What’s Wrong with the Beef you Buy?

Trinity Vandenacre met Mike at the Rendezvous City Beef Roundup last summer where Trinity was one of the beef competition judges. Mike presented, “Cows Can Save the World” for the first time. The updated version, most recently presented to the Beartooth Stock Association, follows:

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Full presentation: https://nobull.mikecallicrate.com/2024/01/15/cowboys-can-save-the-world/

 

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Perspectives on Agriculture: Past and Future

Callicrate note: Several years ago, in a conversation with John, we discussed the use of a new term describing what I thought was a better kind of agriculture.  Since “sustainable” had been stolen by big corporate ag, I suggested the word “regenerative” better described the kind of agriculture I wanted to practice. In an obvious effort to protect the meaning of an an important term, John asked, “Is it sustainable?”

After some thought, I realized the answer was no. Until we address the abusive market power of big corporations, family farmers and ranchers will be denied their fair share of the consumer dollar, and thereby the income required to be good stewards and husbandmen.

John Ikerd is perhaps the most insightful, thoughtful, and historically wise person I know regarding agriculture and food systems. John describes a transformational shift back to family farm agriculture is not only possible, but necessary. I agree!

By John Ikerd

The Harvard Business School defines transformational changes as “changes that are typically much grander in scope than incremental, adaptive changes. Very often, transformational change refers to a dramatic evolution of some basic structure of the business itself—its strategy, culture, organization, physical structure, supply chain, or processes.” I have lived and worked through a period of transformational change in American agriculture.

From my perspective, two factors are largely responsible for this transformation in American agriculture. The first was the new agricultural technologies that emerged following World War II. Tractors had begun to replace horses in some areas in the 1930s but didn’t do so in many areas until factories started turning out affordable farm tractors rather than the Jeeps and tanks needed during the war. We bought the first tractor for our farm when I was in high school.

“Affordable commercial fertilizers and pesticides, also byproducts of World War II, allowed farmers to abandon the crop rotations or integrated crop and livestock systems they had relied on to manage pests and maintain productivity.”

The number of tractors on farms in the U.S. tripled between 1940 and 1960, and the number of workhorses and mules dropped from 15 million to fewer than 5 million. Farmers specialized and expanded their operations to justify their investments in tractors and specialized farm equipment. Affordable commercial fertilizers and pesticides, also byproducts of World War II, allowed farmers to abandon the crop rotations or integrated crop and livestock systems they had relied on to manage pests and maintain productivity.

The new mechanical and chemical technologies not only allowed each farmer to produce more but also allowed farmers in total to produce more. The resulting surpluses in agricultural production depressed commodity prices to unprofitable levels, forcing reluctant farmers to adopt new cost-cutting technologies to survive. Farmers needed their own hay balers, grain combine harvesters, or field forage choppers to remain competitive. They also needed more land to justify these added investments. Agricultural economists called this the technology treadmill.

“Farmers no longer needed their neighbors to help them farm, but they needed their neighbors’ farms.”

Farmers no longer needed their neighbors to help them farm, but they needed their neighbors’ farms. The farmers who didn’t get big enough fast enough didn’t survive. They sold out or were forced out of farming—they fell off the treadmill. Many farmers in our community either fell off or never got on the technology treadmill; they moved elsewhere.

“Rather than addressing the out-migration of farmers as a problem, the policymakers saw it as an opportunity to transform agriculture.”

The second cause of the agricultural transformation was a fundamental change in U.S. farm policy. Rather than addressing the out-migration of farmers as a problem, the policymakers saw it as an opportunity to transform agriculture. In 1962, the Committee for Economic Development (CED), a prestigious business/academic think tank, assembled a subcommittee to address “the problem of agriculture.” The resulting report noted the rapid outmigration of farmers beginning in the 1930s, but concluded, “Nevertheless, the movement of people from agriculture has not been fast enough to take full advantage of the opportunities that improving farm technologies and increasing capital created for raising the living standards for the American people, including of course, farmers”

“The CED saw economic security for farmers as an impediment to the efficient use of resources.”

U.S. farm policies during the 1940s and 1950s had continued the commitments of the Agricultural Adjustment Act of 1938—the first farm bill. The stated purpose of the act was to provide economic security, or parity incomes, for family farmers as a means of “preserving, maintaining, and rebuilding the farm and ranch land resources in the national public interest.” The CED saw economic security for farmers as an impediment to the efficient use of resources. They proposed an “adaptive approach” that “utilizes positive government action to facilitate and promote movement of labor and capital where they will be most productive and will earn the most income”—meaning out of agriculture.

The CED report provided a blueprint for transformational changes in agricultural policies during the Nixon Administration with Earl Butz as secretary of agriculture during the 1970s. The new policies forced farmers to either “get big or get out.” Every farm bill since then has continued to incentivize and support the specialization, mechanization, and consolidation of farming into large industrial agricultural operations.

“As agricultural economists, our research and extension programs were designed to help farmers turn their farms into agribusinesses.”

By the time I received my Ph.D. in agricultural economics in 1970, I had been thoroughly indoctrinated into this new vision for the future of farming. While the universities claimed the technologies they developed and promoted could benefit all farmers, this was true only if farmers were willing to specialize, mechanize, and expand their farming operations. As agricultural economists, our research and extension programs were designed to help farmers turn their farms into agribusinesses.

“The farm policies of the 1980s were an experiment to see if large, specialized farms could survive without government assistance. They couldn’t.”

The changes in farm policy were necessary to continue the process of industrializing American agriculture. Large, specialized farming operations may be economically efficient, but they are also risky and vulnerable to economic collapse—as evidenced during the farm financial crisis of the 1980s and the COVID-19 crisis that started in 2020. The farm policies of the 1980s were an experiment to see if large, specialized farms could survive without government assistance. They couldn’t.

Government price supports, deficiency payments, subsidized crop and crop revenue insurance, guaranteed loans, and disaster payments are all means by which taxpayers have absorbed the risks of industrial agriculture. Without these government programs, the industrialization of agriculture likely would have slowed, and possibly reversed, during the 1970s and 1980s.

“… the keys to hastening another transformational change in American agriculture—from industrial to sustainable.”

I will close this perspective on agriculture column with what I feel are the keys to hastening another transformational change in American agriculture—from industrial to sustainable. First, the previous transformation was completed essentially in 50 years—between the early 1950s and the late 1990s. Few if anyone involved with agriculture in the 1950s could have imagined the large-scale, specialized, mechanized, corporately controlled farming operations of the 1990s. The changes before and after this period were incremental, rather than transformational. Agriculture by 2075 could be dramatically different from anything that seems remotely possible today.

“… our understanding and knowledge of sustainable alternatives to industrial agriculture today are far more advanced than our knowledge of industrial agriculture in the 1950s.”

Second, our understanding and knowledge of sustainable alternatives to industrial agriculture today are far more advanced than our knowledge of industrial agriculture in the 1950s. Many of the environmental and social costs of industrial agriculture were a result of people doing things without knowing the consequences of what they were doing. Farmers today have access to research on soil health, cover crops, crop rotations, and integrated crop and livestock systems of the pre-industrial era as well as the formal and experiential research of academics and organic and sustainable farmers over the past 50 years and even earlier.

“Perhaps what is needed is another prestigious think tank, like the CED, that understands the need for policies to support a post-industrial agriculture—an ecologically sound, socially responsible, economically viable agriculture.”

Third, with the technical knowledge in place, a transformational change in farm policies could trigger a transformation in agriculture similar to that of the 1970s. Perhaps what is needed is another prestigious think tank, like the CED, that understands the need for policies to support a post-industrial agriculture—an ecologically sound, socially responsible, economically viable agriculture. This think tank could make the ecological and social case that we have too few farmers, rather than too many, and propose farm policies that support more farmers who are committed to taking care of the land for the long-run benefit of society as well as themselves.

Finally, a return to vigorous enforcement of antitrust laws could transform the balance of economic and political power, including the power to transform farm policy. The U.S. was faced with a similar situation of concentrated economic and political power in the early 1900s. Monopolies of the time, such as Andrew Carnegie’s U.S. Steel Company and John D. Rockefeller’s Standard Oil Company were powerful politically and well economically. Five U.S. beef-packing companies controlled up to 75% of the market.

“… corporate control of markets was reversed by a progressive populist movement that demanded fundamental change. It can and must happen again.”

The trend toward corporate control of markets was reversed by a progressive populist movement that demanded fundamental change. It can and must happen again. My perspectives on this and other aspects of the agri-food system will be the focus of my next column. Ultimately, agri-food sustainability is not an option; it is a necessity.

A longer, more detailed version of this post with references is available at the JAFSCD link below.

https://www.foodsystemsjournal.org/index.php/fsj/article/view/1220

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Harvesting Change: Making a Local Meat Market

How One Cattle Rancher Ditched the Industrial Meat Model and Forged a More Sustainable One

Cami Koons
ckoons@flatlandkc.org

Mike Callicrate and his son Teegan are hardworking ranchers. But they aren’t typical.

Almost 30 years ago, they bucked an industrial food production model focused on maximizing output. Instead, they focused on raising healthy cattle without the use of growth hormones or drugs and selling the meat directly to local consumers.

If producers expect to live off the land, they must find a place to sell their products, said Teegan Callicrate, Mike’s son who oversees the Callicrate Cattle Co. ranch, feedlot and slaughter operation in Saint Francis, Kansas.

“Ideally, they should be sold locally and go back to people in the communities that they come from,” Teegan Callicrate said. “That’s what I think this design can do for many communities across the world.”


Flatland on YouTube

The Callicrate family’s integrated approach of raising, processing and selling meat directly to consumers proved to be durable during the COVID-19 pandemic. When meat aisles at most grocery stores were empty due to supply chain disruptions, Mike Callicrate said his operation never “missed a lick.”

Besides creating a more resilient local food chain, Callicrate’s approach is more environmentally sustainable.

In his travels between Colorado Springs, Colorado, where the Ranch Foods Direct processing and retail operation is headquartered, and the ranch in Saint Francis, Mike Callicrate sees dry riverbeds and large-scale farming practices that turn his stomach.

His operation strives to give back to the soil and not pump excess water from the ever-shrinking Ogallala Aquifer.

“When you consider that all wealth comes from the soil, let’s put together models that build soil rather than deplete soil,” he said.

That means rotational grazing for cattle and feeding them grains that are locally grown without chemicals or genetically modified seeds. The company also composts all its slaughter waste and turns the bones into biochar that goes back into the soil.

It’s all part of an effort to rethink the food chain in ways that make it more resilient and sustainable.

“And I think it’s these kinds of models that do that,” Mike Callicrate said.

To learn more, watch the first episode in a new Flatland series focusing on the food chain, “Harvesting Change,” part of a PBS climate change programming initiative

Original Post: Harvesting Change: Making a Local Meat Market

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Return to carcass trade is essential for cattle industry and rural prosperity

After more than 50 years of concentration, consolidation, hyper-industrialization, and a pandemic, the producers, workers, animals, and consumers have all suffered from the loss of competition and demise of local/regional food infrastructure.  Land-grant and business school economists teaching “Big is better – It’s a business, not a way of life,” have facilitated the gutting of rural America with an increasing wealth transfer from the land and the people who do the work, to the financial sector.

Mike Callicrate with Ranch Foods Direct slaughters animals at Callicrate Cattle Company where they’re raised and processes the carcasses into wholesale and retail cuts in Colorado Springs.

Getting put in the Box

When I started feeding cattle in the mid 1970s, there were twenty-some small to regional meatpackers buying cattle in my area and selling carcasses to grocery stores with fresh meat counters and butcher shops. Meat cutters, breaking the carcasses down into retail cuts in front of customers, were highly skilled and well-paid, with wages high enough to drive new pickups and live in homes they would own when the mortgage was paid. By the mid 1980s, the small meatpackers and skilled butchers, from slaughter to retail, were mostly gone, along with my pathway to a fair cattle market. What happened?

Think of boxed-beef, the “Box,” as a tool, a tool of extraction, like a mafia bag man standing between the rancher and the consumer demanding a larger and larger share of the wealth created from the land. Few knew at the time IBP (Iowa Beef Processors) implemented their boxed-beef program in the late 1960s how much the “Box” would change an industry – and not for the better.

Cow-calf producers are the largest and most important sector in our cattle and beef industries, but as widely dispersed and independent operators, are no match for the concentrated market power of the food cartel: big meatpacking, big food retail, and big food service companies. Cattlemen are literally left with a few scraps after the cartel extracts their double digit returns. Despite the fact the rancher invests the most, and stands the most risk in producing our food, they’re often left eating their equity, without enough income to feed themselves or support their families.

The “Box” is the primary tool today’s meat cartel uses to mine even greater amounts of wealth from our farms and ranches than the robber baron meatpackers of the early 1900s. Turning grass into beef is the cows greatest gift, so why are we allowing the beef cartel to continue driving our ranchers and farmer feeders out of business, reducing our ability to feed ourselves, replacing our producers with low quality beef imports, while removing more soil building, climate healing cows and other ruminate animals from the landscape?

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How we were put in the box …

In 1970, the New York meat trade rejected IBP’s new innovation in boxed beef in favor of their long established and successful carcass trade. The meat cutters union, protecting the interests of their skilled and well-paid butchers, also said no to boxed-beef, leaving IBP with millions in unpaid invoices, and in deep financial trouble. In the panic, the solution became clear – bribery.

The deal put IBP in command of the beef world. With the Mafia partnership and the eastern meat trade in hand, IBP became the biggest beef packer in in the world, and soon aligned with the other two biggest beef packers, Cargill and Monfort (later became ConAgra, now JBS) to manage the market in their favor and hyper industrialize the supply chain. In violation of every provision of Section 202 of the Packers and Stockyards Act, the three predators, like a T-Rex and two Raptors, proceeded to consume essentially all of the smaller owner-operated, more efficient, and lower cost carcass plants. With antitrust cops and trial court judges in the pocket, or looking the other way, the cartel drove four-firm concentration to 85% and competition to near zero. With retail consolidation tracking the same as meatpacking, the cow-calf producer, the course of least resistance, has paid the bill with a drastically shrunken share of the consumer beef dollar.

“But on this day, Moe Steinman, as a front for the Mafia, would achieve what no one else had achieved, even in the days of Al Capone or Lucky Luciano. Moe Steinman, who had risen from the gutter only by his lack of scruples, would tighten his fist around one of the biggest corporations in the country, a corporation that dominated a major national industry. It was an industry that almost every American depended on almost every day. It was an industry – unlike trucking – that was clothed with all the garments of Wall Street respectability.”

The markets worked prior to IBP’s boxed-beef deal with the Meat Mafia:

Buy your beef from a carcass butcher and make sure it hangs for at least 7 days.

Getting out of the box is the key to restoring widespread economic prosperity, improving food system resilience, food safety, food security, and meat quality.

See: Vicious Circles – Big meat packers continue to suck the blood out of cattle industry

Deskilling on the Disassembly Line: Technological Change and Its Consequences in Beef-Packing Since the 1960s

Food System Success or Failure? It’s time to decide

The Secret at 1400 Independence Avenue

How We Got Here … The food security crisis in America

What could 300 million dollars do? Part II

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“Cowboys Can Save the World”

Saturday, I spent the day with a group of Montana ranchers at the Beartooth Stock Association annual meeting. They ventured out in minus 20 degree weather, many just finishing cow chores.

Cattlemen and women represent the literal heart and soul of our country, often unaware of their cows value beyond feeding us. They go to work everyday, rain, shine, or blizzard, as the stewards of our grasslands and rural communities, creating the wealth for the very base of our economy. These Montana ranch families, like many other independent family operations across America, are constantly improving the environment with their ruminant animals, while feeding us the healthiest, best quality meat in the world. So why are we making their lives so difficult?

At the Fremont County Fair last summer in Florence, Colorado, cowboy singer, Michael Martin Murphey said, “Cowboys can save the world.” The following presentation makes the case for why he’s 100% right.

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Links with additional Content:

  1. Slide 9 link: https://nobull.mikecallicrate.com/2013/08/25/i-really-want-to-talk-about-zilmax/
  2. Slide 17 Link: https://nobull.mikecallicrate.com/2021/10/24/texas-am-and-other-land-grant-economists-lead-effort-to-end-competitive-livestock-markets/
  3. Slide 19 Link: https://www.latimes.com/archives/la-xpm-1990-04-22-fi-486-story.html
  4. Slide 29 Link: https://www.ers.usda.gov/data-products/meat-price-spreads/ and by-product value – https://www.ams.usda.gov/mnreports/ams_2829.pdf
  5. Slide 30 Link: https://cowpool.org/
  6. Kansas cowboy Jim Gray shares some wisdom on Rural America

From Robert Taylor, economist and long-time advocate for the family farmer, rancher, worker, and independent businessman:

Deja Vu all over again:

The “Farmers Revolt” against the “Robber Barons” led to formation of the Grange. The platform of the Grange was simple:

“We are opposed to such spirit and management of any corporation or enterprise as tends to oppress the people and rob them of their just profits. We are not enemies to capital, but we oppose the tyranny of monopolies. … We meet in the midst of a nation brought to the verge of moral, political and material ruin. … Corruption dominates the ballot box, the Legislatures, the Congress, and touches even the ermine of the Bench. The people are demoralized…the newspapers are largely subsidized or muzzled, public opinion silenced, business prostrated, our homes covered with mortgages, labor impoverished, and the land concentrating in the hands of the capitalists. … The urban workmen are denied the right of organization for self-protection; imported pauperized labor beats down their wages … The fruits of the toil of millions are boldly stolen to build up colossal fortunes, unprecedented in the history of the world, while their possessors despise the republic and endanger liberty. … The land, including all the natural sources of wealth, is the heritage of the people and should not be monopolized for speculative purposes, and alien ownership of land should be prohibited.”

The Granger’s declaration of 1874.

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