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June 2010 Archive for Out to Pasture

RSS By: Steve Cornett, Beef Today

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Competition Rule Casualties

Jun 28, 2010

By Steve Cornett  

If you didn’t believe that the Obama administration meant to declare war on conventional agriculture, you should have been sitting in on the press conference when Agriculture Secretary Tom Vilsack and Dudley Butler, head of the Grain Inspection, Packers and Stockyards Administration (GIPSA), announced their proposed new rules governing producer-processor relations.

These guys plainly see themselves as champions of what the Obama administration does not want to call “the little people.”

The best thing about the proposal is that it is—at this point—harder on poultry than meat producers. This reporter has long argued that you can’t expect processors or consumers to pay a lot for beef when they can steal chickens.

I got a shot at two questions during the press conference and blew them both. I wanted the first to be why they felt these rather bold—draconian, I would call them—changes were needed, given the fact that no study has ever shown a significant problem with vertical integration in the beef industry.

That’s an easy one to dodge. They simply assert that the farm-retail spread is increasing at the same time the number of producers is decreasing. They—and a lot of cattle producers—presume a cause-and-effect relationship.

Phewie...if so, why is the number of poultry operations in the U.S. virtually the same today as it was two decades ago, since that industry is far more vertically integrated than the beef and pork industries?

I’ll tell you why, or you can go look at the study and figure it out yourself. That integration has made the poultry industry MORE profitable for producers. It has removed much of the risk. It has removed the boom-and-bust nature of open markets that farmer groups so love to despise during subsidy-setting sessions. It has put the risk on the integrator and rewarded him well enough to keep him pushing for more efficiency.

Sure, there have been casualties among chicken growers. But not near as many as there have been among my friends in the cattle business.

My second question tried to get at why the comment period on the beef parts of this proposal would end a few days before—BEFORE, mind you—that scheduled GIPSA/Justice Department session on beef. I didn’t get an answer, probably because I’m so flubby of tongue in these public forums.

But it’s a darned good question, and I’ll tell you what the people smarter than me think. They think it’s because the Obama administration wants to do this in two steps: Apply these rules now and bring a ban on packer ownership of cattle and “captive supplies” after they hear from the populists who are even now planning to fill the seats at the hearing in Ft. Collins, Colo.

I know a lot of people want them to do that. For some small cattle feedlot owners, I can see why. If they can get Mr. Obama to outlaw the tools that allow big and connected feedlots to pay more for feeder cattle, they will be more competitive. I don’t like the taste that leaves in my mouth, but I can see the practicality of the argument.

What I don’t understand is why so many people professing to represent cow-calf producers are wanting to see it. Ranchers have put millions of dollars of those big guys’ equity in their pockets over the last few years.

According to Steve Kay, the top four feeders in the country—JBS, Cactus, Cargill and Friona Industries—feed almost 2 million head of cattle a year. That would be close to 40,000 feeder calves they buy each week.

They buy them because they outbid people like me. All of them, as well as other big feeders, can outbid us because they can make more at feeding cattle than you and I can. They can do that because they have the trust of the packers they cooperate with. Trust is a big part of the value in any product. Because a packer trusts one of those guys to deliver what he says he will when he says he will, the packer will pay more.

When you and I go to sell a feeder calf, the market value of our calves is increased because Tyson and Cactus feeders have a longstanding relationship. So Cactus and those other guys keep paying more for feeders than anybody else.

So now we think it’s smart to outlaw that? What would happen to the feeder market if Mr. Obama and R-CALF go their way and those four big feedyards and their 40,000 head of weekly demand suddenly disappeared?

I’m presuming that the Obama administration will be clever enough to phase their big changes in, so that the effect isn’t obvious enough to let them catch the blame. They seem to have that figured out with their health bill, anyhow.

Still, the damage will be there. Beef is worth X compared to poultry and pork’s Y and Z values. From that X must come a feeder calf price, a fed cattle price, a wholesale price and a retail price. If in our zeal to protect the little guys that Obama doesn’t want to call "the little people," we inflate the costs of three of those segments, there’s only one place for the extra bucks to come from: calf producers’ pockets.

But when I asked about the basis for this change, the answer went back to “what we heard in the country.” The squealers are packing these hearings, and they’re giving the Obama folks all the cover they need to take the beef industry back 40 years.

These people really believe America would be better off with a farmer-market based agriculture. If you’re ready for that, if you think you can thrive in that market, fine. You can sit still because the consumerist groups and populist farm groups are having their day in the sun.

But if you are of the view that modern agriculture and free markets are your best bet, you better speak up. There are a lot more of them than us, they are a lot more verbose and this administration will take us as far backwards as they think they have cover for.

Steve Cornett is editor emeritus at Beef Today. You can reach him via e-mail at scornett@farmjournal.com.

This column is part of the Beef Today Cattle Drive
eNewsletter, which is delivered to subscribers biweekly and includes beef industry analysis and market information as well as the latest beef headline news. 
Click here to subscribe.

 

 

 

More from Mark Schatzker

Jun 20, 2010

By Steve Cornett  

This grassfed beef thread has been interesting. You’ll recall that it started with an off-handed comment I posted about Mark’s book. I tend to be a little defensive toward feedyards and fed beef, and that showed through, I suppose. 

So then Mark replied and then I posted a new set of comments and so now Mark has replied again. I’m enjoying the give-and-take, and in the modern world, it doesn’t waste anything but bytes and pixels to let everybody have his say. 

So here, again, from Mark.

Thanks once again to Steve Cornett for continuing the discussion of my book, although I feel like we’re talking in circles. As I stated last week, I’m not against all grain fed beef. If memory serves, I even posted a photo of a delicious steak that came from a steer that ate—gasp!—grain before it was slaughtered. (But not much grain, mind you.) I refer countless times in the book to good grain-fed steaks—Chianina beef in Italy, Basque Country beef in France, Kobe and Matsusaka beef in Japan.

However, I also committed the grave sin of stating that the very best steaks I have ever eaten have been grass-fed. Everyone associated with the commodity beef industry seems to think I’m part of some socialist conspiracy to confiscate land and outlaw the growing and feeding of corn. Allow me to officially put that myth to rest. I know better than to mess with cattlemen. All I want is to eat good steak. Is that so wrong?

As far as that New York Times story goes, I saw that one, too. And you’re right--$8/pound is a lot for ground beef. Why, that’s almost as much as Niman Ranch is charging (http://store.nimanranch.com/c-27-ground-beef.aspx). (Do they realize they’re not selling grass fed beef?) The company I mentioned last week, Tallgrass Beef, sells its ground for  $6/pound. I think it tastes great, and most nutritionists will tell you that’ it’s healthier.

If, however, you’re one of those people who’d rather buy ground beef on sale at Wal-Mart or Food 4 Less or Save-A-Lot, I will not step in your way. If you think the best food is the cheapest food, you are entitled to that opinion. But you’re probably wasting your time reading a book about a guy who travels the world looking for the best steak. Why, the money I spent on plane tickets alone could have bought me several tons of extremely low quality ground beef.

Now let’s talk for a moment about beef and health.

At the end of Steve’s blog, he states “the FACT of the matter is that grainfed is actually a little healthier.” He’s referring here to a study hat was sponsored by the NCBA and which a lot of people in the grain-fed beef world have been very excited about.

Unfortunately, Steve, the NCBA, and everyone excited by the study are confused about what this study means. How do I know that? I phoned up the study’s lead author, Stephen Smith of Texas A&M, and asked him.

For those of you who haven’t read it, here’s what it said. Stephen Smith and his colleagues found that if you feed Angus steers on corn for 12 months, their beef is higher in a monounsaturated fat called oleic acid. When this particular beef was fed to a group of 27 men five times a week for six weeks, there was a very smallimprovement in their cholesterol.

So here’s a question: When was the last time any “grain-fed” Angus steer spent 12 months in a feedlot? This is a crucial distinction, because when Dr. Smith tested beef from cattle that had only been in a feedlot for eight months—still a long time on feed by conventional standards—he didn’t find the beneficial effect.
So it’s not “grain-fed beef” that’s “healthier.” It’s a peculiar and extremely rare type of grain-fed beef that’s “healthier,” a type of beef almost no Americans are eating right now.

Here’s something else you should know about that study: It hasn’t been published yet. The people who wrote it may be scientists, but until the findings are reviewed by other scientists, published in a scientific periodical—preferably a reputable one—and the results are duplicated by others, you can’t call it science. Doing so is irresponsible. So far, no other scientists than the ones that did the study have given it their stamp of approval.

But there’s a bigger picture problem here. There is more to beef than oleic acid. Grass-fed beef, for example, has more omega-3 fats. It’s also denser in vitamins and antioxidants. And if it’s oleic acid you want, feeding an Angus steer is a silly way to go about getting it. It’s a lot easier—not to mention cheaper—to run out and buy a bottle of, say, canola oil, or some almonds. In fact, one could easily conclude from Smith’s study that the healthiest beef would be a grass-fed steak with some olive oil poured overtop.

Finally, health schmealth. My number one concern, as we all know, is flavor. And my guess is that those Angus steers that spent an entire year on corn would taste darn good. A lot better, certainly, than a typical commodity steak, not because they’re more marbled, but because the cattle were a little older. Those steaks would taste like steak, not veal. But here’s what else they would be: expensive. They might even cost more than New York City grass-fed Highland.

Good luck finding such a steak. I suggest you fly to Japan, where cattle spend more than two years on feed. I ate a lot of steak in Japan. The fat is so unsaturated it washes off your hands with warm water and the morsels of steak burst in your mouth. It’s delicious stuff. I’d say it’s some of the better beef I’ve ever eaten. But it’s not as good as the best grass-fed steak. Not by a long shot. That, of course, is my opinion. And I stand by it. 

Steve Cornett is editor emeritus at Beef Today. You can reach him via e-mail at scornett@farmjournal.com.

 

 

 

Beef Bucks Brouhaha: Round 2

Jun 14, 2010

By Steve Cornett  

The National Cattlemen’s Beef Association, prodded by a none-too-cordial note from Secretary of Agriculture Vilsack, has backed down some on its reorganization plans. They expect to hear “soon”—in, of course, the bureaucratic sense of “soon”—whether they’ve backed down enough or need to go further.

This is a bit of a riveting situation for those of us who believe that intra-industry politics are not only interesting but crucially important to the future of beef producers. The next few weeks, leading up to NCBA’s annual summer confab in Denver, bode to provide something of a political soap opera.

To enjoy it properly, you’ll need some popcorn and some homework. Here’s some homework:

The CBB site provides a couple of FAQs that will be of value to understanding the questions. Frequently Asked Questions on USDA’s role in the checkoff. If you have further questions and enough no-doze, you can see the original enabling legislation by clicking here.

The association’s leadership called a press conference last week to tell us they had made three changes they thought would ameliorate the secretary’s concerns. (You can read about the changes here.)

I’m not sure NCBA leadership believes they’ve gone far enough with this proposal. I am sure the folks demanding more “firewall” between the policy part of NCBA and the beef-promoting, checkoff-funded Federation of Beef Councils don’t think they’re there yet.

As one of the latter told me after NCBA met with representatives of the six organizations who are pushing Vilsack to break the ties that bind the unified NCBA, “We sort of closed the meeting with everybody saying, ‘Well, ok. Let’s just see what USDA thinks of that.'”

These guys don’t just want a “fire-wall.” They want the policy division of NCBA—with which they compete for membership and political sway—divorced from the check-off function. They want assurances that NCBA is not profiting from, nor holding undue influence over, checkoff funding.

Frankly, it looks to me like the proposal as it sits abides by the law as it was written. The Federation members—state beef councils, chose by in-state cattle group —will be at the table voluntarily. Moreover, there is nothing to prevent other organizations from seeking the same relationship with Federation members. There is nothing to prevent any of them from sending their own representatives to the meetings. 

I won’t argue it’s the only way to meet the requirements of the law. The Federation could, in fact, work fine without any input from anybody if that’s what they want to do. But the question is whether this thing is “legal.” Looks to me like it would be. The Federation members will decide how much money is spent on what and who gets to spend it.

Let me remind you that this law was written by the National Cattlemen’s Association and the old National Live Stock and Meat board. They wrote themselves a prominent role into the law, and that law remains unchanged since then.

Up until now, Secretaries of Agriculture have pretty well stuck to the role prescribed to them in the law. They appoint the guys industry groups recommend and they watch to see the checkoff funds are spent in compliance with the regulations.

But this USDA is different. This secretary, for instance, isn’t content to simply let the good old boys nominate each other to the CBB board. He wants more small producers and a wider ethnic representation and such.

I’m not sure where in the regulation the secretary gets the authority to make such demands. But who’s going to argue? He’s the secretary.

Next question, then, is what happens if Vilsack still isn’t happy with NCBA’s proposal? Bill Donald, the incoming president, says he hopes that question won’t come up. He thinks the new plan will suit the secretary.

I’m not so sure. And I’m not sure NCBA will be willing to take all the steps necessary to get the secretary to sign off on ANY reorganization that leaves the Federation and the Policy divisions meeting in the same time zone.

Why would he?

This secretary and his boss have more friends in the non-NCBA outfits than in NCBA. They’re obviously less sold on that “free market” lingo that drives the association. They seem to have bought into the idea that Americans eat too much because food is too cheap. And did we mention that NCBA’s policy division—the one all the un-NCBAers see as competition—endorsed a Republican for president not too long ago?

And so we should watch. NCBA hopes to hear from Vilsack this week. They plan—make that tentatively plan—to send the final framework to their members by June 18th. That won’t be the final plan, of course. It can still be jiggled as the members consider it and juggled at the summer meeting.

I’m not really sure this is all that important to you and me unless these guys fumble around and get the secretary or his un-NCBAer friends mad enough to get the checkoff called up for referendum and then campaign against it.

If that happened, it would be important. We don’t need to lose this checkoff program because of a turf war. But that probably won’t happen.

So mostly it’s just interesting. But you need to do your homework.
 

Steve Cornett is editor emeritus at Beef Today. You can reach him via e-mail at scornett@farmjournal.com.

This column is part of the Beef Today Cattle Drive
e-newsletter, which is delivered to subscribers biweekly and includes beef industry analysis, market information as well as the latest beef headline news. 
Click here to subscribe.

 

 

 

Ground Beef at $8 a Pound

Jun 11, 2010

By Steve Cornett  

Another follow-up on grass fed beef, stemming from our ongoing visit about Mark Schatzker’s book “Steak: One man’s search for the world’s tastiest piece of beef.

I promise to get around to reviewing the whole thing one of these days. But for now, here are two excerpts from feedbacks at the Amazon site, both of which strike me as fairly accurate:

“What I found was an excellent blend of travelogue, food writing, personal journal, and scientific discourse. The book is enjoyable from beginning to end. There is an honesty to the writing, suggesting a deep fascination and passion for the subject matter - steak.”—a five star review.

“If we go back 50 years and make beef like this author's pipe dream, consumers will sacrifice the taste and choice and beef value they enjoy today. We don't want to go there. So fire up the grill and enjoy the taste and sizzle of US raised, grain finished, marbled beef! You deserve it!”—a one star review

Same book, two opinions. I like them both.

Why, that’s just like steaks! Some like one, some like another and some like them all. Too bad the book doesn’t admit as much. 

The New York Times gave us another story this week on how there is more and more grass fed beef available in the big city. It includes a couple of quotes of that sort that makes my eyes narrow and my molars grind when I read about grass fed beef.      

“The people who are aware of what they’re eating are realizing things are getting pretty scary out there.” 

And another: “The public now understands a lot more about how industrial meat is produced.”

What you have there is evidence of the old axiom applied by some car salesmen and most political consultants: “If you have something positive to say about your product, say it. If you don’t, say something negative about the competition.”

The first of those quotes is attributed to a guy who with his “life and business partner” plans to market 20 head of Scotch Highland cattle this year in Manhattan this year. The story says their ground beef sells for $8 a pound.

People who can’t afford that should just eat cake, I suppose.

The good news in all this is that good old Texas A&M has actually taken a look at the science of the health claims so many grassfeeders like to make and a recent report reminds us that the FACT of the matter is that grainfed is actually a little healthier, though there isn’t a lot of difference one way or another. All beef is good for you.

I’ll finally get the whole book reviewed.

Steve Cornett is editor emeritus at Beef Today. You can reach him via e-mail at scornett@farmjournal.com.

 

 

 

Defending Grass-Fed Beef

Jun 01, 2010

By Steve Cornett  

Mark Schatzker, whose book "Steak: One Man’s Search for the World’s Tastiest Piece of Beef’’ I have been reading and blogging about, takes issue with some of my points, and it seems only fair to grant him the same soapbox. 

I have, by the way, made it through his book. It's quite readable, but I suggest he has a bias against grain feeding and feedlots. For some reason, he seems to think their smell is part of the best-taste issue. More on that at another time.

For now, this is Mark's response to my earlier blogs:

Let me begin by thanking Steve for revisiting this topic. The Internet, as we all know, is full of angry types these days, and Steve isn’t one of them. Thanks for taking the high road and inviting me to join a civilized discussion, something that seems to be all too rare these days. People will never agree on everything, but if we can discuss things in a respectful manner, we’re all the better for it.

First off, I would like to say that I’m not resolutely against all feeding of corn. I ate and enjoyed many excellent grain-fed steaks during the course of my travels. In fact, I ate one last night. It came from a farm in Connecticut called Greyledge and it wasn’t grass-fed. It was “light-grained,” which is to say the 100% Angus cattle (and by 100% Angus, I mean actual registered Angus, not “predominantly black hided” cattle of uncertain genetic origin) live on pasture and receive about 4 lb. a day of oats, barley, corn and soy. Greyledge waits a little longer to slaughter—around 24 months. The steak was tender, buttery, very juicy, and it had serious flavor. In other words, it tasted the way a good steak is supposed to taste. Take a look at the marbling. Definitely upper 2/3 Choice, if not Prime.
 

We’re not producing many of these steaks in North America these days. The problem, as you point out, is yield. We use hormones, antibiotics, genetics and beta-agonists to get cattle fat as fast as we can. They’re too young to have any flavor. The meat is more like veal than it is like beef. The only thing you can really say for it is that it’s cheap.

Furthermore, we’ve hybridized, genetically modified and processed corn to the point that it’s just bland starch now. It’s nothing like the corn of, say, 50 years ago. I was in Mexico recently and ate tortillas made from blue and red corn. The flavor was unbelievable. I wonder what beef finished on that kind of corn would taste like. Would yield suffer? I’m certain the answer is yes. But as Temple Grandin told me, yield is the enemy of quality.
 

I also agree wholeheartedly with Steve that there’s a lot more to a cow than just steak. I learned this lesson all too well when I raised my own heifer, an experience I recount at length in Steak. I didn’t get her fat on corn. I let her out on pasture and supplemented her with apples, carrots, acorns and nuts. She sure was tasty. And one of the best things about that heifer was the ground beef.

Have you ever found that your spaghetti sauce seemed a bit thin tasting? Or that your chili didn’t quite have the flavorful punch that it ought to? Does it seem odd that we unload the entire condiment section onto our burgers to make them palatable? The reason is that our ground beef, like our steaks, has about as much flavor as a glass of tap water. So on this point, I resolutely disagree with Steve. There is more flavor in grass-fed ground beef (and, to a lesser degree, good grain-fed ground beef). When you use it in sauces, burgers, meatloaf, etc., the difference is unbelievable. It’s very simple: If you cook with beef that has more flavor, the food you cook will have more flavor.

Steve states: “We’ve trained [retail consumers] to expect that usually [beef] will taste great but sometimes it will taste OK. Importantly, though, it will almost never be bad.” I think that’s a wildly optimistic appraisal of beef quality. The truth is more like we’ve trained consumers to eat beef that has no flavor whatsoever. Year by year, decade by decade, beef has lost its character. We smother it in goopy steak sauces or we sprinkle on seasonings that make potato chips seem subtle by comparison. Is it any surprise Americans are eating 20 lb. less beef per year than in the 1970s? (And don’t tell me it’s because of health concerns. Doritos sales are doing just fine…)

As I said in my book, the very worst steak I have ever eaten was grass-fed. But Steve is wrong to state that there is an overall consistency problem with all grass-fed beef. It’s simply a matter of finishing the cattle properly. Tallgrass Beef is a Kansas-based company that raises and sells only grass-fed beef. It slaughters about 80 head of cattle every week. More than half of their beef grades Choice or better. Two percent grades Prime. That’s about the same percentage as commodity beef, if I’m not mistaken. And their cattle don’t get so much as a kernel of corn.

Some consumers, of course, care only about one thing: price. If they’re happy buying blade-tenderized or brined steak for the change in their pocket, so be it. These days, a lot of folks are struggling to make ends meet, and I’m not suggesting they run out and buy a $40 ribeye. But let’s remember how many niche branded programs there are — CAB, Laura’s Lean, Sterling, Creekstone, Coleman Natural, Niman Ranch, etc. Why all the high-end brands? Because there are lots of consumers willing to pay money for better beef.

This brings us to my basic problem with the commodity beef system: it has no interest in quality. There is no line item on the balance sheet called flavor. When beef is about price per pound, it turns into a race to the bottom. If the feedlot next door can increase margins 2 percent by implanting hormones, treating cattle with beta agonists, or crossing good breeds with big breeds, then the choice is simple: do what they’re doing or go out of business.

That’s why there are only four big packers. That’s why feedlots keep getting larger and larger. The beef that is produced is going steadily down in quality, and a growing number of consumers have had enough.

And that, in short, is why I wrote my book. I wanted to understand this mysterious and delicious meat we call beef. I think it’s an exciting time for the cattle business. Consumers are demanding more choice and they’re learning there’s more to great beef than USDA quality grade. Small ranchers and farmers are making decent wages raising a value-added product. The future promises to be delicious."
 

 

Steve Cornett is editor emeritus at Beef Today. You can reach him via e-mail at scornett@farmjournal.com.

This column is part of the Beef Today Cattle Drive
e-newsletter, which is delivered to subscribers biweekly and includes beef industry analysis and market information as well as the latest beef headline news. 
Click here to subscribe.

 

 

 

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