News Update
Jan. 8, 2009

Economic Crisis Impacts Global Beef Demand

A report in the Wall Street Journal highlighted the negative impact that the global financial crisis may have on expectations for beef exports in 2009.

Reduced foreign buying power was cited as a shadow on an otherwise bright outlook for increasing beef exports to pre-2003 levels. The report said that trade figures from the last quarter of 2008 already showed signs of decline due to the negative world economy. Some bright spots still exist, however, and continue to benefit from the Bush administration’s efforts to cut import restrictions, according to the report. “The big unknown in this whole global beef market is ... the impact of the global financial crisis,” said Chuck Lambert, a deputy undersecretary for the U.S. in the interview.

— Provided by Drovers News Source.

National Western Stock Show
If you couldn’t make the trip to Denver this year, you’ll have two ways to keep up with the shows, Jan. 13-17.

Angus Productions Inc. (API) — will provide online coverage of the junior heifer, Roll of Victory (ROV), and pen and carload shows. Class placings and champion photos will be updated during the week. To view API’s online coverage, visit http://www.angusjournal.com/denver/.

EDJE Technologies will provide live video coverage of the ROV female and bull shows. Visit http://www.edjecast.com to register a user name and password with EDJE Technologies to be able to view upcoming shows and sales and to see the Denver live video.

“Stock Show Weather” a Misnomer

Forget “stock show weather”: There aren’t that many really cold days during the National Western Stock Show (NWSS), says Nolan Doesken, Colorado State University (CSU) state climatologist.

Doesken’s analysis of daily temperature averages during the past 60 years show that 76% of the days between Jan. 10 and Jan. 25 have daytime high temperatures of 36º F or higher. Only 9% of the NWSS days have experienced daytime high temperatures of 25º or cooler. And only 3% fall into the bitterly cold category — with daytime high temperatures of 15º or less.

Doesken analyzed National Weather Service (NWS) temperatures taken between Jan. 10 and Jan. 25 at the former Stapleton airport site between 1948 and 2008.

About 8% of the days had snowfall of 1 inch (in.) or greater; 81% had no snow at all. Still, it’s cold enough for the snow to stick around; 45% of the days during the stock show have at least 1 in. of snow lingering on the ground, Doesken said.

“Climatologically speaking, the Stock Show doesn’t get that cold,” Doesken said. “But for most people, cold is a relative term.”

Doesken said in any given mid-January period of two consecutive weeks, Denver usually experiences at least one strong cold front, a few cold days and a little snow.

— Release provided by CSU News Releases.

Canadian and Mexican Cattle Imports Down Sharply

As U.S. and officials from Canada and Mexico spend the next month and a half discussing how to overcome the disagreements regarding the MCOOL (mandatory country-of-origin labeling) legislation, we thought it would be worthwhile to see how U.S. cattle imports from Canada have fared since the legislation came into effect.

In addition to the date when MCOOL went into effect (Sept. 30), one thing to keep in mind is the provision in the last farm bill that all cattle imported in the U.S. before July 15 would be considered of U.S. origin while those imported after that date would be considered of foreign origin, thus affecting the terms with which they were sold to packing plants. This ‘grandfather clause’ naturally had the most effect on feeder-cattle imports, since by the time those animals came out of feedlots they would be considered of non-U.S. origin and be treated as such by packing plants.

According to U.S. Department of Agriculture (USDA) data published through the end of 2008, cattle imports from Canada and Mexico were sharply lower in the second half of the year. For the period July 14-Dec. 27, 2008, total U.S. imports of Canadian feeder cattle were 187,866 head, 113,468 head or 38% lower than the same period the previous year. Imports of Canadian steers and heifers for harvest during the same period were 262,929 million head, 138,877 head or 35% lower than a year ago. As for Canadian cow imports, it is hard to make any good year-to-year comparisons because imports only started in November of 2007.

As for Mexico, most of the imports are feeder cattle going to southern U.S. feedlots. For the period July 14-Dec. 20, imports of Mexican feeder cattle were 323,105 head, 203,968 head or 39% lower than year-ago levels. Ironically, the reductions in imports from both countries came at a time when a significant devaluation in the value of the peso and Canadian dollar normally would have been conducive of increased imports from these two countries. Under normal circumstances, one would expect cattle imports to actually increase rather than be cut by almost 40%.

Live hog trade has been affected just as severely as we have discussed in this report in previous issues and one can understand the action Canada and Mexico took by referring the matter to the World Trade Organization. And at a time when demand for cattle is down, it will be hard to quickly reverse current trends.

— Release provided by Chicago Mercantile Exchange.

— compiled by Mathew Elliott, assistant editor, Angus Productions Inc.