Source: The Cow/Calf Corner newsletter from the Oklahoma Cooperative Extension Service
Oct. 6, 2014
Cattle Prices: How high is high…revisited?
by Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist
“Feeder and fed cattle prices are at or near all time highs and are poised to keep moving higher. Both Feeder and Live cattle futures suggest that higher prices are yet to come. In several recent meetings and conversations with producers, I am seeing a couple of reactions to the current situation. There seems to be an overall feeling of disbelief or a sense that there is another shoe to fall. The basic question seems to be one of ‘Is this for real?’ Given everything we have been through in recent years and the amount of volatility in most input and output markets, such hesitancy is understandable. It is easy to remember corn and wheat markets in 2008 which soared to astronomical heights for a brief period of time. Are cattle markets in the same situation: set for a wild but short-lived ride into the stratosphere?”
The preceding paragraph was taken from an article that I wrote in January of 2011. I stumbled across it recently and realized that it applies to an even greater extent today with a market situation that is significantly different than when the original article was written. Feeder cattle prices today are nearly double (up more than 90 percent) the level when the question was posed in 2011.Fed cattle prices are up more than 50 percent from early 2011. No one knew in January 2011 that the beef industry would suffer tremendously with drought impacts into 2014 that would take an already tight supply situation to extreme levels and provoke the current unimaginable production and market situation.
It appeared in early 2011 that the beef cattle industry was poised for herd expansion with cattle inventories already lower than intended by the industry. Instead, we find ourselves in 2014 with the beef cow herd down another 6 percent from the 2011 level. Though herd expansion has likely started in 2014, it will take another three years to recover the 1.87 million head of beef cows lost since 2011. Additional expansion beyond that level is likely but will depend on domestic and international market conditions towards the end of the decade. The prospects for herd expansion for much of the rest of the decade suggest that cattle prices are likely to grind higher yet from current record levels before peaking and working lower towards the end of the decade. I’m hearing many producers and others repeating the adage that “high prices cure high prices” and they do; but in the case of the beef industry it will likely take most of the rest of the decade for that to happen. The beef industry does not work like crop production in which major production adjustments can occur in a matter of one crop year. Heifer retention will make tight cattle supplies tighter for a couple of years before any resulting production increase hits the market. The current situation pretty much ensures a four to six year recovery process with supply driven price strength for much of that process.
Are persistently infected cattle in your herd?
by Gant Mourer, Oklahoma beef value enhancement specialist and Barry Whitworth, DVM, Oklahoma State University Area Extension veterinarian
Bovine viral diarrhea virus (BVDV) is a contributor (along with others) to what is known as “shipping fever” complex, or bovine respiratory disease (BRD). However, some animals will be persistently infected (PI) as a fetus with BVDV and will carry BVDV their entire life. These are the animals that are particularly harmful to cattle herds because they may show no clinical signs of the disease at all and yet shed the virus continuously to surrounding animals.
Infected calves transmit the virus through secretions such as feces, nasal discharge, tears, saliva, urine, milk and semen. BVDV may also be transmitted during examination or palpation of the reproductive tract when gloves or sleeves are not changed between animals. Needles can transfer the virus from animal to animal as well. The virus can also survive several days in cool environments and be transferred from tools such as nose tongs, halters, and other tools if not properly sanitized.
Prevention of BVD involves the implementation of a well-defined biosecurity plan developed by you and your veterinarian and possibly testing of calves with an accredited laboratory. Removing all PI calves and cows after testing may be the first step. Also, testing outside animals or purchasing cattle that have been verified as PI-BVDV negative prior to entry into the herd will aid in preventing of the disease. A strong vaccination plan will also help prevent BVDV; it will not treat an animal that is already infected, but it will aid in prevention and will give some protection if cattle come in contact with other cattle via a fence line or other methods.
BVDV has a significant impact on the beef industry as a whole. In a 2007-2008 APHIS measured the occurrence of cattle tested on farm and found that 0.12 percent of 44,150 animals tested were tested positive and 8.8 percent of all 205 operations tested had at least one positive animal. Reproductive losses by far are the most expensive to cow/calf producers and difficult to measure.
Some estimates of BVDV outbreak in 1998 can be as much as $400 per cow. Impacts of BVDV in the feedlot have been measured in several studies over the last few years. Even though calves entering the feedlot may only represent 0.3 percent of cattle, cattle exposed to a PI calf increase its chance of respiratory disease by 43 percent and 15.9 percent of all respiratory tract cases can be attributed to exposure to a PI positive animal (Loneragan et al, 2005). Performance alone of exposed calves can result in losses of $88.26 per animal (Hessman et al, 2009).
Key factors that affect the percentage of cows cycling at the start of breeding
By Glenn Selk, Oklahoma State University Emeritus Extension animal scientist
The breeding season is only weeks away for those herds that have a fall calving program. The most important factors that determine if, and when, a cow returns to cycling activity were analyzed by Kansas State University physiologists. Over a period of 6 years, Kansas State scientists used more than 2,200 beef cows in estrous synchronization studies. As a part of these studies they determined which cows were cycling before the start of the breeding season both before and after synchronization treatments. They then looked at the previous data about each cow and determined the major factors that influenced the likelihood that she would have returned to heat by the start of the breeding season.
The research indicated that three main factors were the most important determinants as to whether the cow would recycle before the breeding season began. Body condition, age of the cow, and the number of days since calving were the biggest influences on incidence of cycling activity before breeding.
Body condition: Cows ranged in body condition score from 1 (extremely emaciated) to 7 (very fleshy). As body condition score increased, the percentage of cows cycling increased in a linear fashion. The Kansas data reported that there was an 18 percent increase in percentage cycling for every 1 full condition score improvement.
Age of the cow: The percentage of first-calf two-year-olds cycling was about 10 percent less than mature cows that were having at least their second calf. The extra nutrient requirement for growth clearly limits the cycling activity at the beginning of the breeding season of two-year-olds. Also, two-year-olds are in the stage of life where the baby teeth are being replaced by permanent teeth. Some of these young cows have problems consuming roughage similar to “broken-mouth” older cows. This explains why many producers choose to breed replacement heifers ahead of the cow herd and therefore give them more days before the breeding season begins for mature cows.
Numbers of days since calving: Cycling activity was also influenced by the number of days since calving. For every 10 day interval since calving (from less than 50 days to 70 days) the percentage cycling increased by 7.5 percent. A short calving season is important because it allows a higher percentage of cows to be cycling by the start of the breeding season.
“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.