the largest beef processor on 3 major cattle producing continents. This is world domination of the export beef market on a grand scale never seen before.

JBS S.A. advised it has received approval from the Australian Competition & Consumer Commission to purchase multi-species processor Tasman Group. JBS paid $150 million for the Tasman Group with the sale expected to now be finalized on the 2nd of May.

Tasman will become a subsidiary of Greeley, Colo.-based JBS-Swift & Co., already the owner of four beef processing plants and four cattle feedlots in Australia (formerly AMH).

Tasman operates six slaughter facilities and one cattle feedlot.

1. Brooklyn VIC - the largest Multi- Species Plant is the Southern Hemisphere.
2. Cobram VIC - Capacity of 3,000 lamb and sheep a day.
3. Yarrawonga VIC- Capacity 330 cattle aday
4. Longford TAS - Capacity 450 beef & 1,500 Sheep, Lamb & Veal a day.
5. King Island TAS - Capacity 180 Cattle a day
6. Davenport TAS - 150 Cattle & 2,500 Sheep, Lamb & Veal a day.
7. Yambinya feedlot NSW - Licensed to Feed 25,000 cattle & 45,000 Lambs. 7,000 acres of country and 5,000 megalitres of irrigation water. Extensive cropping area.

The newly structured Australian assets will have more than 5,000 employees and a capacity to slaughter some 25,000 animals per day.

JBS purchased Swifts last July 2007 for $US1.4 billion ($A1.7 billion) which owned AMH with has abattoirs in Townsville, Rockhampton and Dinmore near Brisbane and at Beef City on the Darling Downs, where it also has a major feedlot that complements similar fattening operations at Mungindi in Queensland and Caroona and Prime City in New South Wales.

With a market capitalisation in Brazil of $US3.2 billion, JBS is South America’s largest beef processor and one of the world’s largest exporters with 23 plants in Brazil and six in Argentina.

JBS is currently awaiting U.S. Department of Justice approval for acquisitions of U.S. beef processors National Beef Packing Co. and Smithfield Beef Group.

If approved, JBS-Swift, currently the third-largest U.S. beef processor in terms of slaughter capacity, would become the USA’s largest beef processor and control some 30 percent of its entire slaughter capacity.

That will mean JBS will be the largest beef processor on three continents - North America, South America and Australia.

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What do you think will be the consequences for beef producers in North America, South America and Australia of JBS’s domination of the worlds export beef production?

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Agmates Editor Steve Truman writes;

This is why we need Royal commission into Meat Prices:

Retail Price to Consumer AUD$50 a kilo.

BRISBANE pensioner Ellen McDonald (picture left) was stewing chuck steak yesterday, still shocked that her local butcher was selling premium lamb cutlets for $50 a kilo. Click Here to read that story.

Photo by Darren England - Courier Mail article 23rd of April.

Wholesale Price AUD $6 a kilo.

In the article the Butcher tells that he has paid a wholesaler $6 a kilo for the meat he sells for $50 a kilo. A mark up of $44 a kilo.

Processor Price to Farmer AUD $3 a kilo.

The processor pays the farmer approx $3 a kilo and sells it for $6 a mark up of $3 a kilo. In that the processors has all the costs of killing, storing and delivering the meat to the retailer. The processor would hope to keep perhaps 20 cents a kilo as profit.

The Farmer gets AUD $3 a kilo.

Western Australian Beef cattle producer John Fry of Torridon Grazing has told the ACCC inquiry into grocery prices that he receives less from wholesalers than it costs to operate his feedlot, and warns that the industry may be forced into ruin.

The Australian Competition & Consumer Commission is conducting hearings on the price of groceries.

Agmate John Carter wrote an article on this just last week. - Supermarket Duopoly Ripping Off Australian Cattle Producers. Click Here to Read that Article

The Australian Beef Association claims that Red Meat Consumers in Australia are paying $3-4 billion a year too much for meat. They have called for a Royal Commission into what consumers pay for meat and what producers are paid. To see that article click here.

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Agmates Editor Steve Truman writes:

The Australian Federal government will come under enormous pressure from the beef & lamb industry’s to negotiate a free trade agreements (FTA) with South Korea & China. FTA’s are urgently needed to match a proposed USA FTA with South Korea & a recently signed New Zealand - China FTA.

Federal Agriculture Minister Tony Burke (pictured left) is to be congratulated on his proactive visit to Asia and particularly South Korea earlier this month.

However developments in the last week will mean he has a lot of work to do to save Australian beef producers from a potentially disastrous beef trade distortion if the US- South Korea FTA goes ahead.

The USA and South Korea have reached an agreement to lift restrictions US beef imports. If the proposed US-Korean Free Trade Agreement goes ahead Australian Beef exports to our 3rd largest customer will be virtually wiped out unless Australia is able to enter into its own FTA with South Korea.

Australia last year exported more than $800 million worth of beef to South Korea.

US and Australian beef exports to South Korea currently attract a 40 per cent import tariff. Under the US Free Trade Agreement (FTA) that will fall to zero for USA producers within 15 years. This puts Australian Beef exports at an insurmountable disadvantage.

David Inall, (pictured left) Executive Director of the Cattle Council of Australia said

“The main threat posed by the ban’s lifting was that a US-South Korea free trade deal could now become law - which meant dramatic tariff cuts for US beef.”

“It really only serves to reinforce the need for Australia to go down the path of a free trade agreement with Korea,” Mr Inall said.

“It’s imperative that Australia strikes a deal with parity of access otherwise we will be placed at a clear disadvantage.”

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Same deal with Our Friends Across “The Ditch”

A newly signed free trade agreement (FTA) between China and New Zealand will have the same impact on Australian lamb exporters.

China currently imposes tariffs of up to 23 per cent on lamb from Australia and New Zealand, but the latter’s tariffs will fall to zero by 2016 as a result of the new FTA, signed in the week ending 11 April 2008.

Chris Groves, the president of the Sheepmeat Council of Australia, said that with China now the third largest market for Australian lamb, it was important that Australia moved quickly to sign its own FTA with China.

Tony Burke needs to get cracking on moving the Rudd government negotiating a FTA deals with South Korea and China. Negotiating FTA’s are notoriously long and slow processes. The three Key government ministers who will move this along are Prime Minister Kevin Rudd, Trade Minister Simon Crean and Agriculture Minister Tony Burke.

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Update No1 - 23rd April @ 1.05pm

Australia currently accounts for some 95% of the South Korean beef market, this is up from 45% prior to the South Korean ban on US meat in 2003 in the wake of the BSE find in the US. This unchallenged asses to the South Korean & Japanese market has been the key driver behind a resurgence in the Australian beef industry since 2003.

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Update No2 - 23rd April @6.46pm

South Korea Braces For a Dip in Beef prices.

South Korean cattle producers aren’t very happy either. Ahead of the re-entry of U.S. beef into its market, South Korea expects a significant decline in its beef prices.

The Korea Rural Economic Institute (KREI), a state-run agricultural think tank, projects cattle prices to plummet by nearly 14 percent compared with 2007 prices. If U.S. beef imports total 240,000 metric tons, a 20 percent increase over last year, the price of premium beef could fall by as much as 5.7 percent.

If there is a 30 percent increase in beef imports, local beef prices will drop 8.3 percent to 10.4 percent, while beef prices would fall by 11.4 percent to 14.2 percent if 280,000 tons of foreign beef are imported.

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USA Agmate and Cattle Broker Joel Gill thought cattle producers would like this:

Courtesy of the Dickinson Cattle Co., Inc. Barnesville, Ohio USA.

Follow along the dusty trail of a modern day Texas Longhorn trail drive. Here at Dickinson Cattle Co.Inc (DCCI)the calves are being born at 8 to 20 per day.

For good management, every 3 to 5 days all the calves of that age group are moved with their mothers to a separate pasture.

It is easier to check pastures if management groups are separated by pairs, springers and dries. By the end of calving season the DCCI pastures will have sorted 40 to 50 pair in 10 to 14 pastures.

On April 7 twenty calves were born. On April 8 the new pairs were driven 3 miles to a new pasture. About half way, the day old calves just got tuckered out and started dragging toward the rear. As they demanded to “sleep-it-off” in the middle of a public road, the DCCI men loaded them into the old ranch truck.Scott became the official baby sitter.

These are all Texas Longhorn calves sired by Over Kill, Tempter, Victory Lap, Temptations The Ace, Super Bowl, Jamakizm, The Shadow and Win Win. They are completely pooped! However, 2 miles is a pretty good stampede for a one day old calf. The 3 and 4 day olds walked the total distance.

Each calf has an ear tag with the initials of the sire and name of the dam. All DCCI calves are weighed, receive a selenium shot and tagged promptly after birth. Little lives are very important at DCCI. Some will grow to be great impressive specimens. Every precaution is taken for their health and safety.

Each calf is unloaded to be optimistically received by the expectant mother at the end of the trail. For those of us north of the fortieth parallel in Ohio, the new grass is just starting.(Ten days ago we had 9 inches of snow.)

New mothers are now comforted and happy. The calves quickly grabbed an aggressive shot of milk, lay down in the new grass and zonk out.

Note: Don’t look at the old truck door–the handle hasn’t worked for months, but it opens and closes fine with a bungee cord. That is one way you can tell DCCI is not operated by the US government.)

Cows mother-up and the calves feel like new in an hour or so. (Youth is wonderful.) All is well that ends well. Dickinson Cattle Co.Inc.Barnsville Ohio USA.

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Agmates Editor Steve Truman writes:

TEYS Brothers has bought the South Burnett meatworks at Murgon. South Burnett Beef went into receivership in May last year putting 350 local people out of work. The collapse of the company effectively left southern QLD with just two export grass beef processors.

Whether South Burnett meatworkers can look forward to a recall to work anytime soon remains to be seen.

Teys, has four major operational plants in Australia which are:

Queensland

Beenliegh (Between Brisbane & the Gold Coast) daily capacity of 1,400 cattle with 800 employees. Beenliegh is the Groups head office and kills all of the grainfed cattle from their feedlot at Condamine.

Rockhampton - daily capacity of 1,700 and employs 900 people. Rockhampton’s single largest employer.

Biloela - (South West of Rockhampton) daily capacity of 700 head and employs 400 people.

South Australia:

Naracoorte - (South East South Australia near Victorian Border) daily capacity of 550 head and employs 300 people. Naracoorte’s single largest employer.

Teys owns two other Plants that are not operational - Innisfail in North QLD that previously had employed 200 people and could kill 600 a day and Katherine in the Northern Territory.

We asked Livestock Executive Director Geoff Teys did they plan to reopen the works, but he told us that Chairman Allan Teys was the only one in the company authorized to speak about the purchase. Allan Teys is away for the next two weeks.

Teys is the largest Australian-owned and second-largest beef processing company in Australia after Brazil’s JBS group, which last year gained control of Queensland-based Australian Meat Holdings. Teys processes about one million cattle and turns over more than $1.2 billion.

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New South Wales cattle producer John Carter writes:

“This is the fourth in a series of articles written after my return from the USA where I attended and was a key note speaker at R-CALF USA’s 3 day annual conference held in Omaha Nebraska. I participated and spoke as a representative of the Australian Beef Association (ABA).”

Video that Sparked 62million Kg Beef Recall

The United States Department of Agriculture (USDA) was really hammered by speaker after speaker at the conference and they deserved it.

As I waited for my connection in Los Angeles I read the Los Angleles Times and was amazed to read the story of the 62 million kgs of beef recalled due to a Federally inspected Californian abattoir killing downer cattle for the food chain!

The USDA recall is not because of it’s rigorous inspections but instead a video secretly taped by the Humane Society of the United States. The video showed Hallmark/Westland plant workers prodding downer cattle to get them to stand, and moving downer cattle with machinery, such as a forklift.

Click here to see the video that sparked outrage. (Thanks to Agmate Paul Williams for putting us onto this footage. WARNING - Footage shows cows too sick to stand being shoved by forklifts at a slaughterhouse….. Graphic footage … 2/2008)

I later phoned a retired friend who was a USDA employee and in a sad tone he said the the USDA was no longer the independent body admired worldwide for its integrity.

My friend said, “They (sic USDA) are now under the influence of the crooks in Washington.”

Conference delegates were most critical of the USDA reopening of the Canadian border against their own BSE rules. This was easier to understand than was their refusal to allow Independent meat packer Creekstone’s request to be able to test all their beef for BSE (at their own cost) which would have gained them access to lurative Japanese export markets.

Also delegates were furious about the USDA’s delaying of the Mandatory Country of Origin Legislation (MCOOL) for beef that was passed five years ago, but as yet due chiefly to USDA opposition is to be implemented.

My admiration for the independent R-CALF USA lone battle against bureaucracy on behalf of producers has grown enormously.