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bright future ahead for cattle industry

The American Cattle Industry Is Far From Doomed

Listen to some of the pundits and you likely could be convinced that the American cattle industry [3] is in trouble. First off, I’ll admit there are conditions that make it possible to paint a bleak picture, as essentially 30 years of falling demand have helped shrink, consolidate and contract the industry.

But the demagogues have always been out there, preaching that our problems are someone else’s fault, and outside forces are conspiring against us. They blame the economy, multi-national packers, corporate feeders, exports, the government, even capitalism [4]. Such naysayers have been around since the first cow changed hands, and they seem to have grown to be a self-sustaining voice. The typical producer may not be a follower of these groups that actually need a declining industry to prosper, but we shoulder some of the responsibility for their existence.

In my office, I keep a big white board on which I keep my to-do list. The current list includes sorting calves, moving calves to the feedyard [5], getting feed purchased and delivered, prairie dog and weed control [6], lining up ultrasound, etc. I mention the list only because it illustrates that most of us are consumed with the daily tasks required to keep our operation going.

I understand how important the health of our industry [7] is to my bottom line in the long term. And I understand that our silo mentality can be destructive to building demand and remaining competitive [8]with the other proteins. However, necessity dictates that I spend most of my time working on my own operation’s success and survival.

But the industry does face threats, and given the trend lines of those threats, the industry does seem to lack urgency at addressing them, and it certainly lacks accountability. It seems like everyone has an excuse why falling beef demand or the lack of industry profitability [9] isn’t their problem. And the internal bickering that’s escalated to a whole new level in the last couple of decades has created organizational chaos on the national level. The fragmented nature of our business means we have no plan and certainly no overriding strategy.

While it’s true the industry puts significant effort into formulating a long-range plan [10] to guide decisions from the top down to the committee level, in reality, it isn’t something the industry wakes up and focuses on achieving on a daily basis. It’s far more likely to serve as a rallying point, similar to when the U.S. shouldered the challenge of putting a man on the moon. Part of the reason the industry’s long-range plan hasn’t had the impact it should is the limited funding. Thus, like most ag organizations, the focus is putting out the daily fires, rather than preventing the fires in the first place.

As an industry, we must embrace the concept of taking risk, and adapting to a rapidly changing world. We don’t have to accept plummeting demand [11] and a shrinking industry.

I’m 100% confident that the U.S. cattle industry’s future is extremely bright, and I base it on the strength of the people involved in this industry. [12] They’re some of the world’s most capable, and I’ll put the work ethic of the men and women in this industry up against anyone. They also have values, and enthusiasm and passion for what they do. The American cattle industry will prosper because of the strength of people involved in it. 

But we must confront some issues that have hindered our progress. For instance, we typically haven’t acted quickly or boldly enough when it comes to aggregate industry challenges and opportunities. Organizations have feared making mistakes or offending someone. And there’s a tendency to focus on things largely outside of our control – BSE, ethanol subsidies [13], the value of the dollar, trade barriers, even the practices or preferences of packers, retailers or consumers.

I believe we must eliminate the caretaker mentality so pervasive in our industry. Of course, we believe strongly in our role as caretakers of the land, our animals, and traditions and values – it’s fundamental to us. But outside of our industry, the word caretaker doesn’t have the positive connotation we ascribe to it.

 

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Our goal can’t be to maintain the status quo in a rapidly changing world. We must embrace change; that requires a non-caretaker type of mindset. If this industry is doing things the same way five years from now as we are today, then we should expect margins to be narrow, demand [15] to decline, and the industry to continue to contract.

It’s not a question of whether the people in this industry have the intellect or fortitude to make dramatic changes, and it isn’t a question of whether we know the dramatic changes that need to be made to alter our path. It’s a question of how, as a fragmented, predatory, and hugely independent industry, we can unify around the causes and changes that are needed.

I have faith because the overwhelming majority of those involved in this industry understand that we must ensure that our industry will be better when our kids inherit it [16]. They believe in what we’re doing, and understand what this industry contributes not just economically to our great country. When pulling together on the same team, we are a powerful positive force.

 

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5 Thoughts From A Beef Industry Thinker [21]