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Articles from 2013 In May


Veterinarians Are Key To BQA Progress

beef cattle at feedbunks

You’ve got to get your boots on the ground and be an extra set of eyes for your producers,” says Dan Thomson, DVM, Jones Professor of Production Medicine and Epidemiology at Kansas State University’s (KSU) College of Veterinary Medicine.

Dr. Thomson is speaking about the assessments that are part of the nation’s Beef Quality Assurance (BQA) program, as well as the need for veterinarians to serve their clients with knowledge and service that extends beyond animal health issues.

“The challenge for veterinarians is that they have to stay ahead of the curve, ahead of the training their clients are receiving,” Dr. Thomson says.

In the case of BQA, consider that 3,600 producers became BQA certified online between February 15 and March 15. That’s when Boehringer Ingelheim Vetmedica, Inc. partnered with the BQA program to cover the $25-$50 certification cost of individual producers.

“Not only do veterinarians need to know BQA inside and out, they need to know how to translate that information into action,” emphasizes Dr. Thomson, who also serves as director of KSU’s Beef Cattle Institute which coordinates Animal Care Training, including online BQA training and BQA certification.

Translating information into action is the nexus where Dr. Thomson believes veterinarians need to focus in partnering with clients for the sake of animal care and operational sustainability.

Although BQA principles and the goal of unsurpassed animal care remain constant, Dr. Thomson explains, “It won’t be one set of best management practices that works for all operations. Based on the client’s technical ability, geography, resources, facilities, and the type and size of cattle, best management practices will be different. Best management practices on a farm change from day to day based on the cattle arriving and the people who show up for work that day.”

bqa certified cowherd with angus cows

Assessments Serve As Foundation For Improvement

If you’re unfamiliar with BQA, there are two primary tools. First is the training and education that enables certification. Next, are sector-specific assessment tools that can be downloaded for free at BQA.org.

Assessments are the tool that can transform BQA best management practices into a total quality management system by which improvement is an ongoing journey rather than a static destination.

“For cow-calf producers, I think the assessment is crucial for continuous improvement,” says Ryan Ruppert, BQA Senior Director. He speaks from his position overseeing national BQA efforts. But, he also speaks as a producer who has seen the transforming potential of BQA in his family’s Nebraska cow-calf operation when the veterinarian is a partner.

“Twenty years ago, we bought vaccines from our veterinarian, and he might come out to do a C-section. But, I don’t remember ever getting a lot of information from our veterinarian until we started working with Bob Bohlender,” Ruppert says.

Dr. Bohlender, a veterinarian at the Animal Clinic in North Platte, NE, is a BQA pioneer and firebrand who has long championed the synergy available when veterinarians, clients and other professionals work together to improve animal care and production.

“He became our herd consultant,” Ruppert says. “He didn’t come out to do C-sections or cut open deads; he was there to manage the health of our herd.”

When Dr. Bohlender began shifting some of his workload, the Rupperts began working with Kent Pieper, DVM at Farnam, NE.

“Here’s a guy who says to a client, ‘You need to work on cattle handling,’ as an example,” Ruppert says. ‘Do the BQA assessment. I’ll come back in six months and do the same assessment and look at your records. Then, we’ll see how closely our assessments match and where improvements can be made.’”

“I’ve yet to conduct an assessment where the producer didn’t say, ‘This is a good deal, let’s continue doing it,’” Dr. Thomson says.

Even before formal assessments, Bob Smith, DVM, a consulting feedlot veterinarian based at Stillwater, OK, explains, “Veterinarians have unique involvement with dairy and beef producers in that they are at client operations for a variety of reasons, which allows them to conduct informal assessments about how BQA is being employed.” Dr. Smith has also been at the forefront of BQA leadership. Among other things, he was chairman of the committee that developed the industry’s Cattle Industry Guidelines for the Care and Handling of Cattle.

“As veterinarians, we have to serve as teachers, mentors and role models for BQA,” Dr. Smith believes. “I look at assessments as an additional service we can provide to clients. The veterinarian should be poised to help clients implement and improve BQA. How many producers even know these assessments are available? Assessments provide an opportunity to look in a systematic way at everything that might impact animal care on their operation.”

Although producers are encouraged to conduct assessments themselves, never including outside expertise means leaving lots of opportunity on the table.

“If you do the assessment and it says you’re doing everything right, then you didn’t assess yourself correctly,” Ruppert says. “There’s always something you can be doing better.”

Part of the ill-founded confidence of self evaluation stems from the blindness spawned by familiarity. Reach for the jug of tea in your ice box long enough and chances are you’ll lose sight of the handsome fuzz growing on the leftovers from last year’s Christmas party.

Part of it stems from experience. No matter how good individual producers are at what they do, few have intimate knowledge of operations besides their own.

Speaking again from his family’s experience, Ruppert explains, “If you do the assessment yourself every time, you’ll miss things. You don’t have the breadth of experience of your veterinarian who hopefully has a couple dozen other clients.”

National Beef Quality Audit

Keep in mind there is an industry-wide assessment tool, too. It’s called the National Beef Quality Audit (NBQA).

“The national audits are how we compare ourselves at one point in time to another,” Dr. Smith explains. “They help guide our research and educational efforts for further improvement.”

More and more, BQA and assessments are as much about the outside world as the operations employing the tools.

“The Food Marketing Institute (FMI) continues to tell us their members want to see more animal welfare work in the beef industry,” Ruppert says.

It’s not necessarily that FMI and others have a problem with how beef producers care for their stock, it’s that they don’t have a way to assess it. At the same time, pork and poultry producers are further ahead in providing those kinds of assessment tools.

That’s why records, written protocols and documentation are crucial to BQA.

“It’s like [Dr.] Dee Griffin always says,” Ruppert explains. “If you don’t write it down, then it never happened. You have no way to prove it.” Dr. Griffin is another BQA pioneer and lynchpin who is University of Nebraska’s Feedlot Production Management Veterinarian at the Great Plains Veterinary Educational Center at Clay Center, NE.

“We’re seeing packers and retailers pay more attention to BQA, too,” Dr. Smith emphasizes. In the past several months he has helped three clients prepare for and undergo BQA based audits from retailers.

“Using BQA assessments assure us that we’re doing things right,” Dr. Smith says. “These assessments also help us get ready for audits when our industry partners ask for them.”

“If you don’t have records, you can’t capture the added value associated with verifying animal health and your management practices,” Ruppert says. “You have no reference point for improvement.”

Think about BQA in the feedlot sector which set the standard for other segments of the industry. Think about those audits being requested by packers and retailers. Because of their BQA efforts, logic suggests it wasn’t much of a stretch for feedyards to begin participating in and receiving added value from process verification programs associated with things like age and source verification.

“Especially with the cost of production today, as veterinarians, it’s imperative that we provide management advice in addition to health advice,” Dr. Smith says.

Doing so means strengthening the veterinarian client patient relationship (VCPR). It means becoming more involved with client goals and resources, providing nutritional advice, and ferreting through production records, Dr. Smith says.

It might even mean conducting in-house research trials, as Dr. Smith has done with clients, to evaluate the worth of a particular product or practice in a given situation.

Incidentally, for the veterinary community, Dr. Smith says, “A near-term goal should be getting an FDA approved, effective, affordable pain control product that we can use for routine surgical procedures like castration and horn management, as well as for managing the pain associated with lameness.”

BQA Moving Forward

Push come to shove, Dr. Thomson stresses that veterinarians involved in a strong VCPR serve as the final word for cattle well being when questions arise.

“As veterinarians, we’re there to help clients develop best management practices,” Dr. Thomson explains. “But, when someone comes to the farm wondering about herd health and animal care, the veterinarian will provide the answer.

“I don’t know of anything more defensible in the public eye than producers being able to say they are caring for their cattle under the supervision of a veterinarian. It’s like saying you’re caring for your kids under the supervision of their doctor.”

Logically, Dr. Thomson expects the next major area of BQA to revolve around the environment and food safety.

Already, Ruppert says industry working groups are developing what would become BQA approved practices for such things as castration and dehorning.

“BQA is really a promise to consumers that we care about our cattle and understand how to care for them,” Ruppert says. “I really think for producers to get to the next level, to make BQA part of their culture and part of their business model, they need the broader perspective of their veterinarian. They need that perspective to help them identify the BQA concepts they need to work on and how they can implement them.”

Just as outside perspective elevates BQA within operations, Dr. Smith stresses cooperation within organizations is essential for BQA success.

“For BQA programs to be effective, it takes commitment from everyone, from the owner, to the manager, to the pen rider, to the person delivering feed,” Dr. Smith says. “We have to be constantly aware of employee turnover and the fact that newer employees might not yet be BQA certified. Client operations need to have a program established that allows employees to see their commitment to BQA. It should be included in the employee handbook if there is one. There should be an opportunity for new employees to become BQA certified early in their employment. Special effort should be given to training what I term mid-level employees so that they can serve as trainers and mentors in order that everyone is performing on the same level in providing animal care.”

“It’s a fluid process; it will never be done,” Dr. Thomson says.

Though Dr. Smith is confident there are no glaring deficiencies in the current BQA program, he says, “We have to keep looking for areas where we can improve BQA and the well being of animals and touch all facets of the industry. BQA allows us to showcase our commitment and investment in nutrition, cattle handling, the environment, everything that is part of animal care.”

“I think BQA certification will be the first step going forward for cow-calf producers to verify their sustainability, their animal welfare and all of those other things,” Ruppert says.

Beyond the traditional role of helping clients with biosecurity and disease control, Dr. Thomson believes the greatest value veterinarians will offer in the future is providing the kind of herd-wide information and consultation alluded to earlier.

“There is no group that will be more important than veterinarians to the family farm as society moves toward more regulation and transparency,” Dr. Thomson says.

 

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There Are More Consumers Today, And They’re More Diverse

getting beef to young consumers

Buckle up. The road of consumer change is fixing to get winding and the grade, steep.

“The next half-century marks key points in continuing trends,” says Thomas L. Mesenbourg, acting director of the U.S. Census Bureau (USCB). “The U.S. will become a plurality nation, where the non-Hispanic white population remains the largest single group, but no group is in the majority.”

The U.S. is projected to become a majority-minority nation for the first time in 2043. Minorities represent 37% of the U.S. population currently, but are projected to comprise 57% of the population in 2060.

In December 2012, USCB estimated the U.S. population at 314 million; it pegs the population in 2050 at 399.8 million. Though significantly less than the agency’s previous quadrennial projections, it still represents an increase of 27.3% in fewer than four decades.

According to USCB, the population is projected to grow more slowly over the next several decades than previously estimated, due to lower projected levels of births and net international migration.

Incidentally, the U.S. population represents approximately 4.5% of the world’s population today.

Melting pot continues to thicken

The non-Hispanic white population in the U.S. is projected to peak at 199.6 million in 2024, up from 197.8 million in 2012. Unlike other race or ethnic groups, however, it is projected to slowly decrease, falling by nearly 20.6 million from 2024 to 2060.

Meanwhile, the aforementioned Hispanic population is projected to more than double, from 53.3 million in 2012 to 128.8 million in 2060. If  this is correct, by 2060, nearly one in three U.S. residents would be Hispanic, up from one in six today.

The black population is expected to increase from 41.2 million to 61.8 million over the same period. Its share of the total population would rise slightly, from 13.1% in 2012 to 14.7% in 2060.

Meanwhile, the Asian population is projected to more than double, from 15.9 million in 2012 to 34.4 million in 2060, growing from 5.1% of the U.S. population today to 8.2% by 2060.

 

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Moreover, the ethnic and racial lines are getting blurred.

“Once a mainly biracial society with a large white majority and relatively small black minority — and an impenetrable color line dividing these groups — the U.S. is now a society composed of multiple racial and ethnic groups,” say authors of the 2011 Congressional Research Service report, The Changing Demographic Profile of the United States. “Along with increased immigration are rises in the rates of racial/ethnic intermarriage, which in turn have led to a sizable and growing multiracial population. These trends are projected to continue for the next decades.”

Millennials poised to drive

The U.S. population is growing older as it becomes more ethnically blended.

Baby boomers (born between 1946 and 1964) have long been the leading market target. They numbered 76.4 million in 2012 — about 25% of the total population.

The population aged 65 and older is expected to more than double between 2012 and 2060, from 43.1 million to 92.0 million. According to USCB, the older population would represent just over one in five U.S. residents by the end of the period, up from one in seven today.

According to beef checkoff-funded research, the marketplace is fractured into three major generational cohorts: baby boomers, generation X (which followed the boomers) and millennials (born 1980-2000). At 80 million, millennials outnumber boomers and are set to carry the mightiest market stick.

That’s why millennials are a research priority for the beef industry.

Checkoff-funded studies in late 2011 and 2012 revealed that, although this generation enjoys beef, some issues hinder their consumption of it.

For one, Wendy Neuman, director of market research at the National Cattlemen’s Beef Association (NCBA), a contractor to the beef checkoff, says millennials have little experience with shopping for beef, or preparing it once they get it back home. They recognize beef’s nutritional benefits, but don’t necessarily know the appropriate number of servings, or understand how beef fits in a healthy diet and active lifestyle.

Millennials view food as a route to diverse cultural and social experiences. But, 54% of them say it’s hard to know which cuts to choose in the meat case. In part, because of their lack of experience preparing beef, 56% reported disappointment in the results when cooking hamburgers (compared to 31% of boomers); and 55% are disappointed when they cook steak (compared to 40% of boomers). Flavor drives the disappointment for burgers. Tenderness is the reason for steak disappointment.

The good news is that millennials are knowledge seekers. In the research, 75% said they wanted information about steaks, and how to prepare and cook them; 55% wanted information on preparing and serving beef to their children.

Millennials tend to buy the same cuts rather than diversify their choices, too. However, 50% said they would buy more beef if they knew more about the different cuts.

One startling find in the 2011 research was that millennial parents are limiting their children’s consumption of beef. Besides being the key consumer group of the future, these millennials will influence the following generation.

The checkoff-funded “Millennial Parent” study last year asked why millennials limit beef in their children’s diets. One reason is they perceive chicken as being easier to prepare. Plus, kids prefer the taste of chicken (including strips and nuggets), and it can be served in a wide variety of ways.

Millennial parents also perceive other meats as more heart-healthy than red meat.

Strategies need to evolve

Rick McCarty, NCBA vice president of issue analysis and strategy, and John Lundeen, NCBA senior executive director of market research, summarized some megatrends that will affect the beef industry in coming years.

New, sometimes smaller packaging: “Households composed of 1 to 2 persons now represent 62% of total households. In addition, some families are now eating more à la carte meals,” the duo says. “Retailers are going to need several merchandising options as they reach out to these consumers.”

Checkoff-funded research indicates strong consumer interest in packages of small, 4-5-oz., expertly trimmed steaks in the meat case, as well as on the restaurant menu.

Market research also indicates that beef’s subpar performance in the microwave is a limiter to beef consumption.

Ethnic shifts change the landscape: “Not only will tastes shift, but the beef industry must be able to satisfy increasingly diverse consumer palates,” McCarty and Lundeen say. “This will create an explosion of taste options to enjoy, particularly for millennials, who embrace ethnic flavors to a much greater degree than older segments of the population.”

Technology aids decision-making: According to McCarty and Lundeen, research indicates millennials are much more likely than other consumers to use a “shopping app” at the supermarket — an app that tells them, for example, what’s on sale and where to find certain foods in the store, and provides recipes and suggest ingredients.

More product, consumer targeting: “The beef industry has come up with several new beef cuts [Denver Cut, Flat Iron Steak, etc.] that have helped make steak-eating more affordable, and increased the value of the carcass to the beef industry,” Lundeen and McCarty say. “Today, half of U.S. households are low- to moderate-income households, and these consumers are typically higher-frequency beef eaters. Innovation is needed to find affordable beef options for all income levels…”

More convenient beef products: “Nearly one-third of consumers believe that 40 minutes is too long to wait for their meals, from start to table, and 70% say an hour is too long. Add to that the fact that 70% of women now are working — it’s easy to see that convenience is critical,” McCarty and Lundeen explain.

“While ground beef has been the fallback product for the time-conscious, more convenient whole-muscle cuts, including microwaveable roasts, could boost demand. So, too, could easy beef options that quickly assemble into one-pot meals, an increasingly popular choice,” they add.

“Trust me” is more than a slogan: “Wall Street scandals, political scandals, product recalls, pyramid schemes, economic meltdowns, corporate layoffs … it’s no wonder consumers today have become cynical,” McCarty and Lundeen say. “How does the industry develop a trusting dialogue with those who are pessimistic but love our product? Connecting with consumers involves creating trust in how beef is produced, and assurance that beef is a safe, wholesome, and sustainable food. Consumers, indeed all stakeholders, are demanding more transparency regarding how food is produced.” 

 

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Researchers Mobilize To Whip Summer Pneumonia In Calves

preventing cattle disease in beef calves

Pneumonia seems to be a constant stalker of calves, and for good reason. Most of the bacterial pathogens that cause it are present in the calf’s upper respiratory tract; they just need the opportunity of an immune system compromised by viral infections
or stress.

Summer pneumonia is among the most frustrating respiratory infections in nursing calves. The cause is elusive, and many cases occur during seemingly non-stressful conditions for the calves.

A multistate team of researchers is studying ranches in Nebraska and the Dakotas affected by the problem, and comparing them with ranches in the same veterinary practices that haven’t experienced the disease. The team includes Russ Daly, South Dakota State University; Jerry Stokka, North Dakota State University; David Smith, currently at Mississippi State University but formerly at the University of Nebraska; and Amelia Woolums, University of Georgia (UGA).

Smith, an epidemiologist, investigated outbreaks in Nebraska herds for several years. He consulted with Woolums to design the study because of her expertise in immunology and vaccination to control respiratory disease in cattle.

“We know a lot more about weaning and post-weaning respiratory cattle disease in calves, and how to prevent and treat it,” Daly says. “Basically, the lesson is that if we minimize calves’ stress levels and do a good job of early vaccination, we tend to see fewer problems,” he says.

However, there’s little data regarding the risk factors for summer pneumonia. “We want to understand why some ranches perennially have a problem, and others never do,” Woolums says.

Daly says what’s frustrating about pneumonia in nursing calves is that reduced stress and good vaccination programs don’t seem to prevent the disease as uniformly as they do for post-weaning respiratory problems.

“There may be management practices in some herds that put cattle more at risk. For instance, gathering cattle for artificial insemination (AI), sorting, exposure to dust, etc., may favor virus transmission or compromise the immune system. We don’t always know which factors might be important,” Smith says. In some herds, the pneumonia occurs in calves out on the range, absent of those activities.

“We’re looking at farms with summer pneumonia cases and comparing them with farms in a similar location and time that haven’t had issues,” Daly says. “We want to discover the factors that favor calf health on some farms, or that could help producers prevent this disease. Of course, environmental factors are hard to control, but at this point, we don’t even know if these are involved.”

He says some operations have problems in June and July. Others have sickness in very young calves, while some have pneumonia in calves a month before weaning. While these latter calves will respond to treatment, their weight gain takes a hit.

“If pneumonia happens close to weaning, that calf might not be able to be sold with the rest of the group. There’s also the issue of long-term damage and scarring in the lungs; those calves just don’t do as well later,” Daly says.

Looking at multiple factors

The study is looking at various factors, such as gathering cows and calves for AI or branding. “The calves are only apart from their mothers for a short time. We wouldn’t think it could be enough stress to affect them, but perhaps this handling facilitates transmission of bacteria or viruses,” Daly says.

Or perhaps multiple factors are at work. On some operations, for instance, ranchers move cattle for intensive grazing, or subpopulations are commingled at different times.

Commingling cattle from different sources is a well-known risk factor for feedlot bovine respiratory disease. We don’t know if commingling young calves from different subpopulations on the same ranch increases the risk,” Woolums says.

When cattle on the range are moved to new pastures, stress could be a factor if it’s hot, dusty or a long drive. But what about cattle that aren’t being moved or handled?

 

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“Cattle diseases like calf scours are often multi-factorial; summer pneumonia may be, too,” Daly says. Colostrum intake has been looked at, along with calves’ ability to respond to vaccine at different ages. Weather, like a late-spring storm or a cold, rainy spell in early summer, might be a contributing factor in some situations.

“A respiratory pathogen may be circulating, with some unapparent mild infections, and a little extra stress might put them over the edge,” Smith says.

There may be genetic differences in calves’ ability to mount a good immune response as well. “We’re just scratching the surface of that possibility,” Daly says. “We know crossbred cattle have hybrid vigor, and part of that characteristic includes hardiness and
disease resistance.”

Case-control study

The study revolves around case herds that treated at least 5% of their preweaned calves. These are compared with nearby herds (the control animals) that treated less than 0.5%.

“We’re looking at about 30 cow-calf operations that had respiratory cattle disease this past summer. For each of those, we’re looking at two control herds, randomly selected, from the same veterinary practice,” Daly explains.

Woolums has three UGA veterinary students conducting blind interviews. “They don’t know if it’s a ranch with or without summer pneumonia. They just ask questions about management — how many acres the cattle run on, are they in one group or multiple groups, are they segregated by age, are calves creep-fed, and so on,” she explains.

Thus far, 50 operations have been interviewed — both case and control herds. The aim is to enroll between 75 and 90 farms and include information about the spring 2012 and 2013 calving seasons, she says.

Analysis of herd-level risk factors is another aspect of the research, and management practices of the herds will be compared. “We hope to find differences that may provide clues to the cause of summer pneumonia. However, at this point, we’re simply identifying management practices associated with summer pneumonia. But just because two things are associated, doesn’t necessarily mean that one causes the other,” Woolums explains.

“In future research, we might modify one or two things in some herds, and not modify those things in other herds with summer pneumonia; then we’ll see if there’s a difference in outcomes. This would provide stronger evidence regarding practices that truly cause summer pneumonia,” she adds.

In-herd comparisons

The researchers also are gathering additional data from problematic herds. “If they have individual calf treatment records, we ask them to share those with us,” Woolums says. “Then we’ll compare characteristics of calves contracting summer pneumonia with calves that don’t. That’s the calf-level, risk-factor analysis.”

Age of calves also can be a factor. For instance, are they still protected by colostrum antibodies, or did a calf receive adequate colostrum to begin with? One of the differences they’ve observed is that the age of the dam plays a role.

“We also see this with calf scours, in that first-calf heifers may not give their calves as much immunity through colostrum,” Woolums says.

Such calves are more prone to respiratory disease and/or scours due to inadequate protection, simply because of fewer antibodies in heifer colostrum compared to that of an older cow. Older cows may also have a larger quantity of colostrum, as well as better maternal bonding skills that favor the calf nursing sooner.

“We’re looking at which animals get sick, and when,” Smith says. “Two patterns are emerging. Some herds have sickness in young calves [less than 60 days], but these cases tend to be sporadic.” Perhaps these are due to less resistance in individual calves, or the calf didn’t get enough colostrum and is at risk at an early age,
he adds.

“The other pattern is outbreaks where many calves get sick. These tend to be older calves, 120 to 150 days of age. This could be because the majority of those calves have passed beyond the coverage of the maternal antibodies, but haven’t yet mounted enough of their own immunity,” Smith says.

There may be other explanations as well. For instance, the pneumonia may be occurring during a season when the environment favors virus pathogens, or certain management factors make pathogen transmission easier.

“The problem in sorting this out is that calves in well-managed herds are about the same age. They move into that window of susceptibility at about the same time. Is it something related to the calendar or season, or to the age of the calf?” Smith asks.

Questions on vaccination

Some producers have begun vaccinating calves at turnout, or are adding respiratory vaccines to branding-time protocols. This may help, depending on the age of the calves and the products used, the researchers say. Success may depend on whether the calves are old enough that their immune systems can respond to vaccination, since maternal antibodies from colostrum may interfere.

“Some research suggests that calves 60 to 90 days of age can respond to vaccination. In some instances, they do; sometimes, they don’t,” Woolums says.

Calf age at branding can vary greatly. The oldest might be 2 to 3 months old, while the youngest might be only a week old.

“A week-old calf isn’t likely to respond adequately to vaccination. A dairy calf that received no colostrum can respond to vaccine at a week of age, but a beef calf that received good colostrum won’t reliably respond. So it depends on the proportion of the herd that is 1 to 2 weeks old, vs. the proportion that might be 2 to 3 months old. If the proportion of really young calves is small, it may not be a problem,” Woolums explains.

Age at vaccination is an important aspect. “The other piece of that challenge is that even if you know when to vaccinate, you need effective vaccines against the pathogen that’s involved, or you’re just shooting in the dark,” Smith says.

Ranchers should work with their herd-health veterinarian to design a specific strategy for their operation. No one formula or schedule fits all herds, Woolums says. 

Regardless of when you vaccinate, and with what, some calves won’t mount adequate immunity for one reason or another. “There is also a genetic component — not just in resistance to bovine respiratory disease, but also in response to vaccination,” Woolums says. 

The challenge of sampling

Woolums would like to have a student sample calves when ranchers gather a herd for artificial insemination.

“Then later, if some calves get sick, we could sample them again and see if there’s a difference. One reason there isn’t more research on summer pneumonia is because it’s hard to sample the calves,” she says.

Beef calves aren’t conducive to sampling, except at branding. Calves could be captured during an artificial insemination (AI) program, but not all producers use AI.

“It’s also hard to sample them without changing the risk factors. If we bring them all in to sample them, we’ve grouped them in a situation where they wouldn’t ordinarily have been grouped,” she says. This creates even more risk factors — stress of handling and commingling in close quarters.

Is a virus involved?

Researchers want to find out more about the pathogens involved in summer pneumonia. Woolums says coronavirus is one bug of interest because the virus has been found on nasal swabs of some sick calves.

“But we can also find coronavirus in normal calves. We don’t know if a virus is the actual cause. Just because you find it on the nasal swab doesn’t necessarily mean it’s involved with illness,” she says. 

“The fact some herds have more trouble with pneumonia than others might mean they have some pathogens present that are not present in other herds, but we don’t know,” says Smith. “It may be something like bovine respiratory syncytial virus or bovine virus diarrhea that is making them more vulnerable to other respiratory pathogens.”

Survey seeks disease associations

Woolums says earlier work on summer pneumonia seemed to indicate that certain management practices are associated with summer pneumonia.

 “We mailed a list of questions to producers in Georgia, Florida, West Virginia, Kansas, Iowa and Nebraska, asking about their management and whether they had calf pneumonia. We did find some significant associations,” she says.

“We asked whether the producers saw any calves with respiratory disease, and also the proportion of calves they treated for pneumonia. Some things were associated with whether they saw respiratory disease, and different things were associated with the proportion of calves they treated. For example, if a farm had calf diarrhea, they were more likely to also see calves with respiratory disease. And farms that used artificial insemination were more likely to treat a larger proportion of their calves,” she says.

Depending on the conditions — whether it was low-stress handling, if the weather was hot or inclement, or corrals were dusty — there might have been factors making them more vulnerable. “It’s also possible that when calves are sorted away from their mothers and grouped together, they have more opportunity to spread respiratory viruses or bacteria among themselves,” she says.

Heather Smith Thomas is a rancher and freelance writer based in Salmon, ID.

 

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Some Thoughts On Smithfield, OIE And Planting Progress

Some Thoughts On Smithfield, OIE And Planting Progress

The $7.1 billion purchaseof Smithfield Foods by a Chinese company was announced this week. Shareholders will receive a premium of more than 30% over the last trading, and industry experts seem to agree that the deal is a good one for both Smithfield Foods and China’s Henan Shuanghui, the Chinese meat processing firm. You can read more about the deal and its ramifications here and here.

Smithfield was being pressured by shareholders to re-evaluate its integrated pork production model; the purchase of Smithfield is expected to alleviate that pressure at least in the short term. U.S. investors may not love the U.S. protein market, but the rest of the world does. Brazil, Mexico and the Pacific Rim have been the most aggressive in acquiring U.S. protein companies.

The World Organization for Animal Health (OIE) has voted officially to designate the U.S. as a country whose risk for the spread of BSE is negligible. “Negligible risk” is OIE’s lowest risk classification under the OIE animal health code. Countries with this status are recognized as having implemented robust BSE controls and done extensive surveillance of their herds to demonstrate this extremely low risk level.

Phil Seng, president and CEO of the U.S. Meat Export Federation, says the new designation should remove any legitimate hurdles that U.S. beef has faced in the global market due to BSE. “This decision by the OIE should clear away any remaining concerns that some countries have about the risk associated with importing beef and beef products from the U.S. We think the decision announced by the OIE today should provide a number of beef-importing countries with a reason to reevaluate their requirements for beef imports from the U.S.,” Seng said this week.

• Meanwhile, corn planting pulled closer to the five-year average last week, as of May 26. At that time, USDA reported that 86% of the crop had been planted compared to the 90% average for 2008-2002. At this time last year, corn planting was complete.

USDA’s weekly Crop Progress report indicates that both soybean and corn planting remain well behind schedule, however, and are both roughly at the level of 1993. After planting 43% of corn acres the week of May 19, heavy rainfall in many parts of the Corn Belt reduced planted acres to only a further 15%. Read more here.

With the crop mostly in the ground, the focus now shifts to satisfactory growing conditions over the next eight weeks. 

USDA’s COOL Rule Surprises No One, Distresses Many

Last week, USDA issued its rule on mandatory country-of-origin labeling (COOL). Of course, no one was surprised by the final version, but I think most were amazed. Besides small changes like using the word “harvested,” the only real surprise was that USDA essentially did nothing to address the concerns cited by last year’s World Trade Organization (WTO) ruling.

As you might recall, WTO ruled against the U.S. in a complaint filed by Canada and Mexico regarding the fairness of mandatory COOL. WTO ruled that the law violated provisions of the WTO’s agreement on Technical Barriers to Trade, and gave the U.S. a May 23 deadline for bringing mandatory COOL into WTO compliance.

I love the fact that USDA actually had the nerve to defy WTO, while presumably also recognizing that the U.S. must belong to WTO, and that fair trade and a level playing field benefits everyone. Now, it appears that it will just be a matter of time before we learn what the penalties will be, and how damaging they will be to the industry.

USDA Secretary Tom Vilsack said this: “USDA remains confident that these changes will improve the overall operation of the program and also bring the mandatory COOL requirements into compliance with U.S. international trade obligations.” But meat industry groups and Canada’s Ag Minister Gerry Ritz disagreed.

“These changes will not bring the U.S. into compliance with its WTO obligations. These changes will increase discrimination against Canadian cattle and hogs and increase damages to industry on both sides of the border,” Ritz said in a statement.

Canada and Mexico likely now will move aggressively to impose penalties for our failure to live up to our agreements. And it’s expected that beef and pork imports will be the targets for Canada and Mexico as we move into the retaliation phase. In fact, the Canadian Cattlemen’s Association reported that Ritz and Canada’s International Trade Minister Ed Fast have indicated that Canada would consider retaliatory tariffs in the neighborhood of $1.1 billion.

I still believe that there has to be a way of implementing a workable COOL program that achieves the goals of producers, as well as the needs of consumers, without costing livestock producers hundreds of millions of dollars. Sadly, however, the final rule from USDA makes it clear that the agency either was unable to create a workable solution, or felt the current legislation restricted it from making the positive changes needed.

It appears the U.S. strategy now is to do nothing until the penalty phase begins, and then let Congress work it out. Meanwhile, what we have is a law that has failed to accomplish what was intended and has caused widespread disappointment from everyone involved.

However, the pain, like the gain, from mandatory COOL has been fairly minimal so far, but that is going to change. Hopefully, as the industry losses begin to mount up, Congress will take action to address the real issues.

Ag Must Embrace Competition As A Good Thing

ag must embrace competition

I hate monopolies, but living in rural America almost ensures that you will deal with monopolies every single day. For instance, I’d rather go to the dentist than deal with our telephone company. The landlines in our area are so poor, that we can’t use a fax machine. And every time it rains (which admittedly hasn’t been too often the last several years), the cracking and static make it impossible to hear. Meanwhile, using a phone line to access the Internet simply isn’t an option.

Nonetheless, the phone company has no intention of improving its equipment or service; any complaint I might register with that outfit is only of value if doing so makes me feel better. The phone company doesn’t care; plus, it knows its customers have no alternatives or options.

On one occasion, I asked the customer service person in a calm and respectful name for her name, and she hung up on me. I was so shocked and surprised that I called back two times – I guess just to verify that she would continue to hang up on me.

I’ve had similar experiences dealing with my satellite provider, but the worst offender of all is the government. I think we can all relate to this designation for the latter.

 

 

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In the cases of all these entities, when those being served have no alternative for service, there is no incentive to take care of the customer or client. I’m always amazed at how the Chick-fil-A restaurant organization can teach a 15-year-old kid to be polite, customer-focused and well-mannered, but many government agencies almost seem to think their job is to make their customers lives more miserable.

It’s interesting that those of us in agriculture generally can appreciate the value of competition in other industries. For instance, the big three automakers make each other better. After all, I don’t think the quality and value of trucks wouldn’t be nearly as high if Dodge, Ford and Chevrolet weren’t fighting desperately for market share.

And in contrast to our landline phone service, AT&T, Sprint and Verizon are always striving to become better and more competitive, which better serves the consumer. Meanwhile, having Toshiba, Hewlett Packard, Dell, Sony, Apple, etc., going after each other for customers makes for better computers and constant innovation. 

Yet, we have a tendency in agriculture to not value competition. Many among us want the government to take over our lives as a benevolent dictator and guarantee outcomes. I guess the difference is that we’re involved in a commodity business.

In a commodity business, competition leads to incessant concentration and competitiveness, rather than a focus on improving margins and growing market share. In fact, many regard more profit and more market share as leading to increased power, which can be used against smaller/weaker players.

The result is that we in agriculture have alternated between waging a war on our commodity marketplace, and waging a war against competition. Ironically, the war on competition is often presented as an attempt to increase competition.

Rural America and agriculture in general would greatly benefit from more competition, and we must be vigilant about further monopolization of our business. It’s good to know that some people just naturally do what is right, but others seem only to be influenced by whether or not the marketplace insists on it. 

 

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Wildfire Season Is Shaping Up To Be A Doozy

Wildfire Season Is Shaping Up To Be A Doozy

Ah, statistics. We live in a world that cannot function without them. Yet often, statistics can be misleading. Consider, for example, the fact that early-spring wildfires were down in both number of fires and acres burned this year, compared with the last two years.

“But we should not be lulled into a sense of false security about the nature of the upcoming fire season,” says USDA Secretary Tom Vilsack. Last year saw 9.3 million acres go up in smoke, the biggest fire year since 1960, and this year is shaping up to be every bit as bad.

According to Jeremy Sullens, a wildland fire analyst at the National Interagency Fire Center in Boise, ID, the 2013 fire season is really a tale of two halves. “In the eastern U.S., we’ve seen quite a bit of frequent and periodic precipitation, and we’ve seen a reduction in the number of acres burned that we would normally see this time of year. Largely that’s because we’ve seen most of our fires across the eastern and southeastern U.S.”

 

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However, as the country moves into the summer fire season of June, July and August, the fire threat transitions to the western half of the country. And in the West, Sullens says, it’s a very different story.

The western U.S. is still experiencing severe drought in places. “What that’s leading us to is an expectation that we’re going to see some above-normal, significant fire potential across the Southwest, moving up into portions of the Four Corners area,” he says. That threat will likely tail off as the area moves into its monsoon season in July.

“Where we’re really thinking we’re going to have a problem this fire season is in the Pacific Coast states into Idaho and southwestern Montana,” he says. “So across California, Oregon and south-central Washington, and moving into the mountainous areas of Idaho and southwestern Montana, we’re expecting very dry conditions [combined] with heavier fuel types.”

Areas of lighter vegetation, such as the grasslands of the Great Basin, will remain dry. “But the drought has had such an impact that we don’t have the fuel [load] that we would in a normal season. So we’re expecting fires to occur in those areas, but we’re not likely to see the large, significant fires that we saw last year.”

For a complete fire-season outlook, and ways you can protect your home and property, check out these websites:

Watch Out! There’s A New Consumer In Town

USDA photo new consumer in town

The sentiments in the old country song, “The Hand That Rocks The Cradle Rules the World,” have always been true. But now, more than ever, that truth is evident as a growing consumer type – the hybrid consumer – rises to the fore. And those who produce, process and market food products ignore that truth at their own peril.

Hybrid consumers are those who shop at the extreme ends of the retail spectrum and ignore the more popular mid-level brands. Generally characterized by women who are enjoying greater financial empowerment and Millennials, a Rabobank report indicates that this growing consumer segment will increasingly polarize the food market.

Hybrid consumers trade down in basic grocery categories and trade up in product categories that are socially and emotionally significant to them, according to a report by the Food & Agribusiness Research and Advisory group at Rabobank.

“Because hybrid consumers are less focused on mid-market products and brands, they often trade down when it comes to purchasing everyday value-for-money items like basic groceries,” the report says. “However, these same consumers may use the money saved trading down to trade up to premium high-end products that matter most from an emotional and social perspective, such as designer shoes, the latest smartphone, high-end coffee varieties, fine dining, and premium brands in supermarkets,” according to the report.

 

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Consider the juice market, where private label and store brands, and fresh/premium segments are both growing. “For example, Naked Juice and Simply Orange are taking share from mid-market brands such as Minute Maid and Tropicana.”

Three forces are driving hybrid consumer trend, according to Rabobank:

  • Socio-demographic developments. The growth of women’s purchasing power and increasing influence over household spending is a major factor; research indicates women are more objective than men when it comes to food-purchasing decisions. Additionally, younger generations, which grow up using social media, are more likely to make food choices based on merits rather than on specific brand loyalties.
     
  • Food retailer strategies. The advent of discounters has added to consumers’ options to trade down, and, in recent years, private-label products have increased trading-up options. Increased use of the Internet as a tool to compare products and prices has also led to greater consumer awareness regarding food product purchasing.
     
  • Macro-economic developments. The recent global recession has accelerated the existing market dualization. Constraints on disposable income and falling consumer confidence has encouraged trading down on basic items. At the same time, consumers still want to occasionally indulge themselves even in times of economic hardship, and are willing to pay a bit extra for premium quality.

Looking forward 10 years, as Generation Y moves up the career ladder, and Generation Z enters the labor market, Rabobank expects Millennials to have a serious impact on consumer spending. As their purchasing power increases, so will overall hybrid consumption patterns, the report concludes.

 

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Meat Matters

Beef Packers Stymied By Shortage Of Working Capital

cost to run a cattle packing plant

Operating a beef processing plant is far tougher than people realize. Just ask the owners who have closed more than 100 plants since 1977. Whether they were fed-cattle or cow plants, all were unable to surmount the many factors that have reshaped the U.S. beef processing industry over the past 35 years.

These factors include: the replacement of the carcass trade with boxed beef; the demise of slaughter-only fed-beef plants; a shift in cattle feeding from the Midwest to the High Plains; a need to have plants closer to cattle supplies; the age of plants and an unwillingness or inability to upgrade them; uncompetitive labor costs (such as in Los Angeles); a huge increase in operating costs, including added food safety costs; beef recalls due to E. coli O157:H7; and a decline in U.S. cattle numbers over the past 15 years.

Another factor that currently plagues the newest entrant to fed-beef processing, Northern Beef Packers (NBP) in Aberdeen, SD, is a lack of working capital. Plants require an enormous amount of money to operate efficiently. Many small companies, especially family-owned operations, have succumbed because of this.

My list of steer and heifer and cow-bull plants that have closed reveals that 61 such plants closed between 1977 and 1990 inclusive. Another 42 plants closed from 1995 until this February, taking out 30,565 head of daily fed slaughter capacity and 11,930 head of non-fed slaughter capacity. I’m sure there were more plants that closed from 1991 to 1994.

Another of my lists reveals that the largest 24 plants currently have 97,850 head of daily slaughter capacity; the next 25 plants have 30,585 head of capacity; and another 23 plants have 4,870 head of capacity. In other words, the industry is dominated by plants with capacities of 2,000 head or more per day, with a handful of midsized plants, and an equal number of tiny plants.

Two midsized plants (each with about 1,500 head of daily capacity) were in the news recently. The first was NBP, which began operating last October. I wasn’t surprised to hear in April that a lack of working capital forced it to lay off 108 of its 420 employees. As I wrote in my January 2012 column: “It’s one thing to find investors to finance a new plant. It’s quite another to generate the working capital required to pay for livestock and payroll, and to keep the plant operating.”

NBP says it needs to raise about $20 million to run efficiently. Even if it does this, it could burn through this money pretty quickly. Taking the average live fed-steer price the week ending April 27 of $128/cwt. and using an average live weight of 1,350 lbs., each animal NBP bought would have cost it $1,728.

 

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Running at a full capacity of 7,500 head/week would involve $12.96 million in cattle purchases each week. At only 1,000 head/ week, it would involve $1.728 million/week. NBP admits to a dilemma facing many startups — it needs more working capital to process more cattle and run more efficiently. Yet, there’s no guarantee that will mean any profits in the first two years.

The second plant was Sam Kane Beef Processors in Corpus Christi, TX. This family-owned plant has struggled in recent years due to liquidity issues. Some south Texas cattle feeders and ranchers feared it would close, so they bought the company, promising to secure what they called a “vital element of the south Texas cattle industry.”

That’s not an overstatement. For years, Sam Kane has offered the only realistic marketing option for area cattle feeders. The new owners have big plans to revitalize the business, such as offering grid pricing for fed cattle, and launching a branded beef program. I wish them the very best.

Steve Kay is editor and publisher of Cattle Buyers Weekly. See his weekly cattle market roundup each Friday afternoon at beefmagazine.com.

 

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Some Thoughts On The Chinese Purchase of Smithfield Foods

china company buys smithfield

Yesterday’s announcement that Smithfield Foods has been purchased by China’s largest publicly-traded meat processor was all the buzz in the livestock/meat sector –  and rightfully so.This is a major purchase by a company from a country that some expect to eventually become the largest U.S. pork export customer. Remember the “China Principle” – 1.3 billion times any number is a very big number!

• First, the specifics of the deal. China’s Shuanghui Holdings, Ltd., parent company of Henan Shuanghui, the Chinese meat processing firm, is buying Smithfield for $34/share. That’ a premium of about 30% to the stock’s recent value and puts the transaction price at $4.7 billion in cash. According to a report from National Public Radio, it also values Smithfield at $7.1 billion. Several sources reported that that value makes this the largest Chinese purchase of a U.S. company to date.

• Second, it appears Shuanghui intends to leave Smithfield’s management in place and has no plans to make changes in Smithfield’s operations. Smithfield CEO Larry Pope says the company won’t close any facilities and will leave all employee agreements in place.

• Third, let’s keep this in perspective. While Smithfield is a behemoth both as a packer and hog producer, it is a drop in the bucket compared to hog numbers, pork production and pork consumption in China. The accompanying tables show Smithfield’s importance in the U.S. industry. It has roughly a 26% share of U.S. hog slaughter capacity and a 16% share of the U.S. sow herd. (Note that the Successful Farming numbers are sows only, so we assumed that 10% of the June 1 U.S. “kept for breeding” number was comprised of replacement gilts and boars in arriving at that 16% figure.) But where 862,000 sows will produce somewhere in the vicinity of 20-22 million market hogs/year, China in 2012 had 49.28 million sows and slaughtered 694 million hogs. Smithfield’s U.S. numbers would account for 1.7% of the Chinese sow herd and 3% of China’s 2012 slaughter.

So what are the implications of this purchase for the U.S. pork industry?

The purchase doesn’t change the structure of the U.S. industry at all and thus should have no impact on the competitive landscape. In spite of the predictable outcry by small farm advocates and even some U.S. lawmakers, the purchase doesn’t change concentration levels or remove any competitors from the U.S. marketplace.

Pork Powerhouse, Successful Farming, September 2012

There is no reason that U.S. antitrust laws should come into play in any review of the transaction. The sale is subject to review by the Committee on Foreign Investment in the United States, but we understand that that group’s major focus is on national security issues and we don’t see that this one poses any such threats.

Does this potentially transfer U.S. technology to China? Smithfield may have some unique systems or procedures but we doubt that there is much, if any, technology in Smithfield’s plants or hog farms that Chinese firms could not access already. U.S .firms have been actively working with Chinese companies for years and, again, raising and processing pigs probably doesn’t involve much spying or missile technology.

We suspect that the merger will enhance U.S. pork exports to China. It just makes sense that owning a U.S. company will make things smoother for shipments – at least from that company. If that occurs, other U.S. producers and packers will see higher prices and have an opportunity to increase output to backfill the domestic pork supply.

The merger may also push other U.S. firms to develop closer relationships in China, increasing U.S. exports even more. U.S. hog and pork prices may increase in the short run if exports in fact grow – but those price increases will be temporary as long as U.S. producers are not limited by policy decisions, regulations or higher costs in reacting to higher prices. Markets will work if allowed to do so!

The merger explains to some degree the fervor with which Smithfield has shifted to not feeding ractopamine for about 50% of its output. Smithfield’s sizable vertical integration back into production means the system can meet China’s ractopamine-free demands more easily than non-integrated systems can.

 

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