Feb. 29 2016
Cattle market “business as usual”?
by Derrell S. Peel Oklahoma State University Extension livestock marketing specialist
Feeder and fed cattle prices are currently at roughly the same levels as in late 2013. In the intervening 26 or so months, cattle markets have been on a rollercoaster that took cattle prices higher, faster than ever imagined, followed by a sharp correction in late 2015 that was more abrupt and severe than anyone could anticipate. This has left cattle producers cautious and somewhat hesitant about what to expect going forward. One of the challenges through this period has been the fact that many of the cattle and meat market indicators, patterns and relationships have behaved very unusually leaving producers and analysts at a loss to understand and anticipate market movements.
Recently, however, there are number of indications cattle markets may be returning to somewhat more typical behavior. After the worst year ever in 2015, feedlot margins are moving back to levels will lead to positive returns for feedlots. This process is not complete and will likely continue through the next few months. Within feeder cattle markets, the margins or value of gain across weights just recently has adjusted to reflect feedlot cost of gain. The value of gain calculates to the $0.70 – $0.80/pound range in the past couple of weeks. This suggests that feedlots are pricing feeder cattle in a manner that reflects equilibrium across weights. This is the first time in many months that the value of gain in feeder prices is consistent with broader cattle market conditions.
On a very different note, wholesale beef markets appear to returning to patterns not seen for many months. So far in 2016, middle meats are advancing or holding value relative to weaker end meats. This long term tendency for middle meats to be the strongest part of carcass value has been reversed much of the time in recent years, going all the way back to the recession in 2009. Retail beef prices peaked in mid-2015 and are working lower as beef production begins to grow. Similarly, the ratio of retail beef prices to pork and poultry prices pushed to unprecedented levels over the past two years and has now peaked an begins adjusting back to more typical levels. The retail meat price ratios have been an impressive indication of strong beef demand but the fact that the retail price ratios are returning to more typical levels is an indication of more relative stability in meat markets.
Finally, perhaps the most obvious sign of relative stability is the fact that feeder and fed cattle and beef markets are exhibiting mostly seasonal behavior so far in 2016. Dramatic price trends, both up and down over the past couple years have overshadowed seasonal market tendencies. Though cattle and beef prices are expected to trend lower over the coming months, that trend will not be pronounced and markets are expected to behave much more seasonally.
While cattle and beef markets will no doubt continue to experience volatility, especially related to external macroeconomic and global uncertainty, it is encouraging that many of the internal market indicators are swinging back to more typical levels. This indicates a degree of relative stability in cattle and beef markets that has not been there in recent months.
Schedule the breeding soundness exams soon
by Glenn Selk, Oklahoma State University Emeritus Extension animal scientist
Although the spring calving season may still be ongoing, the next breeding season is only a few weeks away. Now is the time to schedule the old and new bulls for their pre-breeding soundness examination.
For the breeding soundness evaluation to be successful, bulls should be evaluated 30 to 60 days before the start of breeding. It is important to allow sufficient time to replace unsatisfactory bulls. Bulls could also be evaluated at the end of breeding to determine if their fertility decreased. A breeding soundness exam is administered by a veterinarian and includes a physical examination (feet, legs, eyes, teeth, flesh cover, scrotal size and shape), an internal and external examination of the reproductive tract, and semen evaluation for sperm cell motility and normality.
The physical examination studies overall appearance. Flesh cover is one factor to evaluate. Body condition can be affected by length of the breeding season, grazing and supplemental feeding conditions, number of cows the bull is expected to service and distance required to travel during breeding. Ideally, bulls should have enough fat cover at the start of breeding so their ribs appear smooth across their sides. A body condition score 6 (where 1 = emaciated and 9 = very obese) is the target body condition prior to the breeding season.
Sound feet and legs are very important because if they are unsound, this can result in the inability to travel and mount for mating. The general health of the bull is critical since sick, aged and injured bulls are less likely to mate and usually have lower semen quality. The external examination of the reproductive tract includes evaluation of the testes, spermatic cords and epididymis. Scrotal circumference is an important measure since it is directly related to the total mass of sperm producing tissue, sperm cell normality and the onset of puberty in the bull and his female offspring. Bulls with large circumference will produce more sperm with higher normality and also reach sexual maturity sooner.
Examination of the external underline before and during semen collection will detect any inflammation, foreskin adhesions, warts, abscesses and penile deviations. The internal examination is conducted to detect any abnormalities in the internal reproductive organs. Also, be certain to ask your veterinarian about the need to test the bulls for the reproductive disease, trichomoniasis, also called trich.
The semen evaluation is done by examining a sample of the semen under a microscope. The veterinarian will estimate the percentage of sperm cells that are moving in a forward direction. This estimate is called “motility.” In addition, the sperm cells will be individually examined for proper shape or “morphology.” Less than 30 percent of the cells should be found to have an abnormal shape.
Any bull meeting all minimum standards for the physical exam, scrotal size and semen quality will be classed as a “satisfactory” potential breeder. Many bulls that fail any minimum standard will be given a rating of “classification deferred.” This rating indicates that the bull will need another test to confirm status. Mature bulls (that were listed as classification deferred) should be retested after four to six weeks. Mature bulls will be classified as unsatisfactory potential breeders if they fail subsequent tests. Young bulls that are just reaching puberty may be rated as “classification deferred,” and then later meet all of the minimum standards. Therefore, caution should be exercised when making culling decisions based on just one breeding soundness exam.
Many producers work hard to manage their cows for high fertility. They may assume that the bulls will do their expected duties. However, it’s important to pay close attention to bulls to establish successful breeding.
“Cow/calf Corner” is a weekly newsletter edited by Dr. Glenn Selk, Extension cattle specialist emeritus at Oklahoma State University with contributions from additional OSU Extension specialists.