May 1, 2017
How beef trade adds value to the beef industry
by Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist
The U.S. is the fourth largest beef exporting country and the largest beef importing country. The U.S. is often a net importer of beef, with the quantity of beef imports exceeding beef exports. Occasionally, beef exports exceed the quantity of beef imports. Most often however, the value of beef exports exceeds imports making the U.S. a net exporter of beef in value terms. Given the relatively close balance between beef exports and imports, just how important is beef trade to the U.S. beef industry?
Most obviously, beef exports add value by increasing the quantity of total beef sales allowing the U.S. to sell more beef to more places. Secondly, beef exports add value by selling beef at higher prices. In some cases this is because high valued products in the U.S. have even more value in global markets. Often, however, it is because products that have a relatively low value in the U.S. have a higher value in some global market. Beef offals are a long time example of this but it is true for numerous other beef products as well. The beef industry produces a vast array of products from different parts of the carcass and of varying quality (e.g. Choice versus Select).
Finally, beef exports add value by optimizing this diverse set of beef products in the domestic market. Beef demand is often characterized with pork and poultry as the primary substitutes for beef. In reality, the biggest substitute for any particular beef product is usually another beef product. As beef is perishable, the entire set of beef products will be consumed on average each year, including products less preferred in the U.S. market. Lower valued products will be priced to ensure consumption, even at the expense of stronger underlying demand for higher valued products. Anyone who has ever put a side of beef in the freezer knows that the steaks are gone long before other parts of the carcass are consumed…but those other products must be cleaned out before more steaks are added to the freezer. The same is true in total in the bigger domestic market. Export markets provide a way to ship out some of those lower valued cuts thereby focusing domestic demand on higher value. Every pound of lower-valued beef product exported is one less pound that competes with increased total demand (and value) for beef in the domestic market. This role of beef exports to improve the domestic product mix and optimize beef demand is often overlooked but is arguably the most important component of total beef export value.
Beef imports are largely driven by the enormous market for ground beef in the U.S. Roughly 72 percent of beef imports are lean trimmings used primarily to make hamburger. In 2016, ground beef consumption was estimated at 25 pounds per capita, making up 45 percent of total U.S. retail beef consumption. Imported beef is used to supplement domestic supplies of lean trimmings which are mixed with the fatty trimmings from fed cattle to make ground beef. Without additional lean, some of those fed trimmings would have, at best, value as tallow rather than as ground beef.
Without imported beef trimmings, one of several outcomes would impact the U.S. beef industry: 1) less ground beef would be produced, reducing the value of the nearly 150 pounds of fed trim from each carcass; 2) some steers and heifers (roughly 10-15 percent) would need to be raised and slaughtered as nonfed beef for lean (…think Australian range beef…) and would be valued roughly the same as cow carcasses or 3) additional lean from fed carcasses could be ground for hamburger rather than being used for whatever higher value it currently has. In each case the value of U.S. beef production is lower than it is when supplemented with imported beef. Imported beef compliments domestic production to improve product utilization in the domestic market and increase the total value of production.
Beef imports are often viewed as (partially) offsetting beef exports thus reducing the net value of beef trade. In reality both beef exports and imports add value to the U.S. beef industry. Beef trade, both exports and imports, helps to sort out the complex set of beef products in domestic and international markets to maximize the value to U.S. beef producers.
Realistic expectations for estrous synchronization and AI programs
by Glenn Selk, Oklahoma State University Emeritus Extension animal scientist
Producers that are wanting to improve the genetic makeup of their beef herds very often turn to artificial insemination (AI) as a tool to accomplish that goal. Many times, these producers have very high expectations as they begin the first season of artificial breeding. Perhaps they have heard other producers tell of situations where “near-perfect” pregnancy rates resulted from THEIR artificial insemination program. Everyone wants to get every cow or heifer bred as they start the labor and expense of an AI program. However, the rules of biology do not often allow for 100% pregnancy rates in most situations.
First of all it is important to understand several terms.
Estrous response rate: the percentage of cows found to be cycling in response to an estrus synchronization protocol. In other words, if we put 100 cows through the working chute and give them estrous synchronization drugs, and only 80 of those cows responded to the estrous synchronization products, then we have an “estrous response rate” of 80 percent. Perhaps some of the cows were not “ready” because they were later calving or they were in poorer body condition. If we are breeding only after they are detected in heat, then only 80 of the original 100 cows would be bred to AI. The effects of the drought may have an impact on the body condition of cows going in to the estrous synchronization protocols and adversely impact the percentage of cows responding to the synchronization products.
Conception rate: the percentage of the cows that were actually inseminated that were palpated and found to be pregnant 60 or more days later. In other words, of the 80 cows in the above example, that were found in heat and inseminated, IF we later found that 70 percent of those “settled” or became pregnant, we would have found 56 cows pregnant.
Pregnancy rate: the percentage of cows that were initially started on the estrous synchronization protocol that actually became pregnant. In the above example, 56 of the original 100 cows became pregnant to the AI program resulting in a pregnancy rate of 56 percent.
Therefore, the Estrous response rate X Conception rate = Pregnancy rate.
In this example: 80 percent Estrous response X 70 percent Conception = 56 percent Pregnant. The above example is hypothetical, yet very much close to the expected outcome of a successful synchronization and AI program. If heat detection is incorporated as part of the system, then it becomes another very important part of the equation.
Research conducted that evaluated different synchronization protocols very often illustrated variables other than protocol were most important. Differences in body condition of the cattle, experience and skill of the AI technicians, and weather influences, often played larger roles in the pregnancy rates than did the synchronization protocol. There was more difference expressed between operations than between the synchronization methods chosen. Help in choosing the synchronization protocol that best suits your situation can be found courtesy of the Applied Reproductive Task Force. This group of scientists list preferred protocols for both replacement heifers and adult cows.
After artificial insemination is conducted on the cows or heifers, clean up bulls will be introduced to the breeding pasture to breed those females that did not conceive to AI. How many clean up bulls are needed?
University of Nebraska researchers (Nielson and Funston, 2016) have reviewed published a review on beef AI trials and have evaluated the reported cow to bull ratios used in the clean up portion of the breeding seasons. They grouped the trials into three categories based on the cow to bull ratios used. Final pregnancy rates for cow to bull ratios of 1:20 to 30, 1:31 to 49, or 1:50 to 60 were 87.8, 82.6, and 89.2 percent, respectively. These ratios are based on the number of cows entering the estrous synchronization and AI breeding season. The fact that the wider cow to bull ratio was as successful as the others should not be surprising. Half or more of the cows were already bred when the bulls were introduced and therefore an actual number of cycling cows to bull ratio was actually near 25:1. In addition, estrous synchrony on the subsequent heat cycles was not as tightly synchronized as the first heat at AI. Natural variation in cycle lengths will cause less synchrony and therefore less intense breeding pressure on the cleanup bulls.
Cow-Calf Corner is a newsletter by the Oklahoma Cooperative Extension Agency.
May 1, 2017