September 15, 2003
Editor?s Note: In his column in the July edition of Sheep Industry News, ASI President Guy Flora wrote about representatives from the United States, Australia and New Zealand sitting down to ?talk lamb.? He also asked Sheep Industry News readers for their opinions on the matter, more specifically what the U.S. lamb industry representatives should discuss with their marketing rivals. Two readers took Flora up on his offer for suggestions, which follow below. If you have suggestions you?d like to share with our readers, please send them in writing to ASI at firstname.lastname@example.org, by fax to ASI at (303) 771-8200 or to Flora at P.O. Box 97; Cardington, OH 43315 or to his e-mail address at email@example.com
Dear Mr. Guy Flora:
In the Sheep Industry News there was a request for ideas from those of us who work with our sheep everyday on what we thought might be points of discussion with our Australian and New Zealand counterparts relative to the sheep and lamb industry in the United States. There was also a request for ideas relative to marketing and funding.
The following are ideas that we would like to see brought up at your upcoming meeting to be held this fall in Washington, D.C. with Australia and New Zealand:
- Relative to marketing and funding, we believe there should be a generic promotion plan funded by the checkoff that is already underway. However, we would add that we believe this should be some kind of ?catchy? idea or advertisement campaign such as the ?BEEF, it?s what?s for dinner? idea the cattlemen have underway. I guess what we are proposing is let?s not try and promote lamb as the gourmet?s delight. Rather, as another meat product that will appeal to all American consumers -- younger, older, ethnic, rich, middle income as well as other so-called ?groups? found living in this country.
- While having this marketing and funding discussion, carefully consider the sheep and lamb products that are currently in favor in Australia and New Zealand for possible development here in America. For instance, lamb sausage (i.e. polish sausage, smoked lamb sausage, etc.), lamb breakfast sausage, smoked lamb, lamb ham, lamb jerky, ready-to-eat lamb (lamb in a dish to just heat-and-eat) and the list could go on and on. This is another way to have lamb added to the American consumer?s list of items to eat.
- We need to ?even? out the price fluctuations of sheep and lamb products in this country. One year lambs are sold for $.50/pound and the next year they are $1.00/pound. Fluctuations such as this create havoc in sheep farm and ranch planning operations all across this country. That?s not to say there shouldn?t be some kind of fluctuation, but in a world market where countries can build up huge surpluses of commodities and ?dump? them on markets in other countries, this exacerbates these fluctuations. If sheep and lamb numbers happen to be high in the ?dump? countries as well, the price drops completely out of the range of a healthy fluctuation often leading to bankruptcy or some other demise of an otherwise healthy business.
- Discussions with Australia and New Zealand relative to timing of imports are other items that should be approached. While I realize the Australians and New Zealanders would rather not discuss anything to do with ?managing supply,? this affects the price they get as well as the prices American producers are forced to deal with during times when American lambs are finding their way to slaughter.
- Finally, we think now is the time to approach both New Zealand and Australia and tell them that we believe there should be a ?floating? tariff on sheep and lamb products brought into the United States from other countries. This ?floating? tariff would be tied directly to the currency exchange rate. This would ?level? the commodity playing field so that imports would have to compete directly at the same price levels found in the ?import? country. The tariff would be tied to the daily currency exchange rate and all sales for that day would be equalized at a dolla-for-dollar basis, i.e. $1.00 American would be equal to $1.00 Australian or New Zealand based on an added tariff to the currency of the country from which the commodity is being imported. Yes, there would be some bookkeeping needed by import sheep and lamb buyers but with computers these days, and the programming available, this wouldn?t even be an inconvenience. Yes, there could be some cheating on this if an exporting country with a lesser exchange rate could get another exporting country to agree to let them import under their import license, but in general, the playing field would be nearly level.
- If you can get item 5 in a written agreement - TAKE IT!!
Thank you for this opportunity to comment.
Raymond and Sherry Hoem
Dear Mr. Flora,
I am a fourth-generation rancher in Central Montana who operates a cattle, sheep and grain operation. We are very tired of imports! We get this big line from our free-trading "friends" that we need to open markets. I find it horrible that all they can come up with is Chile! With the recent passage of TPA, and with the upcoming free trade agreements such as Free Trade Areas of the Americas, Australia and New Zealand, we will be experiencing rapid growth of lamb and beef imports. We are not enforcing previous trade agreements and have to face cheap currencies from all over the world. It's NOT fair!
After reading about increased lamb imports for March 2003 and seeing the lamb market drop in the last couple of weeks, I felt compelled to write a letter to you. I also noticed the import graphs on page 5 of the Sheep Industry News, July 2003 edition. It's a shame so many of our producers went out of business because of cheap lamb. I realize that our dollar is weaker now, but they have had an unfair trade practice because of the cheap exchange rates.
My advice would be to send the Australian and New Zealand members home. We have had previous agreements to promote lamb with the Australians and New Zealanders, but they always take advantage. I would also ask why they don't take U.S. lamb and beef in Australia and New Zealand. I believe we can promote our own products because of our superior lamb.
In conclusion, I thought the lamb summit was in poor taste. I'm very bitter to what they have done to the U.S. lamb and textile industries. The biggest predators are not the coyotes, but the Australians and New Zealanders who want to access our market.
Judith Gap, MT 59453