Oct. 14, 2019
Issues in agricultural and food markets
By Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist
Last week was a busy travel week as I attended and presented at three very different conferences. First was the Global Protein Summit in Chicago; followed by the Rural Economic Outlook Conference at Oklahoma State University in Stillwater; and ending the week with a series of seminars at the Expo Ganadero in Chihuahua, Mexico. Though these conferences covered a wide range of topics, several themes were consistent across at least two or sometimes all three conferences.
All conferences included the widely discussed trend of global population growth and the challenges of feeding the world. Global population is projected to increase from the current 7.7 billion people to over 9.5 billion by 2050 and to exceed 11 billion before the end of the century. One presentation noted that while current attention is on growing Asian populations, Asia will peak in the next two decades and population growth in Africa, which is just beginning to grow rapidly, will dominate global population growth in the last half of the century.
As important as population growth, perhaps more so for meat industries, is economic growth and the growing middle class. Globally, the middle class is projected to expand from two billion to 4.9 billion people by 2030. China alone is projected to add 850 million new middle class consumers by 2030. It is well documented that meat consumption increases as growing incomes support better quality diets and increased protein consumption.
Two different presentations by speakers from the Federal Reserve noted that the U.S. is currently experiencing a very long period of relatively weak economic growth. These and other presentations noted that the shrinking U.S. labor force is contributing to the slow pace of economic growth. As the U.S. population ages, fewer new labor force entrants are available to replace those leaving the work force. It was also noted that productivity growth will not likely be sufficient to offset the declining labor force.
Other labor presentations noted the important role of immigrants historically in food and agricultural industries and the growing need for low to medium skilled workers to support all aspects of agricultural and food production, including vegetable and fruit harvest; dairy, ranch and feedlot workers; labor for food processing and manufacturing; and restaurant servers and chefs. Recent research conducted by Oklahoma State University confirmed the pervasive labor issues and challenges in all sectors of the beef industry from packers to further processing and food distribution to retail and food service*.
The growing reality of the massive impact of African Swine Fever (ASF) was another common topic in these conferences. The rapidly changing dynamics of this disease suggest that the impacts are global in nature and not only for the coming weeks and months but likely will fundamentally impact global protein markets for years or decades. It appears at this time, that swine and pork losses in China, Vietnam, North and South Korea, and the Philippines along with other outbreaks of ASF in Europe and Africa is creating a protein deficit that cannot be currently filled by all proteins in the world.
Finally, the conferences included discussions about alternative proteins, particularly plant-based proteins. Various perspectives noted that some in both the meat and plant-based protein markets view each other as competitors battling to replace the other. There was also recognition that the markets may be complementary, not only for retail and food service businesses to offer a more comprehensive set of protein product choices to consumers; but also the reality that it will likely take both meat and plant-based protein to feed the world through the remainder of the century.
*Clark, Lauren Elizabeth. “Disaggregating Beef Demand: Data Limitations and Industry Perspectives.” , Unpublished M.S. Thesis, Oklahoma State University, May, 2019
Knowing hay quality affects supplementation strategy
By Glenn Selk, Oklahoma State University Emeritus Extension animal scientist
Cattle producers in many areas of Oklahoma have been fortunate this summer to receive timely rains. Many big round bales of hay have been stored for winter feeding. Meeting the supplemental protein needs for the cows and replacement heifers consuming that forage must be done properly and economically. Protein is a vital nutrient for the ruminant because protein is necessary for the multiplication of, and the feed digestion by the microbes in the rumen. The microbial population in the rumen of cows is largely responsible for digesting cellulose in standing or harvested forages.
Higher quality forages are more readily digested in the rumen and have higher rate of passage through the digestive tract of the cow than do lower quality roughages. Therefore, the cow can consume more of the high quality forage on a daily basis and receives more total digestible nutrients (TDN) from each pound of feed consumed. If adequate protein is available to cows consuming lower quality roughages, then the rate of passage and the digestibility is improved compared to cows that are inadequately supplemented while consuming the same low quality forage.
Producers may be surprised to know the large differences in protein supplement needed to meet the cow’s requirement depending on the quality of forage that makes up the majority of the diet. Below is a table of the pounds of 40% protein supplement needed daily for moderate-sized (1100 pound) beef cows in different stages of production and consuming differing quality of grass hays. (Table is adapted from Richards, Lalman, and McKinney; Cattleman’s Management Record Book.)
|Needed 40% protein supplement (lb/hd/day) to meet protein requirement of 1100 pound mature beef cow|
|Hay Protein Concentration (%)|
|Stage of Production||4%||6%||8%|
|Mid Gestation, Dry||2.2||1.1||0|
Larger cows and cows that produce above average milk production will consume more forage and need even more supplement to match their requirements. The table above describes the protein-only needs of the beef cow. Energy deficiency may occur and result in some weight and body condition loss. Energy needs will be increased if cows are already in thin body condition and must be improved before calving next spring. Also, winter weather conditions can greatly increase energy needs. In many instances, the energy requirements can be met with lower protein supplements (for example 20% protein range supplements) fed at about twice the rate as noted in the table above.
Forage quality differences are important, whether the supplement choice is high protein (40%) or lower protein (20% protein). Learn about testing hay for protein content by visiting with your OSU County Extension Office or downloading Oklahoma Cooperative Extension Fact Sheet PSS- 2589 Collecting Forage Samples for Analysis.