A Good WeekWritten by Dennis Sun
Published: 05 March 2016
The last week in January was a great week for the nation’s cattle industry. While the 2016 Cattle Industry Convention couldn’t fix the recent volatile prices in cattle, there was a whole lot of discussion on the issues and some corrective measures taken.
Some 6,700 cattlemen and cattlewomen and those involved in the cattle industry attended the National Cattlemen’s Beef Association’s (NCBA) convention in San Diego, Calif. The event also included some 340 trade show participants. If it was related to cattle, it was exposed in the trade show.
The main topic during the convention was the sudden drop in cattle prices and what should – or could – be done about it as the cattle feeders and beef buyers have really been hit hard by the major volatility in the futures markets. Cattle feeders and others in the industry across the nation have lost an unbelievable amount of equity lately. This in turn has hurt cow/calf ranchers in the hills and those who buy yearlings to summer. But it is the cattle feeders who have really been bleeding lately, which, in turn, has hurt the whole industry.
We all realize that the record high cattle prices in 2014 and the first months of 2015 were caused by really tight cattle supplies and tighter supplies due to diseases in the chicken and pork industry. CattleFax analysts say it was the “perfect storm” in 2013 and 2014 that created an increase in prices, with a classic expansion cattle cycle phase, strong exports, strong demand and tight competing meats for protein sources that are being sought by the world’s growing middle classes. They also say it was a “perfect storm” that caused the downturn in prices, with a soft export market caused by a stronger American dollar and an increase in beef and other meat imports.
Some point their finger at the meat packers and have asked for an official investigation by the U.S. Senate Judiciary Committee to look into potential anti-trust and anti-competitive conduct in the U.S. beef and cattle markets. I didn’t hear much about that issue in San Diego as much as I did hear about the high frequency trading’s impacts to the volatility. These high frequency trades take place in a split second and only benefit the hedge funders.
As I understand it, most of the other commodities have eliminated these split-second trades, delaying trades by at least one second. That’s what needs to be done with cattle. High-frequency traders are using computers to make a profit from price movements caused by large institutional trades buying as when prices are down and selling in a few minutes later for a profit. These split-second trades happen just too fast, and no one can keep track. The one second delay slows down the process so everyone sees the market at the same speed. I’m not sure that I understand it all, but that is what we are hearing.
NCBA is working with the Chicago Mercantile Exchange (CME) by asking for the audit trail data as part of their investigation into the wild swings of the cattle trades. They have already made some improvements in trading by putting a limit on the number of times an individual firm can trade, which will help.
We hope everything that everyone is doing will help. Stability in the cattle markets is the best answer, and we hope that the world’s issues will not hinder it either.
What’s the ValueWritten by Dennis Sun
Published: 27 February 2016
In past years, we haven't given shed antlers much thought, except a comment or two when we heard there was money in them. These days, we know for certain about the money involved, the impacts on wildlife, the trespassing involved and now regulations and impacts on private lands.
In 2009, due to harassment or disturbance of big game populations on public lands in western Wyoming, the Wyoming State Legislature granted the Wyoming Game and Fish Commission authority to create a season for shed antler hunting in western Wyoming, and in turn, the Commission set a season west of the Continental Divide from Jan. 1 through May 1. Even though the collecting of shed antlers out of season is illegal, it has been tough to enforce because of the vastness of western Wyoming.
The main reason for the regulation was to curb harassment of big game herds during the winter while collecting shed antlers, but there should be more to it than that. In a sense, there is free money out there lying around the hills, and when that happens, laws are often broken, both related to wildlife and private property rights.
Ranchers in areas of the state with big game populations have recognized the issues of shed antler collecting, and in past years, the Wyoming Stock Growers Association (WSGA) has worked with the Wyoming Legislature’s Joint Travel, Recreation and Wildlife Committee to regulate collection of antlers across the state as opposed to just west of the Continental Divide. They have also discussed what is appropriate or not for the legislature and Commission to take on regarding regulation of shed antler collection. At the WSGA Summer Cattle Industry Convention in 2015, there was a directive passed to “Investigate appropriate legislative or rulemaking authority to authorize Wyoming Game Wardens to issue citations for unauthorized trespass on private lands to collect antlers.”
There is no doubt about it, there is money in shed antlers, and not only in the craft market – where we see belt buckles, knife handles, chandeliers and lamp stands. The pet chews market has really driven up prices lately, to around $12 a pound for antlers. Around 80 percent of the shed antler market goes overseas to be ground up for pills. Really, it is the export market that is driving up the prices.
A commodity with that much demand that starts out free is kind of like finding gold above ground. Some are going to break laws to collect it. Now, as we have to legislate or regulate for the worst-case scenario, antler collecting will likely have to be a regulated industry.
Where a lot of the antlers are found on private lands, we need to discuss who owns the shed antlers, and if someone trespasses on private lands, is our trespassing law for hunting in effect where land isn’t posted, or is it the hunter’s responsibility to know where they are at? Or can a landowner collect shed antlers on their private lands anytime if not harassing big game herds? As much as shed antlers are worth, penalties need to be harsh enough to be a deterrent. And if the shed antlers are on state or federal lands, what regulations apply and who owns them then?
There is more to this discussion than just the harassment of big game herds, but it is going to take some careful thought. Ranchers, as private landowners, have rights too.
What’s The Truth?Written by Dennis Sun
Published: 13 February 2016
Like you, we at the Roundup have been trying to decide what is the true story coming out of eastern Oregon with the Hammond family and now the Bundy-led occupation of the Malheur National Wildlife Refuge. As you well know, there have been numerous stories coming out of the area concerning the Hammond family for the past couple of years, and now the stories are an everyday occurrence.
We have not written anything here for a couple of reasons. We all feel the emotion that the Hammond family must be going through as Dwight and Steven Hammond go back to a federal prison to serve more time after a federal judge ruled they hadn’t served enough time for crimes they were found guilty of, and we sure didn’t want to print something that was not true. We felt it was better to be silent than to be wrong. After hearing from ranchers and others in Oregon, I’m still not sure what the real story is among all of the stories printed.
First off, although legal, resentencing the Hammonds to finish their mandatory minimum sentence of five years is unrealistically harsh. The Hammonds are not terrorists in my eyes, but they were prosecuted under an anti-terrorism statute. The Ninth Circuit Court of Appeals acknowledged the mandatory minimum considered unconstitutional by a District Judge is harsh, but ruled it’s not unusual and that the courts cannot disregard the required sentence.
The Hammonds are known to be a private, quiet and humble ranch family. The Oregon Cattlemen’s Association has declared that they do not support illegal activity taken against the government but has, and will continue, to support the Hammonds via avenues that are in accordance with the law. You can get on their website at orcattle.com and sign a petition started by the Association asking the White House to review the case and grant the Hammonds clemency. There is also an address to send money for the Hammonds. Now, the Hammonds haven’t requested money be sent to them, and Dwight Hammond said he thought that was wrong. Regardless, many are sending checks to a bank in Burns, Ore. that is holding the money.
The Oregon Cattlemen’s Association and the Public Lands Council were very close in negotiating an agreement with the Bureau of Land Management (BLM) to get the Hammond’s grazing permit back. Then the Bundy-led occupation took place and BLM disappeared. Both the Oregon Cattlemen’s Association and Public Lands Council have been working behind-the-scenes to help the Hammonds. Neither the occupation nor all of the media attention has helped at all.
The Hammonds, as I hear it, don’t like what the Bundys are doing with the occupation, and so far, I don’t think the Bundy’s actions help any public lands ranchers either. First they are armed as a militia, and that’s a blow to the lawful efforts to loosen the government’s grip on western lands. Being armed just gives the wrong impression to the American public, as most don’t understand the overreach by the federal government in the West anyway.
The Public Lands Council is quietly ramping up a public relations move to tell the real story of public lands ranchers and the benefits they create on the public lands. We hope it helps and that it is not too late. There is a true story to tell about those who use the public lands in the West.
Jobs in AgWritten by Dennis Sun
Published: 06 February 2016
Well, we’re starting a new year, and lately I’ve been looking for some positive stories and have found some. Those involved in the beef and cattle business are still in shock from the last half of 2015, but as I’m writing this column, I see that rib steak is on sale at the grocery store for $5.99 and sirloin tip roast at $2.97. I listened to a commodities broker the other morning saying that, with the savings in the price of gas, most consumers will be buying more beef, and we hope that beef is from America. Anything to raise the demand for beef should help back in the hills.
We also see the Mountain States Lamb Cooperative is in the packinghouse business now, and we wish them all the best on their new acquisition.
And the best news I saw this week is a story from Beef Magazine and others on the good jobs this nation’s ag industries have for youth just out of college. The article states, new information shows that bachelor’s degrees in agriculture are in high demand. Jeffery Dorfman with AgFax.com said, “People will always eat, so jobs in producing, processing, transporting and selling food will never go away. For good paying, rewarding and secure employment, college students would be well served to find a major in food and agriculture.”
According to the U.S. Department of Agriculture (USDA), the five-year forecast for college graduates in agriculture and food industries shows there will be 57,900 jobs available per year. However, the nation’s agricultural colleges will only graduate approximately 35,400 students annually. Graduates who majored in fields outside of agriculture will fill a lot of these jobs as a result. However Dorfman said, “Employers much prefer graduates with more background in the field.”
The article states that production agricultural jobs only account for 15 percent of the available positions. Half of the jobs are found in business and management, 12 percent are in agriculture education, communication or government agencies, and 27 percent of these jobs are in the science, technology, engineering and math fields. The part important to youth raised on farms or ranches is that students with agriculture backgrounds already understand the industry, know how to “talk the talk” and appreciate the business – all traits that potential employers desire.
Plus, the jobs pay well. The article states, on average, annually an agricultural operations manager will earn $60,000, an agronomist $45,000, Information Technology (IT) managers in food and agricultural businesses $78,500, and starting agricultural jobs begin at $47,300 per year with a $5,000 bonus.
We don’t want all our youth to leave the farm or ranch, but if they want to or if they want to do something different right out of college, jobs should be there. Employers really like those with ag experience and, most important, their work ethic – they stay until the job is finished, not what the clock says.
Land-grant colleges, like the University of Wyoming, are great places to study agriculture, with great professors, small classes and a ton of scholarships to help the students. They say now the average student loan debt load for a 2015 college graduate is $35,000. Our students need all the help they can get.