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January 19, 2007

Table of Contents
Corn Market Is Now Bigger Issue Than Beef Exports
Korea/U.S. Spar Over Beef And Rice In Free Trade Talks
Change In Livestock Contracts Arbitration Eyed
McDonald's 4-Patty Big Mac Is A Big Hit In Japan
Packer Feeding Ban Legislation Introduced
VeriPrime Introduces Farm-To-Fork Traceability
Corn Production Cut; Demand For Ethanol Steady
Animal Welfare Guidelines Released
Cattle Materials Ban In Medical Products Proposed
DOJ Charges 148 Detainees From Swift Raids
Ethanol Phenomenon Is "Like a Freight Train"
Outside Capital Keeps Ranchland Values Rolling
USDA Economist Provides Ethanol Drain Picture
Weekly Average Diesel Price Drops 7.4¢/Gal.
Disaster Aid Legislation Introduced
House AG Committee Membership Now Set
Mexico Removes Tax On High Fructose Corn Syrup
Small Business Tax Relief Introduced
A Wealth Of Management Info At Your Fingertips
New Issue Of American Cowman Update Available
Cowboy Beef Diplomacy Won't Work In Korea


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Our Perspective
Corn Market Is Now Bigger Issue Than Beef Exports
While issues abound in the industry, the corn market continues to be the biggest story. With USDA's latest crop estimate being lowered to just above 10.5 billion bu., and with carryover stocks falling to 752 million bu., the corn market rallied to historical highs this week. Not surprisingly, feeder cattle and calves moved lower as a result.

The industry is trying to sort out both the short- and long-term ramifications. One can usually learn a lot by looking at history but history doesn't provide much insight into this issue. The last time corn price levels were this high was 1996, but it was a supply-driven market caused by the disappointing 1995 harvest.

That's not the case this time, as we've had three of the largest crops in history -- consecutively, no less. It's a demand-driven market and corn demand is expected to exceed production this year by a significant amount.

Fact is, the overall market structure has changed. With subsidized ethanol, it's difficult to create a scenario where corn will fall much below $3/bu. for quite some time, and the upside risk from that level is much greater than the downside risk.

Today's corn prices unquestionably are sending the signal to increase corn plantings. With corn growers looking conservatively at profits of $200/acre or more for corn, we can expect more acreage in corn than at any time in the last 60 years. What's more, the weather conditions look positive and oil prices are falling. That combination of factors will curtail demand, and feed demand will drop significantly as well, giving the industry an opportunity to rebuild carryover levels.

From a cow-calf perspective, not only does $4 corn devalue the entire inventory significantly, it also creates other problems. Hay stocks are at their lowest levels since 1988, and hay prices are expected to increase as hay ground and water are diverted to grain crops.

In addition, stocker and grazing pressure are expected to increase grass costs, as feeders look to maximize gains outside of the feedyard. The result is a terrible and simultaneous mix of exploding input costs and decreasing revenues.

The bottom line is if corn stays at today's historically high levels for an extended period of time, the industry's short-lived expansion will move into full-blown liquidation. It also poses some interesting dynamics about how the industry might change, from a management, marketing, and even genetic standpoint.

The industry has to form a plan of action and move to address the ethanol issue. Otherwise, a market-distorting government subsidy stands to take away our number-one competitive advantage.

The odds politically look extremely tough to get the ethanol issue based on true economic realities, however. The new Congress is just underway and already there's a plethora of new bills on renewable energy. Many of them attempt to lock in the artificial subsidies permanently and expand the use of ethanol.

Needless to say, these initiatives have the overwhelming support of grain-producing states. And the general public, very receptive to reducing U.S. reliance on Mideast oil, seems willing to pay the price for it. But it's a potentially devastating price the beef industry will have to pay, and we must aggressively take action.

That leaves us in the unenviable position of trying to hammer out a solution -- one where corn prices for the cattle industry are adjusted back to the real-world economic levels that would have occurred had government not intervened in the marketplace. That gets extremely messy and politically challenging.

While there's no simple answer, if we continue to do nothing, our industry will lose a good deal of its competitive advantage and constrict significantly. The effects of this subsidy, and the attempts to escalate it and make it permanent, now have supplanted the restoration of our export markets as the industry's greatest challenge.
-- Troy Marshall


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Foreign Trade
Korea/U.S. Spar Over Beef And Rice In Free Trade Talks
Korean and U.S. negotiators met this week in Seoul for their sixth round of talks aimed at arriving at a free-trade pact. Washington pushed for a full reopening of Korea's beef market, while Korea's Ag Ministry pledged to protect sensitive markets such as beef and rice.

The Korea Herald says little progress is expected on ag items during the current round of talks. Rather both sides will feel each other out on their products of interest and willingness to compromise, with earnest negotiations likely to begin in February in order to meet the July deadline when the Bush administration's fast-track trade negotiation authority ends. A deal between the two nations would represent the largest free-trade agreement with a single market for both sides.

Ag is the most sensitive sector for Korea, as local farmers fear competition from the world's largest economy, the article says. It's a sensitivity reflected in the 235 ag items listed in Seoul's "undefined category," which includes beef, rice, pork, chicken, oranges, tangerines, pears, apples and potatoes.

Such undefined items are treated in a number of different ways, including tariff phase-outs over time, complete or partial exclusion from tariff elimination, or controlling trade volumes via tariff rate quotas, the article says.
-- Joe Roybal


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Beef Marketing
Change In Livestock Contracts Arbitration Eyed
Sen. Tom Harkin (D-IA) introduced legislation to end the use of mandatory arbitration in livestock and poultry contracts. Harkin said, "Producers or growers who feel they have been subject to breach of contract, fraud or illegal activity should be allowed to pursue their rights and remedies in our courts and not forced into arbitration." This issue will be addressed during the 2007 farm bill.
-- P. Scott Shearer, Washington, D.C., correspondent


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McDonald's 4-Patty Big Mac Is A Big Hit In Japan
Steamy sales of McDonald's Japan's Mega Mac, a hamburger with four patties, are forcing an extension of the program. The Kyodo News reports sales projections for the Mega Mac had been set at 1.68 million burgers for the temporary menu item that was to be offered until Feb. 4. But Japanese consumers bought up 3.32 million of the sandwiches in just the first four days of the program, forcing McDonald's Japan to extend the promotion.
-- Joe Roybal


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Packer Feeding Ban Legislation Introduced
Senators Chuck Grassley (R-IA), Tom Harkin (D-IA), Byron Dorgan (D-ND), and Mike Enzi (R-WY) introduced legislation to ban packer ownership of livestock. The bill would make it unlawful for a "packer to own, feed or control livestock, either through a subsidiary or an arrangement that gives the packer operational, managerial or supervisory control prior to seven days before slaughter."

Grassley said, "Outlawing packer ownership of livestock would make sure the forces of the marketplace would work for the benefit of the farmer just as much as it does for the slaughterhouse."

Harkin added: "The livestock marketing system will become dysfunctional if the industry becomes overly vertically integrated. We need some federal limits to how far packing and processing firms can go in controlling all phases of the livestock production and processing industry."

The bill exempts packers with one facility, or cooperatives where the members own, feed or control the livestock themselves. This legislation passed the Senate in 2002.
-- P. Scott Shearer, Washington, D.C., correspondent


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VeriPrime Introduces Farm-To-Fork Traceability
VeriPrime, a member-owned federation of cooperatives including producers, processors and retailers, is introducing the VeriPrime Traceability Assurance System (VTAS). The program is designed to provide Certified Traceable food products -- tracked from "farm to fork" -- to American consumers to ensure accountability throughout the food chain.

VTAS is the nation's first and only feed and food chain traceability program via an accredited USDA certifying body, says a VeriPrime release. Certified Traceable food will be identified by a VeriPrime seal of approval.

"For the first time, consumers can be assured at a glance that the food they are purchasing is traceable to its source," said Scott Crain, DVM, CEO of VeriPrime. "Traceability is the cornerstone of food safety and the VTAS, as the prerequisite for all other food safety programs, ensures that everyone is accountable along each step of the food chain."

USDA accredited Agri Food Certification of Meade, KS, as the certifying agent for the VTAS program.

For more info on Agri Food Certification and the VTAS, visit agrifoodcert.com/news.htm. For more on VeriPrime, visit veriprime.org.
-- VeriPrime news release


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Marketing
Corn Production Cut; Demand For Ethanol Steady
USDA last week lowered its 2006-07 corn yield estimate by 2.1 bu./acre from its December figure, signaling good fortune for corn growers but dark news for cattlemen.

The revised estimate calls for total production of 10.535 billion bu., 210 million bu. lower than previously thought, but still the third-largest crop in history. Compounding the pain was USDA's 50-million-bu. increase in its export estimate, while maintaining its projected 2.15-billion-bu. demand figure for ethanol production. With ending stocks dropping 183 million bu., to 752 million bu., it represents the tightest supply/demand balance since the 1995-96 marketing year, says University of Nebraska economist Darrell Mark.

Writing for the Livestock Marketing Information Center (www.lmic.info/), Mark says volatility in the corn market is playing havoc with cattle feeding breakevens. A 750-lb. feeder steer placed on feed in Nebraska in mid-January would have a breakeven selling price of $90.07/cwt in late June, assuming average feeding performance, using $3.75/bu. for corn and $85/ton for hay, plus other costs at market rates. This puts total cost of gain at $74.37/cwt.

"An increase in the corn price to $4/bu. increases the cost of gain to $76.93/cwt. and the breakeven selling price to $91.10/cwt. Thus, the 25c/bu. corn price increase raises the breakeven selling price for this yearling steer placement by about $1/cwt.," Mark says.

The result will likely be lower calf prices for cow-calf producers, he says. Since Sept. 1, 2006, the prices of 500- to 600-lb. and 700- to 800-lb feeder cattle in Nebraska have decreased $17.47/cwt. and $19.94/cwt, respectively, and Nebraska fed cattle prices have declined $3/cwt. During this same time, Omaha corn prices rallied $1.41/bu.

"Should corn prices continue their surge higher, look for feeder cattle prices to continue their downtrend," Mark says. "Regardless, the uncertainty in the corn market could result in cattle feeders bidding a 'risk premium' into the feeder cattle market (in the form of lower prices) to gain some additional protection or 'cushion', " Mark says.
-- Livestock Marketing Information Center


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Industry News
Animal Welfare Guidelines Released
The Animal Agricultural Alliance has released a new brochure that highlights producer-driven animal welfare programs offered by 11 ag and food associations. The brochure provides a summary of each program plus contact info. It's available on the Alliance web site at www.animalagalliance.com under the Animal Welfare tab.
-- Burt Rutherford


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Cattle Materials Ban In Medical Products Proposed
FDA wants to limit the use of some cattle materials in medical products in order to keep them free of the BSE-causative agent. The proposed rule would cover drugs (prescription, over-the-counter, and homeopathic), biologics (such as vaccines) and medical devices intended for use in humans, as well as drugs intended for use in ruminant animals. The materials include:
  • Brain, skull, eyes and spinal cords from cattle 30 months and older.
  • Tonsils and a portion of the small intestines from all cattle regardless of their age or health.
  • Any material from "downer" cattle.
  • Any material from cattle not inspected and passed for human consumption.
  • Fetal calf serum if appropriate procedures haven't been followed to prevent its contamination with materials prohibited by this proposed rule.
  • Tallow with more than 0.15% insoluble impurities if the tallow is derived from materials prohibited by this proposed rule.
  • Mechanically separated beef.
To ensure compliance, FDA proposes to require firms keep records to demonstrate any cattle material used as an ingredient in these medical products or as part of their manufacturing process meet the rule's requirements.
-- FDA release


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DOJ Charges 148 Detainees From Swift Raids
The U.S. Justice Department (DOJ) charged 148 illegal aliens, swept up in raids of six Swift & Co. packing plants last month ("Federal Sweep Of Illegal Workers Hits Six Swift Plants," Dec. 15 BEEF Cow-Calf Weekly), with federal identity theft.

A DOJ news release says 108 were charged with aggravated identity theft, which carries a mandatory minimum sentence of two years imprisonment. Others will be charged with illegal reentry by an aggravated felon, document fraud, Social Security fraud, and identity theft. State charges of identity theft, forgery and criminal impersonation are also being pressed against 98 other defendants.

During the Dec. 12 raids of six Swift plants, agents apprehended 1,282 workers on administrative immigration violations. Of the 148 workers charged with federal criminal violations, 53 were in Texas, 30 in Iowa, 20 in Minnesota, 26 in Nebraska, 18 in Utah, and one Colorado.

Julie Myers, Department of Homeland Security assistant secretary, said: "Our message is simple: No employee in any industry who uses a stolen identity is immune from law enforcement action."

Evidence uncovered during Operation Wagon Train, which began in February 2006, suggests defendants assumed the identities of actual U.S. citizens, using stolen Social Security numbers and other identity documents to get jobs with Swift. Federal authorities said many of the names and Social Security numbers were reported stolen by identity theft victims to the Federal Trade Commission.

In many cases, victims had received letters from the IRS demanding back taxes for income they had not reported because it was earned by someone working under their name. Other victims were denied driver's licenses, credit and medical services because someone had improperly used their personal information before.
-- Joe Roybal


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Ethanol Phenomenon Is "Like a Freight Train"
That's the analogy that Barry Dunn gave about ethanol at this week's Southwest Beef Symposium in Amarillo. But with a twist. "The ethanol industry is a freight train going down the tracks. Hardly anybody knows where it's going, they're laying the tracks as they go and pulling them up behind because there's little chance we're going back."

Dunn, a Midwest native and executive director of the King Ranch Institute for Ranch Management at Texas A&M University-Kingsville, said while few people know the eventual outcome of the ethanol industry, its effect on cow-calf producers is clearly evident.

Using a Cattle-Fax projection that fed cattle will average $84/cwt. in 2007, Dunn said corn prices at $3.50/bu. puts a 550-lb. feeder steer at $99.25. Corn at $4 puts that steer at $87, and $5 corn puts him at $62.71.

"We're not there yet," he said of feeder cattle prices, meaning the market has some downside potential this year. Dunn called on ag to begin an earnest debate about the full effect of ethanol not only on ag as a whole, but on society as well. In many regions, ethanol is viewed as apple pie and motherhood. "But its not. It's not apple pie and motherhood to a rancher in West Texas."
-- Burt Rutherford


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Outside Capital Keeps Ranchland Values Rolling
An October auction of the historic Rogler Ranch -- one of the Kansas Flint Hills' best-known spreads -- set a new area high when it fetched an average $1,696/acre, or $6.92 million. All but one of the ranch's seven tracts were purchased by individuals whose business interests are outside the cattle industry.

The sale is emblematic of the wave of outside capital propelling rural land prices to record highs, even after adjusting for inflation, writes Mike Fritz, editor and publisher of Farmland Investor Letter®, in the January issue of BEEF magazine.

Nestled in a picturesque rural valley in the southern Flint Hills, the 4,081-acre Chase County ranch has a rich history that dates back to 1859, when Austrian immigrant Charles Rogler walked from Iowa to Kansas and claimed the ranch's original 160-acre homestead.

The ranch's new owners include Allen Wise, chairman of Coventry Health Care Inc., a Bethesda, MD, health-care insurer. Wise paid $4,280,900, or $1,666/acre, for 2,569 acres of grass and cropland. The purchase was small potatoes for the executive: He earned $3.1 million last year from Coventry and owns a $24.2-million stake in the company.

Other buyers include a Houston family in the oil and gas land-leasing business; a Wichita operator of three, rent-to-own furniture stores; and a group of Chicago investors.

Conspicuously absent from the Rogler sale was Texas billionaire Edward Bass, whose Texas and Kansas ranchland holdings include 33,123 acres in Chase County. A portion of Bass's spread adjoins the Rogler Ranch.

"Our viewpoint is pasture prices are obviously too high," says Cliff Cole, Bass's local ranch manager in Cottonwood Falls, KS. Bass last added to his Flint Hills holdings in spring 2005, when he paid $920/acre for 1,220 acres just east of the Rogler Ranch. The price was a new area high at the time.

Some local observers wonder if the Rogler sale will mark a near-term price peak for the Flint Hills. In early December, a 641-acre tract of Chase County bluestem pasture sold for $920/acre to a neighboring landowner.

Auctioneer Rick Griffin, who oversaw both sales, says the level of outside interest is dropping off.

"The cure to high land prices is high prices," Griffin says. "If the neighbors don't have the capability of buying it, we will [eventually] have difficulty getting outside people interested in it."

Locals say a good market test will come in early February, when the 7,317-acre Dunne Ranch in neighboring Butler County comes up for auction. Located 30 miles east of Wichita, the Dunne Ranch lacks the historic buildings and legacy of the Rogler Ranch, but is quality bluestem range.

Joe Sundgren, an El Dorado auctioneer overseeing the sale, expects the pasture to bring $700 to $1,500/acre. Others suspect the price could go higher.

Bass also owns land to the south of the Dunne Ranch, and Gottsch Enterprises Inc., the huge Hastings, NE-based cattle feeding business, owns land on the north end. Robert Gottsch, president, says he hasn't yet decided if he'll attend the auction. The Gottsches paid $1,575/acre for a 640-acre section of Butler County pasture in 2005.

"You can't make any money with cattle on land at these prices," Gottsch complains.

Flint Hills pasture rents for an average of $17.60/acre. Subtract $2.50/acre for property taxes, and $1,500 pasture generates a paltry 1% yield -- which suggests buyers are betting pasture values will continue rising.
-- Mike Fritz, www.farmlandinvestorletter.com


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USDA Economist Provides Ethanol Drain Picture
Keith Collins, USDA's chief economist, provided some ag perspectives on renewable energy before a Senate Ag Committee hearing this week. According to Collins:
  • In 2000, the U.S. produced 1.6 billion gals. of ethanol, utilizing about 6% of the 2000 corn harvest. In 2006, an estimated 5 billion gals. of ethanol were produced, utilizing 20% of the 2006 corn harvest.


  • With 110 ethanol plants operating, another 73 under construction, and eight facilities expanding, ethanol capacity will reach 11.4 billion gals./year in 2008-2009.

  • For 2006/2007, USDA forecasts the total use of U.S. corn will be equivalent to the production of 85.6 million acres, but only 78.6 million acres were planted in 2006. Corn supplies are expected to meet demand because of a large carryin stock of corn, which is expected to be reduced by more than half.

  • Looking to the 2007 corn crop, based on current ethanol plant construction, it's likely that corn used in ethanol production will rise by more than 1 billion bu., from the 2.15 billion bu. of the 2006 corn crop expected to be used for ethanol. Use of 1 billion bu., at a trend yield of 152 bu./acre, would require an additional 6.5 million acres of corn, if corn consumed in other uses remains unchanged from this year's projected levels.
-- P. Scott Shearer, Washington, D.C., correspondent


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Weekly Average Diesel Price Drops 7.4¢/Gal.
With crude oil flirting with the to $50/barrel level this week, a 19-month low, buyers of diesel fuel also gained a price reprieve, as the national average price for a gallon of diesel fell 7.4¢ for the week ending Jan. 15, according to the U.S. Energy Information Administration. The lowest average price was to be found in the Lower Atlantic region where the price fell by 9¢ to $2.368/gal.

According to landlinemag.com, the East Coast saw an 8.3¢ drop to $2.437/gal., while the Central Atlantic logged $2.559, down 7.4¢. New England fell from $2.672 to $2.622, and the West Coast enjoyed a 7.5¢ drop to $2.749. Meanwhile, the Gulf Coast region was down 6.8¢ to $2.391, the Midwest price fell 7.5¢ o $2.408, and the Rocky Mountain region had a 5.7¢ decrease to $2.625.
-- Joe Roybal


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Government
Disaster Aid Legislation Introduced
They're still counting, but estimates are that around 20,000 cattle have been lost due to winter weather in Colorado, New Mexico, Kansas, Nebraska, Missouri, Oklahoma and Texas. And another winter storm that hit California earlier this week has been making its way across the country, sweeping east and north as it bears down on that same region this weekend with more snow.

Sen. Kent Conrad (D-ND) introduced federal disaster aid legislation last Friday in the U.S. Senate. The bill, if passed, will give monetary assistance for cattlemen affected by drought in 2005 and 2006, as well as provide payment to producers who lost cattle in the recent blizzards. The bill would provide $4.4 billion in emergency funding for weather-related crop shortfalls, quality losses, and damage to livestock feed, according to NCBA.

Another disaster aid bill has been introduced in the Senate by Sens. Wayne Allard (R-CO), Pat Roberts (R-KS). Chuck Hagel (R-NE), Pete Domenici (R-NM) and James Inhofe (R-OK) to aid producers hit by blizzards and ice storms in December. It reauthorizes the Livestock Compensation Program and would provide aid for producers who suffered losses from recent blizzards in Colorado, Kansas, Nebraska, New Mexico and Oklahoma. Companion legislation has been introduced in the House by Rep. Marilyn Musgrave (R-CO).
-- Burt Rutherford


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House AG Committee Membership Now Set
The House leadership has named the 46 members of the House Ag Committee for the 110th Congress. About 70% of the committee members have never been through a farm bill debate.

Rep. Collin Peterson (D-MN) will serve as chairman, while Bob Goodlatte (R-VA) will serve as ranking member. Democrats on the committee are Peterson, Tim Holden (PA), Mike McIntyre (NC), Bob Etheridge (NC), Leonard Boswell (IA), Joe Baca (CA), Dennis Cardoza (CA), David Scott (GA), Jim Marshall (GA), Stephanie Herseth (SD), Henry Cuellar (TX), Jim Costa (CA), John Salazar (CO), Brad Ellsworth (IN), Nancy Boyda (KS), Zack Space (OH), Tim Walz (MN), Kristen Gillibrand (NY), Steve Kagen (WI), Earl Pomeroy (ND), Lincoln Davis (TN), John Barrow (GA), Nick Lampson (TX), Joe Donnelly (IN), and Tim Mahoney (FL).

Republican committee members are Goodlatte, Terry Everett (AL), Frank Lucas (OK), Jerry Moran (KS), Robin Hayes (NC), Tim Johnson (IL), Sam Graves (MO), Jo Bonner (AL), Mike Rogers (AL), Steve King (IA), Marilyn Musgrave (CO), Randy Neugebauer (TX), Charles Boustany (LA), Randy Kuhl (NY), Virginia Foxx (NC), Michael Conaway (TX), Jeff Fortenberry (NE), Jean Schmidt (OH), Adrian Smith (NE), Kevin McCarthy (CA), and Tim Wahlberg (MI).
-- P. Scott Shearer, Washington, D.C., correspondent


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Mexico Removes Tax On High Fructose Corn Syrup
Mexico has removed the 20% tax on soft drinks sweetened with high fructose corn syrup (HFCS), a tax ruled illegal by the World Trade Organization. The Corn Refiners Association (CRA) said the tax had "closed the door" on U.S.-owned sales of HFCS to Mexico for more than four years. CRA estimated losses of $944 million in HFCS sales, equivalent to 168 million bu. of corn when the tax was in effect.
-- P. Scott Shearer, Washington, D.C., correspondent


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Small Business Tax Relief Introduced
Sen. Max Baucus (D-MT), Senate Finance Committee chairman, along with Ranking Member Charles Grassley (R-IA) this week introduced a small business tax relief package as a complement to legislation that will increase the minimum wage. The tax bill includes language relating to section 179 of the tax code. The bill would allow a 100% deduction of the cost of most personal property purchased for use in a business.

This particular section of the tax code already benefits cattlemen; in 2003, the annual dollar limit was expanded to $100,000 and the annual investment limit to $400,000. Last year, these expanded limits were extended through 2009.

The National Cattlemen's Beef Association sent a letter to Baucus this week that said, "By its very nature, beef production is a capital-intensive business. In order to carry out day-to-day activities on a farm or ranch, producers are required to invest significant amounts of money in depreciable property such as machinery." NCBA pointed out that expensing is a valuable tool for cattle producers and asked that a continuation of expanded dollar and investment limits be included in any business tax relief effort.
-- Burt Rutherford


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Tips for Profit
A Wealth Of Management Info At Your Fingertips
Looking for info on nutrition, calving or ranch horses? How about some background on body condition scoring of cows, alternative feeds, management calendars, pest management or carcass quality? You'll find those and much more at www.beefcowcalf.com, a resource guide from BEEF magazine that's devoted exclusively to beef cow-calf production.

The free site offers links to North America's latest and most pertinent fact sheets and university research reports for cow-calf production and management. You can scan the opening-page menu and click on one of 22 major subject categories for a further breakdown of topics. Or you can enter a topic in the "Title Search" box and go directly to what you need.

The Web site includes links to more than 2,000 fact sheets and white papers produced by North America's top animal scientists. Also included on the site are links to all the major cattle breed associations, links to the top animal science programs in North America, and much more.
-- Joe Roybal


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New Issue Of American Cowman Update Available
The latest issue of American Cowman Update is now available at www.americancowman.com. Sign up today for the free, twice-monthly electronic newsletter that includes industry news and management info aimed at the smaller U.S. beef producer, and complements the wealth of resource info available at www.americancowman.com.
-- Joe Roybal


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Cow-Calf Weekly Mailbag
Cowboy Beef Diplomacy Won't Work In Korea
Being a cowboy myself, I suppose I ought to appreciate cowboy diplomacy more than I do, but it will get us just as far in Korea as it has in Japan. By now we should understand that if we were a buyer we wouldn't want the seller to insult us and hold a gun to our head intending to force a sale either. No matter how unreasonable Korean buyers might be, it is still their choice, not ours, on what they buy.

As a cattle producer, the packers or buyers is my customer. It's unfortunate that when a packer gets product rejected we feel it too, but the Korean's beef is with a packer, not with us.

If we focus on providing packers with quality products then the packer who provides the same for export will eventually sell it. If we play the tough guy and insult the Koreans, they will go elsewhere for their beef, thinking all beef from the U.S. is substandard.

If we act as the individuals we are, those of us who do the best job will prosper. If we act as a mob we will all be tainted as extortionists rather than sellers of desirable goods.
Fritz Groszkruger
Dumont, IA


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