Derrell Peel Examines the Question: 'How Fast Can the Beef Cow Herd Be Rebuilt?'

Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist, writes in the latest Cow-Calf Newsletter:

Historically, the cattle cycles that the beef industry has observed for many years were self-regulating cycles of inventory driven by internal beef industry factors including calf price levels, beef cattle biology and the rigidity of forage resources used in the industry. It is these factors that influence what cow-calf producers want to do, and that, when combined with the availability and condition of production resources which determine what can be done, result in changes in the beef cow herd inventory. These decisions by cow-calf producers ultimately determine the cattle supply for the entire industry.   

Most of the cow herd liquidation that has occurred since 2001, including the aborted herd expansion of 2004 and 2005, were the result of external factors including input market shocks that reduced cow-calf profitability; a U.S. and global recession that tempered cattle prices and producer expectations; and severe drought since 2011. This means that the last 3.4 million head decline in the beef cow herd was not due to typical cattle cycle factors. It has been suggested that the cattle cycle is a thing of the past. I believe that these other factors have masked and overwhelmed cyclical tendencies through this period and do not mean that the cattle cycle is gone or irrelevant in the future. However in situations where drought has forced inventory adjustments that are counter to what producers want to do, the details of how the adjustments happen become important. How we got to where we are will have an impact on how herd expansion will take place in the future.

Since 2007, the calculated number of heifers entering the cow herd has remained above average even while the very high rate of cow culling has resulted in net liquidation and reduction in the cow herd inventory. In a more typical cattle cycle, the rate of heifer placement decreases at the same time as increased cow culling, with both contributing to herd liquidation. This happened, for example, during the 1996-2001 period of cattle inventory liquidation. In contrast, during herd expansion, heifer placement typically increases simultaneously with decreased cow culling to result in herd expansion (e.g. during 1991-1995). In recent years producers have continued to invest in replacement heifers despite the necessity of reducing herd size as a result of external shocks and drought. The fact that the industry has simultaneously increased cow culling and heifer placements in recent years means that the current beef cow herd is not only the smallest in 60 years, but likely one of the youngest and most productive ever. 

Click here for more from Derrell Peel.  

Holiday Grilling Positively Impacts Beef Restocking Orders, Ed Czerwien Says 

Ed Czerwien, USDA Market News, Amarillo, Texas, files this report for boxed beef trade ending August 31, 2013:

The daily spot choice box beef cutout ended the week at $195.67, which was slightly higher each day and ended the week 50 cents lower. Volume was only 712 loads, which was even lower than the previous week.

The comprehensive choice cutout, which is the weekly average of all types of sales was at $195.44, which was $1.75 higher than last week ending the week very close to the spot market. Sales volume improved since we had the good weather through much of the country, which really helped this last big grilling holiday and no doubt impacted the restocking orders.

Click here to read more or to listen to Ed Czerwien's audio analysis of last week's beef trade.

 

Another week of warm and dry weather continued across the Southern Plains last week. Oklahoma producers continued to cut hay and prepare seedbeds for fall planting.

Corn in Oklahoma in the dough stage was 98 percent by the end of the week, and 79 percent was in the dent stage. Forty-five percent of the crop was mature by Sunday, and nine percent was harvested. Sorghum heading was 94 percent complete by week's end, 57 percent was coloring, and 7 percent was mature. Soybean blooming was 87 percent complete by Sunday, and 64 percent of plants were setting pods, nine points behind the five-year average.  (Click here for the full Oklahoma Crop Weather report.)

In Kansas, producers were busy harvesting hay and silage crops, applying pesticides, and preparing fields for fall seeding.

Corn in dough was 94 percent, behind 100 last year and 96 average. Corn dented was 56 percent, well behind 89 last year and 78 average. Four percent of the crop was mature, well behind 60 last year and 33 average. Corn condition rated 13 percent very poor, 17 poor, 31 fair, 32 good, and 7 excellent.  Soybeans were 96 percent blooming, behind 99 last year and 99 average. Setting pods were 83 percent, compared to 85 last year and 88 average. Soybeans dropping leaves were 3 percent, behind 13 last year and 5 average. Condition rated 2 percent very poor, 9 poor, 33 fair, 49 good, and 7 excellent.  (Click here for the full Kansas Crop Progress and Condition report.)

Select areas of South Central Texas, the Coastal Bend, the Upper Coast, and the Lower Valley received significant rainfall in amounts totaling up to 4 inches.  Fifty-nine percent of the state's corn crop had been harvested, against a 52-week five-year average.  Twenty-four percent of the soybean crop has been harvested, compared with the five-year average of ten percent.  (You can read the full Texas report by clicking here.) 

Corn Crop Matures, Maintains Quality in August Heat

The U.S. corn crop made steady progress toward maturity last week while remaining in good condition, according to a U.S. Department of Agriculture report released today. The percentage of the corn crop denting increased by 19 points last week, while the percentage of corn doughing further narrowed its lag behind the five year-average to only five points. Reports also indicate that the crop condition remains almost unchanged from the previous week with 56 percent of the crop forecast to be in good-to-excellent condition. Last year at this time, only 22 percent of the crop still fared as well.

Currently, 84 percent of all corn acres are forecast to be in fair-to-excellent condition, with only 16 percent rated in poor or very poor condition. The crop condition forecast remained largely unchanged from a week prior, with only three percentage points falling out of the good and excellent rankings. This stands in stark contrast to condition forecasts at this time in 2012, which fell continuously as high temperatures and dry conditions hit large portions of the Corn Belt.

Click here for more and to find a link to the USDA Crop Progress and Condition report.

 

Oklahoma Farm Bureau to Donate to Shelter Oklahoma Schools Initiative

The Oklahoma Farm Bureau is committing itself to help with building storm shelters for every school in the state.   The organization will hold a news conference at the state capitol on Wednesday to announce a donation to the Shelter Oklahoma Schools initiative.

"This project has continued to generate interest and attention to the goal of building a safe room or storm shelter in every school in the state," said state Rep. Jon Echols, R-Oklahoma City. "The support we've received so far has been amazing and this generous donation from the Farm Bureau will help to keep this project going strong."

You can read more of this story by clicking here.  

USDA Appoints Oklahomans to National Peanut Board

United States Department of Agriculture Secretary Tom Vilsack has appointed two state peanut producers to the National Peanut Board for Oklahoma as a member and alternate to serve three-year terms of office beginning Jan. 1, 2014 and ending Dec. 31, 2016.

Gayle White of Frederick is the reappointed Board member. White is the owner/operator of White Farm and Ranch with her husband, Joe D., chairman of the Oklahoma Peanut Commission, and has been engaged in peanut production for more than 25 years.   

Leslie "Les" Crall of Weatherford is the reappointed Oklahoma alternate member. Crall has been in peanut farming for over 15 years. He currently serves as vice chair of the Oklahoma Peanut Commission and is a member of the Peanut Standards Board.   

Click here to read more about these two Peanut Board members from Oklahoma.

Landowners Invited to Attend Lesser Prairie Chicken Strategy Meeting

Oklahoma Farm Bureau is hosting a meeting for landowners and other interested parties regarding a stakeholder conservation strategy for the lesser prairie chicken. The meeting will be Thursday, Sept. 5, at 6 p.m. in the Seminar Center at the High Plains Technology Center in Woodward. The meeting is open to the public.   

The stakeholder conservation strategy will provide a market-based response to the U.S. Fish & Wildlife Service's proposal to list the lesser prairie chicken as a "threatened" species under the Endangered Species Act and will show how the need for continued energy production translates into a mitigation need.

"If the lesser prairie chicken is listed, oil and gas operations will be required to do mitigation, meaning the operations will need voluntary participation from landowners who can sell mitigation credits to preserve and enhance chicken habitat on their property," said Marla Peek, OKFB director of regulatory affairs.   

You can read more of this story by clicking here.