Trade squeezes out U.S. cattle business

By LEE ENGELHARDT
For the Capital Press

I would like to address National Cattlemen's Beef Association chief economist Greg Doud's article "Trade crucial to U.S. ranchers," which was printed in a recent Capital Press.

My family has been in the live cattle business in Washington state for over 130 years. We have seen production agriculture evolve to feed the nation, but now we are seeing our food supply being sourced from other countries in the name of free trade, not necessarily fair trade.

Doud makes the claim that without these imports there would be shrinkage of feedlots and infrastructure in the Northwest. History shows us that, with rising imports of cattle, the Northwest has lost over 40 independent feed yards in the last five years. In fact, the five major packers in the West can process around 1.9 million head per year at full chain speed, but this same region produces 2.4 million feeder calves each year based on a 90 percent calf crop and 20 percent heifer retention in the herd.

In 2008, Canada exported 1.5 million head of direct slaughter and feeder cattle to the United States, of which approximately 500,000 head had Washington state as a final destination. Is this what has happened to our feeding industry, or has the Northwest feeding industry been replaced by imported direct slaughter and feeder cattle?

Doud makes the claim that trade will prevent the loss of feeders and infrastructure, when in fact the opposite has occurred in the Northwest. Because of increased imports of Canadian cattle we now only have two major feedlot owners and multiple contract feeders for these two owners. Currently, we have one independent feeder and a couple of smaller custom lots.

Washington state has two major beef packers, but as imports have increased, our state's cattle herd has declined. Washington has only about 45 percent of the herd it had 20 years ago, while imports have risen from 2 to 3 percent 20 years ago to 22 to 24 percent today. It only takes a 2 percent change in supply to move a market up or down. Is this crucial for producers?

Doud makes the claim that these imports will be good for job growth, but the fact is direct slaughter fat cattle do very little to stimulate jobs.

Feeder cattle could promote jobs in a feeding sector without imports; the Washington cattle herd could increase and fill these same feedlots, thus maintaining those jobs.

Let's also look at the amount of taxes Washington and other Northwest states receive from imported direct slaughter and feeder cattle that are fed and then sold in the United States. A Canadian direct slaughter steer comes to Washington state with 3 to 3.5 tons of Canadian-grown hay and grain that it has consumed and is shipped in a Canadian truck. That's feed and trucking that is not grown or produced by a U.S. farmer or trucker.

A Washington-born calf that spends its entire life in Washington would generate several times more revenue for Washington state and neighboring states than an imported calf.

Contrary to Doud's thinking, this should be good for the U.S. consumer as well as our country's infrastructure as this would increase disposable income.

It was stated recently by the Canadian Beef Information Center that Canada must "differentiate Canadian beef from imports, specifically United States beef."

This comes from a country that is trying to deny the American consumer and American rancher the right to do this very thing in the United States with mandatory country-of-origin labeling. MCOOL is not trying to increase regulations within the marketing chain. MCOOL is about providing information to allow consumers to make informed decisions and allow U.S. producers to differentiate their locally grown product from imports.

Any company in any other business tries very hard to differentiate itself from all other producers. Would NCBA and Doud think it is crucial to try to restrict that?

Lee Engelhardt of Moses Lake is past president of Cattle Producers of Washington.