View this email as a Web page Please add Cow-Calf Weekly to your Safe Sender list.
A Prism Business Media Property
November 10, 2006


Table of Contents
Animal Rights Initiatives A Little Scary
Corn Rallies, Calves Fall -- Fear And Greed Take Control
Election 2006 -- The Aftermath
Ethanol In Brazil -- Impacting Cattle Production There, Too
Johanns Pushing Japan To Drop Cattle Age Limit
West Nile Virus Found In Sage Grouse
Hay Production Is Down, USDA Reports
Japanese Embargo Imports For Swift's Greeley Plant
Make Plans For The International Livestock Congress
North Carolina Plans Risk-Management Workshops
WY-NE Beef Production Convention Is Nov. 21
BEEF Quality Summit Is Next Week In Oklahoma City


ADVERTISEMENT
The POWER of one BRAND can change your future in the beef business.

Certified Angus Beef ®, the oldest, most successful branded beef program in the industry returned more than $50 million in grid premiums in 2003. The demand for CAB® brand products translates into fed cattle premiums of $2-$5/cwt. Source-verified, high-percentage Angus replacement females often top auctions by selling for $50-$100 per head above cash market. Sale barn surveys conducted at nine auction markets indicated premiums are paid, not for black-hided cattle, but for high-percentage-Angus cattle.

One brand, one breed--the power of one can change your future in the beef business.


www.angus.org




Certified Angus Beef® and CAB® are registered trademarks of Certified Angus Beef, LLC

Our Perspective
Animal Rights Initiatives A Little Scary
The most publicized animal rights issue this fall was proposition 204 in Arizona which prohibited veal crates for calves and gestation crates for pigs. A similar initiative was passed regarding gestation crates in 2002, and was successful in essentially eliminating the already small pig industry in Florida.

The animal rights movement has found a model for success and they took it to Arizona where this measure passed by a whopping 61% of the vote. While the agricultural industry was not prepared for the initiative in Florida, they were well funded and well aware of the threat to their industries by this initiative. But, they were simply outgunned on an issue that inherently has the support of the public as they are not educated on the issue.

We can expect these initiatives to emerge at a more rapid pace, and agriculture is going to have to figure out how to band together to counteract the massive funding disadvantage that agriculture is going to have. If they pick each state off one by one, step by step, they will have won not because of the correctness of their agenda, but because of a vastly superior implementation of tactics and strategy.
-- Troy Marshall


Back to Top

Corn Rallies, Calves Fall -- Fear And Greed Take Control
Sure, corn carryover supplies have been reduced, yields have been lowered in some areas and ethanol demand is exploding. But, we're also going to post one of the largest corn harvests in history.

The base for corn demand has been altered and that's a reality the cattle markets and farmers will have to understand. The implications are real. The market is behaving like 3-4 weeks ago when it woke up and everybody decided ethanol production would require 20% of the corn crop. It's as if this increase had never crossed anybody's mind.

Funds, speculators and everyone has jumped in for the ride, sending the markets to new contract highs one right after the other. However, as is often the case the market is also likely overreaching against itself.

Already the experts are predicting that 2007 will see the largest corn plantings in history. Perhaps the market has sent the signal to plant corn from fence row to fence row. But as a good friend explains it, you bring flowers and then a very big diamond when you're proposing marriage, once you're married, flowers once a year usually suffices. There may be some wisdom there for those who are talking about $5/corn.
-- Troy Marshall


Back to Top

Election 2006 -- The Aftermath
The elections came in just as the prognosticators had predicted. So what does it mean for cattle producers? First it is important to remember that the majorities are extremely small. And, while the majority of the new Democrats ran as extremely conservative Democrats, it's not the size of the majority or the makeup of the majority that's important it's the majority status that conveys tremendous political power. While the voters may have elected candidates like Heath Shuler, an ultra conservative Democrat, they essentially elected Nancy Pelosi to the position of House speaker, etc.

Every committee chair and every committee agenda will change. The ironic thing is that while the race was dominated by foreign policy issues, this is an area that's largely a presidential role. Certainly, the Congress controls the purse strings, but reality says they have very little control in this area.

The extension of the tax cuts and the repeal of the Death Tax are now officially dead at least for a couple of years. Trade issues, the environment and even endangered species and will take a momentous shift.

Still in terms of bigger picture items like the 2007 Farm Bill, there isn't expected to be a radical shift overall but the issues that appeal to smaller subsets like packer concentration and captive supply issues will likely find a more receptive audience. Nevertheless, history tells us that what we can expect with a divided government, with narrow majorities, and a lame-duck President without tremendous popularity is essentially nothing.

Instead, after both sides respond with their noble rhetoric about working together to achieve something, we will see positioning for the 2008 election year to begin almost immediately. President Bush has only vetoed one bill in the last six years. That's not surprising as he's been dealing with a Republican controlled Congress. We can expect the cap on the veto pen to come off early and often as both sides posture for 2008.

If the Democrats carry their momentum forward in 2008 that's when we'll see the quantum changes and the huge differences in ideology emerge. To see much more than a small change in the minimum wage over the next couple of years will be dramatic, and sadly that is the best case scenario for both sides, in what promises to be the most momentous election of our time in 2008.
-- Troy Marshall


Back to Top

Ethanol In Brazil -- Impacting Cattle Production There, Too
Growing corn demand for ethanol has many beef producers across the country more than a bit nervous. But, if you think ramped-up ethanol production in the U.S. is impacting the dynamics of domestic cattle production, a look south indicates a similar story. But, in Brazil, the competition isn't over corn -- it's over another kind of grass.

In Brazil, where sugarcane is king, harvest is around 13 million acres today. Brazil's Center for Sugarcane Technology predicts that by late next year 40-50 new alcohol production plants will join the existing 340 plants already in service. Each will need about 67,000 acres of sugarcane located no more than 40 kilometers from the mill. In the state of Sao Paulo alone 2 million acres of cattle pasture will convert to sugar cane in order to fuel another 90 plants planned to be built between 2008 and 2010.

Because Sao Paulo state benefits from some of the best transportation infrastructure in the country, the value of land for sugar cane has risen nearly three-fold over the past three years to $1,250/acre.

Comparing sugar cane ethanol with corn-based production is one that Brazilians love to make. They note that ethanol extracted from corn yields only about 15-25% more energy than the fuels used to produce it. In Brazil, industry studies show cane-based ethanol yields about 830% more energy. Plus, the ethanol plants are fueled with bagasse, the leftover sugarcane stalk.

The upshot is Brazil's thirst for ethanol is driving the cattle industry north and northeast at warp speed into regions of poorer highways, fewer meat packing facilities, and even less law enforcement. Significantly, in just the past couple of years, the state of Mato Grosso has replaced its southern neighbor, Mato Grosso do Sul, as the leader in cattle numbers.

This competition for land in the more fertile and developed southern regions forces Brazilian cattlemen to be even more reliant on the tropics-happy Zebu breeds as the nation's herd shifts north. They are great for that environment -- but on a comparative scale can't compete against their more efficient Bos taurus cousins. And, the beef from these animals simply cannot compete for space in America's meat cases.

Much of the north and northeast is frontier where land must be cleared, fenced and planted to exotic forages before an animal is turned out to graze. And, because of attention to the native ecosystems environmental restrictions against cattle grazing are increasing.

We must also remember that until the South American continent rids itself of foot-and-mouth disease (FMD), Brazil will be hard-pressed to gain entry into NAFTA and Asian fresh beef markets. And, it's the border frontier regions where the danger of FMD lurks.

On Fazenda Mosquito, a former Swift/King Ranch holding now owned by Canadian agro-industrial conglomerate Brascan, about two-thirds of the ranch's 75,000 acres is being systematically converted to sugarcane. A remainder of the property will be saved for "seedstock" production to funnel replacement Nelore cattle onto other Brascan properties located in more remote reaches of Brazil's sub-Amazon cerrado region.

This movement may have a long term impact on Brazil's competitive edge in global beef markets. As the heart of the country's cattle herd moves north, it leaves behind the efficiencies of transportation and marketing infrastructure and animal productivity.

In the scope of global competition, this may be good news long-term for U.S. cattlemen. Make no mistake, with 190 million head of cattle Brazil's a formidable player in global beef trade. But, it's the Aussies and the Kiwis who fear Brazil the most today.

That said, U.S. beef producers must continue to seek every competitive advantage possible while facing pressure from shifting corn usage. We must be aware of the dynamics of the supply chain -- and be willing and able to adapt as competitive forces swirl around us at home and abroad.
-- Clint Peck


Back to Top


ADVERTISEMENT


Real-world Lepto hardjo-bovis protection
Vira Shield 6+VL5 HB from Novartis protects against up to 12 pathogens -- including BVD, vibrio and Lepto hardjo-bovis. The L. hardjo-bovis isolate in Vira Shield 6+VL5 HB originates from a real U.S. herd that was experiencing real reproductive problems. Click on the Vira Shield 6+VL5HB logo to learn more.

International Trade
Johanns Pushing Japan To Drop Cattle Age Limit
U.S. Ag Secretary Mike Johanns may press Japan to drop the age limit on imports of U.S. beef, hardening the call to raise the limit to 30 months from the current 20 months, according to The Japan Times Online. Johanns' remarks underscore what appears to be a strategy of urging Japan to adopt U.S. standards for safeguarding against BSE. U.S. standards require removal of brains, spinals cords, bones and other specified risk materials (SRMs) from cattle aged 30 months or older to safeguard against BSE.

Washington has agreed on stricter requirements for beef exports to Japan, limiting shipments to meat from cattle aged up to 20 months and removing risk materials. Under those conditions, Japan agreed in July to lift the ban on imports of U.S. beef.

"The 30-month limit is not the international standard," Johanns says, stressing that the issue now is about mitigating risks by removing materials at risk for mad cow disease.

USDA called for abolition of the 30-month standard in a recent general meeting of the World Organization for Animal Health which basically agreed on the risk-based approach but maintained the age limit.

The risk-based approach is a particular point of controversy between Japan and the U.S. because a failure by a New York exporter to remove risk material in violation of the agreed safeguard requirements led Tokyo to reinstate the import ban in January. Part of a spinal cord was found in veal that arrived in Japan only a month after the original two-year-old import ban was lifted in December.

The ban had originally been imposed after the first U.S. case of BSE was confirmed in December 2003. While Japan agreed in late July to resume imports after inspecting U.S. meatpackers, Japanese consumers still have safety concerns and major supermarket chains have yet to put U.S. beef products back on their shelves, says the Japan Times Online article.

Another major source of concern is that BSE testing is not required for U.S. beef. USDA is continuing to turn down requests by some U.S. producers to voluntarily conduct blanket testing on cattle for beef exports to Japan to satisfy Japanese consumers. Japan continues to carry out blanket BSE testing on all slaughtered cattle although the government has decided to exempt cattle aged up to 20 months from BSE testing to pave the way for imports of U.S. beef.
-- Clint Peck


Back to Top


ADVERTISEMENT

This year Camp Cooley Ranch celebrates 20 years of ultrasound performance in our Brangus herd. From this work results some of the most powerful, performance proven Brangus, Angus and Charolais bulls to ever sell at Camp Cooley. Your search for Quality in Volume begins and ends at Camp Cooley Ranch. Give us a call or stop by for a visit!
www.campcooley.com
1-800-251-0305

Environment
West Nile Virus Found In Sage Grouse
Since July 2006, greater sage-grouse deaths from West Nile virus have been reported in Oregon, Colorado, Idaho, Nevada, Montana, South Dakota, North Dakota and Wyoming. U.S. Geological Survey (USGS) investigators say more mortalities may be documented before the end of the year. Ranchers are encouraged to report sage-grouse mortality to their respective wildlife agencies.

West Nile virus has also previously been detected in sage-grouse in California and Utah, as well as Alberta, Canada. Experimental studies at the USDA National Wildlife Research Center have shown that West Nile virus is usually fatal to sage-grouse, resulting in death within six days of infection.

Those handling dead birds should take at least minimal precautions. Anyone who encounters a dead bird and is unsure of why it died should wear protective gloves when handling it, or use an inverted plastic bag to collect the bird. Anyone cleaning wild game should wear disposable latex gloves or similar protective alternative. Cooking meat, including game, to over 170 degrees F. will kill any viruses present in the meat.

To report sage grouse mortality or obtain more information on USGS sage grouse work, contact Kathryn Converse, 608/270-2445, kathy_converse@usgs.gov or Bob Dusek, 608/270-2403, rdusek@usgs.gov.
-- Clint Peck


Back to Top

Industry News
Hay Production Is Down, USDA Reports
Feed it if you've got it, or better yet, sell it if you can! Hay that is.

According to the Oct. 19 "Livestock, Dairy and Poultry Outlook" from the USDA Economic Research Service (ERS), hay production is estimated at 147 million tons this year, down 2.4% from last year; May 1 hay stocks were down 23% from a year ago.

Consequently, explain ERS analysts, "Hay supplies are likely to be fairly tight and expensive for this winter, particularly if a more normal winter pattern develops following the mild winter last year."

According to ERS, the September farm price of other hay averaged $93/ton, up from $78.90 a year ago. Alfalfa hay prices averaged $112/ ton, up from $106. Depending on where you live, you've been paying lots higher prices to make for such a low average.

Other hay production is forecast to be down 3% from 2005. Alfalfa hay production is estimated at 2% less.

On a happier note, ERS says pasture conditions continue a modest recovery, though favorable temperatures and moisture are still needed to accumulate much-needed growth for winter grazing.

Plus, rains in recent weeks, along with improved soil moisture, are making wheat pasture look more promising.

For the week ending Oct. 29, according to the National Agricultural Statistics Service (NASS), 28% of pasture is rated Good or Excellent, compared to 29% last year. 22% is rated Poor and 17% is ranked Very Poor, compared to 21% and 16% respectively at the same time last year.

States with the worst pasture conditions -- at least 40% of the acreage rated poor or worse -- include: Alabama (50%); California (84%); Florida (50%); Kansas (46%); Missouri (56%); Nebraska (45%); Nevada (40%); North Dakota (50%); Oklahoma (58%); Oregon (55%); South Dakota (44%); Texas (54%); and Wyoming (63%).

States where pasture conditions are best -- at least 40% rated good or better -- include: Arizona (52%); Idaho (40%); Illinois (54%); Indiana (67%); Iowa (48%); Kentucky (73%); Maine (75%); Maryland (53%); Michigan (50%); New Mexico (62%); New York (40%); North Carolina (65%); Ohio (68%); Pennsylvania (56%); South Carolina (55%); Tennessee (42%); Utah (56%); Virginia (62%); Washington (41%); West Virginia (55%); and Wisconsin (46%).
-- Wes Ishmael, BEEF Stocker Trends


Back to Top

Japanese Embargo Imports For Swift's Greeley Plant
Japanese officials have temporarily embargoed beef imports from Swift & Co.'s Greeley, CO, plant. A Japanese agriculture ministry official told the Associated Press that a shipment of thymus glands was received without proper documentation. The shipment reportedly contained products that were not listed on the manifest.

While those glands are eligible for export to Japan, Swift had not been approved to export them. Swift spokesman Sean McHugh told Meatingplace.com that the box was clearly marked, and that the transparency has led to a measured reaction from Japanese officials, who appear to be treating the incident as routine.

USDA was asked by Japanese officials to investigate the incident and report back with measures to prevent a recurrence. An official with the Agriculture Ministry said he was concerned that such a "simple mistake" would be made so soon after Japan resumed imports of U.S. beef.

The package was only one of 760 boxes containing 11 tons of beef and beef tongue. McHugh says the company's other plants are still able to export to Japan and Swift will cooperate fully with U.S. and Japanese officials.
-- Clint Peck


Back to Top


ADVERTISEMENT
Fresh water on demand, 24 hours a day.

Ritchie manufactures a complete line of livestock watering products with the highest specifications in the industry. Ritchie fountains are available in stainless steel, heavy-duty poly or both and backed by a 10 year limited warranty. Contact us at 800-747-0222. www.ritchiefount.com







Industry Meetings
Make Plans For The International Livestock Congress
The National Western Stock Show will host the 2007 International Livestock Congress -- USA (ILC) Jan. 9 in Denver, CO. The ILC is hosted in partnership with the International Stockmen's Educational Foundation and the National Cattlemen's Foundation.

The 2007 International Livestock Congress, "Global Beef: Thinking Beyond the Fence," gives producers, ranchers, retailers, packers and other industry suppliers real tools to make decisions for tomorrow.

Highlights of the event include a packer panel with representatives from Swift, Tyson and Cargill Meat Solutions and a producer panel with representatives from the cow-calf and feedlot segment and the export and auction market segment. There will be a hands-on program showing producers where the various cuts come from, why certain cuts are exported, and a comparison of values, i.e. the Flat-Iron Steak and the Tri-Trip. Discussions will be held on grid pricing based on carcass merit. This will include workshops on age and source verification, additional methods of adding value to the ranch (wildlife, fishing, birding etc.), disease prevention, drought management and risk management.

The Montana Beef Network animal ID trailer, demonstrations from Colorado State University students and staff and the Beef Quality Assurance display from Oklahoma State University will also be on hand.

The ILC is set for the Renaissance Denver Hotel, 3801 Quebec Street, 303/399-7500. A special room rate of $87 has been secured for conference attendees who specify ILC. The cost of registration is $150 through Dec. 15 and $175 thereafter.

Students may attend for $100. Registration includes the conference, grounds admission to the National Western, and all Jan. 9 evening activities, including a beef tasting experience and the Professional Bull Riders performance.

For schedule and registration information, visit TheISEF.com or call 303/777-5662 or 817/443-0686. Registration is limited, so prompt registrations are encouraged.
-- Clint Peck


Back to Top

North Carolina Plans Risk-Management Workshops
"Working Your Way To Profitability" is the theme of two risk-management cattle workshops planned in North Carolina later this month. Set for Nov. 29 in Clinton's George Upton Livestock Arena, and Nov. 30 in the Iredell County Ag Center in Statesville, the workshops are presented by the North Carolina Cattlemen's Association (NCCA) , the National Cattlemen's Beef Association, and the Chicago Mercantile Exchange.

Both programs begin at 9:30 a.m. with presentations on: marketing alternatives, shifting price risk, the mechanics of futures with hedging, hedge risk management strategies, and timing considerations for selected option strategies. A hands-on workshop follows lunch.

Space is limited, and registration, due by Nov. 22, is $15 for NCCA members and $35 for non-members. For more info, call 919-552-9111 or visit: www.nccattle.com.
-- Joe Roybal


Back to Top

WY-NE Beef Production Convention Is Nov. 21
Profitability issues are the centerpiece for a Nov. 21 Beef Production Convention in the Torrington, WY, Rendezvous Center. Aimed at southeast Wyoming and western Nebraska producers, the 9 a.m.-4:30 p.m. workshops are sponsored by University of Wyoming Cooperative Extension and University of Nebraska-Lincoln Extension, with support from Western Sustainable Ag Research and Education.

Workshop subjects include crossbreeding, windrow grazing annual forages, a producer panel on late spring and summer calving, avoiding insidious effects of errant grazing on rangeland, natural and organic beef, practical application of feeding by-product feeds, animal handling, using a systems approach to ranch management decisions, an animal ID program update, and embryonic loss and fetal programming.

Pre-registration is requested; registration is $15, which includes lunch, can be paid at the door. Visit www.plattecountyextension.com for more info or to register.
-- Joe Roybal


Back to Top

Industry Events
BEEF Quality Summit Is Next Week In Oklahoma City
There's still time to check out the program and sign up at www.beef-mag.com for BEEF magazine's 2006 BEEF Quality Summit. The Nov. 14-15 workshop in Oklahoma City's Clarion Hotel will provide attendees with the background, tools and the environment to make the connections for involvement, and the potential rewards offered, in the new beef-value chain.

The first day's program is devoted to outlining the opportunity available in the new beef-value chain, the second to how to link your production into that chain. Among the topics to be discussed are:
  • How U.S. beef consumers define quality.
  • Quality, profit and the cattle cycle.
  • International competition and opportunities for U.S. quality beef.
  • Current international beef trade opportunities.
  • Producers will discuss how they're paid for quality.
  • Selecting a marketing partner.
  • Evaluating costs, trade-offs and risks of various markets
  • Linking up with a marketing partner -- an opportunity to meet with participating marketing channel reps.
For more detail, visit www.beef-mag.com and click on the "BEEF Quality Summit" box in the top right corner of the opening page.
-- Joe Roybal


Back to Top


ADVERTISEMENT
Thank You To Our Cow Calf Weekly Sponsors!
Click on sponsors logo for more information.


About this Newsletter

You are subscribed to this newsletter as #email#

To unsubscribe from this newsletter go to: Unsubscribe

To subscribe to this newsletter, go to: Subscribe

For information on advertising in this newsletter, please contact: Bret Kealy at bkealy@prismb2b.com

Do you have comments or suggestions about BEEF Cow-Calf Weekly or its content? Write to:
Troy Marshall, troy@seedstockdigest.com
Joe Roybal, jroybal@beef-mag.com
Clint Peck, cpeck@beef-mag.com

 

To get this newsletter in a different format (Text or HTML), or to change your e-mail address, please visit your profile page to change your delivery preferences.

For questions concerning delivery of this newsletter, please contact our Customer Service Department at:
Customer Service Department
Beef Magazine
A Prism Business Media publication
US Toll Free: 866-505-7173 International: 847-763-9504
Email:">beef-mag@pbinews.com