BEEF bits

Jan 2, 2009
by WLJ

BEEF bits

Northern Beef Packers plant still a ‘go’

Dennis Hellwig, the primary investor in an Aberdeen, SD, beef processing plant having trouble getting off the ground, says he still plans on building the facility despite financing problems. Only now, the target date for commencing operations is sometime in May—a year later than initially planned. Among the woes that have befallen the would-be plant have been a series of mechanic’s liens. Hellwig took the blame for not accessing the necessary funding for the plant, whose costs are exceeding the original $40 million price tag, before the economy soured and financial institutions began to restrict their lending. However, he said he expects four more private investors, giving the plant access to $35 million. South Dakota is reportedly willing to kick in $8 million in bonds and/or other financing, but the state hasn’t finalized the deal.

U.S. beef back on top in Korea

Sales of U.S. beef exceeded those from Australia and domestic meat a month after sales began in major discount outlets, industry sources said recently. Sources said Lottemart, E-mart and Homeplus— South Korea’s three major discount outlets—reported combined sales of 1,276 metric tons of the U.S. beef from Nov. 27 to Dec. 26. Sales of Australian beef, which had been the market leader in the absence of U.S. meat, stood at 1,128 metric tons for an on-year drop of about 16-17 percent, while demand for Korean beef gained 5 percent, compared to the year before, at 712 metric tons. “Although Australian beef has been hurt, sales of U.S. beef at large stores across the country fueled consumption of meat and helped Korean meat and pork,” said an industry source.

Red meat production up in 2008

U.S. commercial red meat production from January through November 2008 totaled 46.1 billion pounds, up 3 percent from 2007, according to USDA’s monthly Livestock Slaughter report. Accumulated beef production was up 1 percent from last year, pork was up 7 percent, and veal was up 2 percent, while lamb and mutton production were down 5 percent.

Beef production in November, at 1.96 billion pounds, was 12 percent below the previous year. Cattle slaughter totaled 2.52 million head, down 11 percent from November 2007. The average live weight was down 2 pounds from the previous year, at 1,302 pounds. Veal production in November totaled 11.3 million pounds, 13 percent above November last year. Calf slaughter totaled 81,400 head, up 38 percent from November 2007. The average live weight, at 240 pounds, was down 51 pounds from last year.

GIPSA reviewing bond requirements

USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) is reviewing how it calculates the reasonable bond required to be posted by market agencies, dealers, and certain packers (bonded entities) under the Packers and Stockyards Act (PSA). According to a notice published in the Federal Register, GIPSA is initiating this review to determine what alternatives, if any, exist for revising PSA regulations to better protect the financial interests of livestock sellers and consignors without exceeding a reasonable bond amount for bonded entities. GIPSA is accepting comments and information on several alternative revisions to the regulations and the issues being considered in this review.

Group comments on organic standards

The Texas and Southwestern Cattle Raisers Association (TSCRA) submitted official written comments Dec. 22 to USDA on the proposed revisions to the National Organic Program livestock standards to clarify the role that pasture plays in the production of organic ruminants. The letter, addressed to Richard H. Mathews, chief, Standards Development and Review Branch of the National Organic Program Transportation and Marketing Programs with USDA, is in addition to oral comments TSCRA staff gave during a listening session Dec. 8 in Amarillo. TSCRA restated its view that the proposed rule changes are too prescriptive and may have negative consequences to cattle producers. A main concern lies with an overlapping attempt to regulate sacrificed pasture and fencing off of water sources with the Environmental Protection Agency and National Resource Conservation Service. Other topics of concern include Dry Matter Intake and the rules that may prohibit feed lots and dry lots from pasture use.

Trade meeting planned over combos

U.S. and Mexican officials will meet Jan. 5 to discuss a proposal by Mexico to ban shipments of U.S meat products in large containers called combos, a USDA spokeswoman confirmed. Under the proposal, which could go into effect Jan. 15, Mexico would only allow shipments of carcasses, half carcasses and pieces when packaged in boxes or pallets, according to a notice the U.S. Meat Export Federation (USMEF) sent to meat processors. “We haven’t seen a lot of justification or explanation for why Mexico wants to make this change, and we are hoping our meeting will help provide further information,” said USMEF Communications Director Joe Schuele.