Bottomline Fall Newsletter

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by Joe Epperly Assistant Executive Director North American Limousin Foundation I n recent months, there have been many challenges facing the beef industry over lean, finely-textured beef (LFTB or “pink slime”), transgluterase, EPA fly-overs, antibiotic use, and animal rights activists’ attacks both in the legislature and on the farm (Harris Ranch). This is a function of the today’s media and social networks, and has led to the American consumer becoming more concerned about how their food is raised than ever before. These concerns do not fall on deaf ears as technology use and animal welfare have been at the heart of industry efforts for decades. The question becomes not only what technologies and techniques to use, but also how best to showcase to consumers that the best management practices are being used. Survey information compiled by the National Cattlemen’s Beef Association (NCBA), shows that concerns over production practices are especially prevalent in the Millennial generation (ages 18-32). This is an age group that is important for the beef industry to capture to ensure future domestic markets, though current market conditions make it difficult as beef prices rise. The Millennial generation is starting to graduate from college, begin their professional careers and start families. This is a generation that is highly affected by price but is also more likely to be influenced by production practices. They are a generation that has grown up on INSIDE... Challenges The Beef Industry Is Facing Strategies to overcome them Management Focus Pfizer offers quick tips All-Natural Beef How Cross Four Ranch does business Marketing Drought may dictate changes New Products Pfizer launches two new products. Government Drought, the farm bill and election day. Bottom Line is published four times per year by the North American Limousin Foundation 6 Inverness Court East, Suite 260 Englewood, CO 80112-5595 (303) 220-1693; Fax (303) 220-1884 www.nalf.org Executive Director - Mark Anderson, Ext. 51 Dir. of Communications - Brooke Bennett, Ext. 49 Assistant Executive Director - Joe Epperly, Ext. 47 FALL 2012 VOLUME 14, ISSUE 2 PRSRT STD US Postage PAID Columbia MO Permit 353 North American Limousin Foundation 6 Inverness Court East, Suite 260 Englewood, CO 80112-5595 Bottom Line Bottom Line LIMOUSIN’S COMMERCIAL CONNECTION continued on Page 2 Challenges The Beef Industry Is Facing And Strategies To Overcome Them To view the current and past issues of Bottom Line, or if you’re not already on the mailing list, visit the North American Limousin Foundation website: www.nalf.org. BOTTOM LINE FALL 2012 1

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NALF's Bottomline Fall 2012 Newsletter

Transcript of Bottomline Fall Newsletter

Page 1: Bottomline Fall Newsletter

by Joe Epperly Assistant Executive DirectorNorth American Limousin Foundation

In recent months, there have been many challenges facing the beef industry over lean, finely-textured

beef (LFTB or “pink slime”), transgluterase, EPA fly-overs, antibiotic use, and animal rights activists’ attacks both in the legislature and on the farm (Harris Ranch). This is a function of the today’s media and social networks, and has led to the American consumer becoming more concerned about how their food is raised than ever before. These concerns do not fall on deaf ears as technology use and animal welfare have been at the heart of industry efforts for decades. The question becomes not only what technologies and techniques to use, but also how best to showcase

to consumers that the best management practices are being used.

Survey information compiled by the National Cattlemen’s Beef Association (NCBA), shows that concerns over production practices are especially prevalent in the Millennial generation (ages 18-32). This is an age group that is important for the beef industry to capture to ensure future domestic markets, though current market conditions make it difficult as beef prices rise. The Millennial generation is starting to graduate from college, begin their professional careers and start families. This is a generation that is highly affected by price but is also more likely to be influenced by production practices. They are a generation that has grown up on

InsIde...

Challenges The Beef IndustryIs FacingStrategies to overcome them

Management FocusPfizer offers quick tips

All-Natural BeefHow Cross Four Ranch does business

MarketingDrought may dictate changes

New ProductsPfizer launches two new products.

GovernmentDrought, the farm bill and election day.

Bottom Line is published four times per year by the North American Limousin Foundation

6 Inverness Court East, Suite 260Englewood, CO 80112-5595

(303) 220-1693; Fax (303) 220-1884

www.nalf.orgExecutive Director - Mark Anderson, Ext. 51

Dir. of Communications - Brooke Bennett, Ext. 49

Assistant Executive Director - Joe Epperly, Ext. 47

FAll 2012 VolumE 14, IssuE 2

PRSRT STDUS Postage

PAIDColumbia MO

Permit 353

North American Limousin Foundation 6 Inverness Court East, Suite 260

Englewood, CO 80112-5595

Bottom LineBottom LineLImousIn’s CommerCIaL ConneCtIon

continued on Page 2

Challenges The Beef Industry Is Facing And Strategies To Overcome Them

To view the current and past issues of Bottom Line, or if you’re not

already on the mailing list, visit the North American limousin Foundation website:

www.nalf.org. BOTTOM LINE FALL 2012 1

Page 2: Bottomline Fall Newsletter

the internet and in social media and are highly influenced by sensational headlines regarding LFTB, mad cow disease, antibiotics or Clenbuterol. Millennials are also a main target for animal rights organizations, such as Humane Society of the United States (HSUS), who are focusing on this generation when promoting their vegan agenda.

In order to win the battle for consumers and secure beef ’s future on the center of America’s plate, our industry needs to focus on using management practices that are not only science-based, but also accepted by the consumer. This might seem to be a daunting task, but it really isn’t as difficult as the face value. Global Animal Partnership (GAP) is one of largest humane handling programs and audits in the United States, with products going to retailers such as Whole Foods and restaurants like Chipotle. GAP has representatives from both HSUS and People for the Ethical Treatment of Animals (PETA), who serve on their standards board. The GAP program is predominately composed of practices that a majority of producers are using along with almost all-natural beef producers. As an industry, we are using practices that even our greatest critics approve of, but unfortunately folks don’t believe it without the third-party audit.

The management practices consumers are most interested in (aside from their ideas of enough food, water and

sunshine) is the use of antibiotics, growth promotants and animal handling. Issues such as LFTB and transgluterase are of interest to them, but those are more processor and retailer related matters, which by all means cow/calf producers should be educated enough to speak about, but they have little control over the processes. These practices are more related to the rancher or feedlot operator.

The use of antibiotics on farms is a hot button issue with the American public due to the perception they are overused and causes antibiotic resistant bacteria that will affect human medicine, and this in turn is coupled with worries about residues in the meat supply. As producers, we are responsible for ensuring safety and minimizing residues by adhering to withdrawal periods and label instructions. This involves following Beef Quality Assurance (BQA) protocols for drug administration. It remains important to always give injections in the neck, at prescribed levels and subcutaneously if possible. Anti-microbials, such as ionophores, are also thrown into this category for their sub-therapeutic use. Part of the solution to this issue is education from the grassroots level in how these drugs are used and the safety behind the research and the responsible use by ranchers.

Growth promotants are typically lumped in with antibiotics in the belief that we “pump our cattle full of hormones and have to give them antibiotics to keep them healthy.” While this idea might seem silly and

unfounded to a producer, according to NCBA research over 18 percent of Millennials believe just that. Growth promotants mainly refer to implants and beta-agonists, which are most commonly used in a feedlot setting but have some use by ranchers. Critics fear residues, especially with hormone implants.

In the case of attacks on technology, knowledge is power. At a recent NCBA meeting, Dr. Jude Capper stated that the extra beef from implants and beta-agonists on a single carcass supply seven children with school lunches for the year. Research has also shown that the difference in estrogen levels in an implanted steer versus a non-implanted steer equate to 0.4 nanograms per four ounce serving (1.6 nanograms for implanted steer), whereas three ounces of soy oil, a typical vegetarian protein supplement, contains 168,000 nanograms of estrogen.

The issues regarding animal handling revolve around the same issue of animal welfare. It is disheartening how quick the public is to believe a video put together by an animal rights group of poor handling and production practices and to extrapolate that it is representative of the entire industry. It is amazing to see how people pay attention to an issue like the E6 Ranch incident and lose sight of the millions of dollars producers have put into animal behavior research, facilities and training.

The thousands of producers who attend seminars annually conducted by industry leaders Curt Pate and Dr. Ron Gill on animal handling know what good husbandry is and put it to

use in their operations. Feedlots and ranches across the country continue to upgrade their facilities in the vein of Temple Grandin’s research and protocols for better handling practices. This is an issue that must be attacked from a grassroots level in order to prevent consumer dissatisfaction and government overreach.

Al l of these technologies and practices are topics we need to be prepared to defend in the near future and it will take an effort from the entire industry to do it. As an industry, we have relied on the science behind what we do to defend our practices for a long time. In today’s media environment where a “mommy blogger” can shut down production of a safe USDA-approved product like LFTB with no history of bacterial contamination, science isn’t enough.

As ranchers, we must address the public that is generations removed from the farm and open the barn door. Whether it is hosting a farm or feedlot tour, talking to your congressmen or just the organic Whole Foods shopper down the street, we must act. We stand today on the top of a slippery slope that could lead us toward government regulation of the European vein, where supply is stifled and good producers are forced out of business. It will take producers, backgrounders, livestock market operators, feedlots and packers uniting together to use technology safely and effectively, use animal husbandry wisely and to spread the word publicly to enhance this industry’s image and preserve our way of life. BL

continued from front cover

Quick Tip #1:Know the basics of strategic deworming

Keeping a healthy herd requires p rope r p l a nn ing . A s t r a t e g i c deworming approach involves more than administering a dewormer annually. It’s about knowing when parasites could be compromising the health of your cattle.

“Timing is critical for strategic deworming programs,” says Gary Sides, Ph.D., Cattle Nutritionist, Pfizer Animal Health Cattle and Equine Technical Services. “Along with timing, selecting the appropriate active ingredient, using proper administration techniques and even taking geography into consideration are all vital parts of getting the most out of your deworming program.”

A s t r a t eg i c p rogram a ims to interrupt the lifecycle of the parasite. To do that, cattle producers should deworm their herd twice a year—once in the spring at the beginning of grass green up and again in the fall before winter turnout.

“If spring deworming is done correctly, it can be very beneficial moving into fall because parasite loads are greatly reduced,” Dr. Sides says. “Likewise, fall deworming is still very important to clean up any parasites that might have been missed earlier in the year and takes care of the parasites that may overwinter in the cattle.”

When a dewormer is used correctly as part of a strategic deworming program, it can help cow/calf producers ensure they are feeding cattle, not the parasites, and ultimately allow the animal to utilize forage more efficiently.1

After determining the appropriate timing and identifying the parasites of concern in the area, the next step is choosing the right dewormer.

“There is not one single product class that is effective against all internal and external parasites,” Dr. Sides says. “Your veterinarian is a valuable resource to help pick your battles and maximize efficiencies with the parasite products available to you.”

Dr. Sides recommends using a broad spectrum dewormer such as Dectomax® 1% Injectable since it is

proven most effective in controlling the most economically important parasite—the brown stomach worm—for up to 21 days. In regions where biting lice are a concern in the fall, Dectomax Pour-On is a beneficial fall treatment for external parasites.

“ I m p l e m e n t i n g a s t r a t e g i c deworming program, could mean big improvements to a producer’s bottom line,” Dr. Sides says.

Over time, better parasite control will pay with performance. In fact, deworming contributes to a lower cost of production over the lifetime of the animal.

“Strategic deworming programs are one of the most important tools in the toolbox,” Dr. Sides says. “Producers looking to improve the health and performance of their cattle this fall

Pfizer Offers Quick Tips

continued on Page 4

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Better genetics make a difference where it counts.

Advanced genetic information and management mean better profits by giving you the power to make more precise breeding and selection decisions. Pfizer Animal Genetics has all the products you need to make a difference in your operation. Using our industry-leading DNA tests, you can evaluate economically important traits such as feed efficiency and marbling, determine parentage from multisire breeding pastures, identify genotypes for genetic conditions and homozygous black breeding animals, and a lot more. Learn how Pfizer Animal Genetics products can help you accelerate genetic progress today.

All brands are the property of Pfizer Inc., its affiliates and/or its licensors. ©2012 Pfizer Inc. All rights reserved. PAG12032 www.pfizeranimalgenetics.com l 877-BEEF DNA

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should look to Dectomax to protect their cattle from parasites.”

Important Safety Information: Dectomax Injectable has a 35-day pre-slaughter withdrawal period. Dectomax Pour-On has a 45-day pre-slaughter withdrawal period. Do not use in dairy cows 20 months of age or older. Do not use in calves to be processed for veal. Dectomax has been developed specifically for cattle and swine. Use in dogs may result in fatalities.

Quick Tip #2:

Duration of immunity—confidence labeled on the vaccine

Take the guesswork out of managing respiratory disease. A little extra information on a vaccine’s label—like the duration of immunity (DOI) offered by the product—can help cattle producers select a respiratory vaccine that best fits their herd health program.

“Duration of immunity label claims can help give producers confidence

their cattle will be protected against respiratory disease throughout the high-challenge periods,” says Jon Seeger, DVM, Pfizer Animal Health Cattle and Equine Technical Services.

Vaccines with demonstrated duration of immunity claims—based on disease challenge studies—help offer protection against the specific pathogen for at least the number of days stated on the label. Historically, duration of immunity data has not been required. This means, for example, that a label that reads “annual revaccination” may not denote disease protection for 12 months, Dr. Seeger says.

He adds that since not all vaccines have the same, or any, duration of immunity label claims, producers should choose one that covers the desired phase of production.

“Producers need to think about the challenges and periods of stress cattle face on their operations,” Dr. Seeger says. “Once they work with their veterinarian to determine their needs, producers can match this with the vaccine that has the capability to help provide protection for the entire

production phase. The duration of immunity may be longer than what they need—it’s most important that it doesn’t fall short.”

When managing respiratory disease challenges, Dr. Seeger recommends producers work with their veterinarian to develop a vaccination program that includes a respiratory vaccine such as Bovi-Shield Gold® 5. It helps provide the protection needed to help prevent respiratory disease through each production phase—allowing for maximum flexibility in timing vaccinations to when producers are handling cattle. In addition, Bovi-Shield Gold 5 is the only viral respiratory vaccine that prevents infectious bovine rhinotracheitis (IBR) virus and aids in the prevention of bovine viral diarrhea (BVD) virus Types 1 and 2 respiratory disease for at least 279 days.•

Bovi-Shield Gold can be used with confidence knowing additional studies have been performed to demonstrate its duration of immunity, in addition to its superior label claims, Dr. Seeger adds.

“Duration of immunity information on the label helps producers take the

guesswork out of understanding the protection provided by a vaccine,” Dr. Seeger says. “It’s an added value for the producer when this type of information is available.”

*Prevents IBR respiratory disease and IBR and BVD Types 1 and 2 respiratory DOI claims apply only to SC route of administration. Intramuscular respiratory IBR claim is “aids in prevention.”

About Pfizer Animal Health

Pfizer Animal Health, a business unit of Pfizer Inc, is a world leader in the discovery, development and manufacture of innovative animal health vaccines, medicines, diagnostic products and genetic tests. We work to assure a safe, sustainable global food supply from healthy beef and dairy cattle, swine, poultry, sheep and fish while helping dogs, cats and horses live healthier longer lives. We strive to be the animal health company that provides full healthcare solutions to veterinarians, livestock producers, and pet owners. To learn more, visit www.animalhealth.pfizer.com. BL

continued from Page 2

by Brooke BennettDirector Of CommunicationsNorth American Limousin Foundation

The concept of all-natural beef is still new to some consumers. However,

at Cross Four Ranch, located just outside of Miles City, Montana, it is their way of doing business.

Founded by Fred Wacker nearly 30 years ago, Cross Four Ranch, which spans 400 square miles, is a family run cow/calf, yearling and finished cattle operation that specializes in all-natural beef. Running the ranch is truly a family affair with all members of the Wacker family partaking in some aspect in the daily function of the ranch. The Wacker

family is comprised of Fred his wife, Gwen, and their four adult children and spouses: daughters Sara and husband, Shane Rehm; Julie and husband, Brian Nowicki; Karen and husband, Blaine Martin; and son Mike and wife, Nicole.

Gwen takes charge of the ranch’s bookwork while daughter Sara covers the operation’s accounting. Sara’s husband, Shane, assists the ranch by overseeing the backgrounding lot and the cow/calf and yearling operation. Daughter Julie takes charge of the ranch’s human resources and manages the livestock value-added programs while her husband, Brian, takes charge of cattle, receiving, tracking and scheduling of livestock shipments.

Son Mike and his wife, Nicole, take charge of the farming side of the operation along with owning a livestock trucking business that assists with moving the family’s cattle from ranches to the feedlot. Wacker’s daughter, Karen and her husband, Blaine Martin, live in Bozeman, Montana, and she audits accounts receivable and livestock sales.

Though he is a third generation cattle rancher, when Wacker founded the ranch it was hard to gauge what was to come with the future of the operation. “I came to Miles City when I was 22 with a wife, two kids, two saddle horses, a milk cow and her calf, and a crate of chickens,” said Wacker.

With the $1,700 cash he started with, he has since built up a business that includes not only the ranching enterprises, but also agricultural real estate and insurance agencies.

“My dad was a good rancher, he taught me to care for livestock and how to tell the good ones,” he says.

Progressive thinking and industry-wide understanding help keep his cow sense in tune with seemingly natural business skills. He’s a “people person” and that helps in everything from building ranch relationships to keeping the consumer in mind.

In 1985 Wacker introduced Lim-Flex bulls into his primarily British-based cowherd. “By adding Lim-Flex to my breeding program it allowed me to add the additional frame size that my herd was lacking while adding muscle,” said Wacker.

Including Lim-Flex into the breeding program at Cross Four Ranch has also increased the performance on cattle as they enter feedyards. Increased average daily gains and better dry-matter conversions have helped lower our cost of gains. Improved yield grades with higher cutability on cattle is reflected directly on grid results with cattle that can consistently grade 80-90% Choice and Prime.

Wacker became interested in the natural market in the late 1990s. “My interest in the natural market grew after studying the economics of the natural market. With commodity cattle, you’re competing against every feedlot in the business and doing the exact same thing they’re doing,” Wacker says. “I made up my mind that in the cattle business the only place there was good

All-Natural Beef, How Cross Four Ranch Does Business

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money was if you’re willing to step out of the box and do what nobody else wants to do. Then, in the end they would pay you for it.”

Once making the decision to raise all-natural cattle Wacker was all-in and seven years ago Cross Four Ranch transitioned the entire operation into natural production. “I started with nearly 900 natural yearlings, but nobody would give a dime bonus for them, however the packers were interested,” said Wacker. “Packers were used to killing a lot of cattle that were grading 60-70 percent Choice and Prime, and we came in with these cattle that beat 90 percent Choice and Prime, and it grabbed their attention.”

The family backgrounds cattle at their 12,000-head yard, where they keep an

eye on health, stress and nutrition. “The key to the natural business is keeping the cattle natural,” said Wacker. “We’re doing everything we can to raise a healthy, humanely handed, quality product, so that when you enjoy a beef dinner off our ranch, you’re eating as fine a product as the beef industry has the ability to produce.”

During the summer months, Cross Four Ranch runs their yearling cattle primarily in Montana. These cattle are typically shipped in the fall to finish in feedyards located in Colorado and Nebraska. By doing this, it helps insure a year-round supply of cattle with yearlings that typically finish November through April while the calf-fed cattle are usually harvested May through October.

“The natural cattle are setting the feeder-calf markets here in Montana,” said Wacker. “It’s become common to hear comments such as, ‘Those cattle brought X-amount and they aren’t even natural.’ That’s like saying my Hereford cattle did well and they’re not even Angus.”

He knows high quality and natural have to be achieved in tandem. The cattle are targeted for several high-quality natural programs, including Tyson Fresh Meats, Meyers Natural Beef and National Beef.

“If you take a good product and brand it with a good name and get that consistency, it will absolutely sell,” said Wacker.

Hi s ro l e in tha t cha in i s to make sure the cattle hit al l the specifications, which he says is made relatively easy with access to high-quality genetics. Bred right and calved, they handle them easy, too, following Beef Quality Assurance (BQA) guidelines with an emphasis on weaning and preconditioning.

Since deciding to go all-natural, not much has changed in the way Cross Four Ranch operates. “Other than the buying of only natural calves and the recordkeeping, things are pretty much the same,” said Wacker. “We just try to get calves directly off the ranch and buy ones with a history of good health.”

For the last six years, the ranch has been equipping its calves with an EID (electronic identification) in order to

keep records of each individual calf. If by chance one loses a tag or gets by them, they get scanned in at the yard and Brian, who is in charge of tracking the cattle, knows right away to keep that animal separated from the rest of the herd until the EID tag is replaced if original ID can be reestablished with the backup tag to track individual ID on that animal.

Although there are many benefits to having a computerized system, one that is of crucial importance is the ability to keep individual calf history and provide producer reports. “We track that through a software program and use it to identify groups of cattle that perform better than others,” said Wacker. This computerized system keeps records from death loss to fallout rates, from gains to grades, and then shares the information with producers.

“If we can provide more information back to producers, they will continue to improve the genetic quality of their herds and make the beef industry that much better,” said Wacker.

What started as a vision from Wacker has now grown into an enterprise for the Montana cattle rancher. Not only has the natural market allowed Cross Four Ranch to develop an in-demand product for consumers, but also because of the dedication from the entire Wacker family, the natural vision has developed into a long-established tradition. BL

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To start using the power of the Limousin and Limflex profile, including GE-EPD submit samples directly to NALF at http://www.nalf.org/dna_genomics.php or call 888-320-8747

BOTTOM LINE FALL 2012 5

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by CattleFax

The USDA Cattle Inventory Report on July 1 confirmed what was

mostly known—the beef cowherd continues to decline. With a smaller calf crop forecast for 2012, cattle supplies are not going to increase anytime soon.

At the same time, the United States is experiencing a severe drought. Feed and forage costs for cow-calf producers have already—and will continue to—move signif icantly higher. All of these fundamentals will change how U.S. cow-calf producers manage their herds.

Explore the topics below to understand the scope of the drought and address some of the challenges it presents.

Far Reaching Drought EffectsBased on the U.S. drought monitor

map, more than 80 percent of the U.S. beef cowherd is currently affected by abnormally dry weather conditions.

The U.S. drought monitor map has five categories ranging from abnormally dry to exceptional drought. This scale and the categories are listed on the map (chart 1).

Further analyzing the drought data indicates that more than 50 percent (16 million head) of the U.S. beef cow herd is in a severe to exceptional drought (top three drought categories). This is the highest percentage in that category since the drought monitor data series began in 2000.

About 27 percent (8 million head) of the beef cowherd is covered by the two most severe categories listed in the drought map, extreme to exceptional drought. These worst two categories include widespread crop or pasture losses and shortages of water in reservoirs, streams and wells.

Interestingly, the percentage of beef cows affected by the two worst drought categories in 2011 was also 27 percent.

This was largely because nearly all of Texas and into Oklahoma and New Mexico was in the exceptional drought category, and those three states contain nearly 25 percent of the U.S. beef cowherd.

Obvious ly, the b ig d i f ference between this year and last year is the drought is much more widespread across the country.

On average, only 17 percent of the country has been in the severe to exceptional drought category since 2000. Nearly half of the country (46 percent) is in that category today.

The seriousness of the drought will yet again have a long-term influence on the future of the beef cowherd.

Cow slaughter levels have increased significantly in recent weeks and unless moisture conditions improve significantly, very soon, the beef cowherd will be down much more than forecasted at the beginning of the year for 2013, and contraction could extend into 2014 as well.

seasonal Cow PricesHarvest cow values are exceptionally

seasonal, and prices are affected by an inverse relationship between supply and demand.

Higher prices are common in the spr ing and summer when cow slaughter is low and demand is seasonally high due to additional hamburger use (chart 2).

The slaughter cow market has been at all-time record highs in 2012 averaging $83.50/cwt. on utility cows.

Prices have been mostly seasonal, although values have softened in the last 30 days as more widespread drought has increased cow slaughter numbers in many parts of the country.

As a cow-calf producer, how can you utilize the strong seasonal price pattern to your advantage—especially with drought in many parts of the country?

For producers affected by drought, early weaning in late summer might be an option.

Pregnancy check the cows and sell any open cows immediately. This will stretch a limited grass supply and maximize cull-cow value by beating seasonally lower fall prices. In areas were feed is more ample, traditional weaning in the fall is still the best alternative.

A l so , cons ider ex tending the ownership of open cows until February or March.

Prices should increase seasonally—allowing producers to maximize the return on harvest cows.

Look for cull-cow prices to stay at or above 2012 levels longer term.

The demand for ground beef continues to increase domestically, and smaller cow

slaughter levels are likely once moisture improves grazing conditions.

Value of Gain vs. HayEarly weaned calves flooded the

summer 2011 market and producers to the north had the feed resources to purchase those calves cheaper and feed them profitably into winter.

The oppor tuni ty to purchase lightweight calves at discounted rates—or retain ownership of early weaned calves—this summer exists again due to widespread drought. However, the opportunity cost of feeding calves will be considerably higher for most producers this year for two reasons.

Producers who purchased lightweight calves the previous two summers and sold them as feeder cattle the following winter received near-record profits.

The market paid nearly $500 per head to take a 450-lb. steer in September 2011 and sell it at 750 lbs. in January 2012. The same marketing plan generated around $350/head in revenue the preceding year (chart 3).

However, summer 2012 calf prices are more competitive relative to feeder cattle prices. Typically, the 450-to-750-lb. steer price spread is at a seasonal low from July to September, and calf prices have been 16 percent higher than feeder cattle over the last five years.

Summer calves are currently bringing 20 percent more than feeder cattle. In other words, calves are bringing $26/cwt. more than feeder cattle compared to a $20 average advantage.

The drought also ensures hay prices will be higher across the United States and producers with extra forage could

find willing buyers this fall and winter. USDA reported hay stocks on May 1

were among some of the lowest in the last 10 years, and hay prices continue to be at near-record highs.

The USDA reported U.S. hay price—excluding alfalfa—in July was $184/ton.

From July 2011 to May 2012, hay prices advanced $20/ton on average. Similar price increases are possible in the upcoming marketing year. That will incentivize producers to sell hay not needed to winter cows.

The opportunity to purchase or retain early-weaned calves and sell them as feeder cattle this winter at a profit is not a guarantee.

A combination of tighter cattle supplies, lower corn prices and/or higher deferred live cattle futures prices will be needed to see another aggressive late winter or early spring feeder cattle price rally.

A higher calf-to-feeder cattle price spread this summer and the potential to sell extra hay at record prices this winter may make selling both inputs a more profitable and less risky option.

Cow-calf producers can become a CattleFax member for as little as $200 per year. Members receive daily market updates as well as detailed weekly market analysis and commentary similar to this article. To learn more about membership, v i s i t www.CattleFax.com or call 800/825-7525.

CattleFax believes the information provided is accurate and complete, but no warranty is made with respect thereto. CattleFax should not be liable for decisions or actions taken by the user based on the data/information. BL

Drought May Dictate Marketing Changes

Chart 1 Chart 2 Chart 3

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BOTTOM LINE FALL 2012 7

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by Colin WoodallVice President of Government AffairsNational Cattleman’s Beef Association

As we head into fall, the persistent and expanding drought in this country is

on the minds of producers, consumers, legislators and even the White House. The current lack of rainfall is being compared to the historic droughts of the mid-1950s and the dust bowl of 1934. This has left cattle producers scrambling for hay and water, and consumers worrying about food prices. In Washington, D.C., the drought has become the center of political wrangling. Congress and the White House have a tendency to take natural disasters in agriculture and turn them into grassroots political spectacles. This one is no different.

Right before Congress left for their August recess, the House of Representatives debated and finally passed a drought relief package aimed specifically at cattle producers. This would have renewed the disaster programs included in the 2008 farm bill such as the Livestock Indemnity Program (LIP) and the Livestock Forage Program (LFP). The only problem is we didn’t ask for this disaster package, it simply became an election year issue that pitted Republicans against Democrats, and even caused divide within the parties. The final package only passed by five votes.

What’s worse is that after all of the painful debate, the House discovered the Senate had already adjourned for August and would not be able to address

this bill. More importantly, the Senate Agriculture Committee Chairwoman, Senator Debbie Stabenow, said she would rather complete action on the 2012 Farm Bill rather than do this ad hoc disaster package.

This brings me back to my comment about NCBA not asking for a disaster relief bill. For years, agriculture suffered through the pain of experiencing natural disasters without a permanent disaster program. Each time we would suffer through a hurricane, drought, or other plague, Congress would see the political incentive of trying to help farmers and ranchers through passage of an ad hoc disaster package. Many times, each individual package would have different programs, different conditions to determine who qualified, and different ways to administer the program. Producers would apply and typically wait months for any help or payment. In some instances, such as with Hurricane Katrina, producers were even asked to repay money that had been given to them.

In order to fix this, NCBA fought to have a permanent disaster program included in the 2008 Farm Bill. We were successful in getting this done, but in order to meet the budget constraints, those programs expired a year before the Farm Bill did. Now we find ourselves once again looking at ad hoc assistance. NCBA is asking that the House and Senate finish the 2012 Farm Bill in order to re-establish the permanent disaster program and give some certainty to producers who choose to utilize these

programs. The 2012 Farm Bill also includes provisions that make it easier to hay and graze CRP land in emergency situations. These permanent programs, not ad hoc assistance, are the best way to address the plight of producers caught in the middle of this drought.

The drought has also energized the debate over the mandated use of corn for ethanol. First off, NCBA is not against ethanol. Our message has always been simple; we are against the government mandated use of ethanol. When the Renewable Fuel Standard (RFS) was put in place through action taken in 2005 and 2007, the cattle industry warned of the dangers in mandating that a certain number of gallons of ethanol be produced each year. Our concern was based on the influence that mandated use would have on the corn market, and more importantly, how the RFS would impact our industry in a drought situation like we have now.

As a result of our concerns, the White House threw us a bone by providing a waiver process to reduce the RFS in times of drought. In August, NCBA joined other livestock producer groups in filing a petition with EPA in order to get this waiver. We were supported in our request by nearly 30 Senators and over 150 members of the House of Representatives. In addition, several state governors have also filed a petition seeking a waiver. Our hope is that the EPA will recognize the extreme drought and poor crop conditions will cause the corn carryover to be the lowest we have

probably seen since the 2005-2006 crop year. A simple reduction in the RFS will give producers and the markets confidence we will not sacrifice our livestock feeding industry for the sake of an arbitrary renewable fuels mandate. If for some reason EPA does not grant the waiver, we must ask the White House and ethanol industry just how bad a drought has to get before relief will be considered.

As I mentioned above, this drought has been politicized by both sides of the aisle. That typically doesn’t result in sound public policy. President Obama has even made the decision to lead the disaster assistance effort himself. All the more reason to make sure you have registered to vote. Many have said this is an historic election year. I argue that every Election Day is historic because those elected, from County Commissioner to President, have an impact on our daily lives.

November 6, we will be electing a President, a whole new House of Representatives (all 435 members), and a third of the U.S. Senate. Those elected will determine the fights our industry will have over the next two years. If you have not registered to vote, get out there and do it. Also, put Election Day on your calendar. With options to vote absentee or early in most precincts and jurisdictions, there is no excuse not to cast your vote. Every vote is important and it is a right we have been given thanks to the sacrifices made by many before us, and by the current sacrifices to protect it. BL

Drought, The Farm Bill, And Election Day

Pfizer Animal Health Launches Alverintm Plus And Flunixamine®

Pfizer Animal Health announced the availability of two new brands,

Alverintm Plus (ivermectin/clorsulon) and Flunixamine® (flunixin meglumine), providing additional animal health tools for producers and veterinarians. Both products offer a high-quality, competitively priced animal health option from Pfizer Animal Health for ivermectin/clorsulon and flunixin meglumine.

Alverintm Plus treats and controls important parasites in cattle such as adult liver flukes, gastrointestinal roundworms, lungworms, cattle grubs, sucking lice and mange mites. Alverintm Plus is available in 500 mL and 1,000 mL plastic bottles for ease of handling.

Flunixamine is a nonsteroidal anti-inflammatory drug (NSAID) for use in cattle and horses. For cattle, Flunixamine is indicated for the control of pyrexia associated with bovine respiratory disease (BRD), endotoxemia and acute bovine mastitis. It also is indicated for the control of inflammation in endotoxemia. For horses, Flunixamine is recommended for the alleviation of inflammation and pain associated with musculoskeletal

disorders. It also is recommended for the alleviation of visceral pain associated with colic. Your veterinarian can help ensure proper dosing and administration of Flunixamine, now available in 100 mL and 250 mL glass bottles.

As with all products in the Pfizer Animal Health portfolio, Alverintm Plus and Flunixamine are backed by expert technical support.

“Alverintm Plus and Flunixamine allow Pfizer Animal Health the opportunity to deliver a wider portfolio of products, giving veterinarians, producers and owners expanded access to innovative products, solutions and services,” says Roger Saltman, DVM, MBA, group director, Cattle and Equine Technical Services , Pfizer Animal Health. “Whether we are expanding our product lines or providing world-class customer and technical support, our goal remains the same—to help keep animals healthy.”

In addition to quality services and products such as Alverintm Plus and Flunixamine, Pfizer Animal Health provides industry support through training and education, research and

development, and investment in the future of the veterinary profession and in the beef and equine industries.

For more information about Alverintm Plus or Flunixamine, talk with your veterinarian, your animal health supplier or Pfizer Animal Health Customer Service at 855/4AH-PFIZER (855/424-7349).

Important Safety Information for Alverintm Plus: Do not treat cattle within 49 days of slaughter. Because a withdrawal time in milk has not been established, do not use in female dairy cattle of breeding age. A withdrawal period has not been established for this product in pre-ruminating calves. Do not use in calves to be processed for veal. For use in cattle only—use in other animal species may result in severe adverse reactions, including fatality in dogs.

Important Safety Information for Flunixamine: Cattle must not be slaughtered for human consumption within four days of the last treatment. Milk that has been taken during treatment and for 36 hours after the last treatment must not be used for food. Not for use in dry dairy cows. A withdrawal period has not been

established for this product in pre-ruminating calves. Do not use in calves to be processed for veal. Do not use in bulls intended for breeding. Not for use in horses intended for food. Approved only for intravenous administration in cattle. Intramuscular administration has resulted in violative residues in the edible tissues of cattle sent to slaughter.

About Pfizer Animal HealthPfizer Animal Health, a business unit

of Pfizer Inc, is a world leader in the discovery, development and manufacture of innovative animal health vaccines, medicines, diagnostic products and genetic tests. We work to assure a safe, sustainable global food supply from healthy beef and dairy cattle, swine, poultry, sheep and fish while helping dogs, cats and horses live healthier longer lives. We strive to be the animal health company that provides full healthcare solutions to veterinarians, livestock producers, and pet owners. To learn more, visit www.animalhealth.pfizer.com. BL

All brands are the property of their respective owners. ©2012 Pfizer Inc. All rights reserved. GCA12046

New brands provide additional animal health solutions for cattle and equine markets.

8 FALL 2012 BOTTOM LINE

Page 9: Bottomline Fall Newsletter

Joe Freund Sr.45400 County Road 21 • Elizabeth, Colorado 80107 •  303/840-1850 Home •  303/341-9310 Office

Joey Freund - 303/841-7901 • Pat Kelley - 303/840-1848 • Casey Kelley - 720/480-6709www.runningcreekranch.com

Level 4 Johne’s-Free Certified Herd

1 or 100Where Quantity Meets Quality

We are one of North America’s largest sources for registered Limousin. To complement our quantity, we installed a strict culling system, rigorous herd health

standards and an aggressive AI program to ensure we provide you with the breed’s best Limousin. Rest assured, whether you need one or 100, we can

meet your quality requirements. Come to Elizabeth, Colorado, and drive through our pastures, we’d love to show you the herd.

Whether you need 1 or 100, look to your one-stop shopping source—Running Creek Ranch.www.RunningCreekRanch.com

Each year we market 2-year-old bulls, bred heifers, cows and open replacements females. We specialize in raising cattle that are

built to last, efficient, performance-oriented and loaded with carcass value.

For pricing and availability, give us a call today.

All Limousin Are Marketed Privately Off The Ranch»» 2-Year-Old Bulls»» Bred Females—AI’d to calving-ease sires and due March & April 2013

BOTTOM LINE FALL 2012 9

Page 10: Bottomline Fall Newsletter

North Central Region Breeders south Central Region Breeders

Hunt Limousin RanchCharles & Nancy Hunt

Dan, Melinda, Jenna, Adeline & Houston Hunt10329 Highway 136 • Oxford, Nebraska 68967308/473-8521 • 308/991-3373 (Dan)e-mail: [email protected] • Web: www.huntlimousin.comCertified Level 4 Johne’s Negative Cowherd

Austin, Leah, Bailee, Pitch & Tripp Hager4651 2nd Ave. NE • Karlsruhe, North Dakota 58744

701/525-6363 • 701/626-2345 mobilewww.HagerCattleCompany.com

27195 175th St. • Leon, Iowa 50144 • www.linhartlimousin.comCharles Linhart: 641/340-1306 • David Linhart: 641/446-6906

John Linhart: 515/210-8048

LinhartLimousin

LoneLy VaLLey Limousin

Stan, Mike, Mark, Dean and Chad SettjeChad • 402/910-5504 | Dean • 402/649-2615

Mike • 402/487-2897 or 402/920-023082291 560th Avenue • Creston, NE 68631

www.lonelyvalley.com

Jim, Priscilla & Jared Schott27601 108th St. • McLaughlin, SD 57642

605-823-4974 • [email protected] • www.schottranch.com

Owners: Jim & CarOle COunsilBQA II Certified Herd Certified

Brucellosis- and TB-Free

21314 OSR • MadiSOnville, TX 77864JiM, cell (281) 808-3473

Kevin, cell (281) 808-5511Kevin cOunSil, ShOw baRn MgR.

www.cOunSilfaMilyliMOuSinS.cOM

Lance Hall • 325/235-4345 officeKen Holloway • 580/597-2419, night

580/581-7652, day • 580/597-3006, officeClendon Bailey, Cattle Manager • 580/597-3325

23998 State Hwy. 5 • Chattanooga, OK 73528www.hallchr.com • e-mail: [email protected]

Leonard & Betty Keeton • Lyle & Shana Keeton10510 CR 1100 • Wolfforth, Texas 79382

806/866-9440 • Leonard & Betty806/866-9049 • Lyle & Shana

806/866-9441 • Fax • e-mail: [email protected]

KEETON LIMOUSIN

Bruce, Paula & Lee Roy LawrenceJonny, Amber, Tucker & Colt ParkinsonP.O. Box 299 • Anton, Texas 79313806/997-5381e-mail: [email protected]

L AW R E N C E

F AM I L Y

L I M O U S I N

Robert “Cookie” & Mary Nielson605/203-0903 | 605/203-0904

Adam, Michelle & Greyson Nielson605/203-0733 | 605/203-0732

20129 450th Ave • Arlington, SD 57212www.romnlimousin.com • [email protected]

Bob Mitchell & Sons48715 Hilldale Rd., Wauzeka, Wisconsin 53826

www.springcreekscattleco.comBob, home: 608/875-5049 • Cell: 608/553-0971

Matt: 608/553-1251 • Bart: 608/553-8070 • Scott: 608/553-8069

Spring CreekSCattle Company

Leonard Wulf & Sons47694 320th StreetMorris, MN 56267 Farm (320) 392-5802Fax (320) [email protected]

Jerry Wulf (320) 491-1390Cowherd Manager: Eric Zeltwanger (320) 766-0066

Customer Relations: Joel Edge (319) 540-1731 • Jim Wulf (320) 491-631210 mi. south of Morris on Hwy. 59

Tom & Rita Vaughn & Sons9741 142nd Ave. NE • Cavalier, ND 58220

Home: 701/265-4097 • Cell: 701/520-0110David: 701/520-2556 • e-mail: [email protected]

Jim Watts • Jamie, Jack, Sam & Alex Watts3647 Rd. AA • Fairfield, NE 68938

Home/Fax: (402)262-2240 • e-mail: [email protected], cell: (402)462-0678 • Jamie, cell: (402)984-0177

Breeder SpotlightBreeder SpotlightWant to advertise in the BreeDer SpotLight section? It’s easy! Call Brooke Bennett at (303) 220-1693, ext. 117.

Jack. Vicky. Josh. Jase. Jamye.24300 McDonald Dr. • Lebanon, MO 65536

800/543-3474 • [email protected] • www.jbarjlimousin.com

Level 3 Johnes - FreeCertified Herd

Curt & Leanne Wieczorek39768 267th Street • Mount Vernon,

South Dakota 57363 • 605/227-4601

Wallace & Noreen Wieczorek39778 267th Street • Mount Vernon,

South Dakota 57363 • 605/227-4611

Annual Bull SaleIn February

Limousin

Gene and Virginia Raymond • 785/448-3708 • 785/448-8026 cellArne and Stacy Hanson • 785/448-6142 • 785/448-8027 cell

20217 NW Hwy. 31 • Garnett, Kansas 66032 • [email protected]

Sale: Feb. 16, 2013

John: 605.880.8061 | Paul: 605.880.0039Brad: 605.880.9822 | Warren: 605.237.2127

Office: 605.448.2624 | Fax: 605.448.5786PO Box 155, Amherst, SD 57421

e-mail: [email protected]

Predictable. Efficient. YIELD.

10 FALL 2012 BOTTOM LINE

Page 11: Bottomline Fall Newsletter

53717 Gallagher Road • Charlo, MT 59824Larry & Anita Coleman • (406) 644-2300

Trent & Melissa Coleman • (406) 644-2707 www.colemanlimousinranch.com

Bill & Mary Gates • Gary & Brandi Gates250 Stillwater River Rd. • Absarokee, MT 59001 • www.gateslimousin.com406/328-4393 • [email protected] • [email protected]

www.GatesLimousin.com

Mat & Wendy Lewis30849 Co. Rd. 56 • Iliff, CO 80736

(970)521-0545 • Cell: (970)580-8209 • [email protected]

www.magnesscattle.com

Gary Magness, OwnerPO Box 190, Platteville, CO 80651

970/785-6170, office

Southern Division53160 E. 110th Rd., Miami, OK 74354

918/541-5482, George Hubbard

MILLERBERG LIMOUSIN

491 E 12000 South • Draper, Utah 84020Bob Millerberg • 801/566-4665 Home • 801/561-9911 Office

Jim Millerberg • 801/301-2953 Mobile

Kevin & Julie Ochsner and Family

30300 WCR 388 • KeRsey, CO 80644 • [email protected]

h: 970-351-6008 • M: 970-396-5525Conveniently loCated 60 miles northeast of denver, Co.

Joe Freund Sr.45400 County Road 21 • Elizabeth, Colorado 80107

303/840-1850 Home •  303/341-9310 OfficeJoey Freund - 303/841-7901

Pat Kelley - 303/840-1848 • Casey Kelley - 720/480-6709www.runningcreekranch.com

Level 4 Johne’s-Free Certified Herd

Eastern Region Breeders

Bob & Gwen Minerich, Owners • (859) 582-6888, Bob-cell2003 Barnes Mill Road • Richmond, KY 40475 Office: (859) 328-7118 • Fax: (859) 328-7120Mark Smith, Herd Consultant (515) 965-1458

TB-Free Herd

152 Florida Lane | New Florence, PA 15944John & Kitty Goodish - 724/235-2178

www.tubmillcreekfarms.com

limousin services

24018 State Hwy. 5Chattanooga, OK 73528580/597-3006 • Fax: 580/597-6619Email: [email protected]

Ken Holloway • 580/597-2419mobile: 580/581-7652

Bruce Brooks • 580/276-5137mobile: 580/695-2036

Seedstock Consultants Specialized Sales2300 Monument Ave., Richmond, VA 23220Keith Kissee • Cell: 817-821-6263 Ph: 804/353-2220 • Fax: 804/353-2221email: [email protected]

R&R Marketing Company

(L#2845)

PO Box 281677Nashville, TN [email protected]

Randall O. RatliffCell: 615.330.2735Fax: 615.255.8992

Limousin and Lim-Flex Genetics Available Don Beus • 502 E. Vineyard Ln. • Pasco, WA 99301

Brad Beus • 509/727-2082 • e-mail: [email protected]

Western Region Breeders

308 West Mill • Plainville, Kansas 67663Roger Comeau, owner • 785.434.4686

Mike Smith, manager • 785.885.4882 • Mobile: 785.737.6053

Bob & Euvonne Wies | Mike & Heather Henderson, Mgrs.103 Harris School Road - Wellsville, Missouri 63384

(573)684-2773 | text (573)220-5768 | www.wieslimousin.com

Wies Limousin Ranch

Gordon, Earline & Kassi Schuppe25653 CR 63, Iliff, CO 80736

970-522-8195 or 970-580-8195 • [email protected]

limousin & lim-flex

Sale is 1st Saturday in March.

Brad and Janet Waddle440 Road 161 • Pine Bluffs, Wyoming 82082307/245-3599 Phone/Faxe-mail: [email protected]

Cattle Available For Sale By

Private Treaty

John Ethington - Cattle Manager - 859.533.1301 Bob Knudsen - Farm Manager - 859.621.2140

John Tobe - Owner - 859.621.4411761 Engleman Lane - Lancaster, Kentucky 40444

[email protected] - www.englewoodfarm.com

Solid Values, Futuristic Vision

Chris & Laura MilamCaroline, Andrew, Zachary

785 Cedar Grove Rd.Olmstead, Kentucky 42265

Home: 270/726-1803Mobile: 270/847-0634

e-mail: [email protected]

“Check us out on Facebook”

Jim & Jay Justice and Family2765 Louisville Rd. | Harrodsburg, KY 40330

[email protected] | Jeff Kaufman, Manager, 540/280-5388

VALE, Oregon(541) 473-BEEF

e-mail: [email protected]

www.LuckiLimo.comVes & Marge Garner

BOTTOM LINE FALL 2012 11

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PFBFBIOS2001 BSG-BEEF-HUNTING COW_9.5x13.5

All brands are the property of Pfizer Inc., its affiliates and/or its licensors. ©2011 Pfizer Inc. All rights reserved. BSD11050

If she can’t stay pregnant, what else will she do?

*Do not use in pregnant cattle (abortions can result) unless they were vaccinated, according to label directions, with any Bovi-Shield GOLD FP® or PregGuard GOLD FP vaccine prebreeding initially and within 12 months thereafter. Do not use in calves nursing pregnant cows unless their dams were vaccinated within the past 12 months as described above. To help ensure safety in pregnant cattle, heifers must receive at least 2 doses of any Bovi-Shield GOLD FP or PregGuard GOLD FP product with the second dose administered approximately 30 days prebreeding.

Keep your cows pregnant and on the job. Bovi-Shield GOLD FP® 5 L5 HB* is the only viral combination vaccine to prevent Lepto hardjo-bovis for a full 365 days. Ask your veterinarian or Pfizer Animal Health representative how to protect her pregnancy, your reproductive program and your bottom line.

12 FALL 2012 BOTTOM LINE