Cattle ranchers optimistic about ease in trade restrictions
Ten years ago, fears surrounding Mad Cow Disease led many Asian countries to beef up trade restrictions on U.S. and Canadian cattle.
I spoke with an agriculture economy professor at MSU who tells me, any sort of reductions in trade restrictions will be beneficial for ranchers. The question is how beneficial.
The concern over tainted beef led many countries to require beef exporters to prove their cows were no older than 20 months when slaughtered, with the reasoning that younger cows are less susceptible to the disease.
While other countries eased up over the years, allowing 30 month old beef, Japan stayed fast at 20 months until just this month.
Experts say cattle older than 20 months makes up about half of the U.S. beef exported.
I wanted to learn first-hand what sort of impact change in regulation would have on local ranchers so, I spoke with two who say they took a hit when Japan first implemented restrictions a decade ago.
It's calving season at Camp Creek Land and Cattle. Gallatin Valley native and President Brent Sinnema works with his son, Caleb, to tend to new calves. Sinnema's been ranching since he got out of high school in the '80's
"We're not a multi-million dollar operation here, we're just a family selling some cows and grain and this is where your food comes from," says Sinnema.
He takes pride in his cows.
"We care about the environment, we care about our animals and in the meantime, we'd like to make a little money," says Sinnema.
Yet, Sinnema admits the industry is tough these days, from high feed prices due to drought, to expensive equipment, fuel and fertilizer. To complicate matters, price of beef can change between calving in February and when Sinnema actually goes to sell his cattle months later.
"We spend all of our time trying not to spend money because we don't know what our end price will be but there's a certain amount of security knowing that there's a demand for our product so, that helps the price stay where we can make a profit," explains Sinnema.
That's why he's looking to start age and source verifying this year, something countries like Japan require for their beef.
"I can make a few more dollars a head," says Sinnema.
Cost is also why Sinnema says he's optimistic about the ease of trade restrictions with Japan.
"We're on a global market, whether you want to admit it or not and so, anytime the U.S. Has more opportunity to sell their product, it's good for all of us," he says.
Sinnema sells his cattle in November, once they've been out for summer pasture, but says he's still effected price-wise since the folks who finish his beef need a market.
"If it helps someone down the chain, it helps us. We're all in it together," says Sinnema.
I spoke to some ranchers who use identity tags to verify age and source. They say the ease in trade restrictions with Japan will give them more options when it comes time to sell their cattle.
"With age and source verification with your export market, if that's what they demand to export meat to their country, it's an important part of the whole process," says rancher Jason Camp.
Camp says the ease in restrictions will have a direct impact on the price of the beef he sells.
"Anytime you increase consumption the markets are bound to go up and that's what's going to happen," says Camp.
He says that's going to be a big help once historically high beef prices go down.
Ranchers say the ease in restrictions means a greater confidence in the United States market and recognition that the U.S. has a great, safe beef product. In turn, they say that confidence has a positive impact on the market.