Jan. 2, 2017
A new year for cattle markets
by Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist
Cattle prices in 2017 are expected to average close to fourth quarter 2016 levels, though they will be lower than 2016 for year over year averages. Several factors may have a significant impact on cattle and beef markets in 2017 and may change current price expectations. These factors bear close watching in the coming year.
Uncertainty and Volatility Uncertainty and volatility, from a variety of sources, will continue to hover ominously over cattle and beef markets in 2017. Current U.S. macroeconomic conditions are encouraging; the stock market finished strong and unemployment was low at the end of 2016. However, the economy is gearing up for higher interest rates and potentially higher inflation moving into 2017. Uncertainty surrounds the changes that have been suggested by the incoming Trump administration. The economic impacts may be positive or negative or, more likely, some combination of both, but the uncertainty surrounding coming changes is without question a negative. In addition to U.S. macroeconomic uncertainty, global market uncertainty will likely continue in the coming year. The Brexit vote of last summer has been followed by several additional populist moves in Europe that add to global economic uncertainty. Separate but related to macroeconomic uncertainty, volatility in Live and Feeder cattle futures has significantly reduced the effectiveness of these tools for price discovery and risk management and contributed to additional cash market volatility, which appears likely to continue in 2017.
Beef Production An additional four percent of beef production is expected in 2017 in addition to the 6.1 percent year over year increase in 2016. Cattle slaughter exceeded expectations throughout 2016. Changes in cattle slaughter and carcass weights from current expectations may cause adjustments in beef production levels and timing in 2017 and could impact current price forecasts. Herd expansion through 2016 ensures increased beef production through 2018. Herd expansion may slow or stop completely in 2017 which will impact heifer flows in 2017 and will determine beef production expectations beyond 2018.
International Beef Trade International trade in beef and cattle is a critical component of price expectations for 2017. Expectations for continued growth in beef exports simultaneous with decreased beef imports will significantly offset a portion of increased beef production in 2017. One of the bigger uncertainties surrounding the Trump administration is the direct impact on current trade patterns as well as potential future beef and cattle trade policies. The dollar is expected to continue strong and will continue to pose a headwind to faster and stronger improvement in cattle and beef trade.
Beef Demand and Total Meat Supplies Increased beef production will combine with increased pork and poultry production for another record total meat supply in 2017. Domestic per capita meat consumption is not expected to be a record (depending critically on continued exports of all meats) but is expected to increase another 1.5 percent year over year in 2017, on top of the 1.4 percent year over year increase in 2016. Retail beef prices will continue adjusting down in 2017, which is critical to help the market absorb additional beef in the face of large total meat supplies.
Feed and Drought Feedlots will continue to enjoy low cost of gain as record 2016 grain crops keep grain supplies plentiful through the current grain marketing year. Dry conditions across much of the southern part of the country are consistent with La Niña conditions and could be an issue for 2017 forage and crop production if current conditions persist into spring.
Re-warming methods for severely cold-stressed newborn calves
by Glenn Selk, Oklahoma State University Emeritus Extension animal scientist
Oklahoma has already experienced one “Arctic cold front.” Another is expected to arrive in a few days. Unfortunately, that probably won’t be the last one to show up this winter. Spring calving season is still a few weeks ago for most spring-calving herds. However, the first two year olds to calve may begin the process here in January. Despite our best efforts, there may be a calf born unexpected in the middle of one of those bone-chilling nights. By the time we find it the next morning, it is suffering from hypothermia or severe cold stress.
Several years ago, an Oklahoma rancher called to tell of the success he had noticed in using a warm water bath to revive new born calves that had been severely cold stressed. A quick check of the scientific data on that subject bears out his observation.
Canadian animal scientists compared methods of reviving hypothermic or cold stressed baby calves. Heat production and rectal temperature were measured in 19 newborn calves during hypothermia (cold stress) and recovery when four different means of assistance were provided. Hypothermia of 86 degrees F rectal temperature was induced by immersion in cold water. Calves were re-warmed in a 68 to 77 degrees F air environment where thermal assistance was provided by added thermal insulation or by supplemental heat from infrared lamps. Other calves were re-warmed by immersion in warm water (100 degrees F), with or without a 40cc drench of 20 percent ethanol in water. Normal rectal temperatures before cold stress were 103 degrees F.
The time required to regain normal body temperature from a rectal temperature of 86 degrees F was longer for calves with added insulation and those exposed to heat lamps than for the calves in the warm water and warm water plus ethanol treatments (90 minutes and 92 minutes vs 59 minutes and 63 minutes, respectively). During recovery, the calves re-warmed with the added insulation and heat lamps produced more heat metabolically than the calves re-warmed in warm water. This represents energy that is lost from the calf’s body that cannot be utilized for other important biological processes. Total heat production (energy lost) during recovery was nearly twice as great for the calves with added insulation, or exposed to the heat lamps than for calves in warm water and in warm water plus an oral drench of ethanol, respectively. By immersion of hypothermic calves in warm (100 degrees F) water, normal body temperature was regained most rapidly and with minimal metabolic effort. No advantage was evident from oral administration of ethanol. (Source: Robinson and Young. Univ. of Alberta. J. Anim. Sci., 1988.)
When immersing these baby calves, do not forget to support the head above the water to avoid drowning the calf that you are trying to save. It is also important to dry the hair coat before the calf is returned to cold winter air. If the calf does not nurse the cow within the first few hours of life (6 or less), then tube feeding of a colostrum replacer will be necessary to allow the calf to achieve passive immunity by consuming the immunoglobulins in the colostrum replacer.
Obviously not every calf born in cold weather needs the warm water bath. However, this is apparently a method that can save a few severely stressed calves that would not survive if more conventional re-warming methods are used. With tight profit margins, saving every calf is important to the bottom line.
Cow-Calf Corner is a weekly newsletter by the Oklahoma Cooperative Extension Agency. More information is available at sunup.okstate.edu/category/ccc.
Jan. 2, 2017