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Articles from 2005 In July


NZ Announces Ground Meat Traceability Tool

New Zealand (NZ) scientists say they can trace individual meat patties to their batches of origin, NZ Association of Crown Research Institutes reports.

Until now, traceback of ground products was thought impossible due to the many different DNA profiles mixed together, says lead scientist Grant Shackell. The NZ process can match samples containing ingredients from up to 40 different animals back to their batch source.

"We're effectively using 15 grams of meat from a ton of meat to match one specific patty back to its manufacturing batch," Shackell says. Mock traces of samples returned from a shipment to Japan have been correctly traced back to their production batch; and, samples deliberately mislabeled to test the system have been detected.

"The day is not far off when, if you see a meat patty for sale anywhere in the world, you will be able to trace it back to the country, herd and animal the meat came from," Shackell says.

Three-Judge Panel Reopens Canadian Cattle Trade

At press time, the 4 1/2-month legal skirmish over the importation of Canadian live cattle into the U.S. appeared to be resolved. If unimpeded, Canadian live cattle less than 30 months of age were expected to be moving into the U.S. "within days, not weeks," said USDA Secretary Mike Johanns.

It was in early March, on the eve of USDA's intended border reopening date of March 7, that U.S. District Judge Richard F. Cebull in Billings, MT, granted R-CALF an injunction on the rule. But on July 14, a three-judge panel of the Ninth Circuit Court of Appeals in Seattle lifted Cebull's preliminary injunction. In ruling for a temporary stay, Cebull said reopening the U.S. border to Canadian live cattle would endanger the U.S. beef industry and present ''a genuine risk of death for U.S. consumers."

In announcing its decision July 14, the three-judge panel said it would issue the rationale for its ruling at a later date.

At press time, there was one potential obstacle to resumed live cattle trade yet to be hurdled -- a scheduled July 27 hearing before Cebull. Analysts, however, thought the unanimous ruling by a three-judge Appeals Court panel -- delivered within 24 hours of hearing oral arguments -- might convince claimants to drop their case, or exert pressure on Cebull to change his injunctive view.

Trade in live cattle from Canada had been blocked since May 2003 when Canada announced its first case of BSE in an Alberta cow. In September 2003, the U.S. reinstated trade in beef cuts from Canadian cattle younger than 30 months. Reinstatement of trade in live cattle had proven more problematic.

Every time it seemed headway in reopening live-cattle trade was being made, a BSE-related incident would arise. In December 2003, it was the discovery in Washington State of a BSE-infected cow of Canadian origin. Then, on the eve of the border reopening in early March, Canada discovered its second case of BSE.

Johanns lauded the Seattle ruling, calling it: "great news for the future of the U.S. beef industry, specifically the many ranchers, feeders, and processing plants that have been struggling to make ends meet due to the closed border.

"It also bolsters our position with other international trading partners by following the very advice we have given them to base trade decisions on sound science," he said.

Because the ruling is effective immediately, Johanns said USDA would take "immediate steps" to resume importing cattle less than 30 months of age. He said the Animal and Plant Health Inspection Service already was in contact with the Canadian Food Inspection Agency to prepare to certify cattle for shipment.

"We've been safely importing boneless boxed beef from Canada since September 2003, and now we will use the scientific approach laid out in our minimal risk rule to once again safely import live Canadian cattle for processing," he said.

Jim McAdams, an Adkins, TX cattle producer and president of the National Cattlemen's Beef Association, said his organization is pleased the Court agreed with the science -- beef is safe from BSE.

"U.S. Cattlemen are best served when international trade is based on science and we expect our trading partners to follow the science that BSE does not pose a public health or food safety risk," McAdams said.

Meanwhile, Bill Bullard, CEO of R-CALF USA, said he was "disappointed" in the ruling.

"R-CALF USA remains confident that USDA's Final Rule was not justified, and that USDA did not provide significant justification for overturning a longstanding policy that protected both the U.S. cattle herd and U.S. consumers from the introduction of BSE.

"R-CALF is confident that when we have a full hearing on the merits of the case, we will demonstrate to the district court that USDA's actions are premature and unjustified," he said.

The ruling was another bitter pill for R-CALF, which likely has frittered away potloads of cash in a series of unsuccessful legal and public-relations attempts to promote its protectionist vision.

Jim Robb, director of the Livestock Marketing Information Center, said the border reopening likely will add volatility to the U.S. market. But, on Friday, the first day of trading following the Thursday evening court announcement, there was little downward movement.

"Some of this has already been factored into the market," Robb told BEEF Cow-Calf Weekly. "We could have had this kind of movement without the court decision."

Robb says analysts are in the process of revising their forecasts, as resumption of live cattle trade with Canada wasn't expected until late 2005 or early 2006.

"I'd advise cow-calf producers to focus on the Midwest corn crop as it will be more fundamental to pricing their cattle this fall than the border situation," he said.

He envisions no relief for cattle feeders this fall.

"We're just getting into the real ugly time for cattle feeders," he said. "By the time we get through August breakevens, feeders will be losing $100/head. Breakevens are 90¢ and we'll be lucky to get an 80¢ market in August."

He's looking with interest at how much Canadians will ramp up cow kill. With fed cattle now apparently able to cross to the U.S., he believes Canada might shift its resources toward harvesting cull cows and bulls in order to send more fed animals to the U.S.

Even then, Robb doesn't immediately expect a big run of fed cattle to the border. For one thing, Canada has added significant harvest capacity over the past two years. Plus, today's Canadian feedyard placements won't be market ready until November, he added.

Robb mentioned one other interesting fact: The just-concluded second quarter of 2005 will be the first quarter in history that the U.S. will have imported more than 1 billion lbs. of beef (carcass weight, not product weight) from all sources.

In a morning teleconference today, Johanns said the process for importing live cattle from Canada, once the preparatory steps are complete, will begin in Canada. The Canadian Food Inspection Agency will issue health certificates to verify animal age and ID, and ensure it meets the minimal risk rule criteria.

"Once verified, U.S. Customs and Border Protection will review the documentation and confirm the shipments are appropriate for entry into the U.S," Johanns said. "The animals will then be released to APHIS veterinarians at border inspection facilities who will inspect the cattle and validate the Canadian certification. Additionally, FSIS inspection personnel will verify U.S. requirements are met at the point of slaughter."

To read a transcript of the morning news conference, go to: http://www.usda.gov/wps/portal/usdahome?contentidonly=true&contentid=2005/07/0260.xml.

What benchmarking can tell you

Let's look at what benchmarking — the act of comparing a beef cow herd's production and financial measures to those of a set of benchmark herds — can tell a ranch manager. We'll use the average of my last six herds analyzed in 2004. There's nothing special about these herds; they were just the last six I analyzed in 2004.

I prepared an IRM Costs & Return Analysis Summary for each herd and presented a summary analysis to each respective manager. The managers are now studying their reports looking for their business strengths and weaknesses. Benchmarking is how this is done.

The benchmark herds used here are the average numbers generated from 124 North Dakota beef cow herds participating in North Dakota's State-Wide Farm Business Management Association in 2004. North Dakota State University personnel publish an annual summary averaging management data from all 124 beef cow profit centers.

I presented these 2004 average production benchmarks last month (page 8). This month, I'll present the economic benchmarks. Let's look at each key production and economic benchmark.

Figure 1 is a summary of my recommended “Production Efficiency Measures” applied to the six study herds. The average of these herds will be used in this benchmarking demonstration.

  • Number of beef cows in inventory: The Jan. 1, 2004, count of bred females held for calving in the six study herds averaged 562 females vs. an average of 149 for the benchmark herds. Clearly, the study herds' average number of cows was considerably larger than that of the benchmark herds.

  • Calf death loss: Percent calf loss is based on the number of live calves born. The study herds met my 5%-or-less benchmark goal. When a herd meets or beats a benchmark value, it indicates business strength for the study herd.

  • Average weaning weight (AWW): These six herds generated a 2004 AWW of 449 lbs. (range of 382-564 lbs.). This is 110 lbs. below my suggested benchmark AWW of 559 lbs. When a study herd falls below a benchmark value, it indicates a potential weakness in the study herd.

  • Days calves on cows: The 172 days the calves were on the cows is well below my 195- to 200-day benchmark average. Lingering drought was likely partly responsible, plus the fact a couple of herds use May/June summer calving. Certainly, the lower number of days on the cows contributed to lower AWW.

  • Percent calf crop: Benchmarking the percent calf crop of these six study herds indicates lower percent calf crop is the study herds' single biggest missed profit opportunity. The six herds' 83% average calf crop ( range of 77% to 87%) means they had 8% fewer live calves than the benchmark herds available at weaning. Missed opportunities for profit abound with an 83% calf crop weighing 449 lbs.

  • Weight/day of age (lbs./day): Weight/day of age is a measure of calf growthiness. A proxy for average daily gain, it doesn't require producers to weigh calves at birth; calculate it by dividing calves' AWW by average age of the calves in days. I use this measure to assess the bullpower being used.

    The average weight/day of age for these six herds was 2.6 lbs./day, compared to my benchmark average of 2.9 lbs. The range of the six herds was from 2.2 to 3.1 lbs./day of age, which suggests considerable variation in the bullpower being used among the six study herds.

  • Pounds weaned/female exposed: This IRM-recommended production measure is calculated by dividing total lbs. of calf weaned by the number of females exposed to bulls. It's my favorite production measure.

The study herds averaged 378 lbs. of calf weaned/female exposed. This compares to 507 lbs. weaned/female exposed in the benchmark herds — a major weakness.

Economic efficiency

Figure 2 presents my economic benchmarks. Figure 4 shows recommended economic efficiency measures calculated for the study herds.

  • Accrual-adjusted gross income (AAGI): Gross income in a beef cow herd comes from six sources — steer calves, heifer calves not held back for replacements; culled cows, bulls, and open heifers; and inventory change.

    Gross income needs to also be an AAGI. This means cash sales must be adjusted for inventory change, which can be positive or negative.

    The study herds generated an average 2004 AAGI of $553/cow; benchmark herds generated $637. The study herds grossed $87 less/cow.

    Figure 3 presents the various components of gross income identified in the North Dakota Farm Business Management (FBM) Beef Cow Profit Center Accounts. To be more consistent with my IRM-Financial And Reproductive Management (IRM-FARMS) model, I modified the FBM Summary by moving the cost of raised replacement heifers from the gross income component down to a cost of production component. The earned net income figure is unchanged by this adjustment. The modified average Adjusted Total Gross Income for these benchmark herds comes to $637/cow.

  • Total production costs per cow: On the other hand, these six herds did well in average total production cost at $444/cow. The benchmark costs were $447/cow. Total production costs per cow is another strength.

    I wonder if these herd managers cut costs so much that it led to reduced gross income? Cost-cutting can impact percent calf crop.

  • Earned-net income: The earned-net income of the six study herds was $109/cow compared to the benchmark herds' average of $190/cow. A $109 average is certainly not record setting given the record cattle prices of 2004.

  • Unit cost of producing a cwt. of calf (UCOP): The six study herds had a $110 average UCOP — $28 higher than the benchmark herds. UCOP is a ratio of total production costs divided by total pounds of calf produced. Benchmarking suggests the high UCOP is due to low reproductive performance not a bloated cost structure — an important point to know.

  • Cost to produce $1 of gross income: Calculated by dividing the total cost per cow by the AAGI, the cost to produce $1 of gross income in the six study herds was 81¢. The benchmark herds' average was 70¢. Again, it's the lower production that's raising the cost per $1 of gross income, not bloated production costs.

Conclusions

The key strengths of these six ranch businesses are the low percent calf death loss and lower total costs/cow. The key weaknesses are low percent calf crop and high UCOP.

Since costs/cow were similar for both groups, the higher UCOP for the six study herds must be due to their lower physical production leading to a lower AAGI.

It's obvious reproductive performance is a missing profit opportunity in these study herds. Their lower production led to their poorer economic performance. None of these six herd managers used herd performance records.

Harlan Hughes is a North Dakota State University professor emeritus. He lives in Laramie, WY. Reach him at 701/238-9607 or [email protected].

30-minute, live BSE test developed

Vacci-Test Corp. says it will by offer by fall “a simple, reliable and economical diagnostic tool” for the detection in “live” cattle of infectious brain diseases, including BSE.

The test measures immunity and the presence of infectious diseases in both animals and humans by a simple blood test that determines the presence of a protein marker (Protein 14-3-3) that identifies brain infections such as BSE in cattle or variant Creutzfeldt-Jakobs disease in humans. Bill Hogan, president and CEO, says the test will make affordable mass testing of live cattle in the field possible with results readable in less than 30 minutes.

Currently BSE can only be detected postmortem in a days' long lab procedure significantly more expensive than the “pre-mortem” Vacci-Test, Hogan says. He expects the cost to be about $20/animal, with availability in North America this fall. To learn more, visit www.vacci-test.com.

Previously cleared tissue retested

As of June, USDA has tested 381,000 animals in its enhanced BSE surveillance program. Among them were three animals that tested “inconclusive” last November but under additional testing turned up negative.

In early June, however, USDA's Office of the Inspector General (OIG), which has been working with USDA in reviewing its BSE-related activities, recommended all three of the inconclusive samples be subjected to a second internationally recognized confirmatory test — the Western blot test. On June 10, USDA announced the blot test results found one of the three samples to be “reactive.”

That sample was subsequently sent to the Office of International Epizootics (OIE)-recognized laboratory for BSE in Weybridge, England, for additional testing. As of press time, those results had not yet been returned.

In making the June 10 announcement, USDA Secretary Mike Johanns said, “The first thing I want to mention again is that there is no risk to human health here. The animal did not get in the food or the feed chain. The firewalls USDA put in place some time ago once again have shown they do work.”

What YOU told us

Cattle producers responding to a BEEF magazine survey conducted in early June overwhelmingly favor a national animal ID program for animal health monitoring and traceback purposes, even if it's mandatory. But only about 37% of respondents want the data to be controlled by either state or federal government.

The survey was delivered to 18,645 BEEF magazine subscribers on June 6, with 700 responding during the June 7-10 data collection period. Here are the results.

Editor's note: Question 12 asks: “Who do you most trust to maintain the database?” and offers “an industry group such as NCBA” as one option. NCBA would not control the data, but rather an animal industry consortium would. See page 23.

Question 1

Do you believe a national system of individual animal ID and traceback is needed for animal health monitoring purposes?

No 17.7%

Yes 76%

Don't know 6.3%

Question 2

Should such a national system for animal traceback be mandatory?

No 29.6%

Yes 62.9%

No answer 0.3%

Don't know 7.3%

Question 3

Are you familiar with the National Animal Identification System (NAIS) as proposed by USDA?

No 25.6%

Yes 74.4%

Question 4

Are you in favor of NAIS as proposed?

Don't know 45.1%

Yes 26.6%

No 27.7%

No answer 0.6%

Question 5

Have you registered your livestock premises with your state authority?

No 61.4%

Yes 37.3%

No answer 1.3%

Question 6

Do you plan to register your premises in the next six months?

Don't know 40.7%

No 22.1%

Yes 36.3%

No answer 0.9%

Question 7

Do you individually ID your cattle?

No 13.6%

Yes 83.4%

No answer 3.%

Question 8

If so, do you use electronic ID tags?

No 86.1%

Yes 12.3%

No answer 1.5%

Question 9

The working group advising USDA implementation in the beef industry recommends RFID tags be required. Do you agree?

Don't know 29.3%

Yes 44.9%

No answer 2.3%

No 23.6%

Question 10

USDA's Strategic Plan requires all livestock premises to be registered by Jan. 1, 2008, and all cattle entering commerce to be identified individually with official NAIS tags by Jan. 1, 2009. Do you believe the timeline is:

Too fast 15.3%

Reasonable 60.3%

No answer 3.1%

Too slow 21.3%

Question 11

What is your single biggest concern with NAIS?

Potential for liability by producers 16.9%

Confidentiality of data 22.4%

Cost of the program and labor requirements for producers 47%

No answer 2.6%

I have no concerns 11.1%

Question 12

Who do you most trust to maintain the ID database?

Federal government 17.3%

State government 19.4%

Industry group such as NCBA 41.3%

No answer 4.3%

Other 17.7%

Question 13

NAIS data will be accessible only to state and federal animal health officials. Should NAIS data (such as premises of origin and animal birth dates) also be accessible to meat processors and purveyors to verify cattle source and age for eligibility for export markets?

Don't know 15%

Yes 47.7%

No answer 3.4%

No 33.9%

Question 14

If NAIS is instituted would you try to capture other individual performance data on your animals in order to make better-informed management decisions in such areas as selection, breeding, etc., or to take advantage of other value-added opportunities?

No 7.6%

Yes 76.9%

No answer 3.7%

Don't know 11.9%

Question 15

Who should bear the cost of NAIS compliance at the producer level (cost of tags, cost of reporting data, etc.)?

Some combination of all these 65.6%

State government 0.4%

No answer 4.9%

Producers 11%

Federal government 14.7%

Other segments, such as feedlot, packer, etc. 3.4%

My Top 10 Clicks

Bill Rodin

Owner/Operator, Antelope Ranch Co.
Cholame, CA

  1. www.beef-mag.comBEEF magazine
  2. www.westernstockmansmarket.comLocal cattle market information.
  3. www.WVM.comCattle market information.
  4. www.angus.orgAmerican Angus Association.
  5. www.angusbeefbulletin.comAngus Beef Bulletin.
  6. www.weather.comWeather information.
  7. www.FOXNews.comFOX News.
  8. www.washtimes.comThe Washington Times.
  9. www.opinionjournal.comWall Street Journal.
  10. www.nationalreview.comPolitical commentary.

High frequency may be the answer

One of the main concerns in the quest to apply electronic ID technology to the livestock industry is the bottleneck at point of sale. Can we find systems to scan cattle rapidly and accurately as they move through a sale yard, for example?

Enter research into high-frequency tags currently exchanging signals at 916 kH.

North Dakota State University's Dickinson Research Extension Center (DREC) has been leading the research into high-frequency ID technology. DREC has begun a multi-partner demonstration project to find the best hardware structure and tag composition. Speed and accuracy are critical, says Mick Riesinger, DREC livestock biosecurity specialist.

The CalfAid team placed high-frequency eartags in cattle and collected data as the cattle were run individually and in a group through corrals. Two sets of high-frequency readers were installed.

Test results revealed an accuracy of 94% with only one bank of readers activated. With two banks activated, the read rate was 99.9% accurate. The read distance was from 6-22 ft. in initial high-frequency tests. Since then the researchers have expanded the read distance to 30 ft., recording a 99.9% accuracy rate.

“The eartags need to be relatively small, which is a challenge,” Riesinger says. “And, we have to be concerned about moisture, which is an enemy of this technology.” He says the research will look at different operating “speeds.”

“Our goal is to operate at 2.4 gigahertz, which is wireless technology, the same speed as cordless telephones,” Riesinger explains. “We could move up to 5.2 or 5.7 gigahertz.”

The next step is to work with ear tag companies that can handle a high-frequency tag.

“We're working on attaching a high-frequency antenna to a tag that's only been used for low frequency,” Riesinger adds. The DREC group will also test high-frequency systems capable of reading both high- and low-frequency tags.

For more details, contact Riesinger at [email protected] or 701/483-0028.

House passes ag appropriations bill

At presstime, the House of Representatives had just passed H.R. 2744, “the fiscal year 2006 agriculture appropriations bill,” by a vote of 408-18. The $100.3 billion bill provides $16.8 billion in discretionary funding with the rest going to mandatory programs. This is a 17% increase in mandatory spending, primarily for farm subsidies and food stamps. The major issue for the livestock industry was the one-year delay of the mandatory country-of-origin labeling (COOL) of meat products. Other key items include:

  • Food Safety and Inspection Service funding increased by $20 million over last year, to $837 million.

  • Animal and Plant Health Inspection Service funded at $829 million, a $16-million increase over last year.

  • BSE detection/prevention funded at last year's level — $90 million.

  • The bill doesn't include White House-proposed user fees for meat and poultry inspection.

The Senate Ag Appropriations subcommittee was to consider the legislation in late June.