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BEEF'S COW CALF WEEKLY    June 27, 2008  |  A PENTON MEDIA PUBLICATION
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    Table Of Contents
> Barack Obama Responds To BEEF Cow-Calf Weekly Article
> Canada Confirms Another Case Of BSE
> HSUS Videos Engender Varied Emotions
> Is Slashing Overhead Costs A Waste Of Time?
> Midwest Flood Impacts Are Big, Very Big!
> Packing Industry Struggles Continue
> U.S. Beef Trade To South Korea To Resume. No, Really!
> A Year Of Extremes
> Carrington Research Center Field Day Is July 15
> Changing Supply/Demand Picture Reshaping Foreign Outlook
> Congress Calls On USDA To Expedite Downer Rule
> Crop Report Due On Monday
> Fifteen-Page State Of Industry Report Available Online
> Flooding Spawns West-Nile Virus Concern
> Follow Happenings Of The 2008 BIF Meeting Online
> Gasoline Price Slips For First Time Since March 24
> Immediate Penalty-Free Release Of CRP Acres Urged
> Latest NDSU Beef Cattle, Range Research Available Online
> More TB Found In California; Status Downgrade Coming
> Organic Goes Enviro
> Pork Producers Call For Relief From High Feed Costs
> Public Meetings Set For National Bio Lab
> Relief Effort Underway In Flood Areas
> U.S. Pork Exports Jumped 200% In Past Decade
> Yet Another HSUS Video Of Downer Abuse Surfaces

    To Our Readers
      Barack Obama Responds To BEEF Cow-Calf Weekly Article

I have read with interest your article on how the upcoming election might impact agriculture (“Obama Vs. McCain – What’s The Difference,” June 6 Beef Cow-Calf Weekly). I disagree with your contention that agriculture is “far down” on the priority list for both candidates. Agriculture is a very high priority for me. America must retain its leadership in agriculture and I am committed to working with farmers and ranchers to achieve that goal.

I have held rural forums and meetings in most agriculture states and have released Rural Plans in states across the country. Unlike my opponent, I supported the recent farm bill though I had hoped it would have contained more reforms, including tighter payment limits. Senator McCain and I have established very different records on agriculture. Indeed, it is one of our major differences.

America continues to have the safest, most abundant and cheapest food supply in the world. Even with the recent increase in the cost of food, Americans spend only 10% of their disposable income on food – the lowest in history. America’s farmers and ranchers are important to the future of our country and I intend to give agriculture a high priority in my administration.

Beef producers are a key component in a healthy and vibrant rural America. By strengthening USDA and working to enhance food safety and meat processing, my administration will assist the industry in providing a wholesome and safe product to your customers.
Sen. Barack Obama (D-IL)
Democrat for U.S. president



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    Our Perspective
      Canada Confirms Another Case Of BSE

At press time, the details remained limited on the latest case of BSE found and confirmed in Canada, other than she was from British Columbia. The cow posed no risk to humans as she never entered the food chain, the government said. The animal was detected through Canada’s national BSE surveillance program, the Canadian Food Inspection Agency says, and a comprehensive investigation in an effort to determine the birth farm of the animal has been launched.

Given the magnitude of other news this week – E. coli recalls to resumption of trade with South Korea, to the flood damaged corn crop – perhaps it’s not surprising that this latest BSE case exerted little impact in the marketplace. But it’s important to note that expectations are that Canada will continue to find more BSE cows.
-- Troy Marshall

    HSUS Videos Engender Varied Emotions

If you haven't seen the latest Humane Society of the U.S. (HSUS) video on YouTube, it’s probably worth viewing. It was shot at the Portales Livestock Auction in New Mexico.
-- Click on headline to read the rest of this story by Troy Marshall

      Is Slashing Overhead Costs A Waste Of Time?

Being a low-cost producer is a sacred tenet of our industry, but what business has ever increased profits by slashing costs? Don’t get me wrong; watching overhead and expenses is good business, but profits are generated by investing in making a more valuable product and marketing it more effectively.

The problem with the whole low-cost doctrine is that it’s defensive in nature, when the industry should be proactively working on increasing its value proposition. Do we spend our time thinking of opportunities or challenges, solutions or problems?

The low-cost mantra assumes that demand can’t be improved, that marketing can’t capture value, and that individual players are locked into a commodity system with no power to affect demand or price received. If that’s your outlook, then the proper solution to tougher economic times is to hunker down and focus on outlasting your competitors. But when did survival become the goal of this industry?

Admittedly, this industry has been shrinking for a considerable time, so sustainability does need to be the first goal of the cow-calf industry. But ultimately our goal should be profitability.
-- Troy Marshall



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      Midwest Flood Impacts Are Big, Very Big!

Estimates on the economic losses created by the recent floods are running as high as $21 billion. And, as the damage to the 2008 crop was being assessed, corn climbed to hover around $8/bu. Estimates for corn usage for animal feed, ethanol and export are all in the process of being revised downward compared to pre-flood numbers. And while there’s even more uncertainty in the corn market than normal, one thing we know for certain is that carryover stocks coming out of this harvest are expected to be at historical lows relative to demand.

USDA's long-term estimates for corn prices now look almost ridiculously low. And ethanol and energy policy continue to move up the political hierarchy as consumers struggle to deal with soaring food and energy prices.
-- Troy Marshall

    Packing Industry Struggles Continue

Tyson announced the sale this week of its Canadian beef operations to XL Foods Inc. for $107 million in Canadian dollars. Tyson has already closed three other plants and slipped from No. 1 to No. 3 in terms of beef-slaughter capacity in the U.S. The stocks of meatpacking plants have been taking a severe hit, but Tyson stock rose on news of the sale.
-- Click on headline to read the rest of this story by Troy Marshall

    U.S. Beef Trade To South Korea To Resume. No, Really!

South Korean's government continues to walk a fine line on the resumption of beef imports. On Saturday, it reached an agreement whereby the U.S. government agreed to supervise a private industry accord with South Korea to only export beef from animals younger than 30 months of age.
-- Click on headline to read the rest of this story by Troy Marshall



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    A Year Of Extremes

Crops have incurred more than $8 billion in estimated weather-related damage thus far in 2008, according to the American Farm Bureau Federation (AFBF). Iowa accounts for about half the damage, but there are notable problems in at least a dozen other states ranging from the excessive wetness and flooding in Illinois to drought in California.
-- Click on headline to read the rest of this AFBF release

      Carrington Research Center Field Day Is July 15

Beef research, controlling feed costs and the value of manure as fertilizer will be among the topics at the North Dakota State University (NDSU) Carrington Research Extension Center's annual beef production field day July 15 from 9 a.m. to noon.
On the program are:
  • Updates on two producer feedout programs (Dakota Feeder Calf Show and Eastern Dakota Feedout Project).
  • Beef cow-calf research, including fetal programming, natural supplements and a mineral study.
  • Beef feedlot research, including natural supplements, glycerol and pea feeding.
  • Relative value of manure as fertilizer with high nitrogen, phosphorus and potassium prices.
  • Controlling feed costs, competitive feeds and prices, and altering management practices.
  • Update on developments in research and the market demand potential for super feeds.
  • Tour of the center's cattle-handling facilities
  • Crop management tours and a noon lunch.
For more info, call 701-652-2951 or visit www.ag.ndsu.nodak.edu/carringt/.
-- NDSU release

    Changing Supply/Demand Picture Reshaping Foreign Outlook

The key drivers in the short-term outlook for U.S. meat exports include politics, economic variables, domestic production, market access, consumer trends and competitor developments. Here’s a market by market analysis:
-- Click on headline to read the rest of this story by Clint Peck



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      Congress Calls On USDA To Expedite Downer Rule

The fiscal year 2009 ag appropriations bill passed by the House Ag Appropriations Subcommittee contains a provision pressing USDA to expedite the rule governing non-ambulatory cattle – downer cows.

Rep. Rosa DeLauro (D-CT), chairwoman of the House Ag Appropriations Subcommittee, said, “The repeated revelations of cattle abuse occurring at livestock auction sites and slaughterhouses are extremely troublesome. Not only are we again witnessing the inhumane treatment of cows and the illegal slaughtering of downed cows for the food supply, but also the distribution of potentially contaminated meat into the school lunch program.

“USDA must not only publish a proposed rule to close the loophole that allows downer cattle to be slaughtered for the food supply, but they must expedite this rule, so it can be implemented immediately.”

This week another video regarding the treatment of downer cows at an auction site was released by the Humane Society of the U.S. See “Yet Another HSUS Video Of Downer Abuse Surfaces” elsewhere in this issue.
-- P. Scott Shearer, Washington, D.C. correspondent

      Crop Report Due On Monday

USDA will release the much-anticipated 2008 acreage report on Monday. The National Ag Statistics Service (NASS) has announced several steps it is taking to assess the impact the extraordinary rainfall and flooding in the Midwest is having on the 2008 crop. NASS will re-interview producers during the week of June 23 in the affected areas of Illinois, Indiana, Iowa, Minnesota, Missouri and Wisconsin to get a more accurate determination of how much of the planted area will actually be harvested for grain.
-- P. Scott Shearer, Washington, D.C. correspondent

      Fifteen-Page State Of Industry Report Available Online

BEEF magazine’s annual state of the industry report is now available online at: beefmagazine.com/advertisers/BEEF%20SOI%202008_0609.pdf. Penned by Shane Ellis, Iowa State University Extension livestock economist, the 15-page PDF file provides an overview of the U.S. beef industry’s current status and prospects, as well as discussion and easy-to-reference graphics on demand factors, inventory issues by sector, prices and profitability, industry structure, profitability and more.

And for further discussion on state-of-the-industry topics, view the article “2008 & Beyond” at beefmagazine.com/business/0601-experts-weigh-beef-industry-future/. It includes the opinion and prognostications of four top industry experts: Bill Helming, Randy Blach, Tom Field and Bill Mies.
-- Joe Roybal

      Flooding Spawns West-Nile Virus Concern

This spring’s devastating floods in the Midwest may do more than uproot lives and hammer the corn crop. Authorities say the standing water left behind, along with rising summer temps, may lead to more Culex mosquitoes that carry West-Nile Virus.

In 2007, 3,630 people were diagnosed with the disease and 124 died. So far in 2008, eight people have already been diagnosed in Arizona, Mississippi, Oklahoma, Tennessee and Texas. In addition, West Nile is a serious disease in horses and animal cases have been reported in Alabama, Florida, Indiana, South Carolina, Utah, California, Illinois, Louisiana and Texas.

For more on West Nile in both humans and animals, go to beefmagazine.com/mag/west_nile_warning/index.html
-- informify.com

      Follow Happenings Of The 2008 BIF Meeting Online

If you can’t attend the 2008 Beef Improvement Federation (BIF) Annual Meeting and Research Symposium in Calgary, Alberta, next week, follow the meeting online at www.bifconference.com.
-- Angus Productions Inc.

      Gasoline Price Slips For First Time Since March 24

The U.S. average retail price for regular gasoline slipped for the first time since March 24, shaving .3¢ to $4.079/gal. for the week ending June 23. Retail diesel also fell, by 4.4¢ to $4.648/gal., the largest weekly decrease since Jan. 21.

For gasoline, the East Coast slipped by .5¢ to $4.047, while the Midwest shaved just .1¢ to $3.996, the Gulf Coast fell by 1.8¢ to $3.919, and the Rocky Mountain regional price rose .8¢ to $4.002. The West Coast added 0.8¢ to $4.46, and California shaved . 75¢ to $4.58.

Meanwhile, diesel was down in all regions, falling by 4.1¢ on the East Coast to $4.711/gal.; 4.4¢ in the Midwest to $4.574; 5.4¢ in the Gulf Coast to $4.602, and 3.3¢ to $4.652 in the Rocky Mountains. The West Coast dipped 3.6¢ to $4.816, while California fell for the third week in a row, shaving 4.7¢ to $4.922.
-- Energy Information Administration

      Immediate Penalty-Free Release Of CRP Acres Urged

More than 130 organizations and companies are calling on USDA to allow for immediate penalty-free release of non-environmentally sensitive cropland from the Conservation Reserve Program (CRP). In a letter to USDA Secretary Ed Schafer, the Alliance for Agricultural Growth & Competitiveness (AAGC) stated that “stronger measurers must be taken very soon to ensure that grain and oilseed production more adequately meets the demand for food and feed.” The letter also noted:
  • For wheat, USDA expects global stocks to remain at historic lows, despite a projected increase in U.S. production. In addition, disease problems in portions of the U.S. wheat crop currently being harvested will reduce yields and quality.
  • For corn, domestic production is expected to decline by 34 million metric tons (mt) to 298 million mt in 2008/09, even though biofuel demand for corn will increase over the same timeframe. This dynamic helps explain USDA’s estimate that ending U.S. stocks for corn will fall approximately 50%.
  • While production for soybeans will increase in 2008/09, USDA reports expect that a 14-million-mt increase in production will only raise stock levels 1.3 million mt.
  • Corn/wheat for feed usage are forecast to decrease by more than 12% for 2008/09. For animal ag to cut production by 12% will require severe economic hardship on these producers while further pressuring consumer food prices to move even higher.
Those signing the letter included: Ag Retailers Association, American Feed Industry Association, American Meat Institute, National Chicken Council, National Grain and Feed Association, National Oilseed Processors Association, National Pork Producers Council, National Turkey Federation, Pet Food Institute, and U.S. Poultry & Egg Association.

This week, Schaefer said USDA will make a decision in the next two weeks on this issue.
-- P. Scott Shearer, Washington, D.C. correspondent

      Latest NDSU Beef Cattle, Range Research Available Online

The latest edition of the North Dakota State University "Beef Cattle and Range Research Report" is available online. To access the report, visit www.ag.ndsu.edu/livestock/beef-reports.html. The page also contains links to previous reports, as well as the most recent NDSU research in areas related to beef cattle production, including cow-calf, backgrounding and feeding, and animal health.

A limited number of the CD version of the report also will be available on a first-come, first-served basis. To receive a copy of the report on CD, contact Holly Erdmann at 701-231-7513 or holly.erdmann@ndsu.edu.
-- NDSU release

      More TB Found In California; Status Downgrade Coming

Bovine tuberculosis (TB) has been detected in two more dairy herds in Fresno County, the California Department of Food and Ag (CDFA) announced this week. That brings the current total number of herds affected to three.

USDA is beginning the process to officially downgrade California’s bovine TB status from “accredited free” to “modified accredited advanced,” CDFA says. The drop in status is required by USDA following detection of two affected herds within 48 months. It means additional testing requirements will be required on California’s cattle industry when shipping animals out of state.

CDFA animal disease-control experts are working with USDA to evaluate dividing California so that part of the state could return to a “TB Free” status while intensive disease eradication efforts continue in the affected area of California.
-- Central Valley Business Times

      Organic Goes Enviro

Eco-labeling is a new certification program similar to the organic label, but goes beyond the organic concept by reflecting new land-management practices for the entire farm ecosystem, including non-crop lands. With funding from USDA's Cooperative State Research, Education and Extension Service (CSREES), a team of scientists, growers and environmentalists in Wisconsin developed the "Healthy Grown" label to reflect this land-management practice to promote balanced ag management and support broad ecosystem health.

Paul Zedler from the University of Wisconsin, in collaboration with the World Wildlife Fund and the Wisconsin Potato and Vegetable Growers Association, is studying the biodiversity and ecological benefit, of non-crop lands in ag landscapes.

Returning to natural vegetation has the benefit of sustaining biologically diverse ecosystems and minimizing management costs. The investigators expanded on an existing integrated pest management model to understand insect population density and diversity changes among different habitats. By controlling for beneficial insects, investigators feel it may be possible to reduce the application of chemical insecticides. The group is also using bird populations as indicators of ecological function and ecosystem health.

Farmers who produce Healthy Grown foods participate in demonstrations, presentations and discussions at field day events to encourage others to adopt these management techniques. In addition, the project educates consumers of the link between food grown with healthy land management practices and ecosystem services. The eco-label lets consumers know that producers grow foods following specific environmental standards and practices to ensure ecosystem health.

As a direct result of the team’s work, the Natural Community standard protocol for certification was developed in 2006. The program includes identification of non-crop land near crop fields and the selection of management activities, such as prescribed burning and invasive weed removal, to increase biodiversity on these lands. The program also requires farm monitoring to validate increased environmental services.

The certification standard will expand land-management practices into a broader ecosystem perspective and increase the presence of beneficial insect species, alternative pest control practices and environment biodiversity. It will also help reduce the application of chemicals that are harmful to the environment and costly to producers.
-- CSREES release

      Pork Producers Call For Relief From High Feed Costs

The National Pork Producers Council (NPPC) is calling on USDA to take steps to provide relief from high feed costs. NPPC in a meeting with USDA Secretary Ed Schafer asked USDA to:
  • Release immediately and without penalty non-environmentally sensitive acres from the Conservation Reserve Program.
  • Allow crop farmers to plant (at their own expense) a harvestable crop on those acres that could not be planted this spring due to weather condition, even though the farmer may have collected a disaster payment on the ground. This action also may require congressional approval, and we will ask Congress to act.
  • Support a waiver of the biofuels mandate (Renewable Fuels Standard) for ethanol as requested by Texas Gov. Rick Perry.
  • Support the elimination of, or significant reduction in, the ethanol blender's tax credit.
  • Support the elimination of, or significant reduction in, the tariff on ethanol imported into the U.S.
According to NPPC, “If more crops can’t be planted and if there is no relief from the ethanol mandate, feed costs will go even higher than the record levels we’re seeing today, many livestock producers will go out of business, meat supplies will fall and retail meat prices will rise. That wouldn’t be good for the livestock industry, American consumers or the U.S. economy.”
-- P. Scott Shearer, Washington, D.C. correspondent

      Public Meetings Set For National Bio Lab

The Department of Homeland Security has released a draft Environmental Impact Statement for building a National Bio and Agro-Defense Facility (NBAF) and will hold public meetings to present the impact analyses of siteing, constructing and operating the proposed lab. The public is invited to attend and provide comments on the National Bio and Agro-Defense Draft Environmental Impact Statement (DEIS).

Most meeting locations will have an identical afternoon (12:30-4:30 p.m.) and evening (6-10 p.m.) session consisting of the following:

A one-hour open house to view material, register to present oral comments, and speak informally with subject matter experts (12:30-1:30 p.m. and/or 6-7 p.m.). Presentation on the NBAF DEIS (1:30-2:30 p.m. and/or 7-8 p.m.). Formal comment period (recorded by a court reporter) (2:30-4:30 p.m. and/or 8-10 p.m.).

  • July 24 – Washington, D.C.; Grand Hyatt Bridge Room.

  • July 29 – Butner, NC; Butner-Stem Middle School Gymnasium.

  • July 31 – Manhattan, KS; Kansas State University Union Forum Hall.

  • Aug. 5 – Flora, MS; First Baptist Church Christian Life Center.

  • Aug. 7 – San Antonio, TX; Radisson Hill Country Resort Ballroom.

  • Aug. 11 – Old Saybrook, CT; Saybrook Point Inn Ballroom.

  • Aug. 12 – Greenport, NY; Greenport School Auditorium.

  • Aug. 14 – Athens, GA; University of Georgia Mahler Auditorium

    Go to www.dhs.gov/xres/labs/editorial_0803.shtm for full details.
    -- U.S. Animal Health Association

  •       Relief Effort Underway In Flood Areas

    The National Cattlemen’s Foundation (NCF), in cooperation with the National Cattlemen’s Beef Association (NCBA), has launched a disaster relief effort to assist farm and ranch families impacted by catastrophic flooding in the Mississippi River corridor and surrounding areas.

    Many farm and ranch families in Iowa, Missouri, Indiana, Illinois and Wisconsin have been displaced from their homes, or remain without power, potable water, and other utilities. Crop losses are enormous, including hay and forage normally used for livestock feed, as well as crops targeted for fall harvest. Downed fences and other property damage have also resulted in stranded and lost livestock, with thousands of farmers and ranchers struggling to make repairs and keep their operations functioning as well as possible.

    NCBA is joining with state cattlemen’s associations across the nation to provide assistance through the NCF. Every dollar contributed will directly assist families struggling to keep their farms and ranches operating under these difficult conditions. In conjunction with NCF, state cattlemen’s associations from states in the affected region will manage distribution of all funds donated. Donations are tax deductible.

    Credit card contributions can be made by calling 1-866-BEEF-USA (1-866-233-3872) with Visa, MasterCard, and American Express cards accepted. Online contributions can be made at www.nationalcattlemensfoundation.org, then selecting “Contribute Now” on the left-hand side of the screen. Make check contributions payable to NCF, with “disaster relief” included on the memo line. Donation checks should be mailed to:
      National Cattlemen’s Foundation
      9110 East Nichols Ave., Suite 300
      Centennial, CO 80112
    --- National Cattlemen’s Foundation release

          U.S. Pork Exports Jumped 200% In Past Decade

    One of every 3.3 lbs. of pork traded globally is U.S. product, says the U.S. Meat Export Federation (USMEF). That’s up from one of every 6 lbs. traded globally a decade ago.

    Ten years ago, the U.S. exported 1.116 billion lbs. of pork. In just the first four months of 2008, the U.S. pork industry already has exported 1.389 billion lbs. to trading partners around the globe. In fact, U.S. pork has set export records for 16 consecutive years, USMEF says.
    -- USMEF news release

          Yet Another HSUS Video Of Downer Abuse Surfaces

    Yet another video depicting the mishandling and abuse of downer dairy cattle in a livestock auction market surfaced this week, further chipping away at the industry’s contention that such incidents are isolated. The video, surreptitiously captured by an undercover Humane Society of the U.S. (HSUS) operative in May 2008, shows spent dairy cows in a Portales, N.M., livestock auction being repeatedly shocked with electric prods and dragged by chains.

    It was the sixth livestock facility this year ensnared in video depictions of animal cruelty in the ongoing HSUS campaign to expose what it calls “widespread abuse of livestock across the country,” which it contends is “looking less like the industry exception – and more like the rule.”

    USDA Secretary Ed Schafer called the situation “unfortunate” and deplorable, adding that the weakened conditions of the animals would have prevented their delivery to a slaughter facility.

    “Furthermore, they would not have passed ante-mortem inspection by the highly trained Food Safety Inspection Service inspection program personnel. Simply put, the condition of these cattle would prohibit them from even entering the first phase of a multi-phased process of approving cattle for slaughter,” he says.

    On May 20, Schafer announced a proposed rule to initiate a complete ban on the slaughter of non-ambulatory cattle that go down after initial inspection.

    “Of the nearly 34 million cattle that were slaughtered last year, under 1,000 cattle that were re-inspected were actually approved by the veterinarian for slaughter. This represents less than 0.003% of cattle slaughtered annually. However, to eliminate further misunderstanding of the rule and, ultimately, to make a positive impact on the humane handling of cattle, it is sound policy to simplify this matter by initiating a complete ban on the slaughter of downer cattle that go down after initial inspection.”
    -- Joe Roybal



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