Checkoff chatter

Aug 6, 2010

The beef checkoff is possibly the most contentious issue ever involving the cattle business. This self-help program has created more heartache among folks trying to do something positive for the industry than I have ever seen. 

It appears that everyone wants to love the checkoff to death and that is just what’s going to happen unless cooler minds start working together. The program was intended to solve problems and promote beef, but at this point, it appears to be creating more problems than solutions. Remember, the idea was to sell beef and keep live cattle prices at a workable level.

Last week during the beef industry summer conference in Denver, CO, separation of the Federation of State Beef Councils (Federation) and the National Cattlemen’s Beef Association (NCBA) was heavy on people’s minds. The executive committee of the Cattlemen’s Beef Board (CBB) made the call for NCBA and the Federation to split. However, when the measure was up for a vote before the membership of the CBB, they strongly told the executive committee they weren’t very supportive of their decision. Some referred to the committee as going beyond their scope of authority. The idea was rejected by a two-thirds vote from the entire board.

Earlier that day, the Federation met and decided that their relationship with NCBA was just fine and they had no intention of walking away despite the CBB’s wishes. They voted to seek a bit more independence from the NCBA’s policy division, but that won’t include moving out of the building or some of the more drastic steps outside groups might like to see.

At the end of the day, the CBB executive committee was pretty much told to put away their desire for the separation of the Federation from NCBA. Last week, following the meeting, the Federation sent a letter to USDA Secretary Tom Vilsack, signed by nearly every Federation chairman or vice chairman, which said the group represents a diverse cross section of the beef industry. The letter asked USDA to take into consideration the fact that resources are scarce and industry challenges are many and, as a result, the Federation’s intention to remain allied with NCBA should be honored accordingly. They also expressed a desire to put the issue of separation behind them.

It appears to me the CBB’s executive committee may have a bit of explaining to do about why it tried to break up the successful alliance between NCBA and the Federation. Ironically, what they say and what they do appear to be two different things.

The CBB staff repeatedly have said they represent all beef producers and have referred to the outside audit that was released by CBB as a cause for their actions. It’s hard to say if the CBB executive committee is going to pursue this issue or not. Some of the e-mails floating around last week were a bit antagonistic, at least from my perspective.

I’m sure that by now most folks know what a flatiron steak was six or seven years ago. It was a cheap piece of chuck that sold for $1 a pound. Because of the work of every group involved with the checkoff, it is now a 2-pound cut of meat selling for $5 a pound. It is these programs that help create value from a beef carcass, not arguing over who may get the credit for doing it. That’s a fruitless issue. As far as I’m concerned, the participating universities, NCBA, CBB and the Federation should all get credit for the work they’ve done to enhance beef values.

Last week, CBB was expected to start a larger audit of NCBA’s checkoff activities. NCBA has said they are more than willing to take part in that audit. They’ve told us they have no motive to abuse the accounting firewalls and are open to suggestions to improve them. After 14 years under this arrangement, there have been few reasons to question the integrity of NCBA’s use of checkoff funds.

There is apparently a lot of deep-rooted resentment on this issue. People’s feelings are hurt and motives are being questioned. But it’s clear to me that a handful of people are pushing the buttons in this episode.

That said, I just don’t get it. I realize that all cattlemen’s associations don’t see things the same way on many policy issues, and that’s fine. But are differences in policy issues between organizations playing a role in this situation? Is it really a good idea to maim the checkoff to satisfy the few? In my mind, destroying any group that’s promoting beef doesn’t seem like a wise choice, nor does cattlemen’s organizations feeding on one another. I just can’t tell if the fight is on or whether cooler heads will prevail. — PETE CROW