TCFA ANNOUNCES TOP 10 STORIES FOR 2001

            Cattle feeders are finishing the year with eyes sharply on the bottom line as low fed cattle prices and record feeder cattle prices have teamed up to cause a severe equity drain,  according to Richard McDonald, president & CEO of the Texas Cattle Feeders Association (TCFA).  Speaking at the annual TCFA Year-End News Conference today in Amarillo, McDonald summarized the year and released the Association's list of Top 10 news stories in 2001.

          "This has been an up-and-down year for cattle feeders," McDonald said.  Cattle feeders began the year with optimism and a strong market, but saw the cash market for fed cattle slowly erode while feeders cattle prices remained at record levels.  Average price for 750-lb. feeder cattle was $86 per cwt., compared with the record $88 in 2000.  Average price for 450-lb. calves was a record $111, up $2 from last year's record.

           "There are a number of reasons for the fed cattle market's performance this year," McDonald said, "including a tenuous global situation for beef and large numbers of very heavy cattle coming out of feedyards.  We saw England face a devastating foot-and mouth outbreak and cattlemen in the U.S., working with both state and federal government, went to extraordinary efforts to keep it out of our country."

           In addition, the discovery of BSE in Japan severely eroded that market.  "Japan is our major export market for U.S. beef.  Consumers there have cut back on beef consumption and that's taken a toll here in Cattle Feeding Country."

            Beef industry organizations, responding to the market situation, encouraged restaurants, grocery stores and USDA to take advantage of declining wholesale beef prices and pass the savings on to consumer.  In addition, McDonald said TCFA stepped up its efforts to encourage support of the beef checkoff.  "The beef checkoff, particularly when we face a market like we endured this year, becomes even more important to cattlemen.  That's why we were so disappointed when the Livestock Marketing Association (LMS), unable to gain enough support form cattlemen to force a referendum, turned to the courts and challenged the checkoff's constitutionality."

              Here are the news stories that made headlines this year:

Top 10 News Stories in the Cattle Feeding Industry

1.  The fed cattle market kept cattle feeders on edge all year.  The market topped at $82 per cwt. in early March, then dropped throughout the year to a low of $60 in mid November.  The $22 spread is one of the largest on record and led to large equity losses for cattle feeders.

2.  Feeder cattle prices remained strong even with large equity losses by cattle feeders.  Average rice for 750 lb. feeder cattle was $86 per cwt., compared with the record $88 in 2000.  Average price for 450 lb. calves was a record $111 per cwt., up $2 from last year's record.

3. An outbreak of foot-and-mouth disease in England and ongoing efforts to eradicate BSE in Europe caused concern worldwide.  A Harvard Risk Assessment for BSE found that the U.S. is highly resistant to the disease.

4. Tyson Foods completed its merger with IBP, creating the largest meat protein company in the world.

5. BSE was discovered in Japan, causing a major disruption in the beef market.  The U.S. beef industry ramped up efforts to tell Japanese consumers that U.S. beef is safe and wholesome.

6. Mandatory Price Reporting turned into a major disappointment when it not only failed to increase the amount of price reporting, but actually reduced information available to cattlemen.

7. A Tax Bill was passed that, among other types of relief, phases out estate taxes over 10 years.

8. Congress continues to develop a Farm Bill with differing viewpoints between the House and Senate, meaning a final bill will hammered out in Conference Committee.

9.  China and Taiwan were accepted into the World Trade Organization, opening up a potential new market for beef.

10.  The vitamin price fixing case was settle for some indirect purchasers of vitamins used in animal feed.

Top 10 News Stories Around TCFA in 2001

1.  LMA challenged the constitutionality of the beef checkoff when their efforts to force a referendum failed due to lack of support from cattlemen.  The beef checkoff originated from an idea proposed at a TCFA Feedyard Manager's Roundtable meeting in 1974.

2. Heavy beef supplies and low prices caused beef industry organizations to encourage grocery stores, restaurants and USDA to pass the savings on to consumers.

3.  Consolidated Beef Producers started selling cattle in 2001 and traded more than 500,000 in the first six months of operation, making it one of the largest alliances in the beef industry.

4. TCFA was heavily involved if efforts to prevent foot-and-mouth disease (FMD), pushing federal and state agencies to protect U.S. borders.  Efforts included the U.S.-Mexico Cross Border Working Group meeting at TCFA headquarters to coordinate measures to keep foreign animal diseases including FMD out of North America.

5. TCFA filed a 12-page document commenting on EPA's proposed Confined Animal Feeding Operation (CAFO) rules, pointing our the rules would expand EPA's power beyond that granted by Congress.

6.  The Texas legislative session saw many wins for cattle feeders.  TCFA was very active in representing cattle feeders' interests.  Wins included legislation dealing with water, trucking, rural economic development and TNRCC administration.

7.  A coalition including TCFA submitted a notice of intent to file a law suite challenging the designation of critical habitat for the Arkansas River shiner.

8.  A survey of livestock auction markets by TCFA found that 75% do not support LMA's efforts to declare the beef checkoff unconstitutional.

9.  TCFA initiated an Environmental Service program that assists feedyard personnel with site inspections, training, soil and water sampling and other tasks.

10.  Usage of www.tcfa.org, TCFA's web site, increased as more members turned to the site as a source of information.

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