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Monday, March 28,2005

Sale of wild horses to Indian tribes

by WLJ
The Bureau of Land Management announced last week that it is selling more than 500 wild horses to two Indian Tribes in the Dakotas under a new law passed by Congress. The BLM has sold 141 wild horses (105 mares and 36 studs) to the Rosebud Sioux of South Dakota and 120 horses (96 mares and 24 studs) to the Three Affiliated Tribes of North Dakota. Completion of other sales to these tribes will take place over the next several weeks. BLM Director Kathleen Clarke said, “As the BLM implements the new sale-authority legislation passed by Congress, we are pleased to announce our first sales to tribes. We look forward to completing more sales with tribes and all others interested in providing long-term care for the wild horses affected by the new sale-authority law.” The Bureau carried out its first sale of wild horses––200 mares to a Wyoming-based company––on March 1 under legislation recently passed by Congress. This measure, which became law in December 2004, directs the BLM to sell those wild horses and burros that are more than 10 years old or have been unsuccessfully offered for adoption at least three times. About 8,400 BLM-managed animals became eligible for sale under these criteria. “I urge horse advocacy groups, humane organizations, and more tribes––as well as the general public––to help the BLM find good homes for those horses affected by the new law,” said Clarke. The Bureau has set up a toll-free number for those interested in buying a wild horse or burro (1-800-710-7597). Interested groups or individuals may also contact the BLM at a new e-mail address(wildhorse@blm.gov). There are about 37,000 wild horses and burros roaming public lands managed by the BLM in 10 Western states. Wild horses and burros have virtually no natural predators and their herd sizes on the range can double about every five years. As a result, the current free-roaming population exceeds by some 9,000 the number that BLM-managed rangelands can sustain. The Bureau determined––on the basis of its analysis of rangeland conditions––that 28,000 is the number of wild horses and burros that BLM-managed rangelands can support in balance with other resources and other approved uses of the public lands. Federal law authorizes the BLM to remove wild horses and burros from the range to control herd sizes; those animals removed are cared for in holding facilities and thousands are placed into private ownership through adoption each year. Since 1973, the BLM’s adoption program has put more than 203,000 animals into private care. Currently there are about 24,000 wild horses and burros in short-term facilities in the West and long-term facilities in the Midwest. The cost of holding and caring for wild horses and burros in both short- and long-term facilities is projected to be about $20 million in Fiscal Year 2005, which will be more than half of what the agency expects to spend on the wild horse and burro program in the current fiscal year. The cost of caring for and feeding a wild horse in a long-term facility is about $465 per animal per year. The BLM manages wild horses and burros under the authority of the 1971 Wild Free-Roaming Horses and Burros Act. Congress has amended this law three times––in 1976, 1978 and most recently in December 2004, when it directed the BLM to sell wild horses and burros meeting the law’s newly established sale criteria. The BLM remains fully committed to its adoption program, which it will keep separate from its new sale-authority program. So, the Bureau will not be selling wild horses and burros at any of its adoptions. — WLJ

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Monday, March 21,2005

Canada slaughter capacity up

by WLJ
Canada's cattle and beef industry has followed through with plans to increase the nation’s overall beef slaughter capacity, and expansion is expected to continue as the U.S. border remains closed to live Canadian cattle. Prior to Canada's initial BSE confirmation in May 2003, the country's total slaughter capacity was at 72,000 per week, although the plants were actually processing closer to 65,000-69,000 each week. Currently, total weekly processing capacity around 84,000 head per week. Cliff Munroe, chief of Alberta Agriculture's regulatory services branch, said the province's two largest facilities, Lakeside Packers and Cargill Foods, have expanded their kills significantly, and that further growth of those packers is expected. In addition, a number of smaller projects are in the works, including Rancher's Beef, which is already slaughtering cattle at Sunterra's lamb/veal facility in Innisfail. Construction is also under way on an 800-head-per-day facility north of Calgary. Another group is working to set up an 800-head/day plant west of Edmonton. Several other projects are planned across the Prairies and in eastern Canada sources said. If the U.S. injunction against reopening the border to Canadian live cattle is not overturned, Munroe said it is likely Canada, specifically Alberta, would put even more emphasis on increasing the domestic slaughter capacity, as the country works to divorce itself from its dependency on U.S. processors. "If you add up all the hopes and prayers out there, capacity could increase to 120,000," said John Masswohl, director of international relations with the Canadian Cattlemen's Association. Realistically speaking, he thought slaughter capacity would increase to 95,000 per week heading into 2006. Masswohl thought Canadian oversupply was roughly around 500-550,000 head of cattle, of which 300,000 to 350,000 were older animals. If the younger animals can't be moved to the U.S., it could take until 2007 to get through the backlog, according to Masswohl. Even if the U.S. border does eventually open, it will only be for those animals under 30 months of age. As a result, most of the current projects in the works are for dealing with those animals over 30 months of age. Canada has too many live cattle and not enough slaughter capacity, said Cam Daniels, vice-president of the Canada Beef Export Federation. He agreed that new plants and increased slaughter capacity were the best solution, but didn’t give a timetable or the extent of expansion that would be needed to balance out cattle supplies and packing capacity. — WLJ

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Monday, March 21,2005

Beef Bits

by WLJ
Oscar Meyer sale rumored Kraft Foods’ desire to focus solely on cheese and dairy, biscuits, coffee, and specialty beverages has fueled speculation that it wants to sell its Oscar Mayer and Louis Rich processed meat businesses. However, the massive size of the Oscar Mayer and Louis Rich brands make them saleable to only a few large companies. Some meat industry experts put a $1 billion price tag on just the Oscar Meyer brand. At least one industry watcher said Sara Lee would be the most logical buyer. Sara Lee already owns Ball Park Franks, the largest U.S. hot dog brand in America. Oscar Mayer is the second largest brand. The Oscar Meyer operation reported a 10 percent sales increase in 2004, in part because of the success of its Deli Shaved Roast Beef sandwich meat. Japan supply fell in January Japan’s beef supply fell to a historical low during January, with total beef stocks totaling just 60,001 metric tons. Australia has become the largest supplier of beef to Japan, after Japan closed its markets to U.S. beef following the discovery of a cow infected with BSE in late 2003. Beef supplies in Japan fell eight percent compared with January 2004, and were down 36 percent compared with January 2003. Although imports of beef over the period have increased 16 percent to 28,323 metric tons—primarily from Australia—production of domestic Japanese beef declined eight percent to total 25,947 tons. Lone Star posts revenue hike Lone Star Steakhouse & Saloon Inc. posted a fourth quarter revenue hike of 11.7 percent to $205.4 million and a 13.2 percent year-to-date increase to $669.5 million. Overall comparable store sales growth edged up 1.3 percent for the quarter and 3.6 percent for the fiscal year. The chain’s Del Frisco’s Double Eagle Steak House recorded the highest fourth-quarter comparable store sales growth, up 17 percent, followed by the recently acquired Texas Land & Cattle Steak House, up 7.9 percent. The company’s namesake chain, Lone Star, fared the worst, with a 1.7 percent decline. Comparable store sales at the company’s Sullivan’s Steakhouse climbed 3.1 percent for the quarter. Hardee's intros new burger Hardee's recently announced it is selling a new Frisco Thickburger two years after the chain's original Frisco burger was retired, following the inauguration of Hardee's line of Thickburgers. The new burger includes two slices of Swiss cheese, two strips of crispy bacon, sliced fresh tomato and a buttered, grilled sourdough bread spread with onion-flavored mayonnaise. The difference is that the Frisco Thickburger is made with a 1/3-lb, charbroiled Angus beef patty, as are the other nine offered Thickburgers. The Frisco Thickburger sells for a suggested price of $3.59. Aussie slaughter down Australian processors slaughtered nine percent fewer beef cattle during January than in January 2004, according to the Australian Bureau of Statistics. Total slaughter was 485,000 head. Australian beef production for January 2005 was slightly lower than in January 2004, due to the decreased slaughter numbers, totaling 132,000 metric tons. However, despite the reduced numbers, the average adult carcass weight for January was 268.3 kilograms per head, an increase of 7.2 kilograms per head, compared to January 2004. Beef sandwiches recalled Lansing, MI-based Eastside Deli Supply recently recalled beef-and-cheese submarine sandwiches sold at more than 300 convenience stores in Michigan, Indiana and Ohio because of possible contamination with listeria monocytogenes. The sandwiches are packaged in clear wrapping and have the description name "Beef & Cheese Sub Sandwich." The recall includes products with sell-by dates up to and including March 22. The Michigan Department of Agriculture discovered the problem during a routine food inspection. No illnesses have been reported, but production of the sandwiches was voluntarily suspended pending an investigation into the source of the problem. Drought forces Aussie cattle sale About 11,000 head of cattle were auctioned off in the Australian city of Roma as the continuing dry conditions force graziers to sell-off stock. Livestock agent Jason Carswell said cattle were trucked in from western Queensland, South Australia and the Northern Territory. "The panic has sort of set in some places where it's drier than most and we're seeing that now with large numbers coming through that people have sort of waited for the rain and it's just getting to the stage to do something before it does get proper dry," he said.

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Monday, March 21,2005

Beef info provided at Japan forum

by WLJ
The U.S. Meat Export Federation (USMEF) used its presence at Japan’s FoodEx 2005, the largest food show in the Asia-Pacific Rim region, to showcase the tastiness of U.S. pork and educate attendees about the safety of the U.S. beef. Since its debut in 1976, FoodEx Japan has become the premier event in the Asian-Pacific Rim region, and the third largest food and beverage show in the world, after SIAL in Paris and ANUGA in Cologne. This year’s show, March 8-11 in Makuhari Messe, featured more than 2,500 exhibiting companies and 100,000 food industry visitors. USMEF reports 20,000 visitors to its booth on opening day followed by 25,000 on March 9. The visitors included buyers from major Japanese supermarket and restaurant chains, such as AEON, Daiei and Yoshinoya. USMEF is providing samples of U.S. pork prepared with four different special sauces developed for the U.S. pork campaign in Japan. “Conducting taste tests of frozen and chilled pork emphasizes the superior flavor of U.S. pork,” USMEF-Japan Senior Marketing Director Takemichi Yamashoji said. U.S. chilled pork is highly thought of in Japan and distance prevents Denmark, a major competitor to U.S. pork in Japan, from shipping chilled pork to Japan. U.S. chilled pork shipments have risen substantially in the last decade and now account for as much as 40 percent of U.S. pork exported to Japan. In 2004, Japan led U.S. pork (including variety meat) exports in value at $978,541, up 25 percent from the previous year and was second in volume at 313,574, up 16 percent. The USMEF booth is hosted eight U.S. packers: Johnsonville, PSF, Sara Lee, Smithfield, Snake River Farms, Sugardale, SIG International and Tyson. USMEF is supplying information on the U.S. beef grading system, especially A40 maturity, which has been discussed with the Japanese government for use in determining age of U.S. cattle eligible for export to Japan once the border reopens to U.S. beef. Japan discontinued accepting U.S. beef in December 2003 when the United States discovered a single case of BSE in an imported Washington state dairy cow. Additionally, USMEF is distributing information on U.S. beef industry safety measures that ensure U.S. beef is safe and free of BSE. Updates on the negotiations between the United States and Japan were also provided. “Buyers are asking when the market is going to open since they want as much notice as possible to develop sales and buying plans,” Yamashoji said. Many buyers thought the slow working of the Japanese government means a resumption of U.S. beef exports to Japan is most likely to happen in late summer or early fall. The U.S. Meat Export Federation is the trade association responsible for developing international markets for the U.S. red meat industry and is funded by USDA, exporting companies, and the beef, pork, corn, sorghum and soybean checkoff programs. — WLJ

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Monday, March 21,2005

It’s a common goal

by WLJ
I received a letter and renewal from a reader last week that has taken WLJ for three generations, starting with my grandpa Nelson Crow. He said that grandpa always wrote the paper for the rancher. I would imagine that this reader has seen a lot of change in the U.S. cattle/beef industry. Through this entire BSE issue I have been accused of not representing the producers, and I’d like to say that is simply not true. Without you, the producer, there is no WLJ. If we’re not telling you what you want to hear, I apologize. Our goal is to report on the entire cattle/beef industry and report factual stories, so you can make good business decisions. It’s unfortunate that producers feel they have to choose sides on issues when the fundamental goals are the same. You have to admit, there has been some absolutely wild stuff going on. Starting with beef checkoff, which the U.S. Supreme Court is expected to rule on in the next few weeks. This producer-funded program has done a lot of good over the past 20 years and to kill it over a lousy $1-per-head is crazy. Even if you have to associate NCBA with it, killing it is the worst crime that a handful of cattlemen have committed, and, trust me, it is just a handful who have tried to kill your only promotion and research program. Next it’s free trade or fair trade, whatever you want to call it. Neither truly exists, or will exist. All we can hope for is access to markets. Every country plays a few games on trade, and we’re no different. R-CALF had a big win when they received their emergency injunction. The cattle markets took a big swing—$6-8 on feeder cattle and $4-6 on fed cattle. There were many in the industry—I include packers—who were ready to ship live cattle south. Many were betting that the border would open on March 7, and Canadian cattle would be on their way to utilize unused slaughter capacity at U.S. packing plants. I believe that the futures market already had an open border priced into the market. Last week R-CALF was told by Japanese officials that their meddling in the Canadian border situation and activity with Congress will only delay trade with Japan. R-CALF ran an ad in the Washington Post thanking the Senate for upholding the closure of the Canadian border and asked the House to do the same. The Senate also passed a resolution that would impose trade sanctions with Japan to open beef trade, really nothing more than a little saber rattling. On one hand, the Senate wants to keep Canada closed, and on the other it wants Japan to open to U.S. beef, which sounds good to constituents. But I would imagine that it sounds a little hypocritical to the rest of the world, especially from a country that has been built on creating freer and fairer trade. The R-CALF reply about the Japanese diplomat was that they didn’t know that he represented government, they thought he was just an industry person, which sounds a little naive. Bill Bullard, R-CALF’s CEO, said that R-CALF’s actions, relative to the Canadian border should have no impact on whether Japan reopens its market to imports of U.S. beef and that R-CALF is not aware that Japan has given any indication that it is willing to accept Canadian beef. R-CALF is probably here to stay, and if they intend on being an industry leader I think it’s time they start acting that way. They have been able to get a lot of things done with few resources, which is remarkable. They certainly may represent producers, but I think it’s time they step into the big leagues and represent this industry responsibly. — PETE CROW

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Monday, March 21,2005

Montana labeling bill praised

by WLJ
The Montana Stockgrowers Association (MSGA) applauded members of the Montana House of Representatives for passing HB 406, the "Country of Origin Placarding Act," with an amendment to postpone implementation until October 2006 when the national country-of-origin-labeling is scheduled to be in place. The bill, which passed the House by 63-37, requires specific commodities offered for sale in Montana to be displayed with a placard indicating country of origin of that food. The law will require producers, growers and shippers of beef, processed whole grains, honey, pork, poultry, and lamb to label each individual portion, piece or package of that commodity in a conspicuous place. Bill Donald, a rancher from Melville and president of MSGA, said his organization supports labeling on both the state and national levels. "The Montana Stockgrowers Association was an original proponent of national COOL," said Donald. "We think it is important to have our beef and other products labeled as to their origin. However, we realize we have to go about this in a manner that is economical and practical to ranchers." Donald said the amendment to delay implementation of the Montana placarding act until 2006 will allow time for a national COOL system to be established, which will ease the burden of having a statewide-only system in Montana. "Montana is a raw commodity state. We send most of our products out of state for processing before they return to Montana in retail form," said Donald. "If we were to try and implement this now, Montana retailers would have many more challenges than if we wait until labeling is required nationally."

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Monday, March 21,2005

Letters

by WLJ
BSE issue gone too far Dear Mr. Crow, I couldn't agree more with your editorial March 7. This BSE issue has certainly gone too far. The R-CALF crowd is leading the public to believe this is a contagious disease of cattle, or that muscle cuts of beef from Canadian cattle could in some way be a consumer health threat, is far from factual. R-CALF leaders seem all too willing to risk eroding consumer confidence in our product in order to further their own protectionist agenda. Thank you for speaking out. Ralph D. "Shorty" Jones Midland, SD Science used as a smoke screen Dear Pete, Are those that advocate the continued closing of the Canadian border being hypocritical in their reasoning for doing so? Let’s see if we can noodle this one out without too much rancor. Those that advocate keeping the border closed reference OIE as the source of scientific advice. These advocates say that the science is just not yet complete on BSE eradication in Canada and therefore we should not allow any cattle or beef from cattle raised in Canada into the U.S. That seems reasonable on its face. After consideration of such arguments, a federal judge issued an order prohibiting Canadian cattle from coming into the U.S. and some members of Congress are writing bills to do the same. However, certainly those in Canada and some in the U.S. question the validity of such science. Now, let’s think back to the European ban on hormone treated cattle. Advocates in the EU said and still say that hormone implanted cattle and the resultant beef should not be allowed into the EU. They state as scientific evidence that studies show that the implanted hormones may cause problems later for those who consume such beef. The U.S. government retaliated with tariffs on EU produced products imported into the U.S. The U.S. cattle industry raised a clamor that such “scientific” evidence was fallacious and should not be used as a “non-tariff” trade barrier. How can we have it both ways? Our treatment of Canadian cattle and the EU treatment of some U.S. cattle seem to me to be a similar use of “science” to advocate a cause. To me, both are based on science of convenience. So I ask you Pete, are we in the U.S. beef industry being hypocritical when we use “science” as the reason for banning Canadian cattle but yet ridicule the “science” the EU used to ban US cattle? Or, has “science” been used as a smoke screen for greed on the part of both the EU for its ban on hormone treated cattle and some U.S. beef producers for their wanting a ban on Canadian cattle and beef? Sincerely, Mack H. Graves Latigo Management & Marketing Consultants, Inc. Centennial, CO Change: A fact of life Dear Editor, I cannot let the letter from Mr. McClure, claiming "misinformation" from NCBA go unchallenged. My husband and I have been active members in NCBA and predecessor organizations since the late 1950s when he served one year as president of the Jr. American National Cattlemen. We have seen many changes, usually working for the good of the cattle/beef industry (where we and two of our sons' families make our living), I might add. We realize some in the cattle business fear and/or dislike change. It is a fact of life, and often is an improvement. Running water and disposable diapers for babies are two of my personal favorites witnessed in the years of my adulthood! Mr. McClure is off base in accusing you and NCBA of misinformation, in my opinion. We look forward to the arrival of WLJ as an important and factual source of news of our industry. Mr. McClures' claim of "a few controlling NCBA" flies in the face of the fact that over 6,000 people attended the recent annual meeting, and that the vast majority of NCBA members are cattle producers, with feeders following in number, and they are ALL eligible to vote either at convention or through the mail. Issues brought up by members from either local or state organizations proceed through the committees or are brought to the floor at the convention and are acted upon by the members. Rather typical, sometimes boring procedures, but necessary to a well conducted meeting. COOL cannot, under the law as currently written, be "quite simple." There are conflicting trade laws. The prevention within the law of mandatory-ID, yet requirement for packers to "source verify" their product, is an internal conflict. The exemption of a huge portion of imported beef from the law via foodservice and the restaurant trade all serve to make it very difficult at best, and more likely impossible, to administer. Labeling beef produced in the USA is available and being used currently in the best possible way—by people who are adding value to their product and putting their label on it. Some consumers are choosing to pay the cost of such an identified product—some are not. Private enterprise at its best! Until you show some viable proof of your accusations, Mr. McClure, it seems to me you should be the one eating your words, rather than (Pete) Crow! Sincerely, Maxine Jones Midland, SD

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Monday, March 21,2005

Obit

by WLJ
Judith (Little) LaFranchi Judith Antoinette LaFranchi, 66, passed away February 15, 2005. LaFranchi was born January 19, 1939, on the Onyett Dairy in Gridley, CA, to Irvin Leroy Little and Ella Onyett Little. LaFranchi attended College of the Pacific and graduated from Sonoma State College with a Master’s degree. LaFranchi began showing Guernsey dairy cattle in 4-H at the age of 10 and won her first Showmanship class in 1951. Over the years she won numerous contests and was named California Guernsey Queen for the 100th California State Fair. In 1962 she married fellow dairyman Henry LaFranchi of Calistoga. They showed Ayrshire Dairy Cattle very successfully for many years, winning the “All Americans” title many times. In 1965 they entered the National Dairy Cattle Congress Exposition in Waterloo, IA, the largest dairy cattle show in the world, winning every class they entered. Survivors include her father Irvin Little and step-mother Pat, Gridley; brother Dennis Little and wife Loretta of Orland; son Erik LaFranchi and wife Steffani, Calistoga; daughter Cheryl LaFranchi and husband Frank Mongini, Calistoga; and grandchildren, Rachael, Logan and Ashley LaFranchi and nieces, nephews and cousins. Contribution can be made to the California Junior Angus Association, Abbie Nelson, 12211 Pear Lane, Wilton, CA 95693.

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Monday, March 21,2005

Seasonal high seen due to Easter rally

by WLJ
— Calves, yearlings strong on fed profits. Fed cattle markets were quiet most of last week, feeders were looking to get $94-95 on the heels of a very active market a week earlier, which was the result of a combination of seasonal Easter demand and the Canadian border remaining closed. Packers were offering $88, and they weren’t getting much bought through Thursday. Other than formula cattle, just a handful traded in the northern Plains at $149 dressed, $92 live, $1-2 lower than the prior week. Northern feeders were again early to trade while southern Plains feeders were comfortable with current inventory. The April live cattle contract moved lower during the week. April hit a high two weeks ago of $91.45 on March 9 and then slipped to $88.47 last Thursday. Cash markets were starting to feel the pressure. Packers have been earning a little money since the boxed beef cutout moved higher based on a little pre Easter panic buying by retailers, the Choice cutout was $156.55 and Select was at $150.18. The latest packer margin index shows packers earning $18 per head based on a average live cattle buy of $92.89 two weeks ago. The boxed beef market was expected to soften after the Easter holiday buy was complete. Boxed beef volume was much slower last week Slaughter levels have remained fairly strong for current times. Processors moved just over 599,000 head through packing plants. Many packers were announcing cut backs just after the Montana federal judge decided to keep the border closed. Either holiday orders are very strong, the slowdown talk was just talk, or is coming this next week. Cattle feeders were also seeing some positive margins as many breakevens on fed cattle are between $88-94. Analysts at HedgersEdge.com think that the seasonal winter high may have been made two weeks ago at $94. The lean beef market has been showing significant strength over the past few weeks. Ninety percent lean was trading at $156.23 last week and the 50 percent trim market was at 76.60. John Nalivka, analyst at Sterling Marketing, Vale, OR, said that food service was starting to feel the pinch on hamburger prices, “the ninety-nine cent hamburger may be a thing of the past,” he said. Some West Coast markets were reporting slaughter cows in the 60-cent range reflecting seasonal trends. The cow beef cutout was $121.13 and the West Coast cow carcass price was up $5 from the prior week to $85-87. Wayne Purcell, ag economist at Virgina Tech, said that the court ruling to block the opening of the Canadian border as scheduled on March 7 has injected huge uncertainly into the cattle markets. The April live cattle futures had been as low as $85.35 on March 2 and then surged after the court action to $92.25 on March 9. “Current prices are well off those highs, and we have seen a similar pattern in the June futures. I do not think we are ready to hold a $90 market even with the border still closed and in spite of the limited trade we saw last week,” Purcell said. “There continues to be talk of lagging demand in the institutional market even though the demand index for the fresh beef market shows a modest increase in the forth quarter compared to the forth quarter of 2003. Boxed beef values for the Choice beef are back above $155 and that will leave the packers some room to pay batter prices for cattle. It is a nervous and uncertain market, and I would react by being a seller on rallies to the recent highs.” He also suggested producers take profits on long hedges on March feeder cattle around the $106.40 high, seen back on March 9. “If you had moved out and placed long hedges in the summer in the August contract, look at taking profits on those positions around its March 9 high of $106. I do not see a reason across the next several weeks for these contracts to trade up and hold a new contract high,” Purcell said. Calves and yearlings were both stronger nationwide last week with the continued ban on Canadian feeder cattle and good spring grazing prospects both helping demand for all classes of cattle. Calves were bringing $2-4 more last week, while heavier, more feedlot-ready cattle were bringing $3-5 more than the previous week. Analysts said that many cattle feeders started reporting some profits two weeks ago when fed cattle started bringing $93-95 and that trend was expected to continue. Several analysts said cattle feeding profits ranged between $30-50 per head. Jim Robb, chief analyst with the Livestock Marketing Information Center (LMIC) said, the psychology of the industry is bullish all around right now, and that includes the feeder market,” “Plus, there are fewer cattle than normal for this time of year, and this is usually a short supply season anyway.” In addition, feedlots in northern states were reportedly looking for replacements and were waiting for March 7, which is when Canadian feeder cattle were expected to be allowed back into the country. When U.S. District Court Judge Richard Cebull, Billings, MT, granted a temporary injunction against that, cattle feeders were forced to look at getting back into the domestic feeder cattle market, sources said. Feeder cattle prices were also helped by better quality cattle coming off of southern wheat pasture, particularly Oklahoma and Texas. According to Bob Miles, USDA auction market reporter from Oklahoma, feedlots like cattle coming off of wheat pasture because they are a little bigger framed than cattle coming right off of cows, and they can pack on the weight at a more rapid pace without as long of a transition phase. “We have been seeing a lot of wheat cattle since Feb. 21, and that shows with the increase in price being paid for yearling cattle,” Miles said. “This will probably last another week and then the wheat cattle market will subside until the last half of April.” Producers who graze-out their wheat normally do so until the end of April or beginning of May. “Right now, cattle are being pulled off of wheat because, if they wait any later, any chance of harvesting the crop for grain is jeopardized,” said Miles. The first three days of the week saw feeder cattle futures rally significantly before sliding backward Thursday. For the week, however, the first few listed contracts were still all up $2-3 compared to the end of the previous week. The CME feeder cattle index last Wednesday was at $106.10, compared to $103.16 the same day the week prior. On the calf side, backgrounders and stocker operators are both fighting for available supplies, which are very tight right now. Backgrounders still have the availability of less expensive corn to feed calves in an effort to get them ready for a feedlot scenario, while stocker operators can feed cheaper corn until spring grazing actually kicks up, over the next month or so. Commodity analysts said the cash price for feed corn last week was running between $3.60-4 per cwt prior to delivery. Forecasts for spring grazing are abnormally bullish across most of the country, with the primary exceptions being in the Northwest and the eastern part of the northern and central Plains. Calf prices were also helped by the profits being reaped by stocker operators and backgrounders. An informal survey of nine market analysts and extension economists indicated that those two sectors were showing anywhere between a $50-90 per head profit on cattle bought this past fall and sold during the first half of March. — WLJ

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Monday, March 21,2005

Wild and Scenic Rivers Act could eliminate grazing

by WLJ
Recent court decisions regarding the Wild and Scenic Rivers Act (WSRA) have heightened awareness of possible ramifications of a misapplication of this law on the beef industry. With another Wild and Scenic Rivers case decision pending, producers may need to advocate to maintain grazing in these areas. In the 1960s, Congress created the National Wild and Scenic Rivers System to protect and preserve rivers in response to concerns that rivers were being dammed, dredged, diked, diverted and degraded at an alarming rate. In October 1968, the newly enacted Wild and Scenic Rivers Act pronounced that, “certain selected rivers of the Nation which, with their immediate environments, possess outstandingly remarkable scenic, recreational, geologic, fish and wildlife, historic, cultural or other similar values, shall be preserved in free-flowing condition, and that they and their immediate environments shall be protected for the benefit and enjoyment of present and future generations.” The legislation continues on to say, “Each component of the national wild and scenic rivers system shall be administered in such a manner as to protect and enhance the values which caused it to be included in said system without, insofar as is consistent therewith, limiting other uses that do not substantially interfere with public use and enjoyment of these values.” Designating an area as a wild and scenic river is not like designating a national park because the Wild and Scenic Rivers Act does not generally lock up a river like a wilderness designation. The goal, as outlined by Congress, was to halt development and preserve the character of a river. Uses compatible with the management goals of a particular river are supposed to be allowed under the act. However, grazing seems to be a use that is not being recognized under WSRA. The National Cattlemen’s Beef Association (NCBA) and the Public Lands Council (PLC) have become increasingly aware that grazing in wild and scenic areas is beginning to be eliminated altogether. Jeff Eisenberg, director of public lands for NCBA and executive director of PLC, said, “Numerous operations and families in Oregon and potentially many times more people throughout the western United States have been adversely impacted by the court decisions applying the WRSA to grazing.” PLC cited ONDA v. Green in which Oregon Natural Desert Association (ONDA) challenged federal agency management of grazing in Donner und Blitzen wild and scenic corridors from late 1990s to the present. With this case, the court ruled that grazing could only continue so long as it met the statutory requirement to “protect and enhance” the value for which the river designation was established. Then the court used this statute to authorize federal agencies to exclude cattle from the river areas. ONDA raised the same issue of cattle grazing in two other cases brought against the Bureau of Land Management involving the Owyhee River area. In the first decision, the court asserted that agencies have the “duty—not only to restrict it, but to eliminate (grazing) entirely” along designated corridors if it violates the “enhance and protect” standard. “More than 50 operations ran cattle along the subject area of the Donner und Blixen, Owyhee, and Malheur Rivers,” said Eisenberg. “These decisions affected hundreds of people if you consider that each operation often consists of several different families.” Currently, ONDA is involved in another case challenging grazing along the Malheur Wild and Scenic River. This case is called Oregon Natural Desert Association v. U.S. Forest Service. Eisenberg said about five ranching operations are at risk if the court makes the same decision as in the other three cases. “We respect the fact that Congress has passed that statute, but we want there to be a balance between respecting the existing uses and protecting the resources,” said Eisenberg. “The fact that cows are always getting kicked off because of the protected and enhanced statute is a problem.” NCBA is currently talking to different people to see what can be done to see that the balance between people and resources is restored.

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