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Friday, August 1,2008

No penalty-free early-out for CRP acres

by DTN
USDA will not allow landowners to take acres out of the Conservation Reserve Program (CRP) early unless the landowner agrees to pay the normal early-out penalties for breaking a contract, Agriculture Secretary Ed Schafer said last Tuesday. Schafer said the decision not to allow early out "strikes the best possible balance between supporting programs that protect our natural resources and meeting the nation’s need for grain production." The decision effectively means farmers wanting to void a CRP contract for 2009 crops would have to pay the USDA penalties to do so. In choosing to stand pat on CRP, Schafer said USDA completed "a very thorough review" of recent crop reports, weather conditions, commodity prices, and the likelihood of more land going into production. All of those factors allowed USDA to stand pat when it came to the penalties. "We realize we are in a situation that can change rapidly and quickly, but at this point in time, we are comfortable with the numbers we are seeing coming out," Schafer said. The impact of Midwest floods earlier this summer does not appear as severe as earlier thought. USDA reports show the country should potentially produce the second-largest corn crop on record, with an anticipated harvest of almost 79 million acres, he said. "We don’t feel the corn and soybean crops are going to be as bad as we originally feared," Schafer said. The decision not to allow early out of CRP comes less than a week after a federal judge limited a special USDA program allowing summer and fall haying and grazing on CRP acres. The federal judge determined USDA could not make such significant changes to the CRP program without first doing an environmental impact statement as required by federal law. Still, some agricultural groups and commodity end-users have been clamoring for USDA to tap the CRP program for more production acres. Conservation groups, wildlife groups and some farm organizations have argued the other way, maintaining the CRP is a conservation program and using that land for production could impact the environment and may not provide enough quality acres to alter commodity production. "There are a lot of groups that feel strongly about this issue either way," Schafer said. "So if you want to count that as pressure, certainly we have heard the message on both sides of the equation here. But, you know, the reality is we have acres that are coming out of the program because of expiring contracts." USDA reports there are now 34.7 million acres in the CRP, down from about 36.7 million acres last year. Schafer said another consideration was that the new farm bill maxes out the program authorization in future years at 32 million acres. Schafer pointed out that as many as 9.3 million acres could potentially come out of the program between now and fall 2010. In late September, contracts for 1.1 million acres are expected to expire. The potential expired acres jump to 3.8 million in fall 2009, and 4.4 million acres in 2010. "So, large blocks of land will be available for other purposes if landowners choose to pursue them," Schafer said. The penalty for canceling a contract before it expires requires a landowner to pay back every single dollar received under that contract, including cost-share money and rental payments, plus interest. There’s also an additional penalty of 25 percent of one year’s rental payment. High commodity prices and land values have prompted more landowners to take acres out of CRP early and put the land into production, despite the penalties. Over the past 19 months, landowners have paid penalties to pull out 288,726 acres from CRP, which included a high mark of 36,890 acres last May. Senate Agriculture Committee Chairman Tom Harkin, D-IA, one of the architects of the CRP program in the mid-‘80s, stated last week he thought Schafer made a sound decision not to approve early outs. Harkin had complained that allowing early outs now would be unfair to producers who chose earlier to pay the penalties necessary to get out of the program. He said a more gradual transition would be a more sound decision "for conservation and everyone with an interest in CRP." "Today’s decision also protects the public’s investment in conservation paid for through years’ worth of CRP payments," Harkin stated. "We already expect that millions of acres will exit CRP over the next few years as contracts expire and landowners choose to return the land to cropping." — Chris Clayton, DTN

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Friday, August 1,2008

Nebraska and Iowa producers promote U.S. beef in Tokyo

by WLJ
Two beef producers from Nebraska and Iowa took part in a U.S. Meat Export Federation (USMEF) U.S. Beef Checkoff-sponsored promotion, made possible through the financial support of the Nebraska Beef Council and the Iowa Beef Industry Council, that helped boost weekend sales of U.S. beef tenfold at a key store in Japan’s largest retail grocery chain. U.S. beef producers Bill Rhea of Arlington, NE, the Nebraska Beef Council’s treasurer, and Scott Niess of Osage, IA, and a member of the Iowa Beef Industry Council’s board of directors, witnessed and participated in a large-scale USMEF U.S. beef promotion for Japanese consumers at an Ito Yokado supermarket in Tokyo on July 12. Funded by the Nebraska and Iowa state beef councils, the U.S. beef retail promotion at four of Japan’s major supermarkets—Aeon’s Max Valu outlets, Ito Yokado, Daiei and York Benimaru—were part of USMEF’s continuing campaign to rebuild Japanese consumer confidence in U.S. beef by reestablishing its presence in supermarkets and reacquainting target consumers with its positive attributes—taste, consistency and value. "It is a great opportunity to see this U.S. beef promotion," said Rhea, "and to talk with consumers and buyers in Japan." USMEF is conducting a series of U.S. beef storefront events in its July-August "Beef de GENKI" (energy from beef) campaign at the four supermarket chains. This campaign is tied to USMEF’s strategic "We Care" theme and is targeted toward families with children to show that "We Care" about their health and vitality so they can enjoy life to the fullest. The campaign aims to increase sales, enhance consumer perception of U.S. beef, and rebuild trust by handing out samples, educating customers through information panels, and entertaining families with games. Since Japan reopened its market, the main supermarket chains have started offering U.S. beef one by one. Aeon, Japan’s largest supermarket chain, was the last to do so in December 2007. Its supermarkets have a reputation for high quality products at fair prices. One of the more innovative retailers, Aeon allows its customers to trace the origin of its domestic beef through in-store computers and cell phones. The U.S. producers also joined in the fun by participating in USMEF games with Japanese families. Their particular outlet increased its weekend U.S. beef sales tenfold, selling more than 500 U.S. steaks. The presence of U.S. ranchers showed consumers the real "face of the industry" and allowed them to gain a much deeper understanding of the Japanese market through a market debriefing, meetings with U.S. beef importers/buyers, and a visit to a Japanese Wagyu processing facility. "The customers’ reaction to U.S. beef is very positive," said Ito Yokado’s senior buyer. "This event proved very effective and I’d like to hold it again and expand it." "One of the things that is pretty remarkable about this whole trip," said Niess, "was that it was the first time that the Iowa Beef Industry Council and the Nebraska Beef Council came together in a joint effort to promote beef in Japan. And anyone that we talked to that had tasted or had sold American beef is wanting more—wanting more availability, wanting more volume, to be able to sell more American beef." Besides enthusiastic responses from consumers and supermarket buyers, USMEF garnered even more publicity for U.S. beef by securing articles in three major Japanese publications: Meat Journal, Chikisan Nippo and Nikkei. Chikusan Nippo The Meat Journal jointly quoted Rhea and Niess: "Japan is an important partner for the U.S. beef industry. We visited several retailers and distributors in Japan this time, and they want American beef. We wish the current problems, including age limitation, will be cleared and beef exports to Japan will increase." — WLJ quoted both Bill Rhea—"We’ve received very good reactions from consumers, and felt that U.S. beef was trusted by them,"—and Scott Niess—"Japanese consumers willingly tasted American beef with smiles. The safety, healthiness and reasonable price are the best attributes of American beef products."

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Friday, August 1,2008

Evocative, emotive "marbling"

by WLJ
To start a lively discussion amongst a group of cattlemen, just utter the word "marbling." It’s been called one of the most emotive words in the beef industry. From those who dismiss it as unimportant to the staunch defenders, opinions will vary. A presentation at the American Society of Animal Science annual meeting earlier this month focused on the science behind the word. Larry Corah, vice president of Certified Angus Beef LLC, shared research related to the value of marbling. "Nearly all beef scientists and connoisseurs indicate that there are three key attributes to beef palatability: tenderness, juiciness and flavor," he said. If it’s not met, tenderness is the most important. "It is clearly a threshold trait," Corah said. "The good news it that most researchers agree the beef industry has made great progress in both understanding and improving tenderness issues." Studies show marbling accounts for between 8 percent to 18 percent of the variation in tenderness, but Corah said it’s more significantly tied to juiciness and flavor. Two separate multi-city studies proved that when tenderness was held constant, consumers buy meat based on flavor. "Data out of Texas Tech University tells us that flavor is 2.5 times as important as tenderness when it comes to consumer acceptability," he said. "The taste they look for is a direct result of at least 80 to 90 days on a high-concentrate diet." The consumer preference for marbling isn’t isolated from the market price of beef, said Corah. "In the last 10 years, market differentiation has developed as a result of the demand for enhanced beef quality," he noted. "Colorado State University studies show that if beef tastes great, people are not only more likely to buy it, but more likely to pay more for it." That’s why over 40 percent of all fed cattle are marketed on quality-based grids, and those that make Premium Choice add more than $500 million per year to the industry. "The research not only says that marbling is important, but it’s also complicated," he said, noting factors like genetics, nutrition, breed and environment. "I would argue that there have been three major technologies in the past 50 years in our business: implants, ionophores and beta-agonists," Corah said. None have a positive effect on marbling, and a few—aggressive implants and Beta-II agonists—can be detrimental. "We really need more research to understand the mechanism in which these management practices affect marbling," he suggested. "The National Beef Quality Audit says we’re leaving $26.81 per head on the table in lost quality. That’s a lot. "As we continue to make great strides in tenderness, the ultimate driver for beef demand will be flavor," Corah predicted. — WLJ

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Friday, July 25,2008

42 Letter to the editor

by D. "Bing" Bingham - contributing columnist
Dear WLJ Editor, This letter is in response to the ‘Guest Opinion’ appearing in the July 7, 2008, issue of the Western Livestock Journal stating "Split-state status still wrong for Montana cattle industry" by Steve Roth, president, Montana Stockgrowers Association. As a cattle producer in a state that was granted split-state status in its fight to eradicate bovine tuberculosis (TB) in its deer herd, I wholeheartedly agree with the position of the Montana Stockgrowers Association. Michigan has endured a tremendous economic cost and an endless managerial hardship associated with this disease for over 10 years and it is my opinion that having split-state status is one of the reasons that we are no closer to the end of this problem than when the disease was first discovered. Split-state status lessened the urgency of eliminating the disease by the Michigan Department of Agriculture, the Michigan Department of Natural Resources, the United States Department of Agriculture, some in the livestock community, and, of course, the politicians. It effectively shifted the urgency and strong desire to eradicate TB in the deer to only the beef and dairy producers in the affected counties. Although I live in a region of the state that was granted TB free status, I am still shut out of our traditional markets because the state veterinarians in the states where our feeder cattle were marketed are not confident that Michigan’s policy of managing the disease by containment will safeguard their state’s livestock industry, a position with which I agree. The officials responsible for disease control refuse to take the necessary step of eliminating all of the deer in the affected counties. The importance of this step was expressed well when even Baxter Black weighed in on Michigan’s problem and in a rare serious column, stated that only by eliminating the deer in the affected counties could TB be eradicated. Such a measure is said to be impossible, but hunters nearly exterminated the bison on the Great Plains in a few short years. Had the deer been eliminated early after TB’s discovery, the region would now be repopulated with healthy deer. Let us hope that the state and national officials in charge of human and animal health show the leadership required to eradicate brucellosis in the Greater Yellowstone Area and bovine tuberculosis in the states that have infected deer. Let us also pray that they do it before the host wildlife of these diseases spread it to other states and countries. For those who don’t feel this is a possibility, I suggest you ‘Google’: New Zealand bovine tuberculosis. Sincerely, Clarence Wilbur

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Friday, July 25,2008

Cow size—Effects of cow size on pasture management

by Kris Ringwall, North Dakota State University
Cow size—Effects of cow size on pasture management The effect of cow size and expected production from pasture management directly impacts expected outcomes that translate into income. This relationship was discussed in recent BeefTalk articles. A drought, at least in western North Dakota, initiated the discussion. The Dickinson Research Extension Center (DREC) established two different groups of cattle based on body weight, calculating inputs and potential outcomes. The two groups (herds) of cattle were weighed. The first herd had 52 cows that averaged 1,216 pounds (856 to 1,395 pounds) and the second herd was 50 cows that averaged 1,571 pounds (1,350 to 1,935 pounds). Since not all of these cows had mature records in the center’s data system, data from all the cows was added. Mature cow records were allotted to 100-pound increments. The production potential based on "percentage of cow weight weaned" was calculated for the mature cows. Lee Manske, DREC range scientist, calculated the expected nutritional pasture needs and expected outcomes from these cows based on production estimates by 100-pound increments of cow weight. For cows that were less than 1,300 pounds, the monthly forage dry-matter intake was calculated at 933 pounds. This required 10.75 acres per cow per grazing season in western North Dakota, with a predicted calf weaning weight of 617 pounds. For cows that weighed from 1,301 to 1,400 pounds, the monthly forage dry-matter intake was calculated at 997 pounds. This required 11.49 acres per cow in western North Dakota, with a predicted calf weaning weight of 611 pounds. For cows that weighed from 1,401 to 1,500 pounds, the monthly forage dry-matter intake was calculated at 1,051 pounds. This required 12.11 acres per cow in western North Dakota, with a predicted calf weaning weight of 589 pounds. For cows that weighed 1,501 to 1,600 pounds, the monthly forage dry-matter intake was calculated at 1,101 pounds, requiring 12.68 acres per cow in western North Dakota, with a predicted calf weaning weight of 598 pounds. For cows that were greater than 1,600 pounds, the monthly forage dry-matter intake was calculated at 1,188 pounds, requiring 13.68 acres in western North Dakota with a predicted calf weaning weight of 572 pounds. With that data, I already can hear the e-mails coming. The data does not appear logical. The data means calf gain on pasture weaning weight minus birth weight and then divided by age and then multiplied by grazing days is decreasing as the cow size increases. The larger cows are weaning less percentage of their body weight and producing a smaller calf. Cows less than 1,300 pounds had a pasture gain estimated at 336 pounds. The 1,301- to 1,400-pound cows’ gain was estimated at 332 pounds. The 1,401- to 1,500-pound cows’ gain was estimated at 318 pounds. The 1,501- to 1,600-pound cows’ gain was estimated at 323 pounds, and for cows weighing more than 1,600 pounds, the gain was estimated at 307 pounds. Translated even further, seasonal calf weight gain (pounds) per acre for each cow group would be 31.21, 28.88, 26.23, 25.49 and 22.41 pounds, respectively. Associated individual costs could be calculated as well as the value of calf gain on a per-acre and/or per-cow basis to fine-tune the added value of the smaller cow. As was noted in previous discussions, what is offered here is food for thought. Previous and future managerial decisions can and will determine production potential. There is little we can do to change nutritional requirements, stocking rates and plant biology. How cattle perform given individual production scenarios will vary, but one thing is for sure, do not assume what you see fits. The actual collection of data is essential to guide local changes in management. The application of assumed principles may or may not apply locally. It never hurts to have "more food for thought" for supper. May you find all your ear tags. — Kris Ringwall (Kris Ringwall is a North Dakota State University Extension Beef Specialist, director of the NDSU Dickinson Research Center and executive director of the North Dakota Beef Cattle Improvement Association. He can be contacted at 701/483-2045.)

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Friday, July 18,2008

GIPSA cites JBS/Swift

by WLJ
GIPSA cites JBS/Swift USDA’s Grain Inspection Packers and Stockyards Administration (GIPSA) announced two weeks ago that it had cited Greeley, CO-based JBS/Swift and Company with violations of the Packers and Stockyards Act (PSA). According to a release from GIPSA, the company "inaccurately weighed hot carcasses for the purposes of payment to livestock sellers; used a dynamic monorail weighing system which was not accurate; reported inaccurate hot carcass weights to livestock sellers and paid livestock sellers on those inaccurate hot carcass weights; failed to pay the full purchase price for the livestock purchased within the time period required by the Packers and Stockyards (P&S) Act; and failed to pay the full amount due to livestock sellers for hot carcasses weights." According to one industry source, the allegations regarding inaccurate weights benefitted producers. The weights recorded by company scales were reporting weights in excess of actual hot carcass weights, which were used in turn as pay weights by the company. On June 18, 2008, GIPSA filed a complaint against Swift. If the allegations are admitted, or proven in an oral hearing, Swift may be ordered to cease and desist from violating the PSA and assessed a civil penalty. — WLJ

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Friday, July 18,2008

Truck weight laws leave farmers in the lurch

by WLJ
Truck weight laws leave farmers in the lurch Farmers and ranchers hauling their own goods to market across relatively short distances should not be held to regulations intended for commercial long-haul drivers, according to Mike Spradling, president of the Oklahoma Farm Bureau. During a recent hearing before the House Committee on Transportation and Infrastructure’s Subcommittee on Highways and Transit, the Sand Springs, OK, cattle and pecan producer testified on behalf of the American Farm Bureau Federation (AFBF) regarding the negative impact existing truck weight laws and regulations have on farmers and ranchers. "Current weight limits imposed by the Safe, Accountable, Flexible and Efficient Transportation Equity Act and the Federal Motor Carrier Safety Regulations (FMCSRs) burden farmers and ranchers hauling their products to market," said Spradling. "The American Farm Bureau Federation recommends changes to FMCSA’s rules regarding Commercial Motor Vehicles (CMVs) that will make them more workable for some farmers and ranchers while still maintaining the safety of rural roads." The current federal definition of a CMV is a vehicle with a gross vehicle weight rating or gross combination weight rating of 10,001 pounds or more. It takes very little to reach that threshold. For instance, a heavy-duty pickup truck can often exceed the 10,001-pound weight limit. This makes interstate travel unreasonable by triggering requirements such as a commercial driver’s license and compliance with hours of service rules. "Establishing a national threshold of 26,001 pounds would begin to eliminate the inconsistent and confusing system currently in place and free small farmers and ranchers from being regulated the same as commercial truck drivers," Spradling said. "Concentration within the agriculture industry has reduced the number of grain elevators, cotton gins and livestock markets, forcing farmers and ranchers to drive longer distances, often across state lines, to sell their commodities," Spradling said. Additionally, the lack of uniformity between states causes confusion and frustration, according to AFBF, which has proposed solutions to ease the burden of trucking regulations on some farmers and ranchers. "Farm Bureau believes there are several changes that need to be made to the agency’s current regulations," Spradling testified. "They include exempting border crossings between states with similar weight restrictions, raising the weight limit for CMVs to at least 26,001 pounds, or exempting state border crossings within the 150-air-mile radius currently recognized by FMCSA [Federal Motor Carrier Safety Administration]." — WLJ

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Friday, July 18,2008

Tuberculosis may have migrated from humans to cattle

by WLJ
Tuberculosis may have migrated from humans to cattle Tuberculosis (TB) may call to mind Old West consumptives and early 20th-century sanatoriums, yet according to the World Health Organization, the disease took the lives of more than 1.5 million people worldwide in 2006. In the U.S. alone, thousands of new cases are reported annually, making TB an enduring menace. The need to better understand this disease is becoming critical, note researchers at Arizona State University, especially with the emergence of antibiotic-resistant strains and increasing globalization spurring pathogen migration. Among those trying to decipher the origins and trajectory of Mycobacterium tuberculosis, the bacteria responsible for TB, are three researchers in Arizona State University’s (ASU) College of Liberal Arts and Sciences. Graduate student Luz-Andrea "Lucha" Pfister and associate professor Anne Stone in ASU’s School of Human Evolution and Social Change, and Michael Rosenberg, an assistant professor in the School of Life Sciences, are trying to establish a credible evolutionary timeline for TB. Their research suggests that the disease migrated from humans to cattle—not the reverse, as has long been assumed. The research estimates that the evolutionary leap took place prior to the domestication of cows—more than 113,000 years ago—indicating M. tuberculosis is a much older pathogen than previously believed. This outcome supports that of the French Pasteur Institute’s Cristina Gutierrez, an evolutionary mycobacteriologist whose work first cast doubt on the cattle-to-human TB link and its date range. Gutierrez calls the findings of Pfister’s team confirmation of TB’s ancient origins and human-cattle transmission. This summer, Pfister presented the results of the group’s research at the annual meeting of the Society of Molecular Biology and Evolution in Barcelona. She also presented during the April assembly of the American Association of Physical Anthropologists and subsequently saw the group’s research reported on in the journal Science. With no fossil evidence to consult, studying the deep history of bacteria has only recently become possible. Genomics holds the key. Using DNA, Pfister, Stone and Rosenberg are making inroads into calibrating the watershed moments in TB’s development, such as when it expanded in the human population. Through their work, they also plan to address the biogeography of the disease and what types of TB ancient people had relative to modern strains. Why are scientists interested in TB’s status thousands of years ago? Pfister puts the research into perspective. "An accurate time frame can help us learn about the development between host and pathogen. It can aid in understanding the disease and the way it evolves, how it creates new strains to stay alive." As Stone is quick to point out, "The data we generate can be used by clinicians to study this disease and formulate appropriate treatments. Our work is historical, but the implications are far-reaching." One of the primary goals is to calculate a meaningful mutation rate. The established model for bacteria was developed in the 1980s in regard to E. coli. "This mutation rate has been used as the universal standard, but that is not feasible. TB and E. coli are very different. Bacteria may evolve at different rates. We cannot say that one model applies to all," Pfister noted. Pfister, Stone and Rosenberg worked with 108 genes, compared to just over 20 genes used in the E. coli formula. As a result, they were able to delve deeper than Gutierrez at the time she conducted her ground-breaking research. "The Pasteur Institute looked at a small piece of the genome; the full genome gives a much better idea," says Stone, alluding to the team’s comprehensive approach and its possibilities. "The work we have done so far is only one aspect of a bigger project," explains Rosenberg. "There are different directions we want to go with it. Of course, the main target is to get a better estimate of the rate of mycobacterium evolution, but a lot of things branch off from that." Rosenberg, a computational evolutionary biologist who designed the program to analyze many of the sequences, says the project shows that "as we get more data and complete sequencing of full genomes, we find new ways of looking at issues, which can do away with assumptions. An example is the belief of cow-to-human transmission of TB. That was a long-held notion, but it was just an assumption." "It is the evolutionary way of thinking that has caused us to explore this issue from new and varied angles," states Pfister. "An evolutionary perspective is also important in a contemporary sense because our species’ population is growing dramatically. Soon we will reach carrying capacity. We will start producing pathogens and opportunities for problems at escalating rates." Pfister was born and raised in Chile where TB ran rampant before being subdued by aggressive government health programs. However, as in other parts of the world, Chile is presently facing a resurgence of TB. Still, Pfister is hopeful that someday, the deadly pathogen will be rendered obsolete. "We now have lots of gene data. We can count mutations. There is so much evidence out there; we just need to link it all. If we start looking at the history and essence of TB in a holistic, transdisciplinary way, we can see the big picture and find solutions," enthused Pfister. — WLJ

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Friday, July 18,2008

Red Angus announces new employee

by WLJ
Red Angus announces new employee Mikalena Randazzo has been hired as the commercial marketing specialist for the Red Angus Association of America (RAAA). Randazzo was raised on a commercial cow/calf operation near McAlester, OK. She brings experience from the family operation as well as from her former position as the office secretary of Oklahoma BEEF Incorporated (OBI). While working for OBI, she was responsible for data entry, maintenance of the OBI Web site, data extractions for catalog preparation, and coordinating sale day activities. Randazzo received her Associates Degree in Agriculture from Connors State College and her Bachelors of Science in Animal Science from Oklahoma State University. Randazzo was hired as an RAAA intern receiving training in the Feeder Calf Certification Program’s (FCCP) supplier evaluation process, registration data input, sale catalog data extraction and website content, layout and design. As the commercial marketing specialist, Randazzo will manage the content on the RAAA Web site, handle FCCP enrollment, assist in industry communications, and contribute to commercial marketing and RAAA promotions. "She (Randazzo) expresses an exuberant energy with an eagerness to learn. She is a talented and dedicated young woman with a great future ahead of her," said Clint Berry, Communications and Member Services director of RAAA. She is proud to have earned the opportunity to work with a great breed of cattle and an organization whose focus is on the commercial beef industry and beef production. "I’m excited by the opportunity to join the RAAA staff and am honored to have received this position," said Randazzo. "I’m looking forward to working with the RAAA members and their commercial customers," she added. Randazzo can be contacted at mikalena@redangus.org or 940/387-3502. — WLJ

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Friday, July 18,2008

Feeder cattle markets rev up

by WLJ
Feeder cattle markets rev up —Video sales, special auction market sales garner good demand, prices. The fall in corn prices last week served to add significant support to feeder cattle markets, particularly the action in the video auction last week in Reno, NV. Western Video Market’s (WVM) annual Reno sale saw good prices on offered cattle and moderate to good demand from buyers. Although trucking costs hitting $4 and higher per loaded mile had some buyers restrained, action overall was good, particularly for the heavier classes of cattle and calves which were weaned and pre-conditioned. Interestingly, some of the fly-weight calves in the upper-200 to mid-400 lb. calves bound for grass also met with heavy bidding action and some of the best prices of the week. Nevada calves were in especially high demand at the WVM sale. For example, one 260-head offering of 380 lb. steer calves brought $149.50, while another ranch offering 120 steer calves in the 400 lb. class sold at $147.50. Another Nevada offering of 100 weaned steers with a base weight of 460 lbs. called for $140.50. Although yearlings and heavy calves were predictably fewer in number, their selling prices were also very strong during the sale, particularly for the Plains state offerings. A Nebraska ranch sold a lot of 212 head with a base weight of 975 lbs. for $113.25, while another Nebraska outfit sold 130 head of 830 lb. steers at $115.75. One Wyoming ranch offering 200 steers with a base weight of 740 lbs. sold their cattle at $116. The strength of the fed cattle markets over the past several weeks, at a time when the market is traditionally marking its summer lows, has bolstered demand for feeder cattle and the futures contract level has allowed cattle feeders to lock in some profit potential for next year. The result has been a growing interest in the trade to contract calves for fall delivery and rising prices for offerings on the video sales, private treaty, and the seasonally light auction market cattle. The realization among cattle feeders that there are more tight supplies ahead is also starting to hit the market, bumping prices higher. Heavy cow slaughter, heavy planned marketings of heifers, and low numbers of cattle coming in from Mexico and Canada are all pointing to a shortage of available feeder cattle next year. Already this year, cow slaughter is up more than 8 percent from last year. High cull cow prices as a result of heavy demand for grind product and cow beef and a sharp increase in hay and forage prices is expected by many to continue to keep cow slaughter numbers elevated through this year and into next, translating into a shrinking herd and fewer available calves. As previously mentioned, auction markets continue to run with seasonally light numbers and in places, markets are taking a summer hiatus until calves start to trickle in from pastures next month. One of the few reporting decent runs of cattle last week was West Plains, MO, which reported a run of 4,200 head of steers and heifers started off steady to $2 higher, but quickly moved $2-5 higher, with some spots $6 higher, once buyers got settled and quality and bunches improved. The exception were the offerings of 500-650 weight steers which sold mostly steady to firm with the previous week on moderate supply and good demand, particularly for the yearling steers which have started to appear in this market. At Oklahoma City, OK, a run of more than 9,400 head was called mostly steady with the previous week on the feeder steers, with heifers steady to $2 lower. Calves were only lightly tested during the sale with unweaned kinds still selling at a substantial discount to weaned. Demand moderate with some buying interests not very aggressive. Quality was reportedly not as attractive as recent weeks, with limited numbers of cattle in the mix. At Crockett, TX, last Tuesday, no market comparison was available due to the fact that the sale was just resuming activity after a shut-down, however, prices at the market were good. Steers in the 300-400 lb. class sold in a range of $117-122, while 400-500 lb. steers were in a range of $99-107 with a few reaching $116. Steers in the 600-700 lb. class brought a range of $94-102 while 700-800 lb. offerings brought $93-101. At the annual Bassett, NE, barbeque auction, good numbers of cattle and buyers combined for an excellent sale, with good quality and condition noted on cattle which consisted entirely of yearlings over 600 lbs. Although no trend was applicable, prices were outstanding across the board. The offering of 314 head of cattle in the 800-845 lb. category sold in a range of $111.24-119.60, while 962 head in the 850-890 lb. class brought a range of $110.60 to $119.10 and 1,612 head of 900-945 lb. steers sold in a range of $109.50-118.80. The heaviest class of cattle in the 950-975 lb. range sold between $109.10 and $118.10. Fed cattle markets Feedlot trade started earlier than anyone anticipated last week with all signals pointing lower as the summer slump took hold, at least temporarily. July typically marks the lowest point of the summer market, although it has been unexpectedly strong this year as consumer demand has supported the Choice cutout above the $170 level and kept packer margins up, supporting slaughter volumes. Last Tuesday, trade broke open in the northern Plains and Corn Belt at prices steady to $1 lower than the prior week at $97 live and $154-155 dressed basis. Trade followed Wednesday in the south mostly steady to slightly lower at $98 in Texas and $97 in Kansas following some $154.50 dressed trade there on Monday. Colorado feedlots traded at mostly $97.50 live and $1.55 dressed. Despite the decline in the cutout last week, prices remained good although movement out of cold storage was light to moderate at best. Last Thursday, the Choice cutout slipped 54 cents during morning trade, to $170.39, while Select declined 66 cents to reach $161.43. Although prices are down slightly from the highs notched early in July, they remain historically strong and well above last year’s price levels of $142.26 on the Choice and $136.67 on the Select. The result is a nearly $10 increase in fed cattle prices, which stood at $88.88 during the same week in 2007. As a result of the stronger margins in the fed cattle markets, packers are maintaining incredible margins on their beef operations, estimated at $67.60 per head by HedgersEdge.com last Thursday, down from the highs in excess of $100 and more per head notched earlier in the month. The result has been a willingness among packers to keep chain speeds up as they work to capture as much value from the positive market as they can. Feedlots, on the other hand, have been caught in a tough spot for much of the year. Caught between rising feed and fuel costs and relatively high calf prices, many are reportedly on the market. Some sources note that the number of feedlots on the High Plains being quietly offered for sale could be 60 or higher. Consolidation in the feedlot business could occur rapidly if the market dynamics don’t shift soon. As it is, catle feeding has been a volatile business and heavy losses and increasing risk have dissolved the willingness among producers to retain ownership in cattle, particularly with calf prices remaining high. Unless corn continues its correction, the number of feedlots on the market could continue to rise for some time to come. The cow beef markets continued to shrink back slightly last week, a correction that began after the first week of July and the strong seasonal demand that accompanies the Fourth of July holiday. Robust cow slaughter numbers have had little impact in pushing prices lower and the cow beef cutout last week stood at $143.46 on Thursday, nearly $30 higher than a year earlier. The 90 percent lean market traded at $183.55, up from $141.26 during the same week in 2007. Meanwhile, the 50 percent trim climbed to $97.33, up more than $44 from the 2007 price of $53.81. — WLJ

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