Cow-calf producers subsidize other players
Recent issues of the WP focused on the state of the cow-calf section of the Canadian beef industry.
There was a noticeable absence of reference to the financial health of feedlots, packers and the retailers.
There was, however, one admission that there is a lot of money in the beef industry, and “trickle down” economics have not worked all that well for the cow-calf sector.
The solution being promoted is that the cow-calf industry be provided with a publicly assisted system of insurance similar to what is available to the grain industry, the difference being that crop insurance is designed to deal with the ever-present environmental risks.
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Cow-calf producers now enjoy access to crop insurance to cover the environmental risk of producing forages. The sole purpose of the proposed expanded insurance coverage is to compensate cow-calf producers for the traditional system of exploitation described as a failure of trickle-down economics. I envision that a publicly funded system of insurance coverage for the cow-calf sector would be used to subsidize this established system of exploitation.
The fact that an insurance plan is being proposed is a radical change in direction. Traditionally, the Canadian Cattle Association assigned the cow-calf sector with the role of providing income insurance for the feedlot and packing industry, applied through a well-established system of inverse pricing.
Problems arose when the independent cow-calf insurance agents became discouraged, sold their cows and closed their insurance agency, no longer able to afford the premiums demanded to meet the ever-increasing income-profit requirements of feedlots, packers and retailers.
The CCA has reportedly become very emotional in its opposition to Bill C-282, a private member’s bill … (to) protect our supply management sector during future trade negotiations.
It finds the example of our supply-managed sector supplying the domestic market while guaranteeing the cost of production to producers a travesty, making the beef industry look bad in comparison.
The solution offered by the CCA is to get rid of supply management. I recently sold seven head of cattle and contributed the involuntary $21 CCA levy. If there is anything that needs its protection removed, it is the CCA.
A change in legislation, making the CCA levy voluntary and authorized at the point of sale, would soon expose who their true supporters really are.
Fred Tait,
Rossendale, Man.
