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Monday, September 10,2007

LETTERS

by WLJ
NAIS is a ruse No matter where you live in America, or what you do—whether you are a 4-H or FFA parent, rancher, logger, farmer, miner, commercial fisherman, recreationist, etc.—you should be paying close attention to the battle for property rights and freedom that is being fought on the lands of Colorado. Whether the National Animal Identification System (NAIS) is “the mark of the Beast” may be questioned, but what is crystal-clear is the USDA’s intention of making this “voluntary” agenda mandatory: Nationwide. Touted as an asset to “homeland security” and “the threat of disease,” the truth is that this is a property rights issue on more than one front. Far more of a real threat is the fact of America’s borders being pried open and/or erased by those with political and global aspirations. America’s people, animals and health are not in need of this three-step plan that the USDA pitches as a must-have. Deception runs rife throughout, from the language deception of “voluntary” to “premises registration” for “traceback,” and more. NAIS is a ruse. NAIS is a moneymaker, too, for those receiving taxpayer dollars by the wheelbarrow full, disguised as “grant funding.” It is dishonest to operate in such a manner, no matter who is doing it. Government agencies are not exempt from wrongdoing, though they seem to be, more and more, of the opinion that they have some sort of “diplomatic immunity” and are exempt from accountability or being punished for wrongdoing. Using children as a tool to wreak havoc with a Constitutional Republic is nothing new, but the manner in which it is being done in Colorado is especially egregious: letting 4-H and FFA kids raise and love their animal projects, only to be told that their parents are keeping them from showing at county and state fair levels. Today’s children will grow up soon and will not forget what was done to them and their parents in the name of “NAIS.” Today’s children will equate the Trojan horse and the soldiers in its belly to today’s NAIS implementers. Anyone that seeks to wrest the bonds of family apart and dismantle this all-important bond of parents and children—whether done by an individual, an organization or an agency—is playing with fire, both morally and legally. Parents that cherish property rights beyond mere “monetary value,” and cannot be purchased by the highest bidder, are perhaps scarce as hen’s teeth, but more priceless than any diamond, for they pass on to their children the certainty that some things are beyond price. Some things must always be beyond putting a price on. America’s freedom is one of those things. America’s property rights are one and the same. Don’t let “NAIS” or any language deception distract you from protecting your property rights, your freedom. It came at too high a price to sell out for any price now. Think of Flanders Field and Arlington Cemetery. Once lost, freedom is not easily regained. Julie Kay Smithson London, OH   Well done Good morning, Dick Crow, Congratulations! Be proud of your staff at WLJ, for having the courage to take a shot at “Big Brother.” Beef and Drovers are timid, fearful, flinch easy and can’t afford the ink to print the truth about what NAIS is wanting to do to the USA livestock industry. Tell your people, especially Tait Berlier, at WLJ, “Well done, thou good and faithful servant to the remaining livestock industry.” Your friend, Darol Dickinson Barnesville, OH  

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Monday, September 3,2007

BLM program improving public lands

by WLJ
In its ongoing effort to improve the health and productivity of the public lands, including those recently affected by wildfire, the Bureau of Land Management (BLM) has initiated a native seed collection effort that is part of an interagency “Seeds of Success” program.  Starting with 12 collecting teams that quickly grew to 35 teams nationwide, BLM and numerous partners carry out the Seeds of Success (SOS) initiative, which is the core of a National Native Plant Materials Development Program. SOS provides seeds from many species of plants to growers, researchers, and administrators of seed in the U.S. BLM’s collecting partners include the Chicago Botanic Garden, Lady Bird Johnson Wildflower Center, U.S. Forest Service (USFS), and the Center for Plant Conservation, along with others. The collection effort complements measures BLM is already taking to fight noxious and invasive weeds, as well as sustain healthy riparian, range, and wildlife habitat on public lands. “In the midst of an intense wildfire season in our western states, this partnership enhances the BLM’s ability to protect and rehabilitate the public lands under its management,” said BLM Deputy Director Henri Bisson. “Through Seeds of Success, our agency’s field offices will have greater capability to re-establish native species when restoring the land.” SOS gathers between 400 and 600 wildland seed collections annually for both long-term conservation and immediate restoration needs. This October, 500 collections will be transferred from the USFS’ Bend, OR, Seed Extractory to the Department of Agriculture’s National Plant Germplasm System to join 1,300 existing collections in the system. SOS material within the germplasm system is freely available to researchers working on native plant materials development.

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Monday, September 3,2007

Cows that work, calves that grade

by WLJ
Many beef producers struggle with priorities when it comes to genetic selection. One part of them knows the market rewards a focus on the end product. After all, consumers are the ultimate customers. Then their skeptical side kicks in: “Yeah, but the most important thing is to get as many live, healthy calves as possible each year so the cows can earn their keep.” Those torn by this conflict of the mind can take heart in an updated research paper by Twig Marston, Kansas State University. Its long title indicates a comprehensive approach. “The Relationship Between Marbling and Other EPDs with Implications When Making Beef Cowherd Breeding and Management Decisions” discusses how carcass quality is related to reproduction. “For profits to rise, there has to be a balance between product quality, or value, and cowherd production costs,” says Extension beef specialist Marston. “For several decades, there’s been a movement toward value-based marketing, so marbling is an economically important trait.” Marston says finding that equilibrium should not be difficult. “Marbling has to be bred into the offspring. It can’t be fabricated from a special environment,” he says. “Luckily, marbling is a moderate to highly-heritable trait. Reproduction, however, is not.” Although no research examines the direct relationship between marbling and reproduction, studies of other traits point the way. In one example, Angus sire data were sorted into groups with expected progeny differences (EPDs) that were in the upper or lower percentiles for marbling score. “There was no difference in the age of puberty onset between the different sire groups,” Marston says. The American Angus Association’s newly created Heifer Pregnancy (HP) EPD also supports this. High-accuracy sires show no correlation between HP and intramuscular fat, marbling, or any growth trait. “The data says you should be able to select for Heifer Pregnancy without affecting other traits,” he says. One study suggests marbling and milk EPDs have no effect on age at first calving, but there is a positive relationship between marbling and preweaning gain. “That is quite favorable if you’re looking to increase both weaning weight and marbling,” Marston says. It follows that increased milking ability eventually increases the ability to marble, he adds. “Mild correlations exist between lighter birth weights, easier calving and heavier milk production to greater marbling,” he says. In Angus populations, marbling ability isn’t related to external fat thickness. “That implies a breeder can match both marbling and do-ability to a particular management system,” Marston says. However, trying to make progress with both traits may yield slower results than choosing one over the other. The most efficient cows tend to be smaller in weight, stature and milk production, Marston says. “We’d expect marbling to be favored in these smaller cows because the traits have a slightly negative correlation.” In the Association’s Dollar Value Index suite of tools, $ Energy has a slightly negative (-.12) association with marbling. Marston says that means a cow with a high marbling EPD may be more efficient. That’s just one more bit of good news for producers who are trying to improve their cowherd and beef-product values simultaneously. “To maximize returns from tomorrow’s marketing systems, producers will have to meet consumer demands in an efficient manner,” Marston says. “Great genetic strides have been made in the improvement of efficient growth. Now it’s time for producers to maintain the growth advantages and increase carcass quality.” In adopting their approach to these issues, Marston says producers have sorted themselves into three categories. “The first group loves their work and lifestyle, but oftentimes goes unrewarded financially because of changes in the market and production environment,” he says. These are the farmers and ranchers “steeped in tradition.” A second group cuts cost with a focus on record keeping. They make data-driven decisions, but often ignore the ultimate customer. “As long as there’s a commodity market for beef, these producers will have an outlet,” Marston says. Cattlemen who are committed “food producers” have a greater chance of survival in today’s industry, he says. “They truly care about the consumers’ wants and find ways to fill their needs. They’re rewarded for their efforts and management,” Marston says. “They anticipate and build the acceptance and demand for beef.” Marston’s entire white paper is available at www.cabpartners.com/news/research/marston_marblingandothertraits.pdf.

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Monday, September 3,2007

Cull cow feeding presents opportunity

by WLJ
—Fed cattle prices rise ahead of holiday. Cash fed cattle trade last week was slow to start, with feedlots and packers working hard to outlast one another before coming to the table. As of last Thursday, analysts were still expecting trade at prices $1 higher than the prior week at $93-94 live and $146-148 dressed. However, as of mid-day last Thursday, feedlots were still passing on packer bids and were as much as $2-3 apart. A rising cutout and the expectation that next week’s holiday-shortened schedule ahead would add more strength to the boxed beef market was adding to feeder’s optimism late last week. Slaughter volume through last Thursday was estimated at 508,000 head, up 8,000 from the same period a week earlier, but below the 514,000 head tally for the same period a year earlier. Despite strong prices projected through the fourth quarter, there are a number of questions surrounding how packers are going to be able to continue to pay higher money for fed cattle without being able to boost the Choice cutout, which has spent most of the summer in the low $140s. “We are still facing a somewhat tight supply of fed cattle through the rest of this year, but packer margins are pretty narrow right now,” said Livestock Marketing Information Center Analyst Erica Rosa. “Our projections show fed prices for the fourth quarter in the mid- to high-$90s, but that’s strictly a result of the supply side. The demand side is pretty uncertain right now. With the uncertainty in the U.S. economy and lower priced competing proteins, you have to wonder whether beef prices are getting to the point where we are priced out of the market.” There is a tight supply of fed cattle right now, although some analysts have started to speculate that the supply is not as tight as previously thought. With weights beginning to increase seasonally and a futures premium for October fed cattle, feedlots may be slowing marketings, easing the supply pinch somewhat to the packer’s advantage. Rosa said there are a lot of unknowns in the market right now given the continued good grazing conditions in much of the country, increased heifer retention going forward this year, corn prices, the macroeconomic situation in the U.S., and international trade. “We have been receiving reports of producers holding heifers back in the southern Plains,” she said, adding that heifer retention this year is expected to be strong in many states where grazing conditions remain quite good as a result of late season precipitation. In terms of international trade, Canadian packers, which have been struggling since the border reopened allowing shipments of live cattle to the U.S., continue to close their doors. That has led to an increase in the number of cattle being shipped to the U.S. for slaughter and an increase in the amount of beef being exported to Canada, Rosa pointed out. Exports to Mexico and other countries are also on the rise, which is adding some support to cutout values. “But if you look at the middle meats, they aren’t able to sustain the cutout,” she said. Middle meats, which are typically consumed domestically, are a key to boosting cutout values higher, however, U.S. consumers are passing them up in favor of lower priced cuts, ground product and competing proteins. “If you look at the restaurant trade, you’ll see an increase in the use of some value cuts like the Flat Iron, mock tenders, skirt steak and flank steak. Restaurants are responding to consumers who are facing an uncertain U.S. economic picture,” Rosa said. “If you look at retail features, you’ll see it there too. I recently saw an ad featuring bratwurst, sausage and ground beef. There were no middle meats on the front page at all.” That lack of demand from the retail and consumer levels translates to a cutout which, last week, was trading higher at $147.01 on the Choice product and $140.49 on Select cuts, above year-ago levels of $145.28 on the Choice and $135.39 on the Select. However, last Thursday’s movement was light to moderate with only 130 loads of fabricated product and 54 loads of trim and grind selling ahead of one of the biggest grilling holidays of the year. Most retailers had already secured their meat needs for the weekend, however, it appeared that none were willing to bet on the need for quick fill-in following the holiday. The cow beef market continues to be the big winner in the cattle markets as a result of consumer preference for lower priced cuts of beef and a drop in cow slaughter compared to 2006 levels. Cow beef cutout values last week were $13 higher than year-ago prices at $118.75, while the 50 percent lean traded at $48.44, $7 higher than the same day in 2006 and the 90 percent lean moved higher to $147.94, compared to $130.56 last year. The opening of the Canadian border to animals born after March 1, 1999, could certainly impact that market if, and when, USDA makes that move. Some speculate it could come as early as October, however, most believe November or December are more likely.  According to Chicago Mercantile Exchange Analysts Len Steiner and Steve Meyer, there are perhaps as many as 600,000 head of cull cows in Canada that would meet the age criteria, although it is unlikely that all of them have the proper documentation required for export to the U.S. They also noted that it was unlikely that there would be a huge pulse of cattle immediately after the border opened, although they did note that possibility exists. In comments last week, the two analysts pointed out that many of these cows are now bred and will likely be retained in their Canadian herds until after calving. Although there could be an initial pulse of cull cows coming in from Canada, the market should remain strong well into the first quarter of next year as U.S. herd building gets underway and cow slaughter drops. That scenario could make feeding culls this winter an attractive opportunity for some producers. Feeder cattle Feeder cattle remained firm again this week, with most regions of the country having adequate moisture. Richard Stober of Superior Livestock Auction talked about their video auction of Aug. 21-24. “For these calves and yearlings, it seems like the market gets better just about every time we have a sale,” he explained. “Most areas are getting adequate moisture, but there are definitely some dry pockets scattered about the west and the Plains,” said Stober. Earlier in the summer, a number of cattle were being sold quickly in large, drought-stricken areas of the Deep South, but Stober said that isn’t the case any longer. “There aren’t really any more fire-sale cattle coming from that area. The south, for the most part, is still pretty dry, but in places like Florida, they’ve been getting enough moisture to go ahead and carry some of these calves out to their normal delivery dates,” Stober said. Stober said demand was very good, with a large number of buyers looking for yearlings. “There were definitely a lot of yearlings selling quite well on good demand and most of them were going to get delivered in the end of September to first part of October. The lighter calves, in most cases, were going to be delivered later in October and November, as there were a fair number of buyers looking for calves to put out on wheat,” Stober explained. The Superior auction had a total offering of 161,000 head, 42 percent of which were feeders over 600 lbs., and 64 percent of the feeder supply being steers. Compared to the last sale, feeder steers and heifers were firm to $3 higher, with calves in some places being $4 higher. Moisture in the southern Plains continued to spur demand for lightweight calves for winter grazing. Areas further west traded as much as $6 higher on most classes of cattle, but the sale’s exception was for lightweight calves in the northern areas, where most calves sold $3 lower. Feeders in the north-central region sold at $123.37 on a 628 lb. average, compared to $119.63 on a 621 lb. average in the western regions. Some heavier 700-800 lb. steers sold for an average of $111.14 in the far western region where prices remain good, but buyers are cautious of drought conditions in the Pacific states. Derrell Peel, Extension Livestock Marketing Specialist for Oklahoma State University, says there is still good reason for prices to remain steady to higher for most feeder cattle. “The economics from a stocker perspective still look pretty attractive,” says Peel. “There has been tons of moisture in Oklahoma and parts of Texas recently, and especially in Oklahoma, there look to be some good opportunities for wheat pasture this fall, especially compared to last year,” Peel explains. “There are a lot of guys with plenty of grass, so that should keep demand for winter grazing cattle strong no matter what, because even though prospects look good, production issues could keep operators waiting until later to decide what to do with their wheat,” says Peel. Peel explained that a horrible wheat crop last year in many winter-grazing areas of Oklahoma and parts of Texas will keep farmers leery of putting too much on their plates this fall. “The main reason stocking could be conservative in this area is because producers will be more concerned with getting a good wheat crop in than they will be about putting calves out to graze,” explained Peel. “I think most guys will still graze if they are able to get the wheat planted in time, but they may reduce stocking rates, or take heavier cattle and put them out later. Most people will just wait a little longer to make sure they’ve got good wheat before they throw a bunch of calves out there,” Peel said. In the cash markets, there was a total run of 4,020 head last week in El Reno, OK, where feeder steers and heifers were mostly steady to firm except for heifers over 700 lbs. Feeders in some instances were $2 higher, and 600-750 lb. thin, grazing-type steers were weak compared to the previous sale’s extremely high market. Steer and heifer calves sold steady on a light test. A large portion of the yearling offering was in thin condition due to extremely wet pastures, which are slowly drying out after significant rains in eastern Oklahoma. Further north at the Bassett, NE, sale, 2,070 head were sold last week and prices were fully steady on all classes of feeder cattle. A few short strings of fall calves were mixed in with the yearlings, which dominated the offerings. Nearly all cattle were over 600 lbs., and 52 percent of the feeders offered were steers. Eight weight feeders sold for averages between $117.58 and $119.84, with average prices for 900 lb. yearlings falling in at $115.50. Last Monday at the Stockland Livestock Auction, in Davenport, WA, 1,543 head sold, but not enough feeder cattle for accurate trend comparisons. Feeder cattle trade was moderate to active and demand was moderate. Feeders made up 63 percent of the run, and the supply included a 50/50 steer/heifer split. Nearly 52 percent of the run weighed over 600 lbs. Eight-weight steers sold in the $101-102 range, but lighter steers and heifers of 600 lbs. were only a $2-3 higher in most cases. Receipts totaled 1,476 last week in Clovis, NM, and compared to the last sale, feeder steers under 500 lbs. were $8-12 higher and steers over 500 lbs. were steady to $3 higher. Heifers sold mostly steady to $1-3 higher. Trade was active and demand good. Feeder cattle accounted for 75 percent, and steers made up approximately 62 percent of the run. Steers and heifers over 600 lbs. totaled 64 percent. — WLJ  

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Monday, September 3,2007

Montana pushes back EVA testing rule

by WLJ
The grace period for Montana’s new horse testing rule has been extended to Sept. 7. The Montana Board of Livestock recently approved a new rule to require all horses coming into Montana be tested for Equine Viral Arteritis (EVA), a respiratory virus that also causes abortion in mares. The new testing requirement was supposed to go into effect on Aug. 20. “That’s just too soon,” says acting State Veterinarian Dr. Jeanne Rankin. “Some of the tests are complicated and take a long time to run.” Also, a stallion could test positive because he contracted the virus naturally or has been vaccinated previously. If a horse tests positive for EVA, further complex tests that identify the specific virus must be run before the horse is allowed into Montana. The complexity of the tests require specialized equipment, so veterinarians must send samples to either the National Veterinary Services Lab in Ames, IA, or the Colorado State University Veterinary Diagnostic Lab in Fort Collins, CO. EVA spreads through the air, infected semen, and through the placenta to unborn foals. Often, stallions will not show symptoms of EVA, but still transmit it to vulnerable mares. Montana’s new order requires imported stallions to test negative for EVA within 30 days before coming into the state. Or stallions can be vaccinated for at least 28 days before coming to Montana if they test negative for EVA within 10 days prior to the vaccination. The new rule holds one exemption: Stallions that are brought to Montana for exhibition only and then return to their home state are not required to be tested for EVA. EVA tests are not the only requirement for traveling horses. All horses that are transported into or out of Montana also must have a brand inspection, a certificate of veterinary inspection (a health certificate) and a negative Equine Infectious Anemia test (a Coggins test) within 12 months. Many breeders artificially inseminate mares and EVA can infect a mare through semen so the donor stallion must be tested before a breeder ships semen, too. The Department of Livestock also requires horse breeders to ship imported semen with a general health certificate and a negative Coggins test on the stallion, as well as the negative EVA test.

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Monday, September 3,2007

USDA announces sign-up for disaster assistance

by WLJ
USDA recently announced sign-up dates for the new Livestock Compensation Program (LCP), Livestock Indemnity Program (LIP) and Crop Disaster Program (CDP). The three ad hoc disaster programs provide benefits to farmers and ranchers who suffered losses caused by natural disasters in recent years. Eligible ranchers and other livestock producers can apply to receive benefits under LCP and LIP beginning Sept. 10, 2007. Eligible farmers can sign up for CDP beginning Oct. 15, 2007, if they suffered quantity losses to their crops. USDA will announce and conduct CDP sign-up for quality losses as soon as possible. LCP compensates livestock producers for feed losses occurring between Jan.1, 2005, and Feb. 28, 2007, due to a natural disaster. This can include producers who suffered losses resulting from blizzards that started in 2006 and continued into January 2007. Livestock producers may elect to receive compensation for calendar year 2007 grazing season losses that are attributable to wildfire natural disasters occurring during the applicable period as determined by the Secretary of Agriculture. Producers in primary counties declared secretarial disaster areas or certain counties declared presidential disaster areas between Jan. 1, 2005, and Feb. 28, 2007, are eligible as are producers located in counties contiguous to those counties. Also, producers in a primary (or contiguous) county that received an Administrator’s Physical Loss Notice directly associated with a disaster declaration made by President Bush may also be eligible. Producers incurring a loss in more than one of the 2005, 2006 or 2007 calendar years must choose only one year for which they want to apply for benefits. LIP compensates livestock producers for livestock losses between Jan. 1, 2005, and Feb. 28, 2007, that resulted from natural disasters, including losses due to blizzards that started in 2006 and continued into January 2007. Producers in primary counties declared secretarial disaster areas or certain counties declared presidential disaster areas between Jan.1, 2005, and Feb. 28, 2007, are eligible as are producers located in counties contiguous to those counties. Also, producers in a primary (or contiguous) county that received an Administrator’s Physical Loss Notice directly associated with a disaster declaration made by President Bush may also be eligible. Producers incurring eligible livestock losses in more than one of the 2005, 2006 or 2007 calendar years must choose only one year for which they want to apply for benefits. CDP provides benefits to farmers who suffered quantity and quality losses to 2005, 2006, or 2007 crops from natural disasters if the crop was planted before Feb. 28, 2007, or, in the case of prevented plantings, for crops that would have been planted before Feb. 28, 2007. Producers who incurred qualifying losses in 2005, 2006 or 2007 must choose only one year to apply for benefits. Producers may apply for benefits for losses to multiple commodities as long as the losses occurred in the same crop year. Only producers who obtained crop insurance coverage or coverage under the Noninsured Crop Disaster Assistance Program for the year of loss will be eligible for CDP benefits. Producers must have suffered quantity losses in excess of 35 percent to be eligible for CDP. On May 25, 2007, President George W. Bush signed into law the “U.S. Troop Readiness, Veteran’s Care, Katrina Recovery, and Iraq Accountability Appropriations Act.” The 2007 Act authorizes LCP, LIP and CDP. It also authorizes funding for the Emergency Forestry Conservation Reserve Program (EFCRP), Emergency Conservation Program (ECP) and Dairy Disaster Assistance Program III (DDAP-III). USDA recently announced sign-up for EFCRP and the distribution of funds to 18 states under ECP. USDA will announce and conduct sign-up for DDAP-III as soon as possible. USDA’s Farm Service Agency is charged with administering the programs.

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Monday, August 20,2007

Big picture volatility impacts cattle market

by WLJ
—Turmoil on Wall Street could spill over into the cattle market. The big picture economic status in the U.S. appeared to be playing a larger role in the beef market last week as concerns in the stock market looked to threaten commodities as well. Three straight weeks of volatility on the New York Stock Exchange, which has erased the equity market’s gains for the year, spilled over into other areas as investors moved money to safer investments. That shift in investments led to sharp drops in the live cattle contract trade last Thursday on the Chicago Mercantile Exchange (CME) and at the closing bell, August contracts had fallen more than 172 points to end at $90.40. October was the biggest loser of the day, with contracts slipping 222 points to finish at $93.70, while December live contracts gave up 190 points to end the session at $97. The decline on CME erased most hope for higher fed cattle trade last week. By mid-day, fed trade was fully developed in Iowa at $142 and in Nebraska at $90 live and $142-143 dressed basis. There were also live cattle trading hands in Kansas and Texas in a narrow range of $90- 90.50, steady to slightly lower than the previous week’s trade. There was a bright spot last week in the fed cattle market as newly formed JBS-Swift announced it was making slow progress toward its planned second production shift at its Greeley, CO, plant. The company intends to hire 1,300 more workers by the time it reaches full production in January 2008. At full capacity, the plant is capable of processing 5,900 head daily, up from its current daily average of 3,700. In a report, JBS, the Brazilian-owned parent company, reported second quarter financial results that illustrate the company has the financial strength to be a major player in the marketplace. JBS reported a 25.2 percent increase in net revenue over the same period a year earlier. Total net profits were reportedly $82.9 million. Despite the solid performance of JBS, things in the U.S. domestic market last week were a little less rosy. Continued difficulty in boosting the cutout had packers slowing chain speeds last week in an effort to trim available supplies of beef and raise prices. Last Thursday, the Choice boxed beef cutout was up 5 cents to a mid-day price of $144.66, while the Select gained a penny to reach $138.85. Week-to-date harvest through Thursday was estimated at 491,000 head, lower than the same period a week earlier when the tally reached 497,000 head, and 2006 numbers of 495,000 head. Market analysts last week cautioned producers to pay close attention to the big picture during the weeks ahead. The recent downturn in the market has quickly sapped the economy and last week, a few economists were beginning to speak about the possibility of a recession if the market isn’t able to regain its footing after sharp losses. The possibility of a long-term downward trend or, worse, an actual recession, could quickly impact the beef market as consumers pull back on their spending. “The supply side of the market is pretty well established right now. We expect on feed numbers and placements to be below a year ago,” said Livestock Marketing Information Center Director Jim Robb. “What isn’t well established is the demand side. Consumer spending trends are notoriously difficult to pinpoint and the big picture is important. Some of these shocks to the market could be difficult to absorb because the economy is on much thinner ice now than it was a year ago. The livestock industry needs to pay attention to the macro-economic situation in the U.S. right now.” The impact of last week’s stock market instability could quickly spill over to other areas of the economy, scaring consumers enough to cause a cutback in household spending which accounts for two-thirds of all economic activity in the U.S. Robb said that could contribute to a sharp drop in the beef cutout and, subsequently, a decline in fed cattle prices. “In other countries, consumers tend to cut back on the amount of protein they purchase when money is tight, turning to other foods. In the U.S., consumers don’t necessarily cut back on their protein intake, instead they tend to trade down for lower priced cuts of meat or cheaper proteins, so things like less expensive cuts of beef, pork or poultry become the protein of choice and that has a pretty immediate effect on the more expensive middle meats which causes a drop in the Choice cutout and the result is a drop in fed cattle prices,” Robb said. “Now, I’m not saying we’re going to drop to $80 fed cattle, but it could have an impact.” Robb said the international market, which has played a key role over the past year in supporting the market, was also starting to show signs of weakness. “Exports to Mexico, which had been one of the only bright spots, are increasingly a concern in the meat complex. The June numbers continued to show a downward trend in the amount of all meats being shipped to Mexico,” Robb said. According to USDA data for the month of June, the latest statistics available showed that beef exports were down 20 percent from the same period in 2006. Likewise, pork exports dropped 43 percent and broilers were down 11 percent from June 2006. Feeder cattle Western Video Market (WVM) held their video auction with a 90,000-head run in Cheyenne, WY, last week and saw strong sales and good demand. Heavy feeders sold mostly for immediate delivery, though some sold a few dollars higher with later delivery dates, mostly in September. The north-central region saw 1,015 head of 850-875 lb. steers sell for an average of $113.64, with an Aug.-Sept. delivery date attached. The same region also saw 4,655 head of five-weight steer calves selling for as much as $134.50, with an average of $127.91 with an Oct. delivery date. Ellington Peek of Shasta Livestock and co-founder of WVM, said the sale demonstrated an extremely strong calf market, with good sales on the yearlings across the board. Peek also explained that heat and drought in some areas made a few calves tough to sell. “The calf market is just excellent, but they were a hard sell on the West Coast,” said Peek. “We had probably 92 percent of the calves sell, which is still good demand, but anything for near delivery wouldn’t sell. It’s so dry in the far western states that you just can’t believe it. There’s a lot of guys out there that just flat don’t have any grass to go to,” he explained. Peek also mentioned that sale attendance was very strong, and that somewhat dry conditions in other areas didn’t seem to hamper overall demand. “We had a packed house there in Cheyenne,” he said. “I think we served close to 400 meals on one day. For most areas of the West, everything just sold really well. Even the Intermountain West, where places had been dry, there seemed to be some fair demand,” said Peek. Extreme heat and humidity continue to take their toll on auction markets in other areas of the country, mostly affecting receipts, but also depressing prices in some cases. The effect of USDA’s 13.1 billion bushel August corn report has mostly been mitigated by the low movement of cattle due to the high temperatures. Oklahoma State University Extension Livestock Marketing Specialist Derrell Peel said last week that cow/calf producers need to look closely at the market when making decisions about whether or not to feed their own calves this year. He said high demand for heavy weight feeder cattle and a cost of gain in the 75 cent per pound range for steers presents an opportunity to add weight before selling calves, which remain in high demand due to short supply. “What this means for stocker and cow/calf producers is that there is an opportunity to look at putting additional weight on animals before they go to the feedlot. Rather than selling calves at weaning or turning over stocker cattle at lighter weights, producers should evaluate the potential for additional time and gain in stocker or retained ownership programs,” Peel said. “Obviously, it will depend on having viable production programs, feed resources and other management considerations, but the incentive is quite strong. When feed grain prices are high, the returns to forage-based gains improves. Responding to this incentive is precisely the mechanism by which the cattle industry exercises the flexibility we have to utilize less grain and increase the competitiveness of beef relative to other meats.” Meanwhile in the cash market at El Reno, OK, last week, feeder steers were $1-2 higher than during the previous week’s sale, with feeder heifers $1-3 higher. Demand continues to be very good as the number of feeders remains low this summer. Steer calves were steady, while heifer calves were steady to $2 lower. Demand was moderate for calves. Feeder cattle were in thin to moderate flesh conditions. In Bassett, NE, 3,400 head were sold last week and the bulk of feeders trended steady, with a higher undertone noted on seven-weight fall calves. The run consisted of average to good quality fall calves and yearlings. Demand was good on all classes and weights. Compared with the previous sale, feeder steers and heifers sold steady in Hub City, SD, last week. Demand was good with several consignments offered in load lots. Supply was 98 percent over 600 lbs. In Davenport, WA, last week, 625 head sold, and compared to the last sale, feeder cattle remained firm in a light test. Trade was active with good demand, with feeders making up only 25 percent of total receipts. — WLJ  

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Monday, July 23,2007

Ag land tax breaks threatened in California

by WLJ
—Funding for Williamson Act dollars faces veto threat. Williamson Act payments to California counties, which offset tax decreases on agricultural land, could disappear if Gov. Arnold Schwarzenegger carries out his plan to axe the estimated $40 million in funding during this year’s budget negotiation. His initial budget contained no money for the program, however, after an uproar, the California Legislature added funding for the program to its budget package. However, the program remains in jeopardy; the governor could still use his line-item veto power to remove the funds. The Williamson Act is a program, similar to a conservation easement, which allows California producers to guarantee that their land will remain in agricultural production for a period of 10 or more years in exchange for a tax break on property enrolled in the program. Funding of just $40 million for the Williamson program represents a small fraction of the state’s enormous $103.7 billion budget. For the state’s producers however, it represents a substantial savings in terms of property tax assessments. In all, according to the California Department of Conservation, 16 million of the state’s 29 million acres of agricultural land in 54 counties are enrolled in the conservation program. But John Gamper, director of taxation and land use at the California Farm Bureau Federation (CFBF), said administration officials are indicating that the governor might go ahead with the cut, even if it means overriding the Legislature with a veto. Proponents of the Williamson Act argue that it is important to maintain land protected under the act for conservation and land use reasons. CFBF said funding the program encourages more responsible planning to protect “our members right to farm,” according to Gamper. He said in the most recent poll of landowners who participate in the Williamson Act program, 85 percent of participating landowners are “satisfied” or “extremely satisfied” with the benefits brought to them by enrolling in the Williamson Act. It is estimated the Williamson Act can save agricultural landowners from 20 to 75 percent in property tax liability each year, or approximately $150 million statewide, according to Gamper. “A survey of landowners in Williamson Act contracts concluded that one in three would not be farming or ranching without the act’s benefits,” said Gamper. As an example of how the cuts would impact counties, in 2005, Amador County received roughly $110,000 in subvention funds from the Williamson Act, according to county auditor Joe Lowe, who said the county puts the money into the general fund to cover property tax losses created by Williamson Act enrollments. Currently, Amador county has 94,000 acres, a third of the total acreage in the county, covered by the Williamson Act. The total appraised value of that property, if assessed at the Proposition 13 value and not with the tax break from the Williamson Act, is $133 million. This means the county would receive $1.3 million in property tax revenue from those areas, according to the county assessor. But, while those lands remain under the Williamson Act, they are assessed at $42.5 million and the county collects about $426,000 in property taxes plus the $110,000 in reimbursement funds from the state, the assessor’s office said. — John Robinson, WLJ Editor  

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Monday, July 23,2007

Television horse source

by WLJ
Handsome Stranger Productions announces the premiere of their newest production, TV Horse Source. This 30-minute television program will air on RVD-TV starting in December 2007. Nancy Stober, president of Handsome Stranger Productions, stated: “We believe this program will change how people market their horses! In the past, a buyer would spend countless hours going through publications, searching Web sites and networking through friends and trainers. Then after making contact with a seller, the buyer would wait days and weeks for photos and video, only to find the horse did not meet their needs. Our program will save both the buyer and seller time and money.” Adding, “Our viewing audience will include people who want to buy, sell, breed, learn about, and people who just love looking at good horses.” The program will showcase horses for sale from every discipline. Each horse will be featured with video clips or photographs, with breeding, training, and show or race earnings announced. The price and seller contact information will appear at the bottom of each page. The program will have a corresponding Web site where potential buyers can access more information, photos, and watch up to seven minutes of additional video. Web site features will include past episodes of the program as well as horses for sale not featured on the show. Additional segments will feature a Stallion Show Case, Breeders Showcase, and information segments from some of the top trainers in the country. Equine industry news will also be a program highlight. The individual with one horse, as well as the breeder, will find TV Horse Source a useful tool in their marketing program. The program will also be a platform for a national campaign to reduce the unwanted pet population by asking viewers to spay and neuter their own pets. Studies show that in two years, this platform could reduce the 5 million dogs and cats euthanized in our animal shelters by up to 1 million a year. The show will be hosted by the current Miss Rodeo California, Kadee Coffman.

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Monday, July 23,2007

Summer means watching cattle for heat stress related problems

by WLJ
With temperatures forecast to hit 90 degrees and above, cattle producers need to take steps to ward off heat stress in their herds, a University of Nebraska-Lincoln (UNL) beef specialist said. It’s important producers make sure their cattle have plenty of water, said Terry Mader, beef specialist at UNL’s Haskell Agricultural Laboratory near Concord, NE. “Cattle do not handle heat stress as well as humans,” Mader said. “Sunny days with temperatures above the mid-80s can be stressful, particularly if there is no wind and humidity is above 50 percent or higher due to a recent rainfall.” Water is probably the best avenue to dissipate heat, Mader said. “The cattle don’t have to be thirsty, but as cattle drink water and pass it through their body, it removes a lot of heat in the process,” he said. Cattle normally take in about five to six gallons of water per day. However, when temperatures rise, that amount can double or even triple. “It’s important to have plenty of available water,” he said. “When there is competition for water, it creates problems because the dominant animals will occupy waterer space and not allow other animals access.” In an emergency, cattle can be sprayed with water to cool them down. However, once producers do that, they need to continue spraying. Spraying cattle with water will allow the animal to rapidly dissipate heat through evaporative cooling processes but this may limit the animal’s ability to adapt to the heat. “That’s why it should only be used as an emergency step,” Mader said. Producers also should have an emergency plan in case water supplies are low or cut off, Mader added. In addition, producers should avoid handling cattle when it’s hot and never after 10 a.m. Cattle body temperatures can rise .5 to 3.5 degrees during handling. Also, producers should feed cattle most of the day’s feed several hours after the day’s peak temperature in the late afternoon or evening. Avoid filling cattle up with feed late in the morning when added heat generated by digestion will peak around the hottest time of the day, he said. Cattle yards also should be inspected so there aren’t any structures that restrict airflow. Cutting down vegetation around pens and moving cattle away from windbreaks can all help. Building earth mounds in pens also can increase airflow by preventing cattle from bunching together. For more information about managing heat stress in feedlots, consult UNL Extension NebGuide G1409, Managing Feedlot Heat Stress, available from local UNL Extension offices or on the Web.

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