Agricultural News
Peel Says Drought Reset Spurs Herd Expansion in Southern Plains
Tue, 02 Jun 2015 14:51:55 CDT
Mother nature has given drought the boot this spring,as there is very little drought left in Oklahoma and the southern Great Plains. That's according to the U.S. Drought Monitor report. May 2015 was not only the wettest May on record but was the wettest month ever in Oklahoma. Oklahoma State University Livestock Marketing Specialist Dr. Derrell Peel said that good news for cattle producers interested in summer grazing. The improvement in forage conditions has been pretty dramatic this spring. He said there is a lot of interest in using those feed resources for feeder cattle as well as for yearling heifers.
In May, the statewide average was nearly 15 inches of rain with numerous locations receiving over 20 inches and a few areas with over two feet of rain. This far exceeds the previous record for the statewide average of about 10.5 inches in May. The resulting floods continue and are causing losses for people and creating management headaches for agricultural producers. Summer crop planting and hay harvest are delayed and the winter wheat crop, nearing harvest, is now threatened by wet conditions after suffering from drought impacts through most of the growing season. Fences have been washed out and some cattle are scattered while others had to be relocated to higher ground. Stored hay has been ruined by flood waters or washed away in some cases.
Radio Oklahoma Network Farm Director Ron Hays featured Peel on the Beef Buzz feature. Click or tap on the LISTEN BAR below to listen to today's Beef Buzz.
The tremendous amount of precipitation in May has all but eliminated drought conditions in Oklahoma. The drought that began in the fall of 2010 has remained a specter over Oklahoma agriculture for over four and a half years until this last month. During that time, even when periodic relief came and marginally improved conditions allowed for forage and crop production, the threat of regressing back into drought was a constant factor in producer decision making and a limit to production plans. Agricultural producers have been continuously on the defensive through the long drought.
By recharging soil moisture and replenishing surface water supplies, the record rainfall in May has effectively reset all drought indicators to zero. It may turn hot and dry this summer and drought conditions may return later in the year or next year, but it will be a new drought rather than a continuation of the previous drought. Starting from this point, he said any new drought conditions that might emerge will take time to reach critical levels and provide producers an opportunity to plan and prepare. That allows producers to be back on the offensive, focusing on what they would like to do, as opposed to what they have been forced to do so much of the time for the past four years.
Now with good grazing conditions, Oklahoma cattle producers will be able to retain their heifers. This will allow herd expansion to continue, but Peel doesn't expect this to change the trajectory of herd rebuilding already underway in 2015. Oklahoma started the year with a 25 percent year over year increase in beef replacement heifers, indicating relatively aggressive herd expansion. Perhaps the biggest impact is that it removes the risk that some producers were facing by gambling on relatively aggressive expansion plans this year. Improved forage conditions ensure that robust herd expansion in 2015 will occur. This may also allow for more aggressive expansion in 2016 than what would have otherwise occurred. This could push already strong heifer retention in 2015 to even higher levels, keeping feeder supplies tight and supporting feeder cattle prices even more in 2015.
In 2015, Country-of-Origin Labeling (COOL) is also coming to the forefront. In May, the World Trade Organization ruled against the U.S. over it's COOL law being trade distorting. This will likely lead to retaliation directed at the U.S. beef industry from Canada and Mexico this year. Peel said this isn't as much about markets, as it is about politics.
"I think Mexico and Canada are at this point poised to sort of keep the pressure on politically to make sure that we do follow through and make modifications or in fact remove the COOL rule that currently exists," Peel said.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network- but is also a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show- and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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