A Primedia Property
December 30, 2005


Table of Contents
It's Time For An Annual Ranch Review
Nine Challenges Facing The Industry In 2006
Take Pride In The Great Year That Just Passed
Canada Imposes Duties On U.S. Corn
Hong Kong Reopens To Imports Of U.S. Beef
U.S., Canadian Beef Sold In Japan
Six Factors For Better Artificial Insemination Success
Bill Addresses Livestock/Poultry Contracts
Use Straw in Cattle Rations, But Carefully
Ag Takes A Hit In Recent Budget Cuts
Allergen Labeling Law Takes Effect Jan. 1
Bill Would Regulate Fertilizer Production & Sale
Make 100% Healthy Calves Your 2006 Goal
KOMA Cattle Conference Set For Jan. 18
Midwest Value-Added Ag Conference is Jan. 27-28
Early Registration Ends Jan. 4


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Our Perspective
It's Time For An Annual Ranch Review
Employees in most businesses undergo at least an annual performance review. To most folks, the prospect of such an exam holds as much allure as a trip to the dentist. But, such exercises are helpful in that they force one to step back from day-to-day activities and take a broader perspective on the job. They also help illuminate activities that may be unproductive, even detrimental, to job performance or the success of the business.

Unfortunately, annual reviews aren't standard operating procedure in the ranching business. Still, it would behoove all of us to set aside a few hours, perhaps a full day, to sit with your spouse, partners or key business associates and conduct an annual review.

We've never had a formal process for doing this in our operation, but Lorna and I plan to sit down early in the morning and walk though the annual review process. We want to look at the areas in which we've progressed, the challenges and obstacles we need to address, and tweak our key goals and plans for 2006.

A great place to start the process is to identify 5-6 key result areas for your operation -- financial performance and personal happiness (mental and spiritual growth, physical fitness, relationships with family, friends and community) are usually on the list. We also look at genetics, marketing, nutrition, animal health, day-to-day management, and our strategic plan. What are the year's goals and our plans to achieve them, as well as our vision of where we want to be in 5-10 years and beyond?

We study each area and try to identify activities we performed well and that allowed us to progress toward our goals. We also examine the negatives that impeded our progress and try to identify remedial actions for the coming year. We try to devise 2-3 main goals for each of our key result areas, as well as a plan to achieve them -- with quarterly benchmarks and objectives we'll review quarterly and use in our weekly planning sessions. Each goal includes a series of action steps needed to achieve them.

U.S. ag's greatest challenge is what time-management experts call "the demands of the urgent vs. the demands of the important." At times, the demands of today are so pressing it seems impossible to focus on tomorrow. An annual review and a little time spent focusing on the big picture are great ways to start out the new year.
-- Troy Marshall


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Nine Challenges Facing The Industry In 2006
  • Exports -- rebuild and regain our market share in lost export markets, while reducing market barriers and solidifying the U.S. position as the world's foremost supplier of high-quality, safe and wholesome, corn-fed beef.
  • Continue to shift away from the commodity trap, and create marketing systems and avenues that allow us not only to consistently hit specific market segments and niches, but reflect these value differences through a revamped marketing system.
  • Implementation of a national animal ID system.
  • Be ready to face even more ferocious attacks from anti-beef advocates.
  • Coping with a cattle-cycle phase where more beef tonnage will be available (even with exports and dry conditions offsetting the effects of expansion to a large extent).
  • Fierce competition from competing meats.
  • Higher fuel, transportation, energy and input costs.
There are two challenges, however, that overshadow all others and will be the keys to determining if the industry experiences a 2006 as prosperous as 2005. The industry seemingly has a clear vision and plan in place to expand on its success in the areas of demand and the business environment in which we operate, but we must watch these two key areas:
  • The first key will be achieving industry unity and mobilizing the industry to move aggressively forward. This isn't the type of unity that eliminates disagreement but that embraces democratic methods of policy formation. It's a unity that allows producers to set aside minor differences on issues to focus on a larger vision and common purpose on which all producers can agree.
  • The second key is to eliminate the zero-sum mentality that's crept into our industry. There's nothing more absurd than the zero-sum view of the world. It leads to the belief everyone must share the same view and operate under the same system, and that government is the tool to enforce that system.
How many of you produce a better product, have a more healthy resource base, enjoy a higher standard of living, and operate more efficiently than your grandfather did? We're producing a higher quality, more differentiated product, more efficiently than 20 years ago. We have better and more powerful genetic and animal health tools, better equipment and technology. It's a combination that gives us the tools to be stronger and better competitors.

Yet, people say we can't compete globally. They say concentration, corporate feeding, multi-national packers, Wal-Mart, pork and poultry, Brazil and Australia will undo us.

We don't operate in a zero-sum world. The size of the pie isn't stagnant or, at least, it certainly doesn't have to be. Our responsibility lies in building a better future just as those who preceded us did.

As long as the majority continue to strike forward, those who advocate the demise of independence, freedom and free markets, and a shift away from entrepreneurship to government management, will always be held at bay. The fundamentals for the future of the beef industry are strong. If we embrace the future with a progressive and aggressive attitude focused on making the pie bigger, we can make it great.

A focus on protection, on stagnation, and the belief that in order for one to benefit another must sacrifice, is our only truly insurmountable obstacle.
-- Troy Marshall


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Take Pride In The Great Year That Just Passed
It's hard to imagine a better year than 2005 is possible for the U.S. cattle industry. There was widespread profitability in all segments, with prices hovering near record levels. Drought-ravaged areas largely are seeing improved moisture conditions, though parts of Oklahoma, Texas and the Southeast are still hurting.

Robust beef demand continues, and the legal controversy surrounding the industry's self-help tool -- the beef checkoff -- finally saw some resolution. Plus, the export markets lost in late 2003 due to BSE are continuing to reopen.

On top of that, the industry continues to develop a plethora of new products, brands and marketing arrangements to help the industry be more responsive to customer demands. Industry value chains are moving beyond the goal of merely satisfying customers to exceeding their expectations.

Our abilities to select for the right genetics, overcome genetic antagonisms and increase overall system profitability are greater than ever. The industry also recorded one of its most successful legislative years ever, defeating crippling legislative initiatives and making inroads in areas ranging from taxes to the environment.

Considering the financial and political clout of the anti-beef and anti-beef production activists aligned against us, it's simply phenomenal how the industry was able to represent its interests so well. Everyone should take pride that the rancher has been able to amass the most critical component of political capital -- integrity and a consistent adherence to a set of principles and values -- that others aspire to emulate.
-- Troy Marshall


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Foreign Trade
Canada Imposes Duties On U.S. Corn
The Canadian government has imposed provisional duties of $1.65/bu. on U.S. corn imports. Canada claims U.S. corn imports are dumped and subsidized.

USDA Secretary Mike Johanns and U.S. Trade Representative Rob Portman in a joint release stated, "Canada has conducted two prior investigations of U.S. corn imports, revoking a countervailing duty order after a GATT panel decision was adopted in 1992 and finding no injury in a second investigation in 2001. We believe Canada should again find U.S. corn imports are not injuring Canadian corn growers and that the unwarranted provisional duties announced today should therefore be terminated."

A final determination regarding anti-dumping and countervailing duties is due March 15.
-- P. Scott Shearer, Washington, D.C., correspondent


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Hong Kong Reopens To Imports Of U.S. Beef
Hong Kong reopened its markets for U.S. boneless beef from cattle less than 30 months of age under the Beef Export Verification Program. Before Hong Kong banned U.S. beef in 2003, it imported $90 million in beef products annually -- the fifth-largest market for U.S. beef exports at that time.

USDA Secretary Mike Johanns says the Hong Kong reopening means the U.S. has regained access to markets valued at more than $2.8 billion, or 74% of the 2003 export value of $3.9 billion.

"USDA will continue to focus our efforts on opening additional markets in Asia and around the world by promoting the use of science-based regulations in global beef trade," Johanns said.
-- P. Scott Shearer, Washington, D.C., correspondent


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International Trade
U.S., Canadian Beef Sold In Japan
Both U.S. and Canadian beef are on supermarket shelves this week in Japan. On Monday, two supermarket chains, Cowboy and Marunaka Co., reintroduced U.S. beef for the first time in two years, according to the Kyodo News. Marunaka received about 6 tons of beef from Kansas, with prices ranging from about $8/lb. for chuck to $14/lb. for sirloin.

Phil Seng, president of U.S. Meat Export Federation, predicts the U.S. will sell about 110,000 tons of beef to Japan in 2006, about a third of the total in 2003. He made this prediction last week during a welcome-back luncheon in Tokyo. Seng added it will probably be three years before the U.S. attains pre-BSE levels of exports to Japan.

And, for the first time in three years, Canada sent 8 tons of Ontario beef to Hanamasa Co., a supermarket and restaurant chain. Before the ban, Japan was Canada's third-largest export market, behind the U.S. and Mexico.
-- Stephanie Veldman


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Breeding & Selection
Six Factors For Better Artificial Insemination Success
Most artificial insemination (AI) programs rely heavily on a wide array of estrous synchronization (ES) programs now available. But success can vary widely, so it's important producers know which factors can negatively impact their AI programs -- and how to manage them.

"The key to ES in cows and heifers is knowing the six basic factors that can hurt success, and understanding that management can overcome most of them," says Cliff Lamb, University of Minnesota.
  • Age differences in females. Two-year-old cows have more difficulty initiating estrus than older cows, even when they calve earlier than older cows.

    Younger cows have greater energy needs due to lactation and growth requirements, Lamb says. Both those needs take priority over her ability to begin her postpartum estrous cycles.

    Because older cows have no growth requirements, nutrients are more likely to be prioritized for milk production and initiation of estrous cycles, he says. Because of this priority system, young growing cows generally produce less milk and remain in anestrus longer.

    Thus, producers need to manage young cows and older cows differently, Lamb says. Young cows need more energy and higher-quality nutrients, especially in the weeks leading up to and immediately post-calving.

    "If you provide younger cows with better care, you'll have much better results when you synchronize and AI them later," he says.

  • Days since calving. As a general rule, the longer between calving and ES, the better the breeding results, Lamb says. ES shouldn't occur less than 45 days after the birth of the calf.

  • Recordkeeping. For ES to work, producers must know when cows calved, whether she had a difficult birth, and the birth weight of all calves. That's why good records are important to ES success.

    "Producers should target starting their ES protocols for when cows are greater than 45 days from calving," Lamb says. "But, if a specific cow had calving difficulties or a large calf, wait a few extra weeks. Without accurate records, these decisions can be extremely subjective."

  • Facilities. Using ES, producers can expect more females to be in simultaneous heat. Thus, adequate facilities to handle the larger cattle numbers are needed.

    ES programs also require females be handled more frequently in chutes for injections. Thus, working facilities need to be able to accommodate the extra work.

    "Not only are reliable holding and sorting pens needed, but you should have a solid alley and chute system," Lamb says. "Anticipating the increase in facility use will certainly contribute to a successful ES program."

  • Labor. Heat detection is important to ES program success. That requires a commitment to having people on location checking for heat.

    "Any observer needs to know exactly how cows act in heat," Lamb says. "This is where a program often fails. A producer might feel he has more important things to do, but abandoning heat check or entrusting it to an incompetent worker results in poor estrus response or poor conception rates."

  • Herd health and nutrition. To improve AI results, use a veterinarian-approved vaccination program for breeding animals, Lamb stresses. Nutrition programs also need continuous yearlong monitoring, not only to ensure adequate feed and water are available but that mineral and protein needs are met.
-- Eric Grant for the National Association of Animal Breeders. Learn more at www.NAAB-CSS.org, or call 573/445-4406.


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Beef Marketing
Bill Addresses Livestock/Poultry Contracts
U.S. Sens. Chuck Grassley (R-IA) and Russ Feingold (D-WI) have introduced S. 2131, which seeks to limit use of arbitration in livestock and poultry contracts. The legislation would prevent the use of arbitration in livestock and poultry contracts unless both parties have given written consent to use arbitration after a dispute arises.

In introducing the measure, Grassley said, "Often when there is a dispute between the packer and the family farmer, and the contract between the two includes an arbitration clause, the family farmer has no alternative but to accept arbitration to resolve the dispute. Arbitration has its benefits in certain cases, so it should be an option, but is should not be the only option."

Grassley and Feingold introduced similar legislation in the 108th Congress.
-- P. Scott Shearer, Washington, D.C., correspondent


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Nutrition
Use Straw in Cattle Rations, But Carefully
When trying to determine how much straw can be used in winter rations for cows, remember straw is a low-energy, low-protein feed that isn't as digestible as hay or green feed, says Juanita Kopp in Alberta Agri-News.

On average, the forage beef specialist with Alberta Ag, Food and Rural Development, says a cow can consume 1.25% of its body weight in straw dry matter (DM). Thus a 1,400-lb. cow could consume 17.5 lbs. on a DM basis, or 19.9 lbs. on an "as-fed" basis if the straw was 90% DM (17.5/0.9 = 19.9 lbs., calculation adjust for moisture content of the straw).

"Near the end of gestation, rumen capacity is reduced by 12-13% because the growing calf takes up internal space," she says. "Straw-based rations shouldn't be fed at this time or once the cow starts to lactate. Save your best-quality feed for this time."

In order of preference, cattle will eat oat straw before barley straw, followed by legume straws, and wheat straw, she reports. The quality of legume straw can be extremely variable. The more leaves on the stems the better, but it can be very coarse and of poor quality. Coarse stems are also harder to dry down, so molds may be present.

"Cattle prefer straw that's aged a year or more," Kopp says. "It's slightly more palatable and digestible."

She says processing doesn't improve straw quality, but can increase daily straw intake. But to prevent malnutrition, impaction, poor conception rates and lower milk production, it's important to supply adequate amounts of energy, protein, minerals and vitamins to pregnant cows' winter rations, she adds.

Treating straw with anhydrous ammonia is one way to improve its crude protein content (CP) and digestibility. She says a Manitoba Ag and Food study found CP content of barley straw went from 5.1% to 9.4% when anhydrous was applied at 3% of forage dry matter.

"There are a number of protein and energy supplements that can be used to increase the protein content in winter feed to meet intake requirements," Kopp says.

These might include a good energy source, such as cereal grains or good quality pellets or cubes. Protein can also be supplemented by feeding canola or soybean meals. If using pellets, producers should request a nutrient analysis, including both protein and energy values.

In feeding straw-based rations watch for impaction problems. When the weather turns cold, cattle will try to keep warm by increasing intake. As straw isn't easily digested, it doesn't pass through the animal quickly enough and can become impacted, which can result in the death of the animal.

"Straw and grain are high in potassium (K), and a ration high in K can cause a magnesium deficiency that results in winter tetany," Kopp says. "Winter tetany is similar to grass tetany or milk fever. Limestone or magnesium oxide should be added to the ration to prevent this deficiency."
-- Juanita Kopp, 403-742-7901 or juanita.kopp@gov.ab.ca


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Government
Ag Takes A Hit In Recent Budget Cuts
By a one-vote margin, the U.S. Senate passed an omnibus five-year budget reconciliation package that cuts $39.7 billion from government programs over five years. Included are $2.72 billion in ag-program cuts. The House will vote on budget reconciliation next month.

The Senate Ag Committee cuts include:
  • No across-the-board cuts for commodity programs.
  • Advance direct payments reduced to 40% for crop year 2006; further reduced to 22% in crop year 2007.
  • Cotton Step 2 program terminated Aug. 1, 2006.
  • Milk Income Loss Contracts -- dairy support program is extended two years.
  • EQIP extended to 2010, funds reduced $1.27 billion for fiscal years 2007-2009, and $1.3 billion in fiscal year 2010.
  • Extend Conservation Security Program to 2011; funds capped $1.954 billion for fiscal years 2006-2010, and $5.65 billion fiscal years 2006-2015.
  • Watershed Rehabilitation program -- cancellation of funds available prior to Oct. 1, 2006.
  • Renewable Energy Program: limit fiscal year 2007 funds to $3 million.
  • Value-added Grant program -- cancel unspent funds prior to Oct. 1, 2006.
  • All unspent funds prior to Oct. 1, 2006, are canceled for the Rural Business Investment Program, Rural Business Strategic Investment Grant Program, and Rural Firefighters Grant Program.
  • Initiative for Ag and Food Systems-- cancel unspent funds for fiscal years 2007-2009.
-- P. Scott Shearer, Washington, D.C., correspondent


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Allergen Labeling Law Takes Effect Jan. 1
Effective Jan. 1, FDA requires food labels to clearly state if food products contain any ingredients with protein derived from the eight major allergenic foods -- milk, eggs, fish, crustacean shellfish, tree nuts, peanuts, wheat or soybeans. These eight major food allergens account for 90% of all documented food allergic reactions.

It's estimated 2% of U.S. adults and 5% of children suffer from food allergies. In addition, 30,000 emergency-room visits and 150 deaths annually are attributed to allergic reactions to food.

FDA says the Food Allergen Labeling and Consumer Protection Act of 2004 will be especially helpful to children who must learn to recognize the presence of substances they must avoid. The law applies only to products labeled after the Jan. 1 effective date.

For more info, visit www.cfsan.fda.gov/~dms/wh-alrgy.html.
-- Joe Roybal


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Bill Would Regulate Fertilizer Production & Sale
The House Subcommittee on Homeland Security Prevention of Nuclear and Biological Attacks approved legislation that would regulate production and sale of ammonium nitrate (fertilizer). The legislation will require any individual producing, selling or buying ammonium nitrate to register with the Department of Homeland Security. Sellers of ammonium nitrate will be required to keep records of purchasers, including driver's license numbers or other photo ID, and the amount of ammonium nitrate purchased.
-- P. Scott Shearer, Washington, D.C., correspondent


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Calf Health
Make 100% Healthy Calves Your 2006 Goal
When I was a growing up on our family farm, my father would have been embarrassed if the telephone rang during "working hours" and he was in the house. In his day, you had to be outside doing physical labor to really be "working."

Times have changed. Today, most of us realize time spent researching and planning is as important as physical labor. In fact, the time spent on such tasks should reduce your workload later in the year.

With that as a backdrop, let's examine some items to discuss with your family or crew in regard to having 100% healthy calves in 2006. Some research-based concepts for producing healthy calves can be transferred directly from research herds to your herd.

In 1995, Jim Clement, a North Dakota veterinarian, published an article on the factors associated with calf diarrhea. It initiated a shift in focus from identifying the "bug" to the bigger picture of "what is the largest risk factor to calf disease on our ranch?" As a result, great strides have been made.

Clement's work, and that of others, shows that, in most cases, the largest risk factor is calf environment. Do your first-born calves survive the neonatal period with no morbidity, but later-born calves develop diarrhea, pneumonia or navel infections? If so, an environmental buildup of pathogens is the likely culprit.

"The solution to pollution is dilution" is a phrase I use with clients to sell the concept of spreading animals as a way to minimize infectious disease. Much as been written about the Sandhills Calving System (beef-mag.com/mag/beef_cleaner_pastures/index.html). Its premise is if every calf can be born in a "clean" environment, the disease challenge will be minimal to non-existent. It's a concept that will work in any herd.

A practice that's received much attention since Clement's 1995 study is that of calving heifers in a separate area from cows will reduce neonatal diarrhea incidence in both groups. Mel Pence, a Georgia veterinarian, later noted that wintering cows and heifers together was another risk factor for calf disease.

When first presented with this data, my clients weren't anxious to have another separate group to feed in the winter. But, as is often the case, an astute client came up with the solution.

In examining the winter rations for his open yearling heifers and his bred two-year olds, he found them to be very similar. By grouping open and bred heifers, he said, both groups get what they need and he doesn't have another group to feed.

The concept has worked well everywhere we've used it, and I encourage you to try it.

Even if bred females and pairs are on a large acreage, environmental contamination can happen. Areas around the water source, feed bunk or hay ring can become a quagmire for calves. If you must feed in the same area, construct a firm pad so it doesn't become muddy. An option is to roll out hay on frozen ground each day in different areas.

Practices to absolutely avoid during calving season are adding cow-calf pairs or buying a calf for a cow that lost hers. Producers don't intend to buy disease when they purchase new animals, but it often happens.

In one case, a calf was purchased to replace a stillborn calf, and the next six calves from this herd died of Salmonella. In all, the owner lost more than $3,000 in calves, and medication and veterinary costs as a result of that single purchase.

Another way to introduce disease is to purchase another farm's fresh or frozen colostrum. Such diseases as Johne's and Salmonella can be transmitted by colostrum.

Do you have purchased feeder cattle right next to your bred females or cow-calf pairs? If they share a water source, are in nose-to-nose contact or have their lot draining into the cow's lot, this can be a source of disease for your herd.

If you have bred heifers due to calve this winter/spring, I hope they're bred to known calving-ease bulls. Dystocia continues to be the No.-1 contributing factor to neonatal death loss.

I see too many herds where bred heifers and first-calf heifers with calves are kept in a very small area due to its proximity to handling facilities. It's nice to have heifers close to the barn in case of calving difficulty, but it's wiser to have the heifers used to eating near the facilities and locked away the rest of the day. If a heifer needs assistance, she can easily be moved to the barn.

I encourage you to discuss your neonatal disease prevention plan with all members of your team. And be sure to let your herd health veterinarian review your plan for completeness. Remember that the environment is the key to disease prevention in young calves.
-- W. Mark Hilton, DVM, Purdue University


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Tips for Profit
KOMA Cattle Conference Set For Jan. 18
The KOMA Cattle Conference and Trade Show is Jan. 18 at the Washington County fairgrounds in Dewey, OK. Registration begins at 1 p.m. and the program at 1:30.

Among the speakers are: Derrell Peel, Oklahoma State University (OSU) livestock economist, providing the beef market outlook; Jeremy Powell, University of Arkansas DVM, on calving season health-management issues; K.C. Olsen, University of Missouri beef cattle specialist, on animal traceability and export opportunities; and Cattle-Traq's Dwayne Skidgel on ID technology advancements. A 6 p.m. evening meal concludes the proceedings.

Registration is $10 before Jan. 9, and $12 after. For more info, contact Washington County Extension at 918-534-2216.
-- Joe Roybal


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Midwest Value-Added Ag Conference is Jan. 27-28
The Midwest Value-Added Ag Conference is designed to help agriculturists explore new market opportunities and learn from farmers, business people and experts involved in value-added farm enterprises. The eight annual conference, themed "Connecting You with Your Customers," is Jan. 27-28 at the Plaza Hotel and Suites in Eau Claire, WI.

Attendees will learn how to write a business plan, market as a group and choose between alternative enterprises. They'll also learn about ag products others have created, sources of start-up funds and how to get a loan. To learn more, call Heather Flashinski, River Country Resource Conservation and Development Council, at 715-834-9672. Register before Jan. 1 to save $15. For more info, visit www.rivercountryrcd.org/valad.htm.
-- Joe Roybal


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Industry Meetings
Early Registration Ends Jan. 4
Advance registration ends Jan. 4 for the 2nd annual Southwest Beef Symposium. Set for Jan. 18-19 at the Tucumcari (NM) Convention Center, the 1 1/2-day program begins with presentations on the National Animal Identification System (NAIS) and ID technology, beef exports to Japan, and age and source verification.

Jan. 19 focuses on cattle management and health, with presentations addressing forage-based growing programs and BVD occurrence, control and prevention. The afternoon session deals with natural, organic, grass-fed and conventional beef production and marketing; and addresses differences in the final meat products, production system trade-offs and the evaluation of niche-market premiums.

The symposium, a collaborative effort by New Mexico State University and Texas A&M University, concludes with a producer/food service panel discussion of experiences in alternative beef product marketing.

Visit spectre.nmsu.edu/dept/welcome.html?t=animal to learn more, or call Clay Mathis at 505-646-8022, or Bruce Carpenter at 432-336-8585.
-- Clay Mathis, NMSU Extension


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