Oh, for the glory days of the cattle drives on the old Chisholm Trail herding those critters from Texas to Kansas railheads. Cowboys would choke back dust searching for elusive watering holes, while watching the cattle succumb to predators and fighting off marauding Indians and rustlers — all while trying to control stampeding cattle. But, after an exhausting day in the saddle, the cowboys could enjoy sitting around the evening campfire eating beans and bacon, a la Blazing Saddles.

It sure wasn’t very profitable to drive cattle hundreds of miles just to load them on rail cars and ship them off to the slaughterhouses in Kansas City or Chicago. Finally, more sophistication entered cattledom, and it was discovered that cattle converted feed stuffs at a ratio of 8 pounds of feed to 1 pound of beef. Moving 8 pounds of feed from the farms in the middle of the country to cattle in feedlots close to processing facilities for them to gain 1 pound didn’t make economic sense. As a result, the cattle were raised for most of their lives near the sources of feed and moved to close by slaughterhouses, saving time and money. Soon there wasn’t a slaughterhouse left in Chicago, probably chased away more by economics than by Upton Sinclair s’ exposé novel, The Jungle. At least that’s my microcosm of how the West was won and cattle were turned into beef.

But the “island” production reality of today’s cattle-to-beef continuum is fraught with inefficiencies and parochial profitability as cattle are moved from the cow/calf operator “island” to the stocker, to the backgrounder to the feeder, to the slaughterhouse. The vagaries of commodity-influenced markets for feeds, cattle and beef allowed some of the “islanders” to make money, albeit off of each other rather than the end product —beef — but seldom if ever all together.

And that’s probably a few of the reasons why President Trump and President Biden felt the need to shore up the cattle-to-beef industry with tranches of money. First, Mr. Trump bailed out American farmers hurt by his trade war with China with $28 billion dollars to be disbursed to the “maligned” farmers.

Trump rolled out the bailout program in 2019 amid his trade war with China, ostensibly to help ease the financial burden to U.S. farmers caused by Chinese boycotts and tariffs on American crops. An initial bailout effort of $12 billion eventually ballooned to $28 billion. The aid was to be distributed through the Commodity Credit Corporation to the farmers. Maggie Haberman of the New York Times reported that what was meant to be a financial lifeline for struggling farmers became a big corporate bailout for big agriculture. The largest of these was JBS, whcih raked in at least $140 million in Trump administration bailouts paid out in a series of contracts to purchase pork products. President Biden’s program for improving the competitiveness of the American beef industry is another “gift” to cattle industry participants, both producers and processors, with the jury still out on its affects.

Commodity-driven markets, as the cattle-to-beef continuum exists today, has ups and downs that are exacerbated by decisions such as whether or not to bring cattle — more specifically, cows and heifers — to slaughter. To interfere with this market mechanism with large amounts of money paid to different sectors of the continuum only serves to distort the balance. Please remember, the cattle profit cycle runs roughly 10 years trough to trough. To artificially warp it with government money results in uneven pendulum swings unfairly helping or hurting some along the continuum.

In both presidents’ programs, the system of letting markets decide was abandoned. It was felt that large tranches of government, AKA taxpayer, money could bend the arc of competitiveness toward equity or at least level the playing field. It has yet to achieve either. As my friend John Nalivka of Sterling Marketing stated in Drovers Nov. 15, 2022, edition, “… with regard to the beef industry, I would strongly submit that current funding programs with the purported goal of strengthening the U.S. beef industry are at odds with dynamics of the industry. The industry and the consumer are better served by market-led agriculture production decisions—period.”

I agree with John. How about you?

What drives cattle today — yeehaw!

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