August 4, 2006
By Mike Barnett
It was a time of conflict in the beef industry. Ranchers were either for it or against it. There was no middle ground. You could count on an argument at the coffee shop, neighbors begrudged neighbors and even the membership of the Texas Farm Bureau was at odds.
Sound familiar? No, I'm not talking about the current controversy over livestock identification. I'm talking about the great beef checkoff debate in the 1980s, when the push for the self-help program began. Advocates then argued the beef industry could ill afford not to pass the checkoff, which eventually became law in 1985. Beef demand was slipping, cattle prices were dipping and industry visionaries saw the checkoff as a means to turn the tide.
Turns out they were right. Now I'm not positive the beef checkoff can take full credit for the up tick in demand that began in 1999, but I'd be willing to bet beef checkoff funds spent on advertising, research and new product development were the catalyst. In short, the passage of the checkoff was a market-driven and economic decision, an action cattlemen needed to take to ensure the future of their industry.
Turn the wheels of time and today cattlemen find another controversy. It too, is being cussed and discussed, and again, there seems to be no middle ground. Passions rise in some quarters when livestock identification is mentioned and arguments against it range from government intrusion to privacy and cost issues. Change is tough, even tougher when someone, or some government, might order that change. Still, we've heard these arguments before.
The impetus of livestock identification is animal health, giving government officials a time line and a tracking method in case of disease outbreak in any of our livestock industries. Producers would be wise, however, to look beyond animal health and consider what happens if some kind of national identification system for livestock is not adopted.
To me, it's simple economics. Source and age verification are the new buzz words in foreign markets, and are increasingly being talked about in domestic markets. Because of disease-related issues such as BSE, foreign buyers will demand to know the origin of the cattle they buy and how old those cattle are.
Japan is a case in point. It has been hard for U.S. cattlemen to regain the Japanese market lost due to our BSE incident in 2003. Australians, who are ahead of the game on livestock identification, filled that void. Once lost, export markets are hard to regain...especially if American cattlemen cannot or are unwilling to meet export market demands. Now whether the Japanese are acting in good faith (No!) and in a fair manner (No!) is the topic of another editorial. The fact is, world markets will demand the identification of animals, and the cattlemen that will benefit will be those who deliver.
According to the U.S. Meat Export Federation, the impact on live cattle due to the export ban related to the December 2003 BSE discovery is approximately $14.60 per hundredweight, or approximately $177 per head. The average cowman hasn't felt that impact because great domestic demand has kept beef prices relatively high the last two years. Let domestic demand and prices slip, however, and U.S. cattlemen will be howling for that export premium.
Like the checkoff, animal identification needs to become a market-driven and economic decision for the livestock industry. Cattlemen should look beyond the dust being raised over issues related to animal identification, which are being addressed, and ensure the industry's future by working toward market pleasing solutions that address not only export and domestic demand, but the animal health concerns of livestock in this country as well.