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Texas Agriculture Archive

October 3, 2003

Don't forget 'demand' factor

By Mike Barnett

Editor

Sold any calves lately? Ain't it nice?

Cooler fall temperatures usually spell lower cattle prices but the Fall of 2003 is sure an exception.

There's lots of reasons for the prosperity currently blessing all phases of the industry—short supplies of fed cattle, limited Canadian imports because of their BSE situation, higher exports and continued cow herd liquidation.

All of this conjoined the week of Sept. 14 when fed cattle set an average price of $89.90 per cwt. Prices for 400-500 weight calves were well over $1 a pound, while the 700-800 weights were approaching the dollar mark.

So let the good times roll. But keep one little thing in the back of your mind...consumers aren't backing away from high prices at the meat counter. Contribute that to the "demand" factor.

Demand was in a tailspin for years, as competing meats took beef on and so-called "health-risks" associated with beef received undue and unwarranted publicity.

The industry didn't take those attacks lightly and decided to fight back. A controversial beef checkoff was finally passed as part of the 1985 Farm Bill and mandatory $1per-head assessments have since been collected.

So have things on the demand side of the equation changed? You betcha. For example:

• Checkoff dollars were invested in research to address health concerns. The result: it's known now that beef plays a huge role in balanced, healthy diets.

• Checkoff dollars were invested in advertising and promotion. Does it work? Ask you wife what she thinks about when actor Sam Elliott announces in that deep, baritone voice: "Beef. It's what's for dinner."

• Checkoff dollars were invested into researching new cuts of beef that have added value to the chuck and the round, and in researching new "heat and eat" products, opening up a whole new world of good, convenient eating for today's harried families.

The beef industry has seen a reversal of fortune, with demand actually climbing the last couple of years.

Too bad all of this could come to a screeching halt for beef, and in fact, all commodities that benefit from checkoff programs.

Some individuals and groups don't like to pay assessments—as is their prerogative—and have challenged checkoffs for commodities across the board.

The beef checkoff, for example, has been upheld as unconstitutional by a U.S. Circuit Court of Appeals. It currently awaits a rehearing for the judges that sit on that court, or perhaps, even the Supreme Court.

What a shame a program that has done so much good could be shut down for good.

And what a shame that all commodity assessment programs could suffer a similar fate.

After all, if you don't toot your own horn, no one will. As far as the beef checkoff goes, the band has played loud and clear a tune American consumers have listened and responded to.

You can't ask for more than that.