Text 17345, 195 rader
Skriven 2008-06-06 13:52:06 av Michiel van der Vlist (2:280/5555)
  Kommentar till text 17315 av Robert Bashe (2:2448/44)
Ärende: Humo(u)r
================
Hello Robert,

On Friday June 06 2008 09:57, you wrote to me:

 MV>>>> A cheaper Doller will make the price of (chicken) food go up.

 MV>> I should have written: will make the price of chicken feed
 MV>> _in_Dollars_ go up.

 RB> Here and further on you're assuming a tight market for chicken feed,
 RB> where relatively minor changes in demand can cause major swings in the
 RB> price.

I merely stated that the price in Dollars goes up. The rest are your words.

 RB>  But don't kid yourself: the USA middle west can still produce
 RB> more grain and other agricultural products than the US can consume.
 RB> Don't you remember how the American farmers were always so interested
 RB> in exporting their surpluses to the USSR?

Exactly! They are exporting! So they would be foolish not to raise their price
if the prices on the world market go up.

 MV>> No, but the US producers of chicken feed will _export_ to the Euro
 MV>> area, thereby reducing supply on the US market and driving the
 MV>> price up (in Dollars).

 RB> This is what I mean, and I'm nearly 100% convinced your assumption is
 RB> incorrect.

It is not an assumption, I am merely applying the laws of supply and demand.
Your logic is faulty.

 MV>> Diseases happen everywhere. Even here in The Netherlands. H5N1 has
 MV>> done a lot of damage to the poultry industry all over the world,
 MV>> the US chickens will not be immune.

 RB> Since when has something like has happened twice in Hong Kong occurred
 RB> elsewhere? I'm not talking about local, controllable outbreaks,

Outbreaks are by definition uncontrolled.

 RB> the ones you're thinking of, but massive problems that affect an
 RB> entire country. The only parallel in the EU was the BSE outbreak in
 RB> England.

And foot and mouth and pigs pest or whatever it is called.... In the past
decade we had several of these incidents virtually bringing the meat industry
to a halt here in The Netherlands..

 RB> And incidently, people don't generally live with chickens in the same
 RB> house outside countries like China and Vietnam - where the major
 RB> outbreaks of poultry disease have occurred.

True, people here do not live among their animals. That accounts for the
relatively small number if human casualties. But do not think the industry was
not affected.

 MV>>>> Maybe you have not noticed it yet but many economies are
 MV>>>> starting to shift from Dollars to Euros, and for good
 MV>>>> reasons....

 RB>>> To sell, yes. Not to produce.

 MV>> You can not only sell in Euros and buy in Dollars. That way you
 MV>> will run out of Dollars end be left with a surplus of Euros. You
 MV>> need someone who will do it in reverse to balance.

 RB> Run out of Dollars?

The individual trader, not the economy as a whole.

 MV>> What I know is so far no one from outside the Eurozone has been
 MV>> successful in penetrating the local market.

 RB> Maybe they haven't tried. Wait and see. Or the laws and conditions in
 RB> the EU are, or have been, too restrictive.

Then the same restrictions will apply to the US chicken farmers. If they are
lifted the others will profit too.

 RB> If I remember correctly, the EU only recently decided to allow
 RB> American chicken that has been disinfected into the EU.

As I understand it, the decision has not been taken yet.

 MV>> If US chicken feed is so cheap in Dollars, what is stopping the
 MV>> European chicken farmers from buying cheap American chicken feed,
 MV>> thereby spending Dollars to raise their chickens and get Euros
 MV>> when they sell?

 RB> The freight on chicken feed is higher than that on the equivalent
 RB> weight of chicken (if I remember correctly, you need around 10 times
 RB> the weight of feed to get one unit of meat),

Closer to one in three.

 RB> so it's a good deal cheaper to ship the meat than the feed.

That depends. Meat shipment needs a lot more care than chicken feed. For fresh
meat, it has to be flown. Otherwise it must be frozen. Which adds to the
expense and makes it less attractive for the consumer. People here seem to
prefer fresh chicken over frozen.

 RB> And, as above, the EU laws and conditions may be too restrictive.

Again: if that is so, all competitors from outside the US suffer equally.

 RB> Remember genetically engineered grain? Anyway, neither you nor I have
 RB> any definite knowledge on this, so both of us are speculating.

My observation that so far  no one from outside the EU has succeeded in
penetrating the market is not a speculation.

 RB>>> I agree, but why should anything like that happen? The products
 RB>>> will be so attractive just on the basis of the lower production
 RB>>> costs that they can easily compete without any government aid.

 MV>> If it is that simple, why are we not flooded with American
 MV>> products already? Why is there no American beef on the shelves
 MV>> here?. Or pork?

 RB> Laws and conditions. Argentinian beef is cheaper. And Europeans like
 RB> leaner pork than in the States, where a lot is made into bacon.

So why should not the same or similar mechanisms apply to US chicken?

 MV>> The only US products I see are grapefruits and wine. They don't
 MV>> compete well with what comes from South Africa...

 RB> Price isn't everything. Like I say, laws and conditions also play a
 RB> major role. And of course differences in taste.

Now you are contradicting yourself. I predicted it would not be a success. For
a variety of reasons. The you said that when they were cheaper pewould buy then
anyway, Now you say price isn't evetthing. Now what is it?

 RB> I already mentioned the case of California pistachios, which I think
 RB> are not very good, but are the only ones you can now get in Germany.

So indeed, price is not everything. The Irianian nuts were ousted from the
market. The same could happen to the US Chlorine chicken.

 RB>>> Just look at Germany and ask yourself why it's cheaper to import
 RB>>> coal from the States than to use German coal.

 MV>> Because the German coal mines have almost been depleted?

 RB> No, because it's cheaper to buy strip-mined coal from the States even
 RB> when you include the shipping expense than to deep mine it in Germany.

Key word: "deep mine". Why deep"Because the mines are nearly depleted.

 RB> Or for that matter to use strip-mined lignite from Germany as a
 RB> substitute.

You know very wel that strip mining is too land intensive to be viable any more
in Western Europe.

 MV>> Eh... didn't you say that what goes up must come down? <beg>

 RB> Are you backtracking, Michiel <beg>?

No, I am just reminding you of your own theory that you now seem to contradict.

 RB> Incidently, I expect to see a further drop in the Dollar vs.

Actually the Dolar recovered a little bit in the last days.

But like you, I expect that to be a temporay effect. The basic reaso for the
dropping Dollar is that the US society as a whole is overspending. As long as
that situation persists, the Dollar will keep sinking.

 MV>> Regarding the US "chlorine" chickens flooding the market here.. I
 MV>> will believe it when I see it.

 RB> You mean when you eat it ;-)

As I already told you, I will not buy it anyway. If I eat it it will be because
someone puts it on my plate without my knowledge.

 RB> We'll see. And by the way, I never claimed they would "flood" the
 RB> market, only that they would be attractive in price and would sell -
 RB> assuming no laws are enacted to specially mark (discriminate against)
 RB> them, which in Germany is a definite possibility, as environmental
 RB> hysteria is a widespread disease here.

Germany is not unique in that. You find it here as well, though perhaps to a
lesser extent.


Cheers, Michiel

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