May 10, 2021
Slaughter Capacity Limits Fed Cattle Markets
By Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist
Most of the U.S. beef packing infrastructure was built in the 1980s. Cattle inventories in the decade of the 1980s averaged 108.3 million head, 15% greater than the 92.1 million head average of the past decade. The industry was characterized by excess capacity for many years as cattle inventories declined. Over many years, capacity slowly exited the industry. In 2000 a ConAgra plant in Garden City, Kansas, burned and was not rebuilt; Tyson closed a plant in Emporia, Kansas, in 2008; and in 2013 Cargill closed a plant in Plainview, Texas. The National plant in Brawley, Calif., closed in 2014 but reopened as One World Beef in 2017.
By Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist
Table 1 below shows characteristics of current steer and heifer slaughter for 2020 and 2019 compared to 2012 and 2007. The COVID-19 pandemic caused unprecedented disruptions in beef packing in 2020 so 2019 is included as a more typical year although a single plant fire also caused disruptions that impacted operations in 2019; though the impacts were relatively short-lived. Despite dramatic weekly volatility within each year, the general characteristics of 2019 and 2020 steer and heifer slaughter over the year were not substantially different. These two years are compared to 2012, the year prior to the Cargill plant closing and to 2007, the year prior to the Emporia plant closing. Total steer and heifer slaughter in 2012 (25.43 million head) was less than 2019 (26.1 million head) and fractionally higher than 2020 (25.3 million head). Steer and heifer slaughter in 2007 was the largest in Table 1 at 27.49 million head.
Table 1. Steer and Heifer Slaughter Summary, Selected Years
|% of Weekly Total||18.0||19.0||18.3||18.2||17.7||9.1|
|# weeks > 98,000||1||4||1||0||0||0|
|% of Weekly Total||18.1||18.1||18.2||18.0||18.5||9.3|
|# weeks > 98,000||5||1||0||4||2||0|
|% of Weekly Total||18.4||20.1||19.4||19.9||19.4||2.7|
|# weeks > 100,000||23||33||15||21||12||0|
|% of Weekly Total||17.2||19.0||18.8||18.9||18.8||7.3|
|# weeks > 100,000||29||38||33||35||29||0|
Table 1 shows the weekly average and maximum steer and heifer slaughter totals annually and for Monday through Friday in each of the years. Some aspects of slaughter have been consistent over time; Tuesday, Wednesday and Thursday daily slaughter tends be consistently higher than Monday and Friday slaughter; Monday slaughter is nearly twice as variable as the rest of the week meaning that there is more labor inconsistency on Mondays. It should be noted that the sum of the daily maximum slaughter levels exceeds the weekly maximum in each of the years in Table 1 by 4 to 11%. In other words, it is never possible for packing plants to maintain maximum daily capacity for an entire week.
Across these years, the change in overall slaughter levels are reflected but with some interesting differences in capacity relative to cattle slaughter. Total slaughter in 2012 was less than 2019 and similar to 2020 levels but had a total of 104 days of slaughter in excess of 100,000 head including 23 Mondays, 33 Tuesdays, 15 Wednesdays, 21 Thursdays and 12 Fridays. The single day maximum in 2012 was 105,695 head. There has not been a single day steer and heifer slaughter total in excess of 100,000 head since 2013, reflecting the decline in total capacity.
In 2020, there were a total of six days with daily slaughter in excess of 98,000 with a single day (Tuesday) maximum of 99,519 head. In 2019, a total of 12 days exceeded 98,000 head with a single day maximum of 99,422 head on a Monday. In 2007, daily steer and heifer slaughter was greater than 100,000 head a total of 164 days with a single day maximum of 106,951 head. Most of managerial flexibility in beef packing comes from Saturday slaughter. Table 1 shows that Saturday slaughter accounted for more than 9% of weekly slaughter in 2019 and 2020. This compares to 2.7% in 2012 and 7.3% in 2007.
The cyclical expansion in cattle numbers from 2014 to 2019 has now pushed cattle slaughter beyond packing industry capacity. It is estimated that annual average slaughter has exceeded capacity since 2016. Although cattle numbers peaked cyclically in 2019, feedlot production is just now at a peak in early 2021, partly as a result of pandemic delays in 2020. The Feb.1, 2021, feedlot inventory was the highest of any month since February 2006. Feedlot inventories declined in March and April but slaughter capacity limitations will slow progress in harvesting fed cattle in a timely manner. Thus far in 2021, Saturday steer and heifer slaughter has averaged 49,359 head per week and accounted for 10.0% of weekly slaughter. Slaughter needs will be seasonally larger in the coming weeks and it will be difficult for feedlots to get more current. It will be challenging to maintain, let alone push Saturday slaughter in the coming weeks. It now appears that it will take the remainder of the second quarter and likely much of the third quarter of the year to move the fed cattle industry into tighter numbers and relieve the capacity constraints that are limiting the fed cattle market.
Breeding Herd Vaccination Plans
Dr. Rosslyn Biggs, OSU College of Veterinary Medicine Extension beef veterinarian
A critical component of herd health is a breeding herd vaccination strategy. Unfortunately, there is no one-size-fits-all vaccination plan. Producers should work closely with their veterinarian to design an approach to meet specific needs. This plan will be based on factors such as animal immune status, disease risk, biosecurity, and management availability. The best vaccine options will be those that provide protective immune coverage for diseases of concern balanced with a defined management timeline and expense.
Producers and their veterinarians should consider many elements when designing a plan. Some of the elements to consider include: biosecurity practices, risk of disease, the agents a vaccine should cover, the use of killed or modified vaccine, booster requirements, inherent risks, vaccine schedule and timing, vaccine cost, and handling and administration techniques. The current vaccination status of your herd and your planned timing of administration will determine whether killed or modified-live vaccine is the best. Pregnancy status will also factor into vaccine choice.
Vaccine coverage may include diseases such as infectious bovine rhinotracheitis (IBR), bovine parainfluenza virus, bovine respiratory syncytial virus, bovine viral diarrhea virus, clostridial organisms (commonly referred to as blackleg and tetanus), leptospirosis, and others.
Each class of breeding animals may have a different vaccination protocol: heifers vs. previously vaccinated cows vs. cows with unknown vaccination status vs. bulls. Many producers will spend a great deal of time focusing on female vaccination protocols in their breeding programs, but bulls should not be forgotten, especially if they are new introductions to the herd. Customizing a vaccination protocol specific to individual groups in your program is always best.
Vaccinations selected for females should focus on diseases potentially impacting the individual, such as agents causing abortions and respiratory disease. Additionally, cows and heifers should be adequately vaccinated with strong immune systems to deliver a high concentration of colostral antibodies to their calves.
In general, all breeding animals should be vaccinated at least annually to cover the diseases of concern for your program and area. Vaccinations administered prior to breeding season should be completed at least 30 days prior to avoid vaccine induced stress or complications that could impact fertility.
Growth Promoting Technologies for Beef Production
By Paul Beck, Oklahoma State University Extension beef cattle specialist
With the increased costs of beef production (especially feed and fertilizer) technologies that improve the efficiency of production are increasingly valuable. For example, if the total cost of producing an acre of cool-season annual pasture increased from $83/acre in 2001 to $170/acre, a 10% increase in average daily gain by stocker calves reduces cost of gain by 3-times more now than it did in 2001. Growth promoting technologies, such as implants and ionophores, are a very cost-effective way to achieve these higher rates of performance of growing cattle.
In one study, steers were placed on wheat either after receiving an implant or were not implanted. Also, cattle in separate pastures were offered a non-medicated mineral, a mineral medicated with Rumensin, or pressed protein blocks medicated with Rumensin. Steers fed the non-medicated mineral that did not receive an implant gained over 2.3 pounds per day, which is excellent performance for grazing steers. But the implanted steers fed the non-medicated mineral gained 2.7 pounds per day, an increase of 0.4 lbs per day! While implanted steers fed the medicated mineral or medicated pressed blocks gained 0.55 pounds more per day than control steers (fed the non-medicated mineral and did not receive an implant). Over a 100-day grazing period supplying an ionophore along with a growth promoting implant increased bodyweight gains by 55 pounds, a 23% increase in performance.
In another study steers received for a stocker program were not implanted, implanted upon arrival to the receiving pens, or implanted following 14- or 28-day delays. Implanting during the receiving period did not affect animal performance or animal health during the receiving period but implanting during receiving did increase gains while steers were on pasture. Implanting increased overall average daily gain by 0.3 pounds per day, but during the last 28-days of grazing steers implanted on arrival gained less than steers implanted either on day 14 or 28 of receiving. During receiving energy is being used by steers to combat stress and enhance immune function, as opposed to increasing performance in response to implants. While grazing steers responded to implants with increasing weight gain, but early implants were playing out before the end of the grazing season.
Recent research examined the effects of implants of growing calves on subsequent carcass quality and consumer acceptability of beef. Steers and heifers were implanted (or not implanted) prior to finishing as calves (shipped to feedlot at 10 months of age) or as yearlings (shipped to feedlot at 15 months of age) after a stocker period with restricted gains (<1 pound of gain per day) or unrestricted gains (> 2 pounds of gain per day). Implants increased pre-finishing gains of all cattle whether they were calf-fed, restricted gain yearlings, or unrestricted gain yearlings. Interestingly performance during finishing was not affected by implants pre-finishing. Carcass quality and tenderness was not affected by implant pre-finishing in calf-fed or unrestricted yearlings, but carcass quality grade was decreased, and toughness was increased with implanting when growth was restricted during the stocker period.
Growth promoting technologies (implants and ionophores) are valuable tools for stocker producers with the potential to increase returns by $30 to 50 per calf. With judicious use of these technologies there is no detrimental effect on subsequent feedlot performance, carcass quality, or consumer satisfaction of beef.