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Monday, July 25,2005

Feds, feeders stagnant

by WLJ
There wasn’t a lot to talk about in the fed cattle markets last week as early week trade was at $79 live, $125 dressed, with very light volumes reported. Many cattle feeders were waiting packers out. Producers’ offers were mostly $83, against packer offers of $77. Southern plains feeders were inactive. The news about the Canadian border reopening was on everyone’s mind, particularly what impact it would have on the market. At this point, fed cattle are trading lower because of fundamental market conditions in the U.S., not because of pressure from Canadian cattle, analysts said. Boxed beef ranged lower, with Choice at $128.97 last Thursday. Live cattle futures were slightly lower, at $78.13 on the August contract. And, there are still plenty of ready cattle in feedlots, with steer carcass weights being up another 8 pounds last week at 822 pounds. Beef demand has been called “tenuous at best,” even though many retailers have beef features running, which appears to be keeping slaughter volume strong. Packers were reportedly losing $21 per head last week, but were still moving large numbers through slaughter plants. For the week ending July 16, 652,000 head were processed and slaughter was running 5,000 head more last week compared to the week prior. To date, there have been only a handful of cattle cross the border, and the Canadian cattle on feed report shows on-feed numbers to be around 800,000 head. Analysts said that figure is in line with slaughter capacity. The U.S. July 1 Cattle-on-Feed Report, being released last Friday, was expected to show on-feed numbers 102 percent of a year ago, placements at 105.3 percent and marketings at 99.9 percent. Most analysts referred to pre-BSE trade to establish benchmarks for their projections. There are several items that will effect the flow of cattle from Canada, analysts said. There is plenty of feed throughout western Canada; Southern Alberta has had good moisture and good grass; slaughter capacity is larger, placing greater demand on their fed supplies; and the Canadian dollar is 20 percent stronger than a year ago and trucking is in limited supply. Lethbridge auction operator Bob Balog said, “The only thing we have in over supply is slaughter cows and bulls. Fed cattle and feeder cattle are in pretty tight hands.” He also said he sold some 770-pound steers in last Wednesday’s auction that brought $120 Canadian—with an 83-cent Canadian dollar, that converts to $100 per cwt U.S. The feeder markets appeared to have equalized and the difference is the cost of a truck ride. Balog also said they had a very active aggressive sale last week, and that buyers were there that haven’t been at a sale in eight months. He also said there are lots of feeder cattle already owned by American companies. Mike Sands, market analyst at Informa Inc. (formally Sparks), said that it’s not the Canadian border weighing on the market at this point, but that the “dog days of summer” are here and the fundamentals are dragging on the market. He is especially concerned about beef demand. Sands expects to see 150,000 head of fed cattle come down from Canada weekly for the balance of the year. He said that is not an overwhelming number compared to past years. Darrell Mark, extension economist at the University of Nebraska, said that history shows weekly feeder cattle imports hit a seasonal low during the summer months and increase into the fall and winter, peaking in February. The average August to December feeder cattle imports from 2000 to 2001 was about 100,000 head, or about 4,800 head per week. These numbers, however, are somewhat inflated by the unusually large feeder cattle imports in 2002, of 557,000 head. That year there was a severe drought in Canada. Fed cattle imports are seasonally highest in the third and fourth quarters. The average August to December fed cattle imports is 340,000 head, or 16,000 head per week. The average 2002-2003 cattle imports from Canada accounted for about three percent of U.S. commercial cattle slaughter during those months. As a result, a negative price impact of roughly $3.50 may be expected based on a current $80 fed cattle market. But, it isn’t expected to happen because of a different set of market dynamics. Mark said that feeder cattle prices are likely to fall more than fed cattle prices partially because of Canadian market conditions. However, further impending losses by cattle feeders and the prospects for higher corn prices will tend to reduce over all prices in the U.S. and Canada. Feeder cattle sales last week were very light, with many producers holding calves back. Market weakness occurred mostly due to concern over the resumption of cross border trade with Canada and hot dry weather that was favoring buyers. Northern tier auction reports indicated a slightly weaker market with moderate to good demand on very light supplies. Although few comparisons were available, auction yards across the northern states reported an undertone of steady to slightly lower prices for the few feeder calves that were marketed. It appears that a sharp decline in per head profits for cattle feeders in the southern tier is weighing heavily on auction yards, with moderate demand and some significantly lower prices reported in key states. Notable declines were reported in Texas and Oklahoma where cattle slumped at least slightly across the board, with significant drops of up to $5 reported in the heavier weight classes. An exception to the trend occurred in Nebraska where buyers offered firm prices and strong interest for heavy nine-weight steers. Softer markets were reported in the remainder of the southern tier with most markets reporting at least moderate demand and light supply. A number of producers have already marketed their fall calf crops via either video auction or direct sales to their advantage. Early last week, as Canadian cattle were primed to start rolling into northern states, buyers started to lose interest and direct prices being offered declined slightly while producers held firm. Overall volume for the week was half or less than year-ago numbers for most states. As the week progressed, buyers developed a wait and see attitude while hoping the border picture would clear up some. A number of analysts believe that quantities of cattle crossing the border will remain low for at least a couple of months due to the rigorous requirements with which producers must comply prior to shipping Canadian cattle over the border. As of press time last Thursday, only a handful of trucks had crossed over the border, creating only a psychological effect on the markets. In the few northern tier states where enough cattle were sold to make a comparison, the trend was reported steady to $2 lower, with demand moderate to good. Feeder cattle futures contracts through last Thursday had regained about two-thirds of the losses reported the previous Friday, which was the day after the Ninth Circuit Court of Appeals had overturned the injunction banning live Canadian cattle from entering the U.S. As of midday Thursday, August feeder cattle contracts were at $107.70 per cwt, while September was at $106.10, and October was at $104.65. The CME feeder cattle index last week was hovering around the $112 per cwt mark, compared to $113 most of the previous week. — WLJ © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.  

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Monday, July 25,2005

Grizzly delisting likely

by WLJ
— Proposal possible before end of summer. Ranchers in and around Yellowstone National Park and the Northwest could be allowed greater control over their predator problems if the U.S. Fish and Wildlife Service (FWS) moves ahead with plans to propose delisting the grizzly bear from the Endangered Species Act (ESA). Grizzly bears are thought to have originally numbered more than 100,000 in the continental U.S. When the grizzly was added to the endangered species list in 1975, the bears numbered fewer than 200 and appeared well on their way to extinction. Due to the conservation of grizzly habitat and protection of the Endangered Species Act (ESA), the bears have rebounded to approximately 1,000 and reside throughout the Greater Yellowstone Area and the northern Rockies, along with an isolated population in Northern Idaho and Washington state. At present, there are more than 1,800 plants and animals listed as endangered or threatened by FWS. It is estimated that 41 percent of listed populations have stabilized or improved since the inception of the ESA, however, only 11 species have been delisted due to recovery. Livestock growers across the west have long been waiting for a decision to remove the grizzly bear from the list. It now looks like that process may be initiated before the end of summer. The leader of the grizzly bear recovery effort for FWS said the agency’s office in Washington, DC, currently has the proposal, and that it will take at least a few weeks to implement any final plan to delist the species. Livestock groups including the National Cattlemen’s Beef Association and the Montana Stockgrowers Association (MSGA) have been widely supportive of the removal of the grizzly, one of the ESA success stories, from the list. Steve Pilcher, executive vice president of MSGA, said, “The association has long been in support of delisting the grizzly bear in favor of more local management.” Pilcher agreed with studies that conclude the total bear population in the Greater Yellowstone ecosystem is adequate to support the genetic diversity necessary to sustain the bear population. FWS estimates the current population in the area between 400 and 600 animals. “We need to be able to manage the grizzly bear as a resource and bring the decision-making ability home,” he said. Foremost on stakeholders’ minds is the issue of human/bear conflict and the predation of livestock by grizzlies that stray outside of the proposed buffer zone surrounding Yellowstone National Park. Of particular concern to Livestock producers in Wyoming is the Upper Green River area. Jim Magagna, executive vice president of the Wyoming Stock Growers Association, stated, “Our overall preference is that the habitat be held to the primary conservation area in which the bears have already recovered.” The Upper Green River area was cited by FWS as being socially unacceptable for reintroduction due to the high likelihood of conflict between humans and bears. In spite of that, it has been included in the recovery zone because it is a critical corridor for bear traffic. Indeed, within the last two weeks, two bears have been relocated from the Upper Green River area back to the primary conservation area after killing domestic livestock. Currently, the conservation group, Defenders of Wildlife, has a compensation fund to reimburse ranchers for losses due to bear and wolf predation. The group has stated that if the grizzly is delisted, they will re-evaluate whether or not the program will remain in place. According to the group’s Web site, they have reimbursed producer losses in the Yellowstone and Northern Continental Divide Recovery Areas in excess of $110,000 since the fund’s inception. The group also provides partial funding for pro-active measures taken by producers to reduce losses due to predation. However, Pilcher noted that although there is a compensation fund, producers are often unable to monitor grazing lands thoroughly enough to prove losses due to predation. “The reality is that the program is just not that effective,” Pilcher said. — John Robinson, WLJ Associate Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.  

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Monday, July 25,2005

Stem cells make older cows young again

by WLJ
Scientists may have found a literal “fountain of youth” which could result in older, proven cows regaining their younger production levels. Researchers at Advance Cell Technology, Worcester, MA, recently concluded a study in which 10- to 13-year-old cows were injected with cloned stem cells harvested from the livers of embryonic calves. The results of the study, published in the June 2005 issue of Cloning and Stem Cells, showed the treated animals reverted back to their younger form, particularly from a reproductive and mammary standpoint. In the study, scientists treated older cows with a small dose of embryonic stem cells, the equivalent of a tablespoon. Prior to injection, the cells were tagged with a genetic marker to enable tracing as the cells moved through and interacted with the body. Stem cell traces were later detected throughout the study animals in new “giant” colonies of white blood cells and regenerated blood vessels in the cows. This cellular growth is consistent with very young cells, and not found in animals of this age class. “The cells are so competitive and youthful that they just take over,” said Robert Lanza, of Advanced Cell Technology, who conducted the study. This research could have a future impact on the livestock industry as more researchers study potential seedstock applications for the technology. At present, most experts feel that stem cell treatment is far too expensive for agricultural applications and research has been limited primarily to government-funded medical research programs. The benefits of using stem cells to treat a range of human diseases are well known by scientists. Doctors have been studying the use of stem cells to treat illnesses from arthritis and genetic diseases to cancer for more than 14 years. Scientists are interested in stem cell therapy because the cells have a remarkable ability to transform themselves into other types of tissue cells found in the body and can actually regenerate tissue as demonstrated in this study. Additionally, stem cell transplants do not present the same risks associated with conventional treatments, such as bone marrow transplants, which require the use of harsh drugs to suppress the recipient’s immune system in order to prevent rejection of the transplanted marrow. Although the methodology used in this experiment is not consistent with current protocols used for human studies, the results are being viewed as a positive step toward understanding the interactions of stem cells in large animal models. — John Robinson, WLJ Associate Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.  

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Monday, July 25,2005

Post-drought grazing management starts now

by WLJ
— Forage problems loom. With drought receding across much of the west, producers are being urged to start reviewing management strategies in an effort to minimize losses from problems not seen since the onset of the drought. It is also the time to take steps to plan for future low water years by preparing a drought management plan. When reviewing operating procedures, it is important to look at the big picture and make decisions that will place the ranch on a solid footing for future low water seasons, rangeland specialists said. Sources noted that building herd size slowly and maintaining proper stocking rates may be the most important step in drought recovery. “Keep in mind the forage base has been stressed; rebuild slowly and don’t put pressure on too fast,” said Doug Powell, rangeland management specialist for the Society for Range Management. “Remember, that’s the way it happens in nature. It takes several seasons for wild ungulates to repopulate following a drought.” Powell also suggested allowing a rest period for water sources that have been used heavily during dry years. “Wells or springs should be closed off and alternate sources such as refilled reservoirs and ponds should be utilized.” Potential herd health concerns were cited as a reason to closely monitor animals at the end of a drought. Although diseases like grass tetany, caused by a lack of available magnesium in forage and more prevalent in wet years, have not been a widespread concern this season, producers should be aware they could become a problem, particularly in older lactating cows. When a drought breaks, it is common for it to end with a period of above average precipitation, Powell said. Ground that has become barren due to drought or overgrazing is susceptible to increased surface runoff and soil loss, which can lengthen recovery time. To reduce runoff damage, range scientists suggest replanting with perennial grasses because they have deeper root systems and higher drought tolerance. This measure will help soil absorb and hold water much more effectively. Grasses that recover quickly from drought stress will also prevent noxious weed infestations in areas where grasses are weak and can’t compete with fast growing weeds. Resting grasslands with slow growing forage and replanting bare areas with native grasses conducive to water retention will provide better drought resistance in future dry seasons. Producers need to take a good look at their pasture to determine the vigor of forage before making long term decisions. “Desirable grasses have grown better than average, but total productivity has been reduced,” said Jerry Voleski, range and forage specialist with the University of Nebraska. “Good rains throughout June have helped, but some rain in July would really maximize production.” Voleski also noted the importance of a good rotational grazing plan and stressed varying the grazing season for each pasture so animals can better utilize both warm and cool season grasses. Pairing the nutritional requirements of animals with the availability of range forage can also increase a producer’s ability to weather a drought situation. Range production can vary greatly over the course of the year and it is in a rancher’s best interest to match the nutrient needs of the herd to the production of forage. Producers should evaluate the herd’s cyclical nutritional needs to ensure the production cycle is synchronized with the growth cycle of the available pasture. The best time to prepare a drought management plan and make necessary changes is while the grass is green. Taking time to design a plan now, in preparation for the future, will ensure a greater likelihood for long-term success, according to both Voleski and Powell . — John Robinson, WLJ Associate Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.  

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Monday, July 18,2005

Beef demand pulls feds $2 lower

by WLJ
After a couple weeks of steady prices, feedlots nationwide were starting to feel the pressure and traded cattle $1-2 lower than the prior week. Through last Thursday, northern Plains cattle feeders sold 55-60,000 head at mostly $127 dressed. Southern Plains and Southwest feedlots finally pulled the trigger Thursday afternoon at $80-80.50 live, compared to mostly $82 the previous week. Texas feeders sold 35-40,000 head, while Kansas trade totaled 45-50,000 cattle. Beef demand was significantly softer the week after the Fourth of July weekend, which was considered strong for beef sales. Retail sources were skeptical whether it would pick up until Labor Day weekend in early September. However, retailers have several big beef features scheduled for the second half of July. Andy Gottschalk, analyst with HedgersEdge.com, said that the current struggle in the market is seasonal and that market pressure has been exacerbated because of weaker-than-normal beef demand. “There’s definitely a demand problem when packers are losing money at these slaughter levels. This time of year, packers generally are well into good margins, earning $30-50 per head, and now they’re losing $7.50 per head.” Boxed beef movement last week was very strong, however, prices were declining as packers were trying to clear inventory. The choice boxed beef index was at $132.99 midday Thursday, compared to $135.14 at the beginning of the week. Select product was down to $128.81 Thursday, compared to $131.22 Monday. Three of the first four days of last week saw well over 450 loads move, with one 600-plus day noted among them. Gottschalk said the beef movement last week could be positive for the cattle market later this month or early August when beef featuring at the retail level is expected to resume. Cattle slaughter picked up last week, but that was following a holiday shortened week. Through Thursday 487,000 head were processed, compared to 500,000 during the same time frame last year. Analysts were still speculating that weekly slaughter could end up over 625,000 head, which is still more than what is needed to meet current beef demand, both domestic and export. For the week ending July 2, 652,000 head were processed, about 30,000 head more than current beef demand. Finishing weights of fed cattle continue to escalate, and that is adding to beef supply pressure. The average weight of all cattle processed for the week ending July 2 was 1,249 pounds, compared to 1,245 the week prior and 1,236 a year ago. Carcass weights were at 767 pounds, compared to 764 the previous week and 761 last year. The USDA reported last Thursday that fed steer live weights averaged 1,322 pounds live, and 841 pounds dressed, compared to 1,266 and 837 pounds two weeks ago. “The holiday shortened week left a lot of ready cattle in feedlots, those cattle were fed an extra week and are now coming out at a very heavy weight, thus hurting the market,” said Reed Marquotte, M&Z Livestock Analytics. “A 1,275-pound steer that missed the packing house because of Fourth of July, probably tipped the scales between 1,300-1,310 pounds, which is a lot of extra weight, when beef demand is already slumping.” Gottschalk added that the weight jump can be attributed to three things—high replacement cattle costs, cheap feed costs and high breakevens on cattle currently being fed. “Feeders feel it is cheaper to feed cattle currently in the lot right now, instead of buying a replacement animal and feeding it,” he said. Feeders, stockers struggle Losses of $100-plus on a lot of fed cattle last week started to weigh on feeder cattle prices. Across the country, heavy weight cattle were bringing $2-4 less than the previous few weeks. In addition to cattle feeders losing money, prospects for beef trade with the Pacific Rim appeared to be delayed even further to very late this year or early 2006. As a result, cattle feeders need fewer cattle to meet marketing slots in the fall and winter, analysts said. The CME feeder cattle index for 600-850 pound steers was around $113 last Wednesday, compared to $116-plus the previous week. Calf prices last week were very mixed with a wide range of prices reported even within the same weight divisions. Steers ranged between slightly softer to slightly firmer, while higher quality heifers were $3-5 stronger. The best demand was from stocker operators on replacement type females that were bought to go back on grass, and sold next winter. Superior Video Auction’s “Week in the Rockies” sale July 5-9, offered over 250,000 head during the five-day event. There were several instances where 400- to 500-pound steers brought $155 or more. There were also instances of 500- to 600-pound heifers bringing $145 or more. Some of the highlights at Superior’s sale were: a set of 450 lb. certified Natural Angus steers for $154, October or November delivery; Barbara Jolly & Sons, Kit Carson, CO, sold a set of 465 black and red Angus certified natural steers for $157 for October delivery; Dragging Y Cattle Co., Dillon, MT, topped the sale with a set of 425 lb. Charolais and Angus sired steer calves, VAC 45 and VASE, for $165; the top yearlings were some 850 lb. Red Angus and Red Angus cross steers from Lonnie Frimann, Minatare, NE, that sold for $113.10; and some 935 lb. steers for $108.85, for August delivery. Western Video Auction also held one of its special sales in Reno, NV, offering over 187,000 head. Some of the highlights from that sale were: a split load of 55 steers weighing 485 lbs. and heifer mates at 470 lbs. from Corder Farms, Ft. Benton, MT, that sold for $131.50 and $126.50, respectively; 83 black steers weighting 600 lbs. from Boone and Crockett Ranch, DuPuyer, MT, that sold for $120; 90 head of heifers weighing 650 lbs from L. Johnson, Great Falls, MT, that sold for $126.50 cwt; 250 Angus-Charolais cross steers, weighing 580 lbs. from Yribarren Ranch, Bishop, CA, that sold for $120.85. On the steer side, a $6-8 premium is being paid for those cattle that are sold with a preconditioning program behind them, are certified as being “naturally raised,” or have been fitted with some sort of source verification mechanism. Superior did sell a group of 420-pound steers for $168 per cwt, and another group of 450-pounders for $162.50. However, for the most part, prices on steer calves were called mostly steady. – WLJ © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.

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Monday, July 18,2005

House approves mCOOL delay

by WLJ
The U.S. House of Representatives last week maintained a delay in the implementation of mandatory country-of-origin labeling (mCOOL) for meat products. The provision barring USDA from spending any money to prepare for COOL’s implementation this September was included in an appropriations bill that the House voted in favor of 408-18. mCOOL, which is supported by several independent farming and consumer organizations but is opposed by most U.S. meat-industry trade associations, would require meat products sold at retail to indicate the origin of the meat contained in the products. Trade groups opposing the plan say COOL will cost the industry hundreds of millions of dollars to implement and that there has been little public outcry for such a labeling law. Opponents of mCOOL said that by passing the delay, Congress will now have time to take action on a meaningful, bipartisan country-of-origin program that makes sense for both livestock and meat producers and American consumers. However National Farmers Union president Dave Frederickson, said there was a need for the bill to be allowed immediate implementation because the competitiveness of U.S. producers in the domestic U.S. market is at stake. “Congress missed an opportunity to help American consumers known where their food comes from, as well as a change to help American producers differentiate their high quality domestic products from imported beef,” said Frederickson. “This law has been on the books for three years. How much more time do they need?” The Senate has not yet taken up ag appropriations discussion, however, debate and a vote on the issue is expected before the end of the month. Language delaying the implementation of mCOOL is expected to be discussed and voted on by Senate members for inclusion in the appropriations package. However, there appears to be much more support for a mandatory program in that branch of Congress. If the Senate keeps Sept. 1 mCOOL implementation, then the issue will be decided in an ag appropriations conference committee made up of both Senate and House members. House Ag Committee Chair, Charles Goodlatte, R-VA, has introduced separate legislation that would repeal country-of-origin labeling on meat permanently. Similar legislation has been introduced in the Senate, being led by Sens. John Cornyn, R-TX, and Blanche Lincoln, D-AR. A time line on discussion and votes for those bills was not known last week. — Steven D. Vetter, WLJ Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.

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Monday, July 18,2005

Species protection bill disliked before unveiling

by WLJ
A proposed bill that would amend sections of the Endangered Species Act (ESA) is getting criticized by property rights organizations, including western ranching groups, and it hasn’t even been introduced in Congress yet. A leaked copy of Rep. Richard Pombo’s (R-CA) “Threatened and Endangered Species Recovery Act of 2005" showed the proposal includes two main items of concern for property owners. The first criticism is for language mandating a 50 percent compensation trigger. Under this change, landowners would have to prove that wildlife protection provided under the ESA has resulted in 50 percent or more of private land being removed from their management before compensation can be applied for. Secondly, Pombo’s bill would give invasive plant species protection. Western state ranching organizations called those two modifications “uncalled for” and an effort to appease radical environmentalists and species conservationists. Two western state cattle organization executives told WLJ last week that the 50 percent trigger compensation, if included in the ESA, could force many of their ranching members out of business or severely hamper their financial stability. “Forget 50 percent, most ranchers would start to lose their viability after losing 10-15 percent of their production. And, to compound it by having to go through a verification process that says 50 percent of your land has been impacted by ESA actions is ludicrous,” one state executive director said. “People will still be in limbo for years before agencies issue final decision, all the while not able to use their land.” On the issue of including “invasive” species under the auspices of the act, private property interests said ranchers could be forced off their grazing or pasture lands because a certain forage has been deemed “threatened” or “endangered.” In addition, several concerns were the result of some grasses commonly used for lawns or yards that could be classified for ESA protection and then the government would technically have control of those areas, as well. “For instance, tall fescue, a grass commonly used by homeowners for their lawns, could qualify as an invasive species and be regulated by the federal government,” said the private property group Liberty Matters, in a statement. Congressional aides said last week that Pombo’s proposal is expected to be introduced in the House of Representatives by the end of July, but did not know any specific date. — Steven D. Vetter, WLJ Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.

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Monday, July 11,2005

BLM rebuffs grazing rule complainers

by WLJ
Last month’s release of the environmental impact statement (EIS) concerning new federal grazing rules was met with some harsh criticism from radical environmentalists and animal rights activists. However, officials with the Bureau of Land Management (BLM) told WLJ that allegations of wrongdoing by them were “false and groundless.” Several activist groups claimed that BLM blatantly and illegally removed findings from the EIS that livestock grazing was indeed detrimental to federally-managed lands, specifically from a wildlife and riparian area standpoint. The groups said they were told by two scientists involved in the regulatory review process that their findings were disregarded and kept from the final EIS publication. However, Tom Gorey, spokesman for BLM, said that the EIS included all information that was agreed to by a majority of the researchers involved in the overall review process. “There were approximately 20 people in the process, including the two scientists that are dissenting,” said Gorey. “They are not happy that their findings were not included in the final EIS, however, the overwhelming majority of reviewers agreed those findings were not pertinent enough to lead to further grazing restrictions.” Of particular concern to the two reviewers critical of the final EIS was that economic benefit to local economies trumped potential environmental damage that could be caused by livestock grazing. However, Gorey said that the findings of the two reviewers failed to incorporate any other parameters into federal grazing management besides potential wildlife habitat or waterway damage. The EIS was published in the Federal Register June 17, and Gorey said that final federal grazing rules will be released late this month and will be implemented 30 days after they are released to the public. Among the changes will be more open communication between graziers and federal land managers and that actual damages will need to be cited before any litigation against federal lands grazing can even proceed to court. — Steven D. Vetter, WLJ Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.

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Monday, July 11,2005

CAFTA halfway through Congress

by WLJ
— Senate passes trade pact. — House debate, vote around corner. The highly controversial Central America Free Trade Agreement (CAFTA) passed the full Senate July 1, and is now awaiting action from the House of Representatives later this month. The Senate vote was 54-45 in favor of opening free trade with six Central America countries—Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua. Proponents of CAFTA called the Senate action very positive, however, opponents of the proposal said that the vote shows that there are some concerns with the agreement. R-CALF United Stockgrowers of America, and several other producer organizations who oppose CAFTA said that the Senate’s vote was the least supportive of any trade agreement voted on by that division of Congress. “We are grateful for the strong opposition to CAFTA,” said Jess Peterson, director of government relations for R-CALF. “In particular, we thank each Senator that stood up for the U.S. agricultural producer and against the poor precedent that CAFTA set for future FTAs (free trade agreements). U.S. ranchers deserve an agreement that ensures international trade, enhances their business operations and isn’t destructive or detrimental.” Opponents of CAFTA claim the agreement fails to create a level playing field for U.S. cattle producers, by allowing Costa Rica and Nicaragua to add special and specific safeguards to block beef import surges from the U.S. Costa Rica and Nicaragua are considered the two largest Central American markets for U.S. beef. “CAFTA fails to address global beef distortions in trade that left unaddressed, only guarantee that U.S. cattle producers will not be allowed to be competitive,” said Peterson. “The U.S. received no special safeguards for beef import surges from CAFTA nations as mandated by Congress, nor does CAFTA follow the guidelines for mandatory country-of-origin labeling (mCOOL) as passed by Congress. The Australian FTA did include these special safeguards for U.S. beef.” Proponents of the agreement said U.S. beef will not get more competition from Central America product and that opponents of the trade pact are just showing their “protectionist tendencies.” Aides to U.S. Agriculture Secretary Mike Johanns said there are tariff rate quotas (TRQs) already in place against Central American countries if they export more than a minimum requirement of beef into the U.S. So far there has never been a TRQ placed against beef from any of those countries because they haven’t exported the minimum amount of product over a year. In addition, officials with the National Cattlemen’s Beef Association (NCBA) said that quality hinders Central America from being much of a competitor in the U.S. beef market. Most Central American beef is from animals that have been grass fed between 18 months and two years and is most suitable for processing, particularly canned or prefabricated products, sources said. Additional concerns of the agreement include not containing adequate environmental protections, or enforceable protections for such core workers' rights as the freedom to form a union. In fact, opposition said that the U.S. Department of Labor intentionally suppressed an analysis of CAFTA that showed several of the Central American countries included in the agreement have poor working conditions and do not enforce workers' rights laws. The Labor Department reportedly instructed the contractor to remove the reports from its web site, to retrieve paper copies of the report before they were distributed to the public, and to not discuss the studies with outsiders. The agency has denied those accusations. CAFTA now goes in front of the full House for discussion and vote later this month. House staffers indicated that a vote could happen sometime during the second full week of July. The biggest sticking point in the House is the debate over details regarding sugar trade with the Central American region. — Steven D. Vetter, WLJ Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.

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Monday, July 11,2005

Drought receding across most of West

by WLJ
— Southwest conditions worsening. — Heifer prices could see jump. Meteorologists and climatologists are on the verge of declaring a majority of the western U.S. drought-free this summer. Sources said there are still some drought-like pockets in the extreme northern Plains, Northwest and parts of the Southwest, however, the Intermountain West, West Coast and central Plains are all in better shape than the previous four or five years. Cattle market analysts said continued improvement in weather and climate conditions could result in a much larger growth rate in the northern Plains and Intermountain cow herds, and a better calf and feeder cattle market later this summer and fall. According to the National Oceanic and Atmospheric Administration’s (NOAA’s) Drought Monitor, as of June 28, the worst situation in the 17 most western states was some D0 to D2 drought conditions. The NOAA data utilizes five classifications of drought with D0 being the least intense and D4 being the most severe. Last year at this same time D3 and D4 areas were noted across the western U.S. Currently, the worst drought areas are the northeastern third of Wyoming, extreme western Montana, the eastern border of Idaho and central Washington and Oregon. Colorado, New Mexico, Nevada, Utah, Nebraska and the Dakotas are almost entirely free of drought conditions. The most improvement has been seen over the last six weeks to two months, with most drought-stricken areas seeing monthly precipitation range between three to six inches. Compared to the previous several years, meteorologists said that rainfall is three to five times larger in many western states, particularly Montana, the Dakotas, Colorado, Nevada, Utah and New Mexico. However, there is cautious optimism concerning the weather outlook come later this summer, into fall. “Things can change very quickly, particularly right now when temperatures get consistently over 90 degrees and the winds kick up severely,” said Douglas Le Comte, NOAA Climate Prediction Center. There was more concern that parts of the Southwest, particularly the eastern two-thirds of Texas and southeastern Oklahoma were drying out more than normal, compared to the previous few years. “Extreme D3 drought developed in northeastern Texas and included adjacent parts of Oklahoma, Arkansas, and Louisiana,” said Le Comte. “Longview, in northeast Texas, has experienced the second driest March-June since 1902. D0, D1 and D2 drought expanded in Texas, with D1 stretching into the Blacklands. Farther south, D3 developed across the Lower Valley. As of June 28, year-to-date rainfall in Brownsville totaled just 2.85 inches versus the normal amount of 10.68 inches.” Herd rebuilding, stronger prices? The marked improvement in a large portion of the northern western states has market analysts projecting cattle herd expansion at rates two to three times more than last year and forecasting another strong rally in calf and feeder cattle prices this fall, particularly heifers. “Particularly in the Dakotas, northern and western Nebraska, Colorado, and several states straight west, cattle herds were downsized significantly the past few years,” said Don Bainstrom, livestock market analyst with Plains Ag Commodities, Rapid City, SD. “The summer and fall grazing season looks to be six weeks to two months longer at least, and then normal wintering kicks in for females. Heifers could be hotly demanded, compared to their steer mates.” Bainstrom and Jim Robb, chief analyst at the Livestock Marketing Information Center (LMIC), Lakewood, CO, both indicated that steers from eastern Texas, southeastern Oklahoma, and into Missouri may start to somewhat overload the feeder cattle market if weather doesn’t cooperate and that even more heifers could be available for producers in areas where drought has started subsiding. Robb added that stocking rates for pasture and rangeland in the northern two-thirds of the western U.S. are probably two to three times what they were the previous few years. Bainstrom concurred. “We had a lot of northern Plains, and western cattle moving south the past few years because of drought,” said Bainstrom. “We could see a lot of Texas and Oklahoma females making their way back up here, particularly those with 1/4, or less, ear in them. The demand for heifers is improving and the continuation of better weather will only help more.” — Steven D. Vetter, WLJ Editor © Crow Publications - Any reprint of WLJ stories, except for personal use,  without permission, written consent and appropriate attribution is prohibited. ©1996-2005 Crow Publications. All rights reserved.

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© Crow Publications - Any reprint of WLJ stories, except for personal use, without permission, written consent and appropriate attribution is prohibited. 2008 Crow Publications. All rights reserved.