05/26/05 Canada and NW beef packing industry

When the debate over whether or not the United States should reopen its border to Canadian live cattle and some beef, and which organizations were for or against such a proposal, was strongly prominent in national media circles earlier this year, the National Cattlemen's Beef Association made a statement. Their governing board said while it favors reopening the border, it should only be done after certain points were reached to assure trade between the U.S. and former customers of our beef would be at levels prior to our nation's 2003 b.s.e. case. Jim McAdams, President of the National Cattlemen's Beef Association, says all but one of the eleven points issued by his organization have been fulfilled. MCADAMS: And our whole philosophy is doing everything that we can to grow this industry, growing demand, which will allow us to have a brighter future and a sustainable future where trying to limit supplies and adding costs while we are doing it is not sustainable and it's just not the right business philosophy. And it is N.A.C.B.'s philosophy that has them concerned about attempts to keep Canadian live cattle out, especially when it comes to the economic viability of the U.S. meat packing industry. McAdams recently visited the Northwest, noting how some Northwest packing plants have struggled since Canadian live cattle and most Canadian beef was banned in the U.S. two years ago over Mad Cow disease concerns. MCADAMS: We realized that a lot of the packing capacity in the Pacific Northwest was built upon a supply of cattle and that supply of cattle was going to be coming both from the United States and from Canada. And when that supply of live cattle was shut off, those packing plants couldn't work at optimum efficiency. They've cut back their production, they've cut back shifts, some of them are just running a fraction of their capacity. While some cattle organizations contend keeping Canadian live cattle out will benefit cow-calf producer's bottom line, McAdams says the entire Northwest cattle industry would suffer economic hardships if beef trade with Canada is not resumed and soon. MCADAMS: If those plants shut down, those feedlots don't have a ready outlet for those cattle, and they'll have to ship them back to the Mid-west, so they'll be freight away. Those cattle will be discounted, and the cow-calf producers in the Northwest will have the same challenge, either feedlots will be paying less because they have to take into account that freight away, or they're going to have to ship those calves all the way to the Mid-West and that is not a good thing.