The twin towers of the Chicago Mercantile Exchange soar 40 stories above downtown Chicago, flanking a two-story building which houses the Merc's trading floors where live cattle and other commodities are sold.
The Merc is a noisy, frantic place marked by pandemonium in the trading pits. But the Merc's system has proved the most efficient way to trade live cattle - until now. A group of Texas cattlemen believe the Internet offers a faster, cheaper way to trade cattle and they have applied for federal approval to open an electronic exchange in Amarillo.
If they succeed, the partners in FutureCom Ltd. will have turned the cattle business on its head and proved that the Internet is the great equalizer, a mechanism that allows new companies to take on the most powerful organizations in agriculture.
No one knows where the Internet will ultimately lead the cattle business, but early indicators suggest the Internet offers ranchers and feeders a powerful edge over their competitors who fail to take advantage of it.
Internet users can tap the system's unmatched knowledge bank for the latest advances in genetics, health, range management, nutrition and financing. They can use e-mail to correspond with top cattlemen and feeders in Argentina, France or anywhere else. Or they can learn which nutrition programs and management practices to avoid, thus sidestepping the road to ruin.
But the Internet also offers opportunities to create brand new business, such as the electronic cattle exchange proposed for Amarillo. The venture plans to combine the Internet's ability to move data quickly with the computer's ability to match bids and asking prices at lightning speed.
Buyers and sellers will submit bids and asking prices to FutureCom over the Internet. Then, FutureCom's sophisticated computer system matches them and notifies both parties electronically when the deal is complete.
The operation will be protected by a high-tech electronic security system, FutureCom says. Among other safeguards, each account will require a password to operate it. "It would be a lot like trading stock by computer," says David Huseman, FutureCom's chief technology officer.
FutureCom still needs approval from the Federal Commodities Futures Trading Commission to begin operations. But if approval comes, as FutureCom expects, electronic trading could replace old-style commodities trading in the same way that automobiles replaced the horse-drawn carriage. "The system, if used 100 percent, would eliminate the trading pit," says Huseman.
At this point, FutureCom has applied only for limited trading authority, which covers sales of live cattle from feedlots to packing plants. But the potential is much larger. "We anticipate other commodities as well," says Huseman. "I don't think we would be limited to anything." Of course, the Merc could go to electronic trading too, although a spokesman says the Merc hasn't announced any plans to do so.
FutureCom is now tuning the operation with mock trading. To glimpse the system, or sign up for mock trading, interested parties can visit FutureCom's Web site at www.futurecom.org.
While Internet trading represents a new line of business, most feeders and cattlemen are using the Internet to improve existing business lines. For instance, some feedlot customers can access performance records for their cattle via web sites.
"Feedlots spend a lot of time faxing information, mailing health information and yard sheets," says Paul Marvin, president of Global Knowledge Group, College Station, TX. "Now they can tell customers to go to their Web site.
"Feedlots probably spend 50 percent of their time going over that information with their customers," says Marvin, whose company develops Web sites and Web site software. "Now they can spend their time explaining the information instead of simply reading it to the customer. That means feedlots will be able to give better service because they'll be able to spend their time doing the more important things."
Naysayers There is, of course, resistance to the technology from some ranchers, feedlot operators and feedlot customers. "There will be people who say they'll never use the Internet," says Marvin. "But the resistance is coming down." One measure of the growing acceptance is the number of visits, which are also called hits, to agricultural Web sites. "I think we've passed our one millionth hit," says Nancy Templeman, spokeswoman for Virginia Cooperative Extension's Web site. The site is just two years old.
One reason for the growing number of users is the growing volume of information available electronically. "We're adding to our site every week," says Templeman. "It just keeps growing by leaps and bounds."
A decade ago the Internet was in its infancy and none of this would have been possible. Today, the Internet is a fixture. Mail which once moved by the Post Office now moves by e-mail. The Internet now holds one of the world's largest storehouses of information. Soon the Internet may replace the chaos at the world's commodities exchanges with electronic trading. And down the road, who knows? The future of the electronic revolution is anybody's guess.
More feedlots and cattle industry groups are creating Web sites, hoping someone will find them. But their efforts may be largely wasted if their Web sites aren't listed with as many search engines as possible.
The search engines are the workhorses of the Internet. They root through Web sites, libraries, and specialized data bases all over the world in search of information. But a search engine can't find a Web site or a library which hasn't bothered to list with the search engine service. Being left out of a search engine listing is like being left out of the phone book.
Let's say, for example, that a rancher wants to find the latest beef genetics studies. Let's also assume that not a single agricultural school, Extension service or agricultural research corporation bothered to register with the rancher's search engine. When the rancher launches his quest, the search engine will hit a dry hole.
There are lots of search engines and new ones crop up all the time. The trick is to register your Web site with as many search engines as possible. "A site that's registered with lots and lots of search engines is more likely to be found," says Kathy Cornett, president of McCormick Advertising, Amarillo, TX. "That's the point of being on the Internet. You want to be found."
How do you find new search engines? You can use a Web browser, such as NetScape, to look for new search engines as they pop up. Cornett does that whenever she logs in on the Internet. When her company designs Web pages for its clients, she notifies those search engines of the new Web site.
But you can't stop there. You have to continue to hunt for new search engines after your Web site is up and running. "You can't stop time when you're dealing with the Internet," Cornett says. "It's like a lava lamp. It just keeps moving."
The Internet represents a major breakthrough in the ability to research topics which will improve the bottom line. Using special Internet features, ranchers and feeders can discover the latest genetic advances, track federal regulation of their industry or hunt for low interest loans.
For instance, say you want to know if geneticists have found new ways to boost weight gain. You can find research on that subject anywhere in the world by using Internet search engines.
A search engine is software which scans data bases for the information you want. A data base is a collection of information. Examples of data bases include summaries of federal cattle research, stories from back issues of BEEF or yesterday's professional baseball scores. You can find them all on the Internet.
Simply going to the BEEF Web site will get you stories from our back issues. But to cast a wider net for information, you can tell your search engine to look anywhere in the world. For instance, your search for the latest genetics breakthroughs might find stories in BEEF, research at a French university, new data from the U.S. Department of Agriculture and dozens of other sources.
The advantage of the Internet search engine is that you don't need to know where to look. Instead, the search engine ferrets through thousands of sources in a few minutes. To do the same search yourself would take thousands of phone calls, and hundreds of hours. Even then, you might never think to call that university in France.