SUREHEALTH® continues to gain approval.
Beef export countries demand proof of age, and the only
way to achieve this is through a Quality Systems Assessment (QSA)
program like the optional one offered through MERIAL ® SUREHEALTH
®. The SUREHEALTH program is the only nationwide calf
preconditioning protocol that requires third-party veterinarian
certification and is backed by a limited 21-day limited warranty. Click here
for more information.
® MERIAL, SUREHEALTH, the
SUREHEALTH and CATTLEHEAD LOGOS are all registered trademarks of Merial.
© 2006 Merial Limited. All rights reserved.
Feeder Prices Continue Rebound
Prices for feeder cattle are finally finding some
strength for one elemental reason, says Derrell Peel, Oklahoma State
University Extension livestock specialist -- supply.
"The annual cattle inventory confirmed we have essentially the same
feeder supplies this year as in 2006," says Peel in his recent
"Livestock Market Comments."
"After the initial shock of higher corn prices comes the realization
that high-cost grain doesn't mean feedlots don't want to feed cattle. It
mostly means they want to feed different cattle, feed them somewhat
differently and, most importantly, price them differently as placements
entering the feedlots."
He says feedlots will be looking for heavyweight feeder cattle this
year, of which there aren't many to be had.
"They'll have to wait until stocker producers have time to put on
additional weight as stockers before more heavyweight feeders will be
available," Peel says. "We're really talking about this fall before we
can transition from a fast-paced lightweight calf market to a heavier
weight yearling market."
In terms of supply, recall that the national cattle inventory had
increased only 0.3% as of Jan. 1, compared to 2006. According to the
Livestock Marketing Information Center, "The reported U.S. calf crop
(Jan. 1) has been stable since 2003. So the calculated number of feeder
cattle outside feedlots that aren't designated for breeding-herd
purposes remains relatively tight. As of Jan. 1, 2007, the calculated
available feeder cattle supply outside feedlots was 28.4 million head,
up 0.9% from a year ago."
In sum, Peel explains, "Stocker producers will have very different
incentives this year compared to the last several years. Instead of
moving cattle to feedlots quickly and at lighter weights, there will be
an incentive for cattle to enter feedlots heavier and feed for fewer
days in the feedlot. This will slow down the rate of turnover of cattle
out in the country and speed up the turnover rate in the feedlot."
That means feedlot inventories will likely continue to shrink through
the first half of the year at least, he adds.
"For the last 3-4 years, we've maintained feedlot inventories by feeding
fewer cattle for more days and now we need to feed the same small set of
cattle for fewer days."
Expect feeder and calf prices to increase a bit more seasonally in the
next month. Summer forage prospects will dictate how much they'll weaken
seasonally into the summer. Moving into the spring, feeder markets will
be very sensitive and likely volatile in response to corn market
conditions, Peel says.
National Stocker Award Competition
Mark April 1 on your calendar. That's the deadline for
submitting an application for this year's National Stocker Award (NSA)
If you're unfamiliar with the NSA, it's open to any stocker or
backgrounding operation that derives the majority of its cattle-based
income from the stocker and backgrounding businesses. You can nominate
yourself or someone else.
The overall winner wins $10,000 in cash, and two other divisional
winners receive $2,500 in cash. For more info or an application, go to
For a hard-copy application, contact Marilyn Anderson at 800-722-5334.
Weather And Crops
Wheat Conditions Improved,
Depending on whom you talk to, wheat pasture prospects
have picked up, though the prospects of spring forage are still plenty
dicey given the lingering drought.
For the week ending Feb. 11, the National Ag Statistics Service had this
to say about selected states:
- Light snow across the Northern Plains and eastward into the Ohio
Valley improved snow cover, better insulating winter wheat from
temperature extremes. The extreme cold and snow across the nation's
northern latitudes and mid-section continued to cause severe stress to
livestock and curtailed outdoor activities.
- In California, recent rains and warmer weather improved growth of
winter forage, wheat and other grain crops in some areas.
- In Texas, mostly dormant wheat remained in fair to good condition
having benefited from recent precipitation and warming temperatures.
Although the favorable weather conditions also contributed to pasture
growth, supplemental feeding of livestock continued statewide.
Don't take a chance. Treat all incoming cattle with
IVOMEC® Plus (ivermectin/clorsulon)
Liver flukes are spreading and every load of incoming cattle could be
carrying them. The liver fluke problem is hard to diagnose and rarely
shows in clinical signs. Only IVOMEC® Plus
(ivermectin/clorsulon) kills liver flukes and other internal and
external parasites, all in a single dose. Product
®IVOMEC and the CATTLE HEAD LOGO are registered trademarks of
Merial. © 2006 Merial Limited. All rights reserved.
Speculating On Corn
Consider it the new industry pastime: swapping theories about how
ethanol's impact on the corn market will either forever change the way
cattle business is conducted long-term, or how a lot of high-priced
ethanol plants will be gathering rust in a few years.
As for the latter, Mike Woolverton, Kansas State University Extension
grain economist, explains, "Some producers have expressed concern that
after luring them with tantalizing visions of historic profits, the corn
market will collapse. Two things might cause that to happen, neither of
which seems likely."
First, says Woolverton in his "Grain Outlook," if corn producers
overshoot and plant 12 or 14 million more acres, and if growing
conditions give record-breaking yields across the country, corn price
would drop from the current level.
"One or the other of those might happen, but the likelihood of both
happening this year seems small," Woolverton says.
The other possible hole in the dam could come in the form of ethanol
margins so low that some existing and impending plants would cease
According to Woolverton, "The subsequent decrease in demand for corn
would cause price to fall. In order for that to occur, oil price would
have to fall more than it has in recent weeks; even then, Congress would
likely raise the ethanol-in-gasoline mandate levels to prevent injury to
grain producers, farmer/investors and rural communities that would
result from a demise of the ethanol industry."
For more of Woolverton's insights see www.agmanager.info/marketing/outlook/newletters/archives/GRAIN%20OUTLOOK_02-01-07.pdf
Stocker Impacts From Ethanol
"After years of shortening the stocker phase, cattle
feeders will likely see more time between the cow-calf and feedlot
segments as lower-cost weight gain systems are sought," says Larry Corah
of Certified Angus Beef® LLC (CAB). "We see a new price structure
for corn, escalating land prices and cattle marketed on individual
merit. All these factors impact the stocker industry dramatically."
Besides the changing competitive dynamics for calves and grass, Corah
emphasized to producers attending the recent National Cattlemen's Beef
Association meeting that potential for carcass and feedlot performance
coming from the stocker segment of the industry will be magnified.
Consequently, paying closer attention to some finer points of stocker
production could pay more dividends.
For instance, Corah points to an Iowa Tri-County Steer Carcass Futurity
study showing that cattle treated once for bovine respiratory disease
(BRD) had a mortality rate 3% higher than those never treated. Cattle
with two treatments had nearly a 10% mortality rate.
The average daily gain (ADG) of cattle with no treatments was almost 0.3
lbs. more than those incurring two treatments.
"This translates to a difference in dollars returned per head," Corah
explains. "The total disparity between those cattle treated twice and
those never treated equals more than $200 in lost profit."
Likewise, Corah explains Nebraska research showed an even greater impact
from supplementing stockers on grass.
"With today's growth and quality genetics, use of a pasture creep or
other supplementation can add a pound to ADG and increase later ability
to grade without deterring feedlot performance. What's more, it can
boost carrying capacity by 40% on increasingly expensive land," Corah
Moreover, Corah suggests these implanting strategies in the stocker
pasture can improve carcass quality:
Furthermore, Corah explains Oklahoma State University studies show that
effective deworming in the stocker phase can lead to a 20% increase in
marbling and ability to grade Choice after finishing.
- When cattle are adapting to the stocker program, delay
- Avoid aggressive implants during this period.
- Question whether implants are even needed during the stock
According to Corah, the stocker industry must move beyond the old
strategy of merely maintaining calves for later compensatory gain.
Cattle that barely get by as stockers are often severely compromised in
their ability to grade.
Keep in mind, however, that though more than 500 million lbs. of CAB
product were marketed last year, the percentage of cattle qualifying for
the program continued to decline.
Preconditioned calves are in demand. MERIAL® SUREHEALTH®
is the only national veterinarian certified preconditioning program.
It's backed by the Merial SUREHEALTH limited health warranty and
now offers optional source and age verification. SUREHEALTH is a
USDA-approved Quality Systems Assessment (QSA) program. Click here
for more information.
® MERIAL, SUREHEALTH, and the SUREHEALTH and CATTLEHEAD LOGOS
are all registered trademarks of Merial. © 2006 Merial Limited. All
Weather & Numbers Bolster
"Bitter cold temperatures with wintry precipitation have
put feeder offerings in a buyer-friendly condition," say Ag Marketing
Service (AMS) reporters.
"Cattle are mostly thin-fleshed and have developed hardness from the
harsh weather that will help them stave off sickness and give
outstanding feedlot performance. New-crop calves are starting to show up
on the market in larger numbers and stocker buyers are aggressively
bidding on them. Many backgrounders believe the availability of
lightweight calves will be tight this spring and they're trying to get a
head-start in their purchasing before the emergence of grass and the
ensuing March Madness."
All told, feeder steers and heifers sold steady to $3 higher last week,
while calves picked up as much as $5.
In response to tighter beef supplies -- substantially lighter carcass
weights courtesy of the lousy winter -- fed-cattle markets gained, as
well. For perspective, carcass weights declined 27 lbs. from the middle
of December to the first of February. In the North, dressed prices were
$1-2 higher at $146-147/cwt.; steady to $1 higher on a live basis at
$90-$91. In the Southern Plains, fed-cattle prices were basically steady
with the prior week at mostly $91.
As a word of caution, though, AMS points out, "The extreme shortage of
hay could make it expensive to hold these stockers until pastures will
support them. The lack of hay is also causing a continued deep culling
of cow herds with a large number of bred cows still coming to town and
most of them going to slaughter. The number of cows and bulls harvested
in 2006 was nearly 11% larger than the previous year."
The summary below reflects the week ended Feb. 16 for Medium and Large 1
-- 500- to 550-lb., 600- to 650-lb. (calves), and 700- to 750-lb. feeder
heifers and steers (unless otherwise noted). The list is arranged in
descending order by auction volume and represents sales reported in the
weekly USDA National Feeder and Stocker Cattle Summary:
| Summary Table
| State|| Volume ||Steers || Heifers
| Calf Weight|| 500-550 lbs. || 600-650 lbs.
|| 700-750 lbs.
|| 500-550 lbs.
|| 600-650 lbs. ||
700-750 lbs. |
| Dakotas ||38,100 |
| MO || 31,900 || $119.11 || $108.45 || $99.39 || $103.13 || $94.85 || $92.26 |
| OK || 30,600 || $117.14 || $105.51 || $99.10 || $104.99 || $95.11 || $92.68 |
| NE ||24,300 || $122.34 ||$117.512 || ** ||
$103.172 || ** |
| KY* ||18,200 || $98-108 ||
$89-99 || $83-935 || $83-93 || $79-893 || $76-865 |
| TX ||16,000 || $113.31 || $102.48 || $98.66 || $101.82 ||
$94.40 || $90.82 |
| IA ||10,700
||$115.782 || $100.617
||$100.802 || ** |
| AL ||8,600 || $106-115 ||$92-983 || $86-93.505 || $93-107 || $85-92 || $79-875 |
||8,200 || $92-115 ||
$84-103 || $77-94 || $82-108 || $77-89 || $72-83 |
| TN* ||8,100 || $107.42 ||$93.68 || $89.51 || $93.52 ||$85.77 || $82.28 |
| KS ||6,600 || $128.61 || $115.73 || $100.31 || $108.86 ||$97.11 || $95.15 |
| CO ||6,200
||$112.312 || $99.33 || $102.62 ||$94.614 || $91.18 |
| AR ||5,800 || $112.30 || $103.47 || $94.78 || $96.24 ||$88.65 || $88.754 |
| WY ||5,500
||$118.242 || **
||$102.752 || ** |
| MS* ||5,000 || $100-110 || $85-95 || $80-954 || $90-951
|| $80-90 || $78-804 |
||4,800 || $93-113 ||
$85-99 || $77-90.50 || $80-102 || $74-89 || $73-83 |
| NM ||4,500
|| $101.84 || 92.21 || $94.66 ||$91.01 || ** |
| FL* ||4,200 || $92-107 || $82-92 || **
||$80-84 || $77-79 |
| LA(ND) ||2,900 || $97-110 ||$91-1102 || ** ||
$92-107 ||$85-1022 || ** |
| MT ||2,700
|| $107.82 || $96.10 || $102.78 ||$98.68 || $90.91 |
| VA ||1,900
|| $107.762 ||$97.484
||$87.24 || $87.67 |
| WA* ||1,700 || $106.81 ||$96.99 || 94.03 || 88.43 ||87.24 || 87.67 |
* Plus 2
** None reported at this weight or near weight
(***) Steers and bulls
(?) As reported, but questionable
Calendar of Events
April 1 -- Applications due for the
National Stocker Award -- for more details and an
application, see www.nationalstockeraward.com;
for a hard copy of the application, contact Marilyn Anderson at BEEF,
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