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News and views on stocker segment issues from BEEF magazine.
July 25, 2006 A Prism Business Media Publication
ISSUE CONTENTS
Emergency CRP Haying And Grazing Expanded

BSE-Driven Chaos Continues

Forage Stockpiling Tips

Heat Scorches The Nation

Wheatland Stocker Conference

Other Upcoming Events

Bears Growl With Cattle On Feed Report

Calf Prices Fall

Questions & Comments


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News
Emergency CRP Haying And Grazing Expanded
USDA has announced expansion of CRP acreage open for emergency practices, such as haying and grazing, to provide drought relief for producers. The expansion will allow livestock producers from eligible counties to obtain needed hay or forage. The expanded area radiates 150 miles out from any county approved for emergency haying and grazing in any of the following states: Alabama, Colorado, Kansas, Nebraska, New Mexico, North Dakota, Oklahoma, South Dakota, Texas and Wyoming.

"Drought conditions have created serious hardships for many farmers and ranchers in the Great Plains and other areas across the country," Chuck Conner, USDA deputy secretary, explains. He says producers can find a map of counties approved for emergency haying and grazing with an approximate 150-mile radius by clicking "Conservation" at www.fsa.usda.gov.

Additionally, producers' CRP rental payment will be reduced by only 10% instead of the standard 25% on CRP lands that are grazed in 2006. To be approved for emergency haying or grazing, a county must be listed as a level "D3 Drought -- Extreme" or greater, or have suffered at least a 40% loss of normal moisture and forage for the preceding four-month qualifying period.

Connor also reminds state USDA Farm Service Agency (FSA) committees that they may authorize emergency haying or grazing of CRP in counties currently listed as level D3 drought, according to the U.S. Drought Monitor. CRP participants should submit applications with their local FSA offices upon approval.

To participate:
  • Livestock producers in counties approved for emergency haying or grazing assistance may purchase hay or conduct emergency haying and grazing of eligible CRP acreage from CRP participants (in the expanded area) willing to provide hay or haying and grazing.
  • Livestock producers in counties approved for emergency haying or grazing assistance must certify they are an eligible livestock producer in an eligible county approved for emergency haying and grazing and that they are requesting emergency haying and grazing of eligible CRP acreage from another eligible CRP participant in the expanded area who is willing to provide hay or grazing.
  • The primary nesting and brood-rearing season of the state where the land to be hayed or grazed is located will be respected. For example, a portion of Minnesota is within the 150-mile range of North Dakota counties approved for emergency haying and grazing. Minnesota's nesting season ends Aug. 1. Livestock producers in North Dakota counties approved for emergency haying and grazing and who wish to hay or graze CRP acreage in Minnesota may begin Aug. 2.
Only livestock operations located within approved counties are eligible for emergency haying or grazing of CRP acreage. CRP participants who do not own or lease livestock may rent or lease the grazing privilege to an eligible livestock farmer located in an approved county.

For all land enrolled in CRP that has been approved for emergency haying and grazing, the 10% payment reduction will be assessed based on the number of acres actually hayed or grazed times the CRP annual rental rate. CRP participants who prepaid the 25% payment reduction will have the difference refunded.

In addition to making forage available on CRP land, USDA is operating a range of programs to assist producers affected by drought or other natural disasters. More info on emergency haying and grazing is available at local FSA offices and online at: www.fsa.usda.gov, click on "Conservation."



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Foreign Trade
BSE-Driven Chaos Continues
By the time you read this, it's possible that USDA will have announced limited resumption of beef trade with Japan. At least that was the media speculation over the past weekend. Meanwhile, BSE continues to drive and cast doubt over a variety of policy decisions. Consider the past two weeks alone:
  • Canada discovered its sixth and seventh cases of BSE; the latter a 50-month old female born after the feeding ban went into place. Just as USDA was finalizing the paperwork to resume allowing imports of Canadian cattle over 30 months of age.
  • A beef roast reportedly found its way into an order of turkey and pork that was shipped to Japan.
  • Creekstone Farms has asked for a summary judgment in its suit against USDA. As you'll recall, Creekstone wants to test its beef for BSE; USDA has refused.
  • Talks with South Korea remain in a stalemate.
  • Now Russia is demanding to audit U.S. pork and beef freezing practices.


Stocker Management
Forage Stockpiling Tips
Tall fescue leads the forage stockpiling pack when it comes to fall yields. According to University of Minnesota (UM) researchers, this perennial served up 20% more yield in the fall than its closest competitor in that part of the country. Researchers conducted the evaluation at the UM research center in Morris, MN. The various species were evaluated from July 15 to harvest prior to a killing frost.

Tall fescue had the greatest fall yield and among the greatest total season yields of eight species evaluated. Reed canarygrass and orchardgrass were second to tall fescue in stockpile yield, producing about 600 lbs./acre less forage dry matter (about 20% less). Since yield data for alfalfa represents the sum of two harvests (mid-August and mid-September), alfalfa would likely not be a good candidate for stockpile management. Even birdsfoot trefoil produced over 1 ton/acre of stockpiled forage; however, the researchers say it would be important to use this forage prior to a killing frost since substantial loss in yield and quality would be expected.

Though any forage species or mixture can be stockpiled, the researchers emphasize some species lend themselves more readily to the practice than others. As an example, they say tall fescue is among the best grass species for stockpiling because: 1) It is productive in the fall; 2) Its feeding value deteriorates relatively slowly after a hard frost; 3) It accumulates a high concentration of soluble carbohydrates (readily digestible energy for grazing cattle) in response to fall conditions; 4) It forms a tough sod which can recover from animal trampling during the wet conditions that can sometimes occur during the stockpile-grazing period.

Recent experiments in Minnesota and Wisconsin have demonstrated tall fescue's potential for stockpiling in this region; but only endophyte-free tall fescue seed should be used. They also suggest to seed small acreages initially if cattle farmers have not seeded tall fescue before.

For producers in that neck of the woods, researchers say:
  • Earlier stockpile initiation (June to early July) will produce relatively more yield of lower quality forage. Later stockpile initiation (late July to August) will produce relatively less yield of higher quality forage.
  • Application of either synthetic or organic nitrogen at the initiation of stockpiling grasses is essential. For synthetic nitrogen, 40-60 lbs. nitrogen/acres is recommended.
  • Yield of stockpiled forage will generally increase until the first hard frost. After this, both yield and quality of the forage will decline. The energy level of the forage will deteriorate more than its protein level, so supplementation should most often be geared first toward meeting energy needs. In Wisconsin research, digestibility of stockpiled grasses declined from about 74% in October, to 71% in December, and about 65% the following March. Over the same period, crude protein percentage declined only 1%, from about 12% to about 11%. In addition, forage quality of the stockpiled feed will decline least rapidly with tall fescue, and most rapidly with legumes.
For the complete report click here.



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Weather And Crops
Heat Scorches The Nation
Temperature records continued to fall last week in the grip of a nationwide heat wave that saw cattle dropping in feedlots, municipal utility consumption soaring to new heights and people getting grumpier than a toothless rattlesnake. Spun differently, soil and crop conditions continue to deteriorate across big chunks of the nation. Even in areas of drought that have received recent rains, while welcome, it's little more than window-dressing.

For the week ending July 18, according to the National Ag Statistics Service:
  • Corn -- 51% is at or beyond the silking stage, which is 5% ahead of last year and 13% ahead of average. Silking was reported at or ahead of normal in all states but Indiana. 6% has entered the dough stage, which is on par with last year and the five-year average. 62% is rated Good or better, compared to 55% last year.

  • Soybeans -- Blooming has begun on 60% of the acreage, 1% behind last year, but 12% ahead of normal. 16% was setting pods, 1% ahead of last year and 5% ahead of normal. 57% is rated Good or better; 53% was at the same time last year.

  • Winter wheat -- 80% of the acreage has been harvested. That's 4% ahead of last year and 7% ahead of the normal pace.

  • Spring wheat -- 97% of the crop is at or beyond the heading stage, which is 7% ahead of last year and 11% ahead of the five-year average. 34% is rated Good or better, compared to 75% last year.

  • Barley -- Heading advanced to 86%, compared to 87% at this time last year and 85% for normal. 52% is rated Good or better, compared to 80% last year.
  • Sorghum -- 37% of the acreage is in the heading stage, which is 12% ahead of last year and 9% ahead of average. 23% was at or beyond turning color, 7% ahead of last year and ahead of normal. 42% is ranked Good or better, compared to 57% last year.

  • Oats -- 18% of the acreage is harvested, which is 1% ahead of last year and 4% ahead of average. 33% is rated Good or better, compared to 64% last year.

  • Pasture -- 24% is rated Good and 4% is rated Excellent, compared to 34% and 7%, respectively last year. 23% is rated Poor and 18% is ranked Very Poor, compared to 17% and 9% respectively at the same time last year.
States with the worst pasture conditions -- at least 30% of the acreage rated poor or worse -- include: Alabama (83%); Arizona (81%); Arkansas (33%); Colorado (65%); Georgia (62%); Iowa (41%); Kansas (35%); Louisiana (30%); Michigan (36%); Mississippi (60%); Missouri (52%); Nebraska (58%); New Mexico (70%); North Dakota (62%); Oklahoma (61%); South Dakota (52%); Texas (63%); Wisconsin (43%); Wyoming (63%).

States with the lushest pasture conditions -- at least 40% rated good or better -- include: Idaho (78%); Illinois (46%); Indiana (71%); Kentucky (66%); Maine (79%); Maryland (61%); Michigan (46%); Nevada (42%); New York (66%); North Carolina (56%); Ohio (72%); Oregon (53%); Pennsylvania (68%); South Carolina (41%); Tennessee (46%); Utah (50%); Virginia (58%); Washington (83%); West Virginia (66%).


Events
Wheatland Stocker Conference
There's still time to sign up for the Wheatland Stocker Conference set for August 18 at the Cherokee Strip Conference Center in Enid, OK. The 20th annual event features a Who's Who of industry leaders to discuss everything from the cattle cycle, to no-till and low-till farming, to the impact of industry transitions on the stocker business.

Speakers and topics include:
  • Paul Hitch, Hitch Enterprises, Guymon, OK, Change and the stocker business.
  • Mark Gardiner, Gardiner Angus Ranch, Ashland, KS, Change and the stocker business.
  • Jackie Moore, Joplin Regional Stockyards, Joplin, MO, Change and the stocker business.
  • Representative Frank Lucas, farm bill legislation.
  • Dan Thomson, DVM, Kansas State University, Stocker cattle health.
  • Derrell Peel, Oklahoma State University, Cattle cycle and stocker economics.
  • Craig Watz, FBI Special Agent, Kansas City, MO, food safety.
  • Roger Gribble, Area Agronomist, Enid, OK, No-till, low-till and maintaining forage quality and quantity.
To sign up -- registration is free, including lunch, contact 580/237-7677. For more information, contact Greg Highfill at 580/237-7677 or Greg.Highfill@okstate.edu.


Other Upcoming Events
August 8 -- University of Arkansas "Conservation Tillage and Stocker Cattle", Clark County Fairgrounds, Arkadelphia, AR. For more information, call 870/246-2281.

September 28 -- Kansas State University (KSU) Beef Stocker Conference, KSU Beef Stocker Unit, Manhattan, KS. For more information contact 785/532-1267.



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Markets
Bears Growl With Cattle On Feed Report
Last Friday's monthly Cattle on Feed Report (COF) likely will cast an unexpected pall over the marketplace: more monthly cattle placement was reported than most every market analyst had predicted. Total cattle on feed was reported at 10.9 million head, 5% ahead of last year and 7% more than 2004. Marketings were reported at 2.2 million head, 6% more than the same time last year and 6% more than two years ago.

It was the June placements that shook things up, though -- 10% more than a year ago, 18% more than two years ago. That's the second highest placement for the month since the series was established a decade ago.

"Maybe the placement total should not have been such a shock as we recall a handsome June feeder market, extremely dry conditions, and June nationwide reported auction totals that were 19% higher than last year," say reporters for the Ag Marketing Service. "Feedlot placements weighing under 700 lbs. dominated the data and were more than 30% over last year, while weights over 700 lbs. were 5% less than a year ago."

For the record, the mid-year Cattle Inventory Report, also issued on Friday, pegs all cattle and calves at 105.7 million head, up 1% from July last year and 2% above 2004. Beef cows (33.9 million head) are up less than 1% compared to last year; they're up 1% compared to two years ago. The estimated inventory of beef replacement heifers remains unchanged at 5 million head.


Calf Prices Fall
Calf prices were lower across the board last week by as much as $10/cwt., more on fleshy unweaned calves, according to the Agricultural Marketing Service (AMS). That's despite the fact that corn futures prices dropped in response to cash corn prices that had lost nearly $0.30/bu. during the previous week.

AMS analysts says this past week's feeder and stocker cattle trade was completely dominated by the overwhelming heat wave that covered most of the U.S. Triple-digit temperatures covered all five major cattle feeding areas resulting in significant death loss of calves, yearlings, and finished cattle. Many Kansas feedlots reported a drop in feed consumption and the absence of performance with many pens containing fewer pounds of cattle than they did two weeks ago. Hot weather also weighed on the dressed beef market with Choice cut-out values more than $5/cwt. lower for the week as consumers deem conditions too hot to grill.

The Cattle on Feed report issued Friday afternoon will likely keep the price pressure on calves. AMS points out June placements under 700 lb. were 30% more than a year ago (see Bears Growl...above).

The summary below reflects the week ended July 21 for Medium and Large 1 -- 500-550-lb., 600-650-lb., and 700-750-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.
OK 34,800 $126.20 $120.11 $116.34 $115.85 $113.13 $108.05
TX 30,000 $121.21 $123.62 $115.51 $115.62 $110.38 $104.46
MO 19,300 $129.43 $122.43 $114.63 $118.39 $114.85 $102.19
AL 16,800 $115-122 $107-112 $98-106 $109-117 $101-107 $92-100
KY* 15,200 $112-122 $106-116 $101-1115 $107-117 $100-1103 $93-1035
GA* 11,100 $102-122 $95-112 $92-105.50 $98-115.50 $90-105 $95.50-97
TN* 10,100 $114.54 $108.28 $102.37 $106.89 $100.17 $92.64
NE 10,000 $143.12 $130.61 $126.01 $128.36 $124.34 $114.73
AR 9,400 $118.41 $112.36 $107.19 $110.74 105.99 $99.24
FL* 7,500 $100-117 $90-113 $85-91 $94-112 $89-102 $91-954
Carolinas* 6,300 $101-118.50 $95-1133 $90-1055 $95-110 $82-1053 $80-965
KS 6,300 $133.36 $125.04 $118.99 $118.19 $114.83 $111.34
MS* 5,500 $110-1201 $100-1103 $96-1005 $100-1101 $92.50-1003 $90-965
SD 5,400 ** $124.854 $115.096 $121.86 $116.714 $116.48
LA 4,600 $106-122 $110-1182 ** $94-117 $98-1132 **
NM 2,500 $127.84 ** ** ** ** **
VA 2,100 $119.84 $118.30 $111.56 $110.24 $103.56 $103.964

* Plus 2
** None reported at this weight or near weight
(***) Steers and bulls
NDNo Description
1500-600 lbs.
2550-600 lbs.
3600-700 lbs.
4650-700 lbs.
5700-800 lbs.
6750-800 lbs.
7800-850 lbs.


Contact
Questions & Comments
Please send questions to:

Wes Ishmael, Contributing Editor, BEEF Stocker Trends, at wesleysink@aol.com

Joe Roybal, Editor, BEEF magazine, at jroybal@beef-mag.com



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