NCBA pres visits WyoWritten by Jennifer Womack
“The agreement that was reached by our trade negotiators with the government of South Korea was fully compliant with OIE based on true science,” says Groseta noting the statement applies to beef from cattle of all ages, not just less than 30 months of age. “Now they’re coming back to us and part of their concern is whether beef is safe from cattle over 30 months of age.”
In an effort to get commerce flowing Groseta says, “The five major U.S. beef packers have indicated they would be willing to label beef over 30 months of age and under 30 months of age to really ensure the Korean consumer U.S. beef is safe. Pre-BSE 2003 the majority of the beef we shipped to South Korea was from cattle under 30 months of age.” He also points out that Korean consumers pay more for their domestically raised beef that’s of lesser quality, than they do for U.S. beef.
Confident the market with the potential to add $25 per head to cattle during a time when feeders are losing money will be regained Groseta says, “Once we can get back in the market place, I’m confident our export sales will surge. That market was an $815 million market pre-Dec. 2003. On today’s dollar that could easily be a $1 billion market.”
Groseta says, “In today’s economic market, with feeders taking heavy losses, those losses are now going to be passed on to the cow-calf sector. For our industry to remain profitable, so I can stay in business, we need to grow the export market. Ninety-six percent of the world’s population lives outside the borders of the U.S. In order for us to be profitable in the business, we’ve got to grow our export markets around the world.”
While Pacific Rim countries have become the focal point, Groseta says, “We’re sending a record amount of beef to a lot of countries worldwide. We’re shipping beef to 104 countries throughout the world and in 2007 we shipped a record amount of beef to 22 of those countries. In the first quarter of 2008 our beef exports worldwide are up 37 percent compared to first quarter last year.” The industry’s export market is more diversified than it was pre-BSE 2003. “We’re in a global marketplace and one billion people have moved from poverty to middle class in the last 10 years and they want to eat meat. We want to make sure at NCBA that U.S. beef is their protein of choice.”
Some have expressed beliefs that the pending merger in the meatpacking and feeding sectors of the U.S. beef industry will help grow exports. “The one thing about JBS-Swift is that they have network established in the world marketplace. What they didn’t have in their portfolio was high-qualify beef and that’s U.S. beef,” says Groseta.
NCBA, says Groseta, is concerned about consolidation in the industry and carefully monitoring the Justice Department’s investigation. “If anybody has any concerns they need to contact our staff in D.C. and we can put them in contact with the Justice Department.”
Also relating to feeder profitability Groseta says when it comes to ethanol the U.S. government has gone off course. “We’re all for renewable fuels, but what has happened is we don’t have a level playing field. By mandate from our government they’ve created winners and losers. The winners are the people who grow corn and the losers are really all of the livestock industry, not only the cattle industry but poultry industry and the hog industry.” Groseta says cattlemen can adjust to the marketplace, but the government mandates makes if difficult to compete.
Recently traveling in Nebraska, Groseta says he’s told the cattle feeding industry there is losing $15 million a week. “We’re losing $150 million a week nationwide in our cattle feeding industry. This industry cannot sustain those kinds of losses.” Losing $150 to $200 per head, Groseta says Texas leaders have asked the government to reduce the 2008 mandate for ethanol usage in this country by half. The public has until June 23 to submit comments to the Environmental Protection Agency on the proposal. “There has to be some relief,” says Groseta noting escalating prices from feed to fuel. He says the requirements are also pushing the demand for corn beyond the cultivated acres available for production.
Like others around the nation, NCBA is anxiously awaiting the U.S. Department of Agriculture’s rules relating to Country of Origin Labeling. Passed as part of the recently approved farm bill, the program is to be launched September of this year. Groseta says USDA is now in a “time crunch” to get the rules written. A “grandfather date” included in the farm bill says all cattle in the U.S. prior to July 15 will be considered as “U.S. origin” for purposes of COOL.
“NCBA did work on some things to make it easier on the producer,” says Groseta of language in the legislation. “We’re waiting for USDA to write that,” he says of a subject he is often asked about by the nation’s producers who want to know what guidelines they’re going to need to meet beginning with the calf crop many will market in the months to come.
With so many opportunities and challenges facing the industry, Groseta says, “We need to engage our own people and they need to be proactive. At the NCBA we have 31,500 members and there are 750,000 beef producers nationwide. We have to activate our people.” With fewer people involved in American agriculture today Groseta says, “We cannot afford to be fragmented. We need to stand united and speak with one voice. Our political clout, whether it’s in your state capitol or Washington, D.C., it’s getting weaker and weaker all the time.”
NCBA President Andy Groseta was in attendance at the Wyoming Stock Growers Association convention in Casper early June. Jennifer Womack is managing editor of the Roundup.