NFO-196 (AV10698): US Farm Report: Bargaining in Action

This is Ted Ward the hog buyer here at the collection point is buying the hogs from the national farmers organization members under contract. Ted with the members bringing the hogs here through the collection point using the collective bargaining program how does this benefit to your packer and your packing company? A big advantage as far as my packing company is concerned is for instance today we've bought almost the a little while, a little over 1,100 hogs and we know Monday morning that we'll have 1,100 hogs there for sure whereas maybe for some unforeseen circumstances on if we hadn't been dealing with the NFO we wouldn't have these hogs so we know that we have these hogs and we know how to plan our kill welcome to us farm report a public information program brought in the interest of agriculture rural business and the well-being of our nation by members of the national farmers organization in this area and others interested in having American agriculture received cost of production plus a reasonable profit the American farmers and ranchers are building a brighter future for agriculture through the national farmers organization the organization that awoke America and represents the leadership of Agriculture u.s. farm report presents bargaining in action with the national farmers organization this is the scaler Gerald Beatty with the Fairbanks-morse scales at the Prescott Iowa collection point of the national farmers organization mr. Beatty if I might ask you a few questions here just while you're in the operation of weighing the hogs here at the collection point what did you just do there with that ticket well I stamped this ticket and wrote the number of hogs and then when we get get the whole hog we average- take average and then turn it over to the buyer here and he mark surprised now how did you actually go about weighing those hogs well the first thing we aim to do is keep the scale in balance at all times we check it about every so many draft probably four or five drafts we check the balance and try to give accurate weights as the hogs are put on and but that's our idea we aim to keep the scale in perfect condition now you mentioned draft what do you mean by the term draft well that way around 20 or 25 hogs on that's per draft per draft draft yes and it varies in the size if we have large hogs they we don't put as many on the scale that time is to do lighter weight hogs what is the qualifications of a scaler like yourself what do you have to do to train yourself to become a scaler well of course we're under the United States Department of Agriculture the packers stock yards administration livestock marketing division and of course I've been a buyer here for several years and I and requires I'm bonded under this Packers and stockyards actually it's very important then that you get a very accurate weight from those skills yes we aim do we want to give accurate weight and aim to keep scaling first class keep Bob Lilley yeah now where is this gentleman's hogs from Greenfield Iowa Greenfield Iowa Bob Lilley how many had to be have that came across the scales how many head twenty, twenty head twenty head yes now you're writing his name down there after the head and of course average on the hog average on the hogs yes well Geralt certainly want to thank you for taking your time out here to show us the operation of actually what the scaler does the inspection of the scales what your qualifications are and the importance on accurate weights to the members of the national farmers organization and the producers of the hogs all across the country well I really enjoy working with the NFO most everyone today accepts the philosophy of collective bargaining and recognizes the leadership and the role of the National Farmers organization collective bargaining program for agriculture a visiting with mr. gene Potter who's director of the National meat commodity department for the national farmers organization which has its headquarters at Corning Iowa mr. Potter is a graduate of the University of Illinois and agricultural economics gene I'd like to ask you what is the importance and the conditions of honest weights to the producers well Don this is an area in livestock marketing that many times particularly in country marketing conditions are are misused and I think that we've seen an example today of honest weighing conditions and how scales can properly and should properly be handled that there are several ways that this can be done as far as giving producers incorrect weights and let us never forget that a check is made up of two things the price one gets per hundredweight and the number of hundredweight he's paid for I'd like to give you some idea of a few of the ways that scales are misused many times accidentally but also many times intentionally take for an example have you ever seen a cigarette laying on the balance on the weights of a scale this can make as much as five pounds difference in a draught of livestock or a cigar that many livestock buyers like to smoke can even be more flagrant than this another point that is many times done the cards that are used that you saw being stamped today with a scale beam these are to be put in following the balancing of the scales not prior to the balancing of it and then there of course there's the cane being used on the platform when the weighing is being done or a man can stand there with these foot close to the platform or the hand leaning on the gate or even manure and straw and other waste material around the platform can make a great deal of difference as far as how much a draught of livestock would weigh how many of you have ever seen a old bolt or a nut on the weights of a scale and this is also something that although it can be used properly should not be used because it can be used improperly or did you ever see a paper clip on the weights of a scale beam this can make an actual test as much as 20 pounds difference so there are many ways down the scales can be misused and it's one of the things that producers are not mostly most of the time aware of and as far as in Ethel's marketing program there's a built-in protection against this because the man that you saw weighing the hogs Gerald Beatty is paid on the amount of pounds he weighs so the more pounds he weighs the greater his pay and I don't know of another livestock marketing program in the country that offers the producers this built-in protection in other words it doesn't pay him to shortchange the weights of the producers he does he short changes himself that's right sometimes gene you know the farmers of losses because of a plant has encountered financial difficulties what kind of guarantee is there for members bringing their livestock to the NFO collection point well Don for over a year now the national farmers organization has been offering the only major check insurance program to livestock producers who are members of our organization and by this I mean in the event that the hogs that we saw today went to a packer and say something would happen as it does many times as particularly a lot of the packing industry has had some trouble in the past as far as financial conditions are concerned and if this check was not good coming back for the hogs we carry a policy that would ensure that check or if the company's check wasn't good then the insurance policy would cover it so it's a great deal different than bonds there is a total insurance on insured plants up to the volume of the livestock being moved so the producer is without a doubt guaranteed his check I just saw on a voluntary basis this is something that people who are members of NFO by supporting and financing the organization have paid for and it is a service that's offered to all NFO members going to collection points through our marketing program that participates in its program the national farmers organization has made up of producer members of all farm organizations I visited with some of these members at the collection point in Iowa this is Roger Sorensen a young farmer that just brought a load of his hauls in here to the NFO collection point Roger how many head did you bring in this morning I brought in 34 head how large a farmer are you Roger well we don't farm too many acres but we raise quite a few hogs and sell feed do a lot of trucking along cattle and log and livestock trucking yeah yes yes we do you do trucking then for farmers and and that whole livestock livestock trucking mainly yes yes that's right how many homes do you raise normally a year well around thousand head this last year we did make it around a thousand head but the water supply was giving us a little trouble at times but we was gonna plan on a few more but we had our hands full on that many how long have you been a member of the National Farmers Organization well about thirteen months now I believe just a little over a year then have you been marketing your life stock since you've been a member of the organization yes we have how many then have you marked through the collection point here under the NFO collective bargaining program well it'd be about a thousand head would be my guess but very little bit be around that figure well you're a young farmer young hog producer I should say a large considerable large hog producer why did you decide to belong and join the national farmers organization well because of the price benefits I guess and I can get a good price here close to home and I'm building the strength of the organization and working with my neighbors to get better prices in other words you found that it was very successful to use collective bargaining which means bargaining together and selling together with your neighbors isn't that right yes that's right by getting a large group of farmers together we can bargain with the producer processor and get a good price for our hoaxes in other words bargaining together creating bargaining power by block selling you can create this bargaining power and bargain with the processors whereas as an individual all you can do is go to the market and say what will you give me yes that's right well what main thing probably besides our collective bargaining brought you to the attention of banding together with your neighbors and belonging to an organizational structure like the national farmers organization well we're in try to benefit the farmer and if you're a farmer you're foolish not to be in it really it's to your advantage the members of the national farmers organization believe that the farmers should spend as much time marketing their livestock as I do producing it because in the end when they get that price on that check this what determines whether they make a profit or a loss this is mrs. Earl Gibson the custodian here at the collection point at Prescott Iowa mrs. Gibson what is your duties as custodian I take the scale tickets as it come from the way master and figure the amount the hogs will bring and we make out the check for the NFO member how long does it take for the farmers for the members of the national farmers organization when they bring their hogs here to the collection point how long does it take for them to get paid their check immediately unless there's a long waiting line I start off on this when we have a larger run otherwise its right away in other words I don't have to wait for a day or two days or a week to get their check they don't you're as a house wife what would you say that fair farm prices can mean to women in rural America well ah to Fred to a woman I think fair farm prices mean just one thing and that is things for her family and home I know she gets these fair farm prices that means she couldn't do many things for her family because they are the ones that are closest to her heart she can remodel her home by major appliances or I have extra funds for vacation recreation for the entire family or it may mean improving farm buildings painting so forth remodeling three years ago when home prices reached their peak of $29 per hundred farmers started fixing things up was there extra money and there was such a run in the community they run out of pay glass lumber wiring everything of that nature now this was in your home area then the area around Corning Iowa so this is an example on what fair farm prices can do to agriculture for rural America in other words fair farm prices would mean stimulating the cash registers up and down rural America and the Main streets yes I think that makes a very good point right there that illustration because it shows just what happens when they get their fair price is you are the custodian here at the NFO collection point what besides your duties of receiving the tickets and making out the checks to the producers is this a business in itself how long do you work at this yes this is really a mess in itself it spreads through the entire week of course because we happen because I do the bookkeeping for the account so that you know more or less covers a period of several days in other words the members of the national farmers organization believe that they should be just as good businessmen as the businessmen in rural America on the Main streets yes I think they have to be this is Jim Leach president of Cass County NFO and Cass County Iowa Jim how many hogs did you bring down here to the collection point 56 today Don Jim you're a young farmer what are some of the other organizations that you belong to with throughout the country besides the National Farmers Organization we belong to the Corn Growers Association also the American Shorthorn Association and I belong to the Junior Chamber of Commerce out at Lanning are you in farming with your father I'm in farming with my father and brother on seven hundred and twenty acres south of Atlantic why did you feel it's necessary to join the national farmers organization well Don in the years past we tried raising standards on our hogs as far as better hogs we raised the yield on our corn it seemed like every time we did this the price either went down on the hog so we sold them for the same price as we had they didn't give us as much as in same any forward as we thought was necessary and also on the corn so we felt that the price was probably the answer to our problem instead of efficiency so much but we keep on getting more efficient but we figured we got to have a decent price along with business and labor to make our farm profitable and have a fair living in other words you became efficient you've got better quality hogs you developed more meat type in your livestock operation in your hog operation but still this didn't give you a good income and a good price that's right Don you're uh you said you tell me that you belong to the or in high school you was an FFA student that's right Don I received an American farmer degree in 1965 at the Kansas City convention what advice would you give to young farmers that are interested in going into farming or young farmers that want to stay in the business with her father or as an individual I think they should study bargaining in agriculture as by as much as they do production goals and standards and join and study some farm organizations that are mainly interested in bargaining for the farmer in other words you believe that today as an individual you have no other choice but go to the marketplace and ask what will you give me but as a group we're working with your neighbors using the collective bargaining program you can build strength you can build bargaining power and get a fair price yes this is what we did because we felt the Washington wasn't going to help us because we were farmers losing in numbers and wasn't gonna have the farm block so we didn't feel we was gonna get help there and we felt that farmers are going to have to do it themselves in this way to NFO we can do it ourselves This Is Earl Gibson the collection point representative Earl what are your duties here is collection point representative well we go out and book the hogs through the week and then we come over here and help weigh them and grade them and watch it to prices is a fair and everything and their weights and everything and you don't believe we're having a lot of good luck getting hogs we got around 12 letter today and you can see right here the farmers beginning to realize that individual they have no chance in the world to get a price but they are blocking their product together now selling together and bargain yeah I think is the only way if they'll ever get a fair price in other words by blocking the production together they're making their bargaining power felt' that's right it fell and a lot more people coming into it now we get new new guys every day selling members that never had participated into the program whose producers hogs are these that are presently in the pen here that we're standing in Earl there are members of the NFO it sells at this point every Saturday we have a point we average about eight two thousand hogs per day per week I mean he said approximately at the point collection point here today you had around 1200 head of hogs right close to 1200 head hog from about 28 members those members within the vicinity of how many County well we have Adam Taylor Union Adair and Cass at the present time I won't have worked in the inner part or the outer counties besides Adams I work out of completely this is a good example then of bargaining power at the marketplace you bet it is going this is Ted Ward the hog buyer here at the collection point is buying the hogs from the national farmers organization members under contract Ted with the members bringing the hogs here through the collection point using the collective bargaining program how does this benefit to your packer you're packing company a big advantage as far as my packing company is concerned is for instance today we bought almost to well a little over 1,100 hogs and we know Monday morning that we'll have 1,100 hogs there for sure whereas maybe for some unforeseen circumstances on if we hadn't been dealing with NFO we wouldn't have these hogs so we know that we have these hogs and we know how to plan our kill and we know if if we don't have these hogs well we can go someplace else to finish out our kill on Monday I understand that you're paying a substantial premium for good quality hogs now this premium that you're paying on these good quality hogs what does this mean to your company as well as to the producers it means a lot to our company because on these better quality hogs they throw the good ham and a good loin we have we can gain a substantial amount selling them to our consumers what would you say the quality the hogs were today I'd say overall the hogs were above average although the weight was just a little heavier than what we would probably like to see it the national farmers organization has reached a milestone for American agriculture for the first time history is being made from coast-to-coast for activation of contracts gene how important are these contracts and for example this particular collection point what part does the marketing arrangements play in the overall program of the national farmers organization collective bargaining program well Don I think one thing before we get into that that this production that we saw delivered here today is production that is moving under an activated contract as far as the importance of these contracts I think that it's significant from the standpoint that this is the first time on major commodities on the broader scope as we have today that contracts have ever been used successfully in agriculture ease the market and what we saw here today although NFO members are offered the opportunity or have the availability their market to sell their production this in itself is not an end that market the Prescott collection point is merely a tool to be used by producers to use their production it gives them the vehicle whereby they can use their production working together as a group or as we say block bargaining and block selling to benefit themselves to benefit the price level to benefit their market conditions in the future and not production being used against them to break the price by other interests in the industry in other words this is just a stepping stone for the members of the organization that's right this is a stepping stone and a tool you mentioned blocks selling and blocked bargaining could you explain this exactly what is block selling and block bargaining well I think one thing that would make this quite evident done that we saw one operation here and this is one of several hundred that take place each week in the organization across the country so this is a small segment of it and of course when you put it all together then that becomes a large block and the using of that large block as if one producer controlled it all as if one producer was the man who was dealing with the industry as many members do working through the organization by voluntarily participating in our marketing program they put their production together to form a large block in that block as such then can be used to write more contracts to write better contracts as far as producers are concerned that can be used to raise and escalate the general market level I'll say for example you had twelve hundred a head of hogs at one given collection point or many collection points say for example let's just take one collection point it has twelve hundred head of hogs what effect would this have under normal conditions well of course you mentioned one and I think that what Prescott had here today was right close to 1208 of hogs and I'm sure that all of you have heard what an extra thousand hogs will do on a major terminal in the countries that the market will be off 25 to 50 cents if there happens to be a and hogs show up that no one was anticipating well imagine what would happen at a small country market on a given day if a thousand or 1200 head of hogs happened to show up the buyer might not even buy him and if he did it definitely be at a lower price whereas these hogs moved under a pre considered price under a price that was already established through contracts between the members in the or between the members of the organization and the processing plant you know today most everyone is the accepting collective bargaining for agriculture for example in a farm publication a University of Missouri agricultural specialist said that farmers they want to prevent extensive vertical integration or corporate farming they can do so through group or political action and he went on to say that he believed and was convinced that farmers could organize and bargain together as a group this is what the members of the national farmers organization are doing and are helping to solve rural America's problems through prayer farm prices through collective bargaining for American agriculture u.s. farm report as presented bargaining in action with a national farmers organization the organization that is solving rural America's problems members of the national farmers organization invite you to tune in again next week at the same time for more facts on agriculture and rural America which is a gear wheel in our economy that produces the majority of our nation's new wealth the farm income pattern sets the nation's prosperity and the national farmers organization represents new thinking and a new generation of agricultural producers a brighter day for American agriculture