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2007 Swine Research Review
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Spotlight on Herd Health
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Market Preview
Tracking the Corn
Crop
Before we contemplate business, let us first contemplate
freedom as we prepare to celebrate the most important day in our
nation’s history. Fifty-six visionaries signed the Declaration of
Independence 212 years ago today, their names appearing just below this
closing line:
“And for the support of this Declaration, with a firm
reliance on the protection of Divine Providence, we mutually pledge to
each other our Lives, our Fortunes, and our sacred Honor.”
How many of us would demonstrate such courage and devotion today?
If you haven’t read the Declaration since your school days, take a few
minutes on Friday to read it again. You can find it at and a bevy of
related information at www.ushistory.org/Declaration/.
Now to business
USDA’s Crop Acreage report, released on Monday, was a pleasant
surprise for corn users as the feds estimate that there were 87.33
million acres planted to corn this spring. That was at the top of the
range of analysts’ pre-report estimates and 1.67 million acres higher
than the average of those pre-report estimates.
Those planted acres could a) exceed expectations, and b) exceed the
March 1 planting intentions of 86 million acres by this amount. In a
year with a tough planting season, this is a strong testament to the
power of economic incentives. Those incentives, of course, grew
dramatically after March 1 as corn prices rose relative to soybeans.
Though the price ratio changed and there is a very strong history for
corn acres to grow, many did not think conditions would allow it this
year. Again: It’s amazing how much ground you can cover in a short
time with 24-row planters and GPS systems.
We are going to need all of those acres! USDA estimates that 78.94
million acres will be harvested. That is 90.4% of the total, 2% lower
than last year and the long-term trend, but only 0.5% lower than the
average for 2002-2006. Floods have no doubt hurt the prospects for
harvested acres, but the economic incentives to harvest corn are still
very strong so we could see this percentage increase if growing
conditions are good.
What does this mean for the corn crop and prices? The futures market
was decidedly bearish early in the week, losing $0.35 on new crop
December corn futures through Tuesday. December corn futures have
rebounded the past two days, though, and as of this writing, stand just
$0.05 lower than last Friday’s close.
Monday afternoon’s Crop Progress report showed 59% of this crop rated
good or excellent. While 2% higher than last week’s number, that
figure is still lower than the worst year on record – 2002 (See Figure
1). It appears that the euphoria over more acres has been swamped again
by the realization that the needs for corn may outweigh the supply.
Figure 2 shows USDA’s June yield and usage figures and the acreages
from last week’s report. This may not be what USDA actually forecasts
in the July 11 World Agricultural Supply and Demand estimates, but it
should be close. I do not expect USDA to change its yield estimate much
if at all before the August reports when they will have objective
measurements of plant populations, ear counts, ear length, kernels, etc.
Uncomfortable Forecasts
The biggest problem with recent (and I fear future) USDA forecasts is
the usage estimates. Note in Figure 2 that USDA is forecasting ethanol
usage to increase 33%, while feed and residual declines by 16.3% and
exports fall by 18.4%. I’m not comfortable with any of those numbers
and here’s why:
- With oil at $140/barrel and gasoline above $4/gal., ethanol
prices should be high enough to allow ethanol plants to operate at
anything below $8/bu. or so for corn. Iowa State University’s Center
for Agricultural and Rural Development (CARD) estimates that the 144
plants currently operating will use 3.225 billion bushels of corn per
year and that the 66 plants currently expanding or under construction
will use another 1.94 billion bushels per year. If anything over 40% of
the new capacity is up and running by the end of 2008, it is very likely
that USDA’s 4 billion bushels for ’08-’09 usage is too low.
- The feed and residual estimate of 5.15 billion bushels is 16.3%
below last year. The DDGS from additional 1 billion bushels of corn put
through distilleries will provide the equivalent of about 280 million
bushels of corn, but that would still leave total feeding 11.7% lower
than last year. None of the species are either able or likely to cut
back that much in one year’s time – unless they are forced to do so
because a) they cannot get feed for the critters, or b) feed is so high
priced that it makes young animals worthless and causes them to be
destroyed.
- An 18.4% reduction of exports is probably the most likely of these
numbers to be correct but even that is questionable. China is on the
verge of moving from corn exporter to corn importer. The dollar remains
weak, which means U.S. grain is a great buy for foreign users. Yes,
wheat output is up and the wheat:corn price ratio is low enough that
wheat feeding will happen in some places, but will enough feed wheat be
available to supplant these exports?
How does that situation get rectified? To get usage numbers this low, I
think prices have to be higher than what USDA projected in June. The
futures market appears to agree with that judgment as ’08-’09
futures contracts are all near or above $8/bu., a price that will drive
more radical reductions of usage over the coming year.
Click to view graphs.
Steve R. Meyer, Ph.D.
Paragon Economics, Inc.
e-mail: steve@paragoneconomics.com
Make ileitis disappear?
Denagard® (tiamulin) 10 is approved to control ileitis in as little
as 10 days. And with its small dosage – 35 grams tiamulin/ton – and
less medication time, no other feed medication is as cost-effective for
controlling ileitis.
Click
on the Denagard logo to learn more.
Swine Health Preview
Enteric Diseases Tap
Pig Performance
The effect of enteric disease on pig growth and
performance is increasingly important as feed costs rise. Diseases
commonly seen in the grow-finish period include ileitis, gastric ulcers,
salmonellosis and transmissible gastroenteritis (TGE). Spirochetal
colitis and whipworms are less common.
Besides causing diarrhea and mortality, diseases affecting the
gastrointestinal tract can impact growth rate and feed conversion of
seemingly unaffected (subclinical) cohorts. Subclinical effects
undoubtedly occur, but are difficult to measure and, therefore, the
extent of the effects are often debated.
The impact of disease will vary by farm, but it is likely that a
significant portion of the shortfall in achieving the genetic potential
for pig growth is due to disease with nutritional and environmental
interactions.
Many of the disease-causing agents are constantly present in herds
(endemic), but only occasionally cause disease. Detection of an endemic
agent does not constitute a disease diagnosis unless it can be
associated with a tissue change (i.e. lesion) or functional change (i.e.
diarrhea).
Many of our more sensitive diagnostic tests allow us to detect
infectious agents but do not offer context to discern the extent or
severity of an actual disease process, in other words, to establish
causality.
Laboratory Confirmation
Following are observations from the Iowa State University Veterinary
Diagnostic Laboratory (ISUVDL) in which an infectious agent was
identified and a compatible lesion was detected by a pathologist to
confirm a disease diagnosis.
Ileitis, also known as porcine proliferative enteritis (PPE), caused by
Lawsonia intracellularis, is present in most swine herds. Both clinical
disease and the subclinical performance compromise are recognized
outcomes of infection.
Data from ISUVDL suggest a seasonal distribution of cases, with disease
confirmed more frequently in late summer and early fall (Figure 1). The
“gold standard” for confirmation of disease is by histopathology and
immunohistochemistry performed on affected portions of intestine.
A positive polymerase chain reaction (PCR) test performed on feces from
pigs with diarrhea is highly suggestive for PPE, but does not confirm
actual disease or absence of other contributing agents. Serology is
useful to determine if and when groups of pigs are infected, but does
not accurately confirm disease status. When in doubt, a full diagnostic
workup is warranted.
In contrast and to no surprise, TGE tends to be more frequently
diagnosed in winter months (Figure 2). The wide availability of a very
sensitive PCR test performed on feces, pooled feces or intestine from
acutely affected pigs makes diagnosis much easier and faster. TGE is not
considered an endemic agent in most herds, therefore diagnosis of TGE
often is met with rapid response and intervention to eliminate the
infection.
The number of cases of TGE diagnosed by ISUVDL has remained fairly
constant over the years, which makes one wonder how well our biosecurity
protocols are designed and implemented. If TGE cannot be controlled with
biosecurity, then it seems likely that other disease agents will not be
controlled.
Seasonality is not observed in ISUVDL data for enteric salmonellosis
(1,037 cases), porcine circovirus type 2 (PCV2)- associated enteritis
(231 cases), spirochaetal colitis (37 cases), or parasitic enteritis (32
cases). However, the number of cases of each of these conditions
diagnosed by pathologists has been gradually increasing over the last
five years. No conclusions from this observation are warranted.
Click to view graphs.
Kent Schwartz, DVM
Iowa State University Veterinary Diagnostic Laboratory
kschwart@iastate.edu
New to the Team. Veteran of the Game.
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and control of swine respiratory disease. When a proven winner joins an
already great team, the results are phenomenal. So Bayer Animal Health
is proud to offer Baytril 100 for treatment and control of swine
respiratory disease (SRD) in all phases of production. For use by or on
the order of a licensed veterinarian. Swine intended for human
consumption must not be slaughtered within 5 days of receiving a single
injection dose.
Click on the Baytril 100 logo for more information.
Legislative Preview
USDA’s Crop Estimate
USDA released the much-anticipated 2008 acreage report
this week. The report indicates that U.S. farmers expect to harvest
nearly 79 million acres of corn and more than 72 million acres of
soybeans this year. According to USDA, farmers planted 87.3 million
acres of corn this year, which is down 7% from last year’s 93.6
million acres, but still marks the second largest acreage since 1946.
The expected harvest of 78.9 million acres of corn is down 9% from last
year, but still ranks as the second largest acreage since 1944. USDA
estimates that farmers planted 74.5 million acres of soybeans, up 17%
over last year and the third largest acreage in history. In an effort
to take into consideration the effects of the Midwest floods, USDA
re-interviewed 1,150 farmers in flood-affected areas of Illinois,
Indiana, Iowa, Minnesota, Missouri, and Wisconsin. The next USDA report
will be the Aug.12 Crop Production report, which will estimate corn and
soybeans yields and production.
RFS Waiver Requested — The public comment period has closed
regarding the State of Texas’ waiver request concerning the Renewable
Fuels Standard (RFS). The U.S. Environmental Protection Agency (EPA)
has until July 24 to make a decision on the waiver request. Congressman
Bob Goodlatte (R-VA) was joined by 50 Congressmen urging EPA to grant
the Texas waiver request. In a letter to EPA, Goodlatte and others
stated, “By acting now to reduce the RFS mandate, the administration
can immediately impact the supply of corn that will be used for food or
feed and lessen the severe economic harm facing millions of
Americans.” Following is a list of various organizations that filed
comments supporting a waiver: State of Texas, Environmental Working
Group, Grocery Manufacturers of America, National Chicken Council,
National Pork Producers Council, National Cattlemen’s Beef
Association, National Petrochemical Refiners Association and National
Restaurant Association. Some of the organizations filing comments
opposing the waiver included American Farm Bureau Federation, National
Association of State Departments of Agriculture, National Association of
Wheat Growers, National Biodiesel Board, National Corn Growers
Association, National Farmers Union, National Sorghum Producers,
American Coalition for Ethanol, Association of Equipment Manufacturers
and Renewable Fuels Association.
National Energy Summit — Ten U.S. Senators have called on
Senate leaders to convene a bipartisan summit of energy experts in an
“effort to develop a plan for securing America’s energy
independence.” Those calling for the summit are Senators Kent Conrad
(D-ND), Saxby Chambliss (R-GA), Bob Corker (R-TN), Lindsey Graham
(R-SC), Johnny Isakson (R-GA), Mary Landrieu (D-LA), Blanche Lincoln
(D-AR), Ben Nelson (D-NE), Mark Pryor (D-AR) and John Thune (R-SD). The
Senators said, “Our hope is to hear from the best experts on energy
policy who can present an unbiased view of the most promising approaches
– including both enhanced conservation and increased domestic fuel
production – that can reduce gas prices, lessen our dependence on
foreign oil and strengthen our economy.” Senator Conrad, who
organized the effort, said, “Our country is in serious danger because
of skyrocketing energy costs. This growing crisis demands urgent
action, and we must be committed to coming together in a bipartisan way
to develop comprehensive energy legislation.”
Congress in Recess — Congress returns next week after the
July 4-week recess. The House of Representatives will be in session
until the end of July and the Senate will be in session until the first
week of August. Congress will then recess for the August break and the
Democratic and Republican national conventions. July is expected to be
a busy month for appropriation bills. The Senate Appropriations
Committee plans to consider the fiscal year 2009 agriculture
appropriations bill in mid-July.
P. Scott Shearer
Vice President
Bockorny Group
Washington, D.C.
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Pork Industry Calendar
July 14-16, 2008:
Welfare & Epidemiology Conference, Gateway Hotel & Conference
Center, Ames, IA; contact: WelfareAndEpi@iastate.edu
or call (515) 294-6222.
July 15-16, 2008: Transportation Biosecurity Summit, Embassy
Suites Hotel, Kansas City Airport, Kansas City, MO; contacts: Lisa
Becton, DVM, National Pork Board, lbecton@pork.org; Butch Baker, DVM,
Iowa State University, rbbaker@iastate.edu; Jim McKean,
DVM, Iowa State University, x2mckean@iastate.edu and Patrick
Webb, DVM, National Pork Board, pwebb@pork.org.
Click
here to get National Hog Farmer's complete pork
industry calendar.
Swine Disease Control Made Easy. Introducing Ingelvac MycoFLEX®.
Call Boehringer Ingelheim at 1-800-325-9167
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