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Monday, February 28,2005

Group sets requirements for Canadian cattle

by WLJ
The Livestock Marketing Association has called for the U.S. border to remain closed to Canadian cattle and beef until USDA meets three requirements. According to a resolution passed by LMA’s Board of Directors, at its recent annual meeting in Austin, TX, the border should remain closed unless and until: • There is full implementation of mandatory country-of-origin labeling (COOL); • there is resumption of U.S. cattle/beef trade with Japan, Mexico and South Korea; and • Canadian cattle imports can be accepted in an “orderly marketing method.” The board of directors noted that LMA provides marketing services “to tens of thousands of cattle producers,” and that those producers, livestock auction markets and others involved in the industry could suffer “serious economic harm” if additional cases of BSE are confirmed in Canada. LMA also said there are looming questions about the enforcement of Canada’s ruminant feed ban, and that the border reopening date of March 7 is premature. “These factors could also further erode consumer confidence in U.S. beef and harm all those in the industry,” the group said in a statement. The directors also said LMA supports the recent action taken by USDA to keep Canadian boxed beef from animals 30 months or older, from entering the U.S. Under LMA by-laws, the resolution will be presented to LMA’s full membership. For the resolution to be overturned, a majority of at least 30 percent of the total membership must vote no. If less than 30 percent of the membership votes, the resolution will stand. — WLJ

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Monday, February 28,2005

Japan reports positive BSE in preliminary test

by WLJ
A cow in northern Japan tested positive for bovine spongiform encephalopathy (BSE) in a preliminary examination last Thursday, a Japanese official said. If confirmed, it would be the country's 15th case of the brain-wasting malady. Preliminary tests on the Holstein cow—already dead when it was brought in from a ranch in Hokkaido prefecture—turned up positive at a dairy health center in Obihiro, said Hokkadio government official Osamu Terada. Other specifics, including the cow's age, were not disclosed. Results from more precise testing at a state-run research center north of Tokyo were likely to be released during the first week of March, officials said. On Feb. 4, Japan confirmed its first human case of BSE following the death of a man with symptoms of the illness. Japanese health authorities have said it was likely the man contracted the disease while living for a month in Britain, where the disease first surfaced in 1989. Earlier this month, a Japanese government panel took a step toward partially lifting a ban on U.S. beef imports, but the decision still has to be approved by the government. Tokyo has checked every slaughtered cow before it enters the food supply since 2001, after its first discovery of BSE. Japan imposed a ban on U.S. beef after the first case of BSE was confirmed in Washington state during December 2003. — WLJ

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Monday, February 28,2005

Europe approves BSE tests

by WLJ
The European Commission approves new BSE tests, opening up competition in the field. The European Commission has approved seven new rapid BSE tests: • CediTect BSE test • Enfer TSE Kit version 2.0 • IDEXX HerdChek BSE Antigen Test Kit (EIA) • Institut Pourquier Speed'it BSE • Prionics Check PrioSTRIP • Roboscreen Beta Prion BSE EIA Test Kit • Roche Applied Science PrionScreen. The approval means that now 12 tests can be used to monitor BSE. Following a laboratory evaluation by the Commission and subsequent field trials by the test producers under the supervision of the Joint Research Center, the European Food Safety Authority recommended that the seven new tests should be approved for use. The tests are designed to detect BSE in brain material collected from animals at the slaughterhouse or which have died on the farm. Until now, tests designed to detect BSE in live animals have not been evaluated. In the European Union, all healthy bovine cattle slaughtered at an age above 30 months and all fallen stock above 24 months have to be tested for BSE, with some derogations for some countries. The five previously approved tests can also be used to check for TSE in sheep and goats. Formal evaluations of additional tests for this purpose are ongoing. — WLJ

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Monday, February 28,2005

Feds stall on packer losses, beef demand

by WLJ
— Moisture still helping calf market. — Feeder cattle losing ground. A Thursday rally in the live cattle futures market kept last week’s fed cattle trade at a stalemate as prospective sellers had more impetus to hold on for at least steady money, compared to the previous week. However, analysts weren’t sure packers would ante up that much, as processing margins continued to go deeper into the red last week. As of press time last Thursday, the only trade for the week was an anemic 13,000 head in Nebraska at mostly $137-137.50 dressed. Other northern cattle feeders were waiting for packers to bid $139 and prospective sellers in more southern feeding areas were asking mostly $89. Packer bids in the south were hovering around $85 live. Packer margins continued to be on the negative side of the ledger last week. In fact, several days last week showed packers losing up to $60 per head, and prospects weren’t looking to improve anytime soon. Boxed beef markets continued to struggle last week. As of midday Thursday, Choice beef was leaving processors’ warehouses at $139.28, while Select was selling for $136.21 per cwt. Choice lost about $2.50 off the previous week’s high, while Select lost a little over $3 in value over the same period of time. Boxed beef movement was called moderate at best for the previous two weeks, with only one day showing over 600 total loads moved via the cash market. Several market analysts said consumers in the eastern half of the country are still trying to get through the winter doldrums, and that it could be another couple of weeks before they start to kick into grilling mode and start demanding beef, especially higher-quality middle meats. Packer demand for live cattle was also said to be waning due to slaughter volumes exceeding weekly beef demand. For the week ending Feb. 19, USDA reported 576,000 cattle processed, 10-15,000 head more than what analysts said needed to be processed to meet current weekly beef demand. Most analysts said 560-565,000 head of cattle would meet current weekly demand rates. Through last Thursday, 451,000 head of cattle were processed, according to USDA, putting packers on pace to process around 550,000 head of cattle. “They just don’t need many cattle right now,” said Reed Marquotte, analyst with M&Z Livestock Analytics. “Demand is anemic, beef movement is very slow and weather still remains very wintery across the country. One or more of those things have to change before packer demand for cattle picks up.” The only glimmer of optimism for cattle feeders last week was Thursday’s 10-30 point rally in live cattle futures. However, analysts even said that wouldn’t be enough to probably rally the cash market because most packer buyers based procurement decisions on the April contract. “February is basically an expired contract, and packers will try to convince feedlots that they need to base their marketing tactics on April, which is currently under $87,” Marquotte said. “The other indicators aren’t there to justify holding out for much more than that, unfortunately.” Stocker cattle gain ground The most positive U.S. cattle market news was coming out of stocker cattle and calf circles last week as spring grazing forecasts continue to improve and alternative feed resources remain much cheaper than normal. Calf prices nationwide ranged between mostly steady to $3 higher last week, with most auction barns reporting strong demand and very active bidding. Rain and snow continues to inundate southern and Far West grazing areas and that continues to improve pasture and rangeland conditions and extend the outlook for the length of the 2005 grazing season. In addition, old crop corn continues to be available to a majority of areas at around $3 per cwt, making it possible for stocker operators to purchase cattle a little earlier than normal and putting them on a little hotter feed ration before being turned out to grass or other pastures. Other feedgrains, specifically milo, barley and feed wheat, are also very cheap and some operators are utilizing them in tandem with cheaper hay. There were several auction barns, particularly in the Southwest and southern Plains, last week reporting some instances of four-weight steers getting back into the $145-150 per cwt range. In addition, higher quality heifers, specifically those called “more replacement heifer quality,” were bringing a $5-8 premium to their “commodity quality” counterparts, auction sources said. Feeders hurt by fed trend Yearlings and heavier replacement-ready calves were struggling last week as cattle feeding profits are still non-existent and there is still some possible pressure coming from Canadian feeder cattle entering the U.S. beginning in March. Feedlot order buyers were seen paying $2-3 less than the previous few weeks. In addition to cattle feeders reporting losses on most cattle marketed during the past few weeks, pen conditions continue to be muddy, which is lessening the desire to bring in cattle to put on full feed. The CME feeder index, for 700- to 850-pound steers, was at $101.61 last Wednesday, compared to $103.89 the previous Wednesday.

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Monday, February 28,2005

NAFTA violations cited

by WLJ
Under an obscure provision of the North American Free Trade Agreement (NAFTA), Canadian cattle producers are asking the U.S. government to pay more than $300 million to cover losses they incurred when the border was closed to Canadian beef after BSE was confirmed in Alberta during May 2003. At the beginning of February, approximately 500 Canadian producers, mostly of them from Alberta, had filed 121 claims under NAFTA seeking at least $325 million in compensation from the U.S. for the May 2003 decision to halt imports of Canadian beef and cattle. While the pending reopening of the border would limit future claims, it would do nothing to diminish the losses Canadian producers say they've suffered so far. "The damages we're seeking are for what the border closing has already done to us," said Todd Weiler, an attorney representing the Canadian Cattlemen for Fair Trade (CCFT), the group that initiated the original suit against USDA. Weiler said he expects to formally initiate arbitration next month, which starts the process of setting up a three-member panel of trade lawyers to hear and decide the case. CCFT's claims are based on a clause that says companies from other NAFTA countries are entitled to the most favorable treatment that U.S. companies would receive in similar circumstances. The provision is designed to prevent countries from arbitrarily tossing impediments in front of foreign competitors, and to encourage businesses to invest and compete across borders. — WLJ

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Monday, February 28,2005

Obit

by WLJ
John Floyd Franz Born in Watertown, SD, John Franz was raised on a farm in Frankfort, SD. At 17, he enlisted in the Navy and served during WWII on the USS Pensacola and was awarded the Purple Heart. Upon his return he met June Wiggins, and they were married for 51 years. He began Franz Furniture Business in Tacoma, WA, and upon retirement moved to Yelm, WA, to raise cattle and horses on his 280-acre ranch. He died Feb. 11 on his ranch while doing what he loved, putting his horses away for the night. He was active in Yelm Moose, Eagles, FFA Alumni and Backcountry Horsemen. John liked people and enjoyed helping out whenever he could, and his big heart earned him many friends. An avid traveler, John joined many tours in this country and abroad. He is survived by his children Kathleen Franz, Carl Franz-West (Bill) and Gregory Franz, and his grandson Tyler West. He is also survived by his three remaining siblings, Kay Young, Evelyn Madden and Cleo Roberts.

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Monday, February 28,2005

Packer picks Saskatchewan

by WLJ
Canada Farm Direct concluded that its first beef slaughter and processing expansion should occur in Saskatchewan after meeting with cattle producers and evaluating the future of the Western Canadian beef industry. “Cow-Calf production and the feelot industry will continue to grow in both Saskatchewan and Manitoba. To reach full potential, substantial additional slaughter capacity is needed,” said Dale Mather of Canada Farm Direct in a prepared statement. “We are studying the feasibility of a new facility to complement the other interests we will have in Saskatchewan.” After concluding its current share offer, Canada Farm Direct will acquire one of Western Canada’s largest slaughter and processing companies. Following the acquisition, processing capacity will be expanded, the release said. “Swift Current, Moose Jaw and other locations along the Highway No. 1 corridor will be evaluated,” Mather said. “The facility is likely to be built with a modular design so that it can expand with Saskatchewan’s cattle herd to reach an ultimate capacity in the range if 1,400 per day.” Canada Farm Direct has been meeting with producers in a number of Saskatchewan communities, where slaughter facilities and buyers are few. Keystone Agricultural Producers has organized such a meeting for Portage la Prairie on March 7. — WLJ

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Monday, February 28,2005

Researchers enhance grazing systems

by WLJ
ARS wants to improve the stability and profitability of forage production. Two research units in the central Great Plain states of Oklahoma and Nebraska demonstrate the agency's commitment to that purpose. The mission of the ARS Grazinglands Research Laboratory in El Reno, OK, is to enhance forage and livestock production and develop management strategies that incorporate climate risk, promote sustainability, and conserve the productivity of grazinglands resources on the Great Plains. Managing intensive grazing systems for forage-finishing of livestock and dairy production requires increased efficiency in nutrient use. William A. Phillips, an animal nutritionist in El Reno, found that kenaf, a crop usually grown in many parts of the world as a source of fiber and in the United States to make paper, could replace alfalfa pellets as a crude protein supplement for lambs fed bermudagrass or fescue hay without affecting feed intake or weight gain. To produce alfalfa hay, farmers have to make a multi-year commitment of land and resources that is not always optimal for some integrated cropping-livestock enterprises. Kenaf, in some cases, would provide producers with more flexibility than a perennial crop. Researchers in El Reno also recently found that the legume pigeonpea could help fill a gap in the year-round availability of nutritious forages for cattle producers. Pigeonpea, a legume with excellent drought resistance, is used widely in Asia for human food and livestock feed. Pigeonpea is environmentally friendly and sustainable, according to agronomist Srinivas C. Rao. Studies found it had yields and nutritive values during the summer equal to those of other forage crops used in the region. It can be used during the late summer and fall forage deficit period in a continuous winter wheat production system. Grazing management also requires a great understanding of animal capabilities, husbandry needs, and grazing behavior. Studies at the El Reno laboratory and the ARS Subtropical Agricultural Research Station in Brooksville, FL, found that remote sensing could soon be used to give real-time quality assessments and nutritional landscape mapping of grazing lands to help users make better-informed harvesting decisions. Remote-sensing techniques that use detection and measurement of reflected or emitted light, heat, sound and radio waves could one day replace time-consuming forage analysis methods, such as near-infrared spectrometry and chemical procedures. Researchers used Midland bermudagrass and other warm-season grasses to compare current methods and remote-sensing techniques to detect concentrations of nitrogen and other components. Remotely acquired information was done in hours, soil scientist Patrick Starks said, which is much faster than conventional lab analysis. Central and Northern Great Plains cattle will soon be enjoying new wheatgrass cultivars developed by ARS scientists at the Wheat, Sorghum and Forage Research Unit in Lincoln, NE, and cooperators at the University of Nebraska. Two of three recent releases have been turned over to seed growers and should be available for spring and fall 2005 plantings, according to Ken Vogel, the Lincoln unit's research leader. Beefmaker is recommended as a pasture forage for yearling beef steers because it is protein-packed and readily digested. Haymaker is intended as a cool-season hay crop for maintaining beef cowherds. El Reno, Lincoln and Brooksville aren't the only places ARS conducts forage research. The program includes research at more than 30 other locations throughout the United States, which are part of Rangeland, Pasture, and Forages, an ARS national program designed, in part, to improve the quality and quantity of forages available for livestock. Under the direction of this program, ARS research evaluates grazing impacts in various environments and develops management practices and techniques that assess and monitor sustained livestock production from grazing lands. This ARS national program aims to provide technology to conserve the natural resource base, while enhancing the productivity, sustainability and ecological health of the nation's rangeland.

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Monday, February 28,2005

Russia stock output down

by WLJ
Russia’s livestock output declined further this past January amid falling profitability, the latest report by the Federal State Statistics Service showed. The sector's output was down as the number of cattle and pigs continued to fall, the service said. The number of pigs was down 7.1 percent on the year to 16 million as of Feb. 1, while the number of cattle was down 5.8 percent on the year to 24.9 million. Meat production was up 3.1 percent on the year to approximately 500,000 tons in live weight, but 54.7 percent less than in December 2004, when slaughter levels are seasonally high. In 2004, Russia's meat output amounted to around 7.7 million tons, down 0.3 percent on the year, compared with a 4.9 percent rise in 2003. Russia's milk output was down 1.4 percent on the year to 1.8 million tons in January. In 2004, milk output stood at 32 million tons, down 4.2 percent on the year. The egg output last month was down 1.9 percent on the year to 2.8 billion. In 2004 the egg output totaled 35.6 billion, down 2.3 percent on the year. Russia's livestock sector was hit last year by high grain and feed prices after a relatively poor harvest in 2003. In addition grain and feed prices remained relatively high despite an ample supply from the 2004 harvest. — WLJ

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Monday, February 28,2005

Rice asks Japan lift beef ban

by WLJ
U.S. Secretary of State Condoleezza Rice raised the issue of Japan lifting completely a ban on imports of U.S. beef during a meeting on Saturday, Feb. 19, with her Japanese counterpart. Rice met with Nobutaka Machimura for bilateral talks. The Japanese understood U.S. concerns and were trying to accelerate procedures "and made a commitment the issue would be resolved," said a State Department official, on the condition of anonymity. Hatushisa Takashima, the Japanese foreign ministry spokesman, said beef imports came up in the talks and that Japan would make an effort to meet U.S. requests. Japan imposed a ban on U.S. beef imports in December 2003 after the U.S. discovered its first case of BSE, in a Washington state Holstein cow. Earlier this month a Japanese government panel took a step toward partially lifting the ban, but the decision still has to be approved by the government. The panel recommended that Japan begin importing U.S. grade A40 beef, which comes primarily from cattle aged 12 to 17 months. Although the panel's decision was welcomed by the U.S. government as an important step toward resuming trade, Japanese consumer organizations criticized the move, saying it was politically motivated. Before the bank, Japan was the most lucrative overseas market for U.S. beef producers, buying $1.7 billion in beef in 2003. The two sides tentatively agreed late last year to resume imports of beef products from cows younger than 21 months. Talks later stalled over how to authenticate the age of cattle. — WLJ

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