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Country-of-Origin Labeling

Information about country-of-origin labeling, and what it means for cattlemen.


Angus International

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Cattle Industry Annual Convention and NCBA Trade Show


Angus Bull listing service

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U.S. Beef Demand Drivers and Enhancement Opportunities

This publication uses national, quarterly data to examine U.S. meat demand. The analysis provides insights into beef demand and topics affecting demand.

Results showed beef demand is sensitive to the strength of the U.S. economy, and that consumers respond to information about beef and nutrition. Results also suggest beef demand suffered as consumers’ demand for more convenient meat products increased. Consumers are also sensitive to food safety.
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Angus Productions Inc.

October 20, 2009


MARKETING...

Cattle in stockyards

Guidelines for Culling Cows

For most cattle producers, culling cows is not an easy task. However, some culling needs to be done each year to maintain optimal productivity. Records on each cow's yearly production would be beneficial when making culling decisions, but collecting some information when the cows are processed can give you a good place to start.

Cattlemen should make it a point to evaluate all breeding females at least once a year. Weaning is likely the most convenient time to do this evaluation. In addition to their vaccinations, cows should also be pregnancy-tested, evaluated for structural soundness and aged based on the condition of their teeth. This information will take a little extra time to collect, but will be valuable when determining a culling order. In addition, this culling order will be useful during a drought as it is usually more profitable to cull unproductive cows as a drought is beginning than to try to hold on until the drought is over.

Usually, the best cows to cull are the ones that have the least chance of being productive in the long term or are the farthest away from being productive. Use the following list as a guideline for establishing your culling order. Cull cows in this order until you reach the desired herd size. Read more.


LMICCow-calf Returns Struggle Again in 2009

U.S. cow-calf operations have seen their profitability decline in recent years, with negative returns posted in 2008 due to higher costs of production and lower calf prices. Since the early 1970s the Livestock Marketing Information Center (LMIC) has estimated cow-calf returns over cash costs plus pasture rent for a typical Southern Plains operation. The estimated numbers are designed for market analysis purposes, thus actual cow-calf returns will vary considerably. Recent estimates for cow-calf returns were lowered some to reflect lower-than-expected calf prices. For 2009, as calculated by the LMIC, many cow-calf operations in 2009 will not cover their cash production costs and returns will likely be similar to 2008. Looking ahead, estimated cow-calf returns should be back in the black in 2010, as calf and cull cow prices rebound.

Net returns have been pressured again in 2009, as input costs remain rather high compared to historical norms, while calf prices have struggled. Calf prices are forecast to be slightly higher in the fourth quarter of this year than in 2008, however for the year, calf prices will still be the lowest since 2003. Currently, the LMIC estimated return for 2009 is around a negative $20.00 per beef cow. If realized, that will be the second consecutive negative year, with the last time producers posting a negative return (prior to 2008) being 1998.

Historically, estimated cow-calf returns vary dramatically over time. In the 36 years the LMIC has estimated cow-calf returns (including 2009), 15 years (42%) have posted negative cow-calf return, with only nine of those years posted losses greater than $50 per cow.

Looking ahead, profitability is forecast to return in 2010 and 2011; however, until then the economic incentive to turn strongly positive for cow-calf producers for overall U.S. cow herd growth will be delayed.

 


Cattle on FeedU.S. Cattle on Feed Up 1%

The U.S. Department of Agriculture (USDA) reports cattle and calves on feed for harvest in the United States for feedlots with capacity of 1,000 or more head totaled 10.5 million head on Oct. 1, 2009. The inventory was 1% above Oct. 1, 2008. The inventory included 6.42 million steers and steer calves, down 1% from the previous year. This group accounted for 61% of the total inventory. Heifers and heifer calves accounted for 4.01 million head, up 4% from 2008.

Placements in feedlots during September totaled 2.39 million, 5% above 2008. Net placements were 2.34 million head. During September, placements of cattle and calves weighing less than 600 pounds (lb.) were 490,000, 600-699 lb. were 450,000, 700-799 lb. were 593,000, and 800 lb. and greater were 855,000.

Marketings of fed cattle during September totaled 1.75 million, 4% below 2008. This is the third-lowest fed-cattle marketings for the month of September since the series began in 1996. Other disappearance totaled 47,000 during September, 8% below 2008.
Click here for a full report.


Sara Snider
Sara Snider

The Source

Weighing the costs and benefits

The AngusSource® Carcass Challenge (ASCC) keeps getting bigger and better. You will find the third-quarter results of the 2009 contest in the following press release written by Laura Nelson, Certified Angus Beef LLC (CAB) Industry information specialist.

With the conclusion of the third quarter, 11 pens of calves have already beaten the 80.7% acceptance rate of the 2008 winning pen. We look forward to seeing the results from the fourth quarter and announcing our overall winner in January. Read more.


Is This A Year to Retain Ownership?

Texas AgriLife Extension economist says strategy is promising with possible market price increases.

Recent rainfall has been beneficial to Texas small-grains pastures, and cattle producers may want to weigh their options when marketing calves in 2010, according to a Texas AgriLife Extension Service economist.

There's potential for increased profit margins if cattle producers consider retained ownership ventures, said Jose Pena, AgriLife Extension economist in Uvalde in his recent economic report.

"Relatively weak wheat prices in relation to recent highs may mean that wheat farmers may prefer to graze small grains this winter/spring," he said. "Abundant supplies of small-grain pastures may be available this spring."

Pena said current cattle market prices suggest that retained-ownership enterprises this fall/winter may be profitable. Retained ownership bypasses the traditional marketing of calves at local auction facilities, opting to place calves on winter pasture for added gain through a contract.

Pena said cattle-gain contracts on small grains last fall were approximately 45¢ to 55¢ per pound of gain. However, since then prices for energy and fertilizer have decreased as have wheat and corn prices. Read more.



Carefully Consider Backgrounding

Weigh the pros and cons before deciding to background calves this year.

Declines in calf prices may interest some producers in feeding calves and marketing them at heavier weights later rather than sending them to market now, according to a North Dakota State University (NDSU) livestock specialist.

But before producers make that decision, they need to consider a number of variables, says John Dhuyvetter, area Extension Service livestock specialist at NDSU's North Central Research Extension Center near Minot. Read more.


Cattle Cycle Book Benefits Producers

Having a good working knowledge of the cattle cycle is one of the keys for economic success in the livestock business. This is true whether one is in a cow-calf operation, a forage grazing operation, a feedyard operation or a beef cattle harvest/processing company. The cattle cycle is a natural accumulation and liquidation of cattle inventory over a period of years. Herd sizes are increased or decreased as producers respond to both the natural biological processes of beef animals and to cattle prices. While exact predictions are impossible, access to historical information about the cattle cycle enables producers to take advantage of opportunities that are present throughout the course of the cycle. Accurate historical market information can significantly aid farm managers in planning for and managing a beef operation.

Cattle Cycle is a publication developed by the Noble Foundation to educate producers about the complex biological and economical relationships driving the cattle cycle. It contains a collection of information that provides producers with a basic understanding of all the stages of beef cattle production — from cow-calf operations, through the feedyard, all the way to harvest. The manual explains how to use information from both market history and futures markets to help make sound cattle management and marketing decisions. In addition, the publication includes many examples of using specific market data to help make better decisions.

The 2009 edition is available on the Noble Foundation web site at www.noble.org/Ag/Economics/CattleCyclePrices2009.

 


CAB Corner

What VAP should stand for

Valued-added products (VAP) or services are simply those that a seller has enhanced before offering to customers. For example, preconditioning adds value to your calves. You add more value to build your reputation and brand, and to command a higher price, of course.

Of course, there's always a place in the market for the truly cheap product, but how does that help the Angus producer? Fortunately, there's an ever-growing demand for premium value-added products. The consumer is looking for that clean, honest beef flavor that cheap products just can't provide. Cutting tests prove that time and time again. Hey, maybe within VAP, the premium category should be called "QAP" or Quality-Added Products, or we should start using the PVAP acronym to reflect the premium value. Read more.


Daily Livestock Report

Meat ConsumptionMuch of the focus in the monthly USDA supply and demand report (released on Friday, Oct. 9) was on the supply outlook for grain crops this fall, and for good reason. A late-maturing corn crop and poor weather have the market guessing as to the true output potential of the 2009 harvest season. Adding to the market's uneasiness is the prospect of an even weaker U.S. currency and all that it implies about U.S. grain exports and energy prices.

The picture for U.S. red meat and poultry supplies going into 2010 remains just as muddled. The latest USDA forecasts point to continued reductions in beef and pork production. USDA lowered slightly its projections for U.S. beef production in 2009 to 29.507 billion pounds (lb.), 2.8% lower than 2008 levels. Forecasts are for 2010 U.S. beef production to be down another 1.6%, reflecting the smaller calf crop but also a slowdown in U.S. cow slaughter rates.

As for pork, the latest projections peg 2009 output at 23.029 billion lb., a slight increase compared to the September projection, but still indicating a reduction of 1.4% compared to a year ago. For 2010, USDA forecasts pork output to be 22.455 billion lb., 2.5% lower than in 2009 but still the third-largest annual pork production on record.

Broiler supplies are down sharply this year, and at 35.230 billion lb. they are expected to be 3.5% lower than in 2008. Forecasts are for broiler supplies to increase by 1.5% in 2010 but that forecast will be greatly influenced by what happens with grain prices this fall and winter.

Lost in some of the year-to-year comparisons, however, is the broader context in which the U.S. beef, pork and poultry markets operate. The reduction in U.S. red meat supplies clearly will impact domestic per capita consumption of beef and pork products. The unfortunate fact is that per capita consumption did not decline simply because of the recession, although the recession accelerated the fall. Rather, U.S. consumers have steadily reduced the amount of beef and pork they consume in the past decade. One could point to a number of culprits for this, from strong export markets, to higher producer costs, to food safety concerns, etc. The fact of the matter is that U.S. per capita beef consumption in 2010 is currently expected to be 60.1 lb. per person (retail weight), compared to 69.1 lb. in 1999, a decline of 13%. Pork consumption in 2010 now forecast to be 47.1 lb. per person, 12% lower than where it was back in 1999. The only meat protein that has shown some growth in per capita consumption is chicken, with per capita consumption in 2010 expected to be 81.7 lb. per person, 5% higher than in 1999.

With domestic consumption shrinking, exports will become increasingly important going into next year.

 

 


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