News Update
July 17, 2008

Cattle Futures Dip

Live cattle futures have been pressured lower recently due to weaker cash prices, softer beef cutout values, lower corn futures prices out front and a general economic uncertainty, according to Wednesday’s Chicago Mercantile Exchange (CME) Daily Livestock Report.

Futures have lost as much as 540 points on the August contract compared to two weeks ago, and the February 2009 live cattle contract was down as much as 563 points, CME reports.

Choice beef cutout values reached $173.8 per hundredweight (cwt.) last week, 24% higher than last year; but choice cutout wholesale beef prices were down $2.70 per cwt. compared to last week.

“As to where the market goes from here will depend on your opinion as to what happens with some of the fundamental drivers in the current market. Will energy prices continue to ease? Will corn prices decline further? … Will the U.S. economy rebound or are we in for a more prolonged and deeper recession? The market is currently trying to grapple with these issues and, at this particular point, the majority of answers seems to be weighing on the downside,” the report noted.

— CME Daily Livestock Report.

Study Shows That Parasite Control Pays


In hard economic times, cutting corners can become a rule instead of an exception. As the cattle industry faces rapidly rising input costs, producers should make every dollar count. According to a recent study from Iowa State University, one place producers cannot afford to cut is in their parasite control program. The study concluded that parasite control is the most economically important practice in beef production.

Iowa State researchers gathered the results of more than 170 previous studies and evaluated the various pharmaceutical technologies available to the cow-calf, stocker and feedyard segments, calculating their economic importance and their return on investment.

At the cow-calf level, the study showed that dewormers affect weaning rates and weights more than any other technology a producer can employ. Cow-calf producers who used parasite control saw an advantage of 23% in weaning rates and 4% in weaning weights. Parasite control was almost six times more important to a cow-calf producer’s breakeven cost than growth-promoting implants (the second-most economically significant choice). Eliminating parasite control practices would negatively affect breakeven selling prices by 34%, which would mean an added cost of $165 per head.

These numbers are a sum of production losses for cow-calf producers. Parasites cause all kinds of costly consequences for their hosts — added stress, lost production, decreased immune response and reduced fertility, to name a few.

“All of that can happen while parasite problems remain at a subclinical level, while cattle appear healthy,” says James Hawkins, parasitologist and consultant for Merial Veterinary Services. “That’s how many producers lose their profits to parasites without realizing it.”

The study showed that dewormers were also the most important choice for stocker operators, affecting average daily gain (ADG) by almost 18%. In that segment, failure to control parasites would increase breakeven prices by $20.77 a head.

In the feedyard, parasite control remained critical. There, dewormers increased ADG by 5.6% and reduced feed to gain by 3.9%. Eliminating their use would increase the per-head cost of production by $22.16.

“That’s more than enough to turn a profitable feeder into a loss,” Hawkins says. “The return on investment that parasite control offers for every segment of the beef industry is indisputable.”

Across segments, over the life of the animal, the study found that the impact of eliminating dewormers would be a 19% change in breakeven prices — or a cost of almost $190 on each head the industry produces.

But not all parasite control products are created equal, Hawkins says. For example, they don’t all control liver flukes, which are among the most costly of all cattle parasites. Flukes are a spreading problem; now endemic in 26 states, they are gaining new ground as cattle, hay and wildlife move around the country, Hawkins says. The National Beef Quality Audit (NBQA) concluded that flukes are one of the top 10 quality issues of the beef industry.

“With liver flukes, prevention is critical because the only reliable way to diagnose a fluke infection is to observe an animal’s liver during a post-mortem exam — long after the economic damage has been done,” Hawkins says.

Liver flukes not only have a negative effect on rates of gain, they affect reproduction too, causing decreased pregnancy rates and lower bull fertility.

As feed and other costs continue to rise, parasite control becomes even more important to profitable beef production and to producers trying to protect their investments. It’s a practice that pays for itself many times over, and that’s been proven for every segment of the beef industry.

For more information, contact your local Merial Sales Representative or visit www.merial.com.

— Adapted from a Merial release.

NOAA: Eighth Warmest June on Record for Globe

The combined average global land and ocean surface temperatures for June 2008 ranked eighth warmest for June since worldwide records began in 1880, according to an analysis by NOAA’s National Climatic Data Center in Asheville, N.C. Also, globally it was the ninth-warmest January-June period on record.

The combined global land and ocean surface temperature for June 2008 was 60.8º F, which is 0.9º F above the 20th century mean of 59.9º F.

Separately, the global land surface temperature was 57.2º , which is 1.3º above the 20th century mean of 55.9º.

The global ocean surface temperature was 62.2º, which is 0.7º above the 20th century mean of 61.5º.

For the January-June period, the combined global land and ocean surface temperature was 57.1º, which is 0.8º about the 20th century mean of 56.3º.

— Adapted from an NOAA release.

W.D. Farr Scholarship Awarded

The academic careers of two outstanding graduate students were recognized today with scholarships awarded in honor of one of the cattle industry’s greatest pioneers. The National Cattlemen’s Foundation (NCF) honored the late W.D. Farr, of Greeley, Colo., through two annual $12,000 graduate scholarships bearing his name. 

Mitchell Bowling is a Ph.D. candidate in the Department of Animal Sciences at Colorado State University, where he also received his master’s degree. He received his bachelor of science degree in animal science from Texas A&M University. Originally from Texas, Bowling is utilizing his degree work in meat science and food safety to increase exports of U.S. meat products.

Crystal Mathews is a Ph.D. candidate in the Department of Agricultural Education and Communication at the University of Florida. A native of Missouri, she received her master’s degree from Texas A&M University and her bachelor of science degree from the University of Missouri. Mathews’ academic work focuses on agricultural education and communication with an emphasis on leadership. In her degree program, she is conducting research on volunteer leadership in the beef industry.

For more information visit www.nationalcattlemensfoundation.org.

— Provided by NCF.

— compiled by Crystal Albers, associate editor, Angus Productions Inc.