BEEF bits

Aug 27, 2010
by WLJ

Hage case finally settled

The battle between Wayne Hage and the federal government has finally been settled by the court system. In a battle that has lasted for more than 20 years, the U.S. Court of Federal Claims recently entered a final settlement in favor of the estates of Wayne Hage and Jean Hage, for the amount of $14.24 million. The battle over land, water and grazing rights between Hage and the federal government’s land management agencies, including the Bureau of Land Management, included eight decisions in favor of Hage. The government illegally seized Hage’s property in 1991, sparking a case that concluded August 2. The award to the Hage estate included not only the estimated value of their property, but also interest on the value of their water rights calculated at 8.25 percent from the date of the taking until the final order was issued by the court.

Burger King profit falls

Burger King Holdings Inc. reported weaker-thanexpected quarterly revenue on declining sales at established restaurants and said its business would remain under pressure in the new year. Burger King is more vulnerable to a weak job market than rivals McDonald’s Corp. and Wendy’s/Arby’s Group Inc. because a larger share of its customers consists of young males, a group that has suffered massive job losses. The company said last Tuesday that high U.S. unemployment and government austerity programs in several European countries would weigh on samerestaurant sales. The second-biggest U.S. hamburger chain said net income fell to $49 million, or 36 cents a share, in the fourth quarter ended June 30 from $58.9 million, or 44 cents a share, a year earlier. Revenue slipped 1 percent to $623 million. McDonald’s global same-restaurant sales were up 4.8 percent for the June quarter, while Wendy’s reported a 1.7 percent fall in systemwide sales at established North America restaurants.

JBS plant expansion moves ahead

The Gun Plain Township planning commission approved plans last week to expand the JBS packing plant outside Plainwell, MI. The plant was acquired by JBS when it purchased Smithfield Beef Group two years ago. The plan to expand the plant will cost the company $43 million and add 81,000 square feet for additional carcass freezing and cooling capacity. The project, which is expected to begin before the end of the year, will boost daily processing operations to approximately 2,200 head, up 300-400 head from current capabilities, according to the Kalamazoo Gazette.

The company will also move a meat grinding operation from Green Bay, WI, to the Michigan plant. Currently the plant employs about 1,000 people.

Canadian hog herd declines

Pork prices may soon begin to climb and add support to the beef complex, if numbers from Canada continue their recent trend. According to USDA’s quarterly U.S. and Canadian Hogs and Pigs report, the number of Canadian hogs retained for breeding has dropped to its second-lowest level in the past 10 years. Canadian hogs kept for breeding totaled just 1.3 million head, down 20 percent from 2004 levels. The threat of rising feed prices and a possible double-dip recession has livestock producers on both sides of the border holding off on expansion decisions for the time being, despite very good price levels. However, analysts worry that without some rapid expansion by protein producers, rapid food price inflation could be right around the corner.

New traceback system in works

A rule expected to be published early next year will establish a new system for animal traceback in the event of a disease outbreak. Kansas Animal Health Commissioner Bill Brown told ranchers and feeders attending the Beef Fest Producers Seminar recently in Emporia, KS, the rule likely will become effective in 2013. The rule will be mostly voluntary, other than a provision requiring identification of animals moving across state lines. Official identification for the program will range from orange metal calfhood vaccination tags up to electronic chips in the ear. Brown said the program will be state-run, with oversight from USDA. State veterinarians and animal health officials are working to standardize traceback systems between states as much as possible.

The Kansas Animal Health Department is in the process of implementing an information management system to track livestock called USA Herds.

Brown said at least eight states already have the system in place. The system will protect producer confidentiality, which is an industry priority.