Cattle industry fights for survival

By Dan Nakaso
Advertiser Staff Writer

The journey from Kahului Harbor to Honolulu to San Ardo, Calif., that began this week for 250 Maui calves had been delayed three times, took a month to pull off and ended up costing Kaupo Ranch an extra $10,000.

Cattle from Kaupo Ranch await loading for shipment out of Kahului Harbor on their way to the Mainland. Christie Wilson • The Honolulu Advertiser

"It's unfortunately been one thing after another," said Alex Franco, manager of Maui's Kaupo Ranch, which shipped its cattle Tuesday.

The $18 million industry had finally emerged from four years of devastating drought. And the size of the herd — 152,000 head of cattle and calves — was up 1 percent at the start of this year, the first increase since the drought began.

Then last month's dockworker problems closed 29 West Coast ports and created a new set of worries.

Ranchers weren't allowed to put their cattle onto ships that might not be unloaded on the other end. So they either had to barge them back to Maui, Kaua'i or the Big Island or pay extra to truck them to the North Shore of O'ahu. They also had to pay for extra feed that suddenly had become scarce as shipments slowed to the Islands.

Because of the delays, some of the 520-pound calves lost weight, reducing their market value. Others grew so tall that they now exceed the 52-inch height restriction for the cattle containers and can't be shipped out.

Industrywide, the dockworker situation already has cost cattle ranchers an estimated $100,000 and grows more expensive with every delay, said Corky Bryan, vice president of livestock operations for Parker Ranch on the Big Island and president of the statewide Hawai'i Cattlemen's Council.

"Who knows what it'll end up being," Bryan said. "The reality is there's not a lot we can do about it."

A federal mediator yesterday announced a tentative agreement in the dockworker talks. But ranchers were already talking this week about costly solutions to prevent problems in the future:

• Leaders of the Hawai'i Cattle Producers Co-Op — a group of mostly Big Island ranchers — are considering chartering a special, large ship called the Filomena Purcell that would take their cattle in bulk from the Big Island to the Mainland, after stopping in Vancouver.

"The extra cost would be about $50 a head or more," said Donn Carswell, president of the Hawai'i Cattle Producers Co-Op. "That's more than we want to pay. But we've got to get our herds to the Mainland."

• On Maui, a 76-year-old paniolo named Buddy Nobriga continued to push state officials to move forward with a ranchers' proposal to set up a holding area on 10 acres of state land near the Matson Navigation Co. shipyard at Sand Island on O'ahu to prevent unnecessary travel for cattle because of shipping delays. The ranchers want a tent-like area to protect the cattle containers from the sun, giant fans to cool down the containers and a water system to augment the water in the containers and to wash out the waste.

A spokesman for the Department of Land and Natural Resources, which has jurisdiction over the land, said the issue is complicated and the department is waiting for more information.

• The Cattlemen's Council begins its annual convention this weekend on the Kohala Coast of the Big Island, and Hawai'i's paniolo will be buzzing about the dockworker problems and what to do about it.

• And at the Longs Drug Store in Lahaina today, cattlemen from the newly formed Maui Cattle Co. will cook and serve Maui-raised beef in the store's parking lot. It's the latest effort by Hawai'i ranchers to create a niche market for their beef on their own particular island.

The seven Maui ranchers who make up the 5-month-old Maui Cattle Co. LLC got an initial deal to market their beef through the Lahaina Longs. They hope customers respond and they can expand their beef to the other Maui Longs Drug Stores and eventually sell 30 percent of their 6,000 head of cattle locally.

Within five years, they hope their entire herd stays on Maui and gets sold through Longs and Maui hotels and restaurants.

Since Hawai'i's cattle feed lots died out in the late 1980s and 1990s, more than 90 percent of Hawai'i-bred calves have been shipped to the Mainland to be fattened up, slaughtered, processed and sold nationwide, including Hawai'i.

Small efforts on the Big Island and Kaua'i have been launched since then to create markets for local beef. But selling locally raised beef locally is still more expensive than shipping it to the Mainland and having it come back packaged and ready to buy.

"Our Mainland counterparts that supply good-quality beef to the supermarkets are processing 2,000 head a shift," said Franco, who's part of Maui Cattle Co. "They could kill all of the cattle in the state of Hawai'i in 10 days. We can't do that. So our cost of processing is so much higher."

With all of the costs and problems of the past few years, Maui ranchers decided they couldn't wait any longer, Franco said.

"There are a lot of obstacles that we need to overcome to do something like this," Franco said. "We finally made the decision that we need to face up to the obstacles and see if we can overcome them."

He hopes customers respond to the Maui Cattle Co.'s message that Maui beef might cost more, but it's raised without antibiotics or growth hormones by paniolo who live in the community.

"We have to be able to sell our product slightly above market prices to survive," Franco said. "We have to live on the advantages we have, that our cattle are born and raised here on Maui, they're cared for by the people that individuals can see."

The dockworker delays are one problem that Sumner Erdman hasn't had in the past few years. But he has had plenty of other things to worry about at his Ulupalakua Ranch on the southwestern slopes of Maui's Haleakala.

Erdman cut the size of his herd 25 percent during the drought years because he didn't have enough grass to feed the cattle and couldn't afford the cost of shipping in feed for all of them.

Erdman normally likes to run 2,500 to 3,000 head of cattle but dropped to as few as 1,800 head two years ago. Now he has only 2,000.

Even though the size of the herd is coming back, Erdman figures the fallout from the drought means he'll lose a total of 55 percent to 65 percent of potential earnings from the start of the drought through the next two years.

It has gotten so bad at the 150-year-old ranch that Erdman is even thinking about selling as much as 50 acres of land. The last time the ranch offered any land was during Hawai'i's last major drought more than 20 years ago when Pardee Erdman, Sumner's father, sold 1,700 acres.

"It was very tough on the family all the way around," Erdman said. "In hindsight, it allowed us to have cash flow. It helped us survive."

For other Neighbor Island ranchers, the future offers little security.

They have little hope that the dock situation will be resolved after the federally mandated cooling off period expires in January between the dockworkers' union and the shipping association.

And that makes Franco worry about a repeat of the back-and-forth his cattle went through just to get on their ship this week.

The first delay came when the West Coast ports originally shut down. Then the cattle missed the last barge back to Maui. So Franco had them trucked to Flying R Livestock in Waialua where they sat for the next 15 days, eating 200 $8-bags of alfalfa a day.

Despite Flying R Livestock's best care, Franco said, the cattle lost an average of 10 percent of their weight through the moves, which translates into less income.

"Finally I said, 'To hell with it. We'll ship them back to Maui,' " Franco said. "A week and a half later we got the word that they could leave. So we shipped them to Honolulu again."

Franco doesn't know what kind of reception to expect today at the Longs in Lahaina. And he has no idea what the future will bring.

All he knows for certain is that the folks at Longs have been nice enough to offer the cattlemen some room in their store.

"It's basically a handshake deal," Franco said. "That's pretty much how we do things."

Reach Dan Nakaso at 525-8085 or dnakaso@honoluluadvertiser.com.