Cow-Calf Corner: Beef market price dynamics; The 3 stages of parturition

Jan. 9, 2017
Beef market price dynamics
by Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist
Retail beef prices will continue adjusting down in 2017 due to retail market dynamics and continued growth in domestic beef consumption this year. The most recent All Fresh retail beef prices in November were $554.20/cwt., down 7.5 percent from one year earlier. All Fresh retail beef prices peaked in July, 2015 and have decreased 9.8 percent from the peak through November, 2016.
The average monthly price decrease since the peak has been 0.6 percent per month but the rate of decrease accelerated in the fourth quarter (Q4) of 2016. November All Fresh beef prices were down 1.7 percent from October following a 1.9 percent monthly decrease in October from September. A faster decrease is not surprising given the jump in beef consumption in Q4 of 2016. Fourth quarter beef production was up a projected 8.3 percent year over year and, when adjusted for fewer beef imports and increased beef exports, resulted in a projected 6.5 percent increase in per capita retail beef consumption compared to Q4 of the previous year. Sharply higher Q4 beef production in 2016 contributed to a projected annual increase in per capita beef consumption of 3.1 percent for the year.
Beef production is forecast to increase year over year by 3.5-4.0 percent in 2017 leading to an expected increase in consumption of 1.3 percent year over year. The consumption increase on a quarter by quarter basis will be relatively modest compared to the sharp jump in domestic consumption in late 2016. The current projection for 2017 domestic beef consumption hinges on the projection for total beef production as well as continued improvements in the net beef trade balance. Increased beef consumption may be interpreted by some as better beef demand while lower retail prices might suggest lower beef demand. In reality, it is the magnitude of retail price adjustments relative to increased consumption that defines the level of beef demand. In general, lower retail prices in the face of increased beef supplies are the expected response for a given level of demand. However, other factors such as pork and poultry prices and macroeconomic conditions may shift beef demand.
The fact that retail beef prices will be lower in 2017 does not inevitably imply additional pressure on cattle prices. The dynamics of retail price adjustments are slower than for cattle and wholesale beef markets. This is true for both price increases as well as decreases. For example, from early 2013, calf prices increased nearly 80 percent to a monthly peak in November 2014. All Fresh retail beef prices did not peak until eight months later in July 2015 having increased just over 25 percent from early 2013 levels. Likewise cattle prices have adjusted down more and faster whereas retail beef prices have adjusted less and more slowly. This is because, not only is it typical for retail prices to adjust more slowly, but also because retail prices began adjusting down eight months after peak cattle prices. Even if beef supplies were unchanged in 2017 we would expect retail beef prices to continue adjusting for several more months. Of course, total beef supplies are expected to increase in 2017 and overall market price pressure will depend critically on both domestic and international demand for U.S. beef in 2017.
The 3 stages of parturition
by Glenn Selk, Oklahoma State University Emeritus Extension animal scientist
As the spring calving season approaches, an increased understanding of the parturition process is helpful. The more we understand about the physiology of the process, the more likely we are to make sound decisions about providing assistance. Parturition, or calving, is generally considered to occur in three stages.
Stage 1: The first stage of parturition is dilation of the cervix. The normal cervix is tightly closed right up until the cervical plug is completely dissolved. In stage 1, cervical dilation begins some 2 to 24 hours before the completion of parturition (2 to 6 hours would be most common). During this time the “progesterone block” is no longer present and the uterine muscles are becoming more sensitive to all factors that increase the rate and strength of contractions. At the beginning, the contractile forces primarily influence the relaxation of the cervix but uterine muscular activity is still rather quiet. Stage 1 is likely to go completely unnoticed, but there may be some behavioral differences such as isolation or discomfort. At the end of stage one, there may be come behavioral changes such as elevation of the tail, switching of the tail and increased mucous discharge. Also relaxation (softening) of the pelvic ligaments near the pinbones may become visually evident, giving a “sunken” appearance on each side of the tailhead. Checking for complete cervical dilation is important before forced extraction (“pulling”) of the calf is attempted.
Stage 2: The second stage of parturition is defined as the delivery of the newborn. It begins with the entrance of the membranes and fetus into the pelvic canal and ends with the completed birth of the calf. So the second stage is the one in which we really are interested. This is where we find all of the action. Clinically, and from a practical aspect we would define the beginning of stage 2 as the appearance of membranes or water bag at the vulva. The traditional texts, fact sheets, magazines, and other publications that we read state that stage 2 in cattle lasts from 2 to 5 hours. As was illustrated in last week’s newsletter, data from Oklahoma State University and the USDA experiment station at Miles City, Montana, would indicate that stage two is MUCH shorter. In these studies, assistance was given if stage two progressed more than two hours after the appearance of water bag at the vulva. The interesting thing about the data was that the heifers calving unassisted, did so in about one hour after the initiation of stage two, and mature cows calved within an average of 22 minutes of the initiation of stage two. Those that took longer needed assistance. These and other data would indicate that normal stage two of parturition would be redefined as approximately 60 minutes for heifers and 30 minutes for adult cows. In heifers, not only is the pelvic opening smaller, but also the soft tissue has never been expanded. Older cows have had deliveries before and birth should go quite rapidly unless there is some abnormality such as a very large calf, backwards calf, leg back or twins. If the cow or heifer is making good progress with each strain, allow her to continue on her own. Know your limitations. Seek professional veterinary help soon if you encounter a problem that cannot be solved easily in minutes.
Stage 3: The third stage of parturition is the shedding of the placenta or fetal membranes. In cattle this normally occurs in less than 8 to12 hours. The membranes are considered retained if after 12 hours they have not been shed. Years ago it was considered necessary to remove the membranes by manually “unbuttoning” the attachments. Research has shown that manual removal can be detrimental to uterine health and future conception rates. Administration of antibiotics usually will guard against infection and the placenta will slough out in 4 to 7 days. Contact your veterinarian for the proper management of retained placenta.
An important ingredient for your calving season preparation is the Oklahoma State University Extension “Circular E-1006: Calving Time Management for Beef Cows and Heifers“. Cow calf producers will want to download this free circular and read it before the first calf is born this spring.