News Update

January 04, 2018

In The Cattle Markets

As we move into the winter feeding months, cow-calf producers have additional opportunities to impact their bottom line. Winter feeding costs represent the single largest cost to cattlemen, typically representing 55%-80% of total costs for their cow herd. This cost is important to consider when making the decision to cull open or unproductive cows or to feed them through winter while trying to improve body condition score. Additional consideration should be given to feed resources available and market value for cull cows.

Cow-calf producers should consider what their individual feed costs are, along with feed availability. The average cow can eat 2.2% of her body weight in dry matter each day during the feeding period. For producers in the upper Midwest, where hay prices are averaging $65-$100 per ton and long feeding periods (around 150 days), feed costs can add up quickly. Depending on hay quality, producers may need to add corn or another energy source into the ration along with providing a supplemental mineral.

Individual costs will vary with different management practices depending on labor, yardage, vet fees and ingredients in the ration.

Read the full Angus Beef Bulletin EXTRA article online.

— Adapted from an article by Jared Geiser & Brenda Boetel, University of Wisconsin–River Falls.

Food Sector Retail Sales and Beef Demand

Consumer demand for beef held up well in 2017, considering slow growth in the economy, intensifying competition from more supplies of competing meats and the developments in consumer tastes and preferences for new food products or dietary diversity. Through the first eleven months of 2017, the retail price of choice beef declined by 1% from a year earlier, according to USDA Economic Research Service. With general price inflation in the economy running at 2%, this translates into a 3% decline in prices in inflation adjusted terms. Supplies of beef available to the U.S. consumer in 2017 are projected to be up to 56.8 pounds (lb.) per person from 54.3 lb. on a retail weight adjusted basis, with only December production and import-export data for November and December yet to be officially released. The graph shows how the price-quantity data for 2017 compares to the last 27 years.

The stoic performance of beef demand comes as retail sales in the food sector grew at the slowest pace since The Great Recession of 2008-2009.

View the full report online at www.dailylivestockreport.com.

— Adapted from a report by Len Steiner, Steiner Consulting Group.

2017: The Ag Year in Review

2017 brought a wave of change for farming. It was a better year than farmers and ranchers have seen in a while.

WOTUS

EPA’s much-maligned and litigated Waters of the United States (WOTUS) rule appeared to have met its match in 2017. Already blocked by federal courts pending trial on the merits, the new administration’s EPA proceeded swiftly to dismantle the old rule by issuing a request for comments on how the new rule should define Waters of the United States — that is, interstate waters that fall under the jurisdiction of the EPA.

Work on the new rule continues while EPA officials have predicted a final WOTUS definition by the end of 2018. Few in Washington expect the rule will go unchallenged in court. Even so, the new EPA is far less likely to bring arbitrary and abusive enforcement actions as it did some years back. In all, it was the best environmental news in years.

Tax Reform

Nothing is certain but death, taxes — and people’s willingness to argue over how much tax is fair. Farmers got an important bump, just the same, as Congress doubled the estate tax exemption to $11 million per person.

Read the AFBF news release online.

— Adapted from a release by Will Rodger, American Farm Bureau Federation.

Asian Sales Lift the Brand

With the end of 2017, we’ll soon be reflecting on the year in beef. Undoubtedly, we’ll toast to what has been a pretty decent run with record-large production and very good demand to go with it. Factoring heavily into that success for the Certified Angus Beef^® (CAB^®) brand in our 2017 fiscal year (October to September) was a record year in international markets with a 26.4% sales tonnage increase beyond U.S. borders.

While riddled with politics and barriers unrelated to product acceptance, the CAB brand continues to make inroads and add “brand loyalists” across the globe. Geof Bednar, CAB international director, reports CAB brand products are enjoyed at licensed retailers and restaurants in 49 other countries, with double-digit percentage growth last year in every region. Global trade accounted for 15% of total CAB brand sales for the year compared to total U.S. international beef sales at 10% of whole-muscle cuts.

Growth was led by Asia, with Japan up 50%, and Korea up 81%. Emphasis has been on providing licensed partners with a “brand experience,” brought about through educational seminars such as our International Masters of Brand Advantages (MBA) training for foodservice leadership, with attendees from 18 countries. Keep reading this Angus Beef Bulletin EXTRA article online.

— Adapted from an article by Paul Dykstra, Certified Angus Beef LLC.

NCBA, Cattle Genetics Experts Team Up
For 2018 Genetic Webinar Series

Cattle genetics will be the focus of a new set of webinars to help cattlemen and women better use the tool in their operations. The National Cattlemen’s Beef Association (NCBA) is teaming up with six genetics specialists from across the country to offer the NCBA Cattlemen’s Genetics Webinar Series, which will kick off Jan. 18, 2018.

Titled “Fake News: EPDs Don’t Work,” the January webinar will be followed by sessions in February, March and April that explore other aspects of genetic utilization that will give cattle producers a knowledge boost on cattle selection and breeding.

Providing expertise to producers through the webinar series is the eBEEF team, a group of six genetic specialists from five academic institutions that have invested time and resources in the advancement of the cattle industry through genetics. Members of the team are Darrh Bullock, University of Kentucky; Jared Decker, University of Missouri; Alison Van Eenennaam, University of California–Davis; Matt Spangler, University of Nebraska; and Megan Rolf, and Bob Weaber, Kansas State University.

For more information, view the full NCBA news release online.

— Adapted from a release by the National Cattlemen’s Beef Association.

— Compiled by Paige Nelson, field editor, Angus Journal.