Tuesday, June 22, 2010

The protein industry can't catch a break...

I have great concerns about the future of our meat and dairy sector.  While I expect it to survive, I also cannot see a way for it to avoid wrenching changes and probable downsizing as additional costs move their business plans to less, but more expensive meat consumption in the US.

Look at the list of challenges: assorted consumer health concerns, food trends, animal welfare issues, environmental liability (especially with CAFOs), ethanol-fueled feed cost increases.

And now blowback from our immigration turmoil.
Residents of a small city in eastern Nebraska voted Monday to banish illegal immigrants from jobs and rental homes, defying an earlier decision by the city’s leaders and setting off what is all but certain to be a costly and closely watched legal challenge.
In Fremont , a meat-packing town of about 25,000 people, unofficial results from The Associated Press late Monday showed that 57 percent of voters approved a referendum barring landlords from renting to those in the country illegally, requiring renters to provide information to the police and to obtain city occupancy licenses, and obliging city businesses to use a federal database to check for illegal immigrants.
Opponents of the new law, including some business and church leaders, had argued that the City of Fremont simply could not afford the new law, which is all but certain to be challenged in court. In a flurry of television commercials and presentations by opponents in the final days before Monday’s vote, opponents said paying to defend such a local law would require a significant cut in Fremont city services or a stiff tax increase — or some combination of the two.
“There were a lot of tears in this room tonight,” said Kristin Ostrom, an opponent who gathered with others in an old V.F.W. building to await the results. “Unfortunately, people have voted for an ordinance that’s going to cost millions of dollars, and that says to the Hispanic community that the Anglo community is saying they are not welcome here. They thought they were coming to a small-town community with small-town values.” [More]
I have no advice for the citizens of Fremont, nor would it be welcome or even useful.  I have lived in a lightly populated rural community for long enough to expect such major debates unfortunately have to drag to an exhausted surrender by both sides. I don't live there - they do.  I do grieve for the collective pain they will be wading through for too long.

But it adds one more burden on an industry already struggling, and probably is spooking the feeders who depend on that plant.

Perhaps it is the cumulative consequences of an industry that failed to temper economic efficiencies such as large feeding facilities, demanding processing work, and wrenching production culture shifts with some inkling the limits of low cost food as a reason for all.

Like too many other examples, the dimly understood and analyzed externalities like smell, or in this case community upheaval have finally shown up on the industry P & L.  Big time.

At any rate, we will be reinventing our protein sector pretty rapidly, I think.  The intensity of public rancor over these issues may no longer allow thoughtful, deliberate action - just wins and losses.  And I suspect there will be more losses than wins.


Anonymous said...

Bitter frustrated people who fear for their own economic and cultural future can do strange things. History tells us things can get worse, much worse. They haven't started burning witches or organized lynch mobs yet. Hopefully calmer emotions will eventually prevail.

Anonymous said...

Much like the animal rights movement, this will make our industry better and provide opportunity for others to capitalize. A simple guest-worker program with 2-3 year work visas would solve so many problems for our agricultural sector. Many of these immigrants only want to work, send some money home and be able to freely travel back and forth to see their families.

Break the law, don't pay taxes, etc and you loose your privilege...do good work and be a good neighbor for 10 years and you should be allowed a path to citizenship thanks to your work visa.

I'm very intrigued by the recent flack Obama has been taking on the immigration front...anyone else amazed at the gumption some are showng to call bull$#(^ on this administration?