Erin Laborie, Nebraska Extension Educator
Prolonged periods of mud and moisture in the feedlot can significantly hinder cattle performance and profitability. When cattle are standing in four to eight inches of mud, gain can decrease by nearly 15 percent. A feedlot with mud that is belly deep can depress gain by nearly 25 percent. Consequently, the negative impact of mud on feed efficiency can result in up to a 56 percent increase in cost of gain as more days on feed are necessary to reach finish.
Several factors figure in to this profit loss situation:
1) Cattle make fewer trips to the feedbunk during muddy conditions which results in lower feed intake.
2) Cattle utilize more energy trucking through the mud to reach the feedbunk. Muddy conditions can increase energy requirements by 10 percent.
3) Cattle can tolerate extremely cold temperatures when their hair coat is dry. However, if their hair coat is wet, maintenance requirements increase two percent for every degree below 30 degrees. For example, a feedlot steer has a 20 percent increase in requirements when his hair coat is wet and the outside temperature is 20 degrees.
Pen maintenance and design can greatly influence the level of moisture in the feedlot. Proper drainage and prevention of runoff water from entering pens is the first step in reducing mud within the pen. A slope of two to five percent from the pad to the lower end of the pen will provide adequate drainage; a three percent slope is ideal. Providing adequate space per animal can reduce mud depth especially in the high traffic areas around water troughs and feedbunks. It is recommended that finishing cattle have 250 square feet per animal.
Mounds should be utilized to provide a dry area for cattle to rest. They should be four to six feet tall, provide 20 to 40 square feet of space per head on each side of the mound, and be constructed so that cattle can step off the mound and onto the feeding apron without having to move through mud.
When muddy conditions do occur, a box scraper can be used to remove some of the mud. Frequent removal of excess manure and bedding will reduce moisture retention and help pens dry out more quickly. Considering every 10 inches of snow equates to about an inch of moisture, be prepared to remove snow before it melts.
Although adverse weather conditions cannot always be predicted or prevented, preparing for these unfavorable circumstances by having a plan in place can help. For more information, see “Mud Effects on Feedlot Cattle” in the 2011 Nebraska Beef Cattle Report (http://beef.unl.edu/c9405542-1c41-4b9c-a143-f192e1e72917.pdf). Feedlot design is also discussed in UNL Extension Circular EC777, “Planning a New Cattle Feedlot” (http://digitalcommons.unl.edu/cgi/viewcontent.cgi?article=5873&context=extensionhist).
Private Applicators Need Certification
All farmers who use restricted use pesticide must have a current certification card according to the Nebraska Department of Agriculture.
The Nebraska Extension is conducting the following training sessions which are approved for renewal or initial certification according to Nebraska Educator Larry Howard of Cuming County. Again this year, there will be a fee charged to support the cost of materials. Producers are reminded to bring their old cards or the letter with the form at the bottom that they received from the Nebraska Department of Agriculture if they are recertifying.
Each session last approximately three hours and will be held in West Point at the Nielsen Community Center on Monday, March 14 at 1:30 p.m. and 7:00 p.m.
For additional information, contact the Nebraska Extension office in Cuming County at 402/372-6006.
Nebraska Beef Council Seeks Director Candidates
The Nebraska Beef Council will be holding board of director elections in 5 of the 9 districts in 2016. Producers interested in becoming a beef council director are encouraged to attend one of the following informational sessions:
(Each session will last approximately 1 hour)
March 15, 2016 - Wayne, UNL Extension Office, 1:00 p.m.
March 15, 2016 - Columbus Public Library, 5:00 p.m.
March 16, 2016 - Kearney, Nebraska Beef Council Office, 9:00 a.m.
March 16, 2016 - Broken Bow Public Library, 1:00 p.m.
March 17, 2016 -Box Butte, UNL Extension Office, Alliance, 1:00 p.m.
*Additional sessions will be added if necessary
Election packets will be available on April 1, 2016 and must be returned to the Nebraska Beef Council by June 15, 2016.
For more information, including districts to hold elections in 2016 and candidate requirements, please log on to www.nebeef.org or call 800-241-5326.
UNL Block and Bridle PorkFest
Dr. Benny Mote, NE Swine Extension Specialist
This is the first year that UNL’s Block & Bridle is putting on a PorkFest. It is led by the newly formed Future Pork Leaders group. I am really excited by this new found interest in pork at the undergrad level and want to keep feeding that fire. They are a little behind getting everything put out in a timely manner, but have everything on track now. If you are going to be anywhere near Lincoln next Thursday, you can purchase tickets below for a good meal. Also if you are interested in entering the rib contest, let me know and I can put you in contact with the person running that portion of the event.
Porkfest will be held March 10th from 5:30-7:30 in the Animal Science Commons. Your ticket gets you a meal (pork loin sandwich, baked potato, beans, cookie, drink) and in to watch the Bacon Eating Contest!
Tickets are available online at this link https://www.eventbrite.com/e/unl-block-and-bridle-porkfest-tickets-21417019883?utm-medium=discovery&utm-campaign=social&utm-content=attendeeshare&utm-source=cp&utm-term=listing.
Smith Featured at Briefing on Lifting Ethanol Regulations to Increase Consumer Choice
Congressman Adrian Smith (R-NE) presented at a briefing today to educate congressional staff on the impacts of an Environmental Protection Agency (EPA) regulation which currently prevents the sale of E15 during the summer months.
Though E15 is cheaper and has a higher octane rating than both E10 and standard gasoline, retailers are unable to market E15 during the summer months due to EPA volatility standards. The EPA granted E10 a waiver from these volatility standards in 1990, but this waiver has not yet been extended to E15.
In April 2015, Smith introduced H.R. 1736 to extend this waiver to E15, allowing it to be sold year-round.
“Ethanol provides consumers with greater choice at the pump, and retailers should have the opportunity to market more options to meet our country’s fuel demand,” Smith said. “For many retailers, the steps required to comply with the EPA’s arbitrary regulation makes E15 uncompetitive. Today’s panel made the case for extending to E15 the waiver already granted to E10 in order to diversify our fuel supply, increase consumer choice, and promote American energy independence.”
Poll Reaffirms Iowans Support of Ethanol and RFS
A new poll conducted by Selzer and Company and released by Mediacom and the Des Moines Register yesterday showed 71 percent of Iowans support ethanol and the Renewable Fuel Standard (RFS). More importantly Republicans’ support for the federal policy has grown since the Iowa caucuses. In a Des Moines Register/Bloomberg poll this past December, Republicans surveyed supported the RFS by 61 percent. The most recent poll conducted by the Des Moines Register/Mediacom showed a five percent growth in support among Republicans to 66 percent, while support among Democrats stayed consistent.
“Iowans know ethanol and the RFS are allowing America’s farmers and innovators to produce clean, secure, renewable fuel right here at home that reduces toxic emissions and is better for the air we all breathe. The immense benefits and potential of biofuels, like ethanol, plays a critical role in America’s energy policy and in developing a 21st century fuel for 21st century vehicles,” noted Tom Buis, co-chair of Growth Energy.
Buis added, “Contrary to the oil industry spin, this poll reinforces the fact that the issue gained ground with Iowans during the 2016 caucuses and now they support it in even greater numbers than before. The relevancy of the issue is why an overwhelming 83 percent of Iowans caucused for pro-RFS candidates in 2016, higher percentage than in 2012.”
Furthermore, as the Des Moines Register highlighted overwhelming support for the RFS, regardless of political party affiliation, noting that 66 percent of Republicans, 76 percent of Democrats and 71 percent of independents are in favor of the RFS. Additionally, the Des Moines Register noted that, “Iowans who consider themselves tea party supporters also like it, with 64 percent in favor.”
Iowa Cattlemen’s Foundation scholarship deadline is March 15
High school seniors who have been involved in cattle or beef activities may be eligible for scholarships from the Iowa Cattlemen's Foundation. Eligible students must graduate from high school this year, and meet any of these criteria:
- received Youth Beef Team training,
- completed the Masters of Beef Advocacy, or
- served as a county Beef Ambassador/Queen/Princess
Candidates will compete for $1,000 scholarships, and up to three scholarships will be awarded.
An additional $500 will be awarded to any $1,000 scholarship winner who has completed the online course for MBA (Master of Beef Advocacy) by the time of the personal interviews in April.
Applications for the scholarship must be emailed or postmarked by March 15, 2016. The complete guidelines for the applications can be found at www.iowacattlemensfoundation.org.
Finalists will participate in a personal interview and presentation in Ames, scheduled for Saturday, April 2, 2016. Each finalist will give a five to eight minute presentation on an issue of their choice that impacts the beef industry, and be interviewed by a panel of judges. Scholarship winners will be announced at the conclusion of the day's events.
Questions about the scholarship program can be directed to Mary Greiman, mary@iabeef.org, or call 641-425-1533.
Corn Growers Applaud Senate Ag Committee Action on GMO Labeling
The National Corn Growers Association today thanked members of the Senate Agriculture Committee who voted to stand with farmers and move forward Sen. Pat Roberts’s bill to address the growing threat of a patchwork of state labeling laws and called for the full Senate to urgently take up this important legislation.
“We find the forward momentum building behind this bill encouraging, and we urge the Senate to quickly pass this bill for the good of America’s farmers and consumers,” said National Corn Growers Association President Chip Bowling, a farmer from Maryland. “U.S. farmers rely on GMOs, a safe, proven technology, to protect our crops from insects, weeds and drought. The FDA should remain the party responsible for important food safety and labeling decisions based in science. Despite the scientific evidence, states such as Vermont are quickly moving toward costly, confusing mandatory labeling legislation pushed forth by agenda-driven activists. We ask the Senate to quickly move forward with this legislation to avoid a situation in which all American consumers pay a high price and gain little actual information.”
Vermont’s mandatory law requiring on-package labels of foods containing ingredients that have been genetically modified takes effect in July, and unless Congress acts swiftly, families, farmers and food companies will face chaos in the market and higher costs. Multiple studies have shown that the associated costs with Vermont’s GMO-labeling law and a subsequent patchwork of state laws will cost American families hundreds of dollars more in groceries each year – with low-income Americans being hit the hardest.
Roberts’s proposal brings continuity to the marketplace, ensuring that consumers have the access to product information they deserve without stigmatizing this safe, proven technology valued by American farmers. The bill, which will go through a markup by the Senate Committee on Agriculture next Thursday, will provide a national framework that places standards in the hands of the U.S. Department of Agriculture and creates a campaign that will educate the public on both the safety of GMOs and on the way in which they can find out more about the foods they purchase.
NCGA, working with partners across the value chain, has pushed for a solution to this issue for more than two years now as a member of the Coalition for Safe Affordable Food.
For more information on the need for a federal labeling standard, visit the Coalition for Safe Affordable Food, at www.CFSAF.org.
Soy Growers Welcome Committee Passage of GMO Labeling Bill
The American Soybean Association applauds the Senate Agriculture Committee for its passage earlier today of legislation from Chairman Pat Roberts that would establish a national framework for the labeling of bioengineered food products, or GMOs. The legislation passed the committee with the support of all 11 Republican members, as well as Democrats Amy Klobuchar, Joe Donnelly and Heidi Heitkamp. ASA President and Delaware farmer Richard Wilkins praised Roberts' leadership on the bill in a statement:
"ASA is extremely pleased to see this bill come through committee, and we are very appreciative of the leadership shown by Chairman Roberts throughout the process. We're also thankful for the Democratic support from Sens. Klobuchar, Donnelly and Heitkamp on this bill, as support from Senate Democrats will be key when the bill reaches the Senate floor in the coming weeks.
"Now, our attention turns to the full Senate, and we will begin our press on senators from both parties to support this legislation. For soybean farmers, the bill represents our continued ability to use biotechnology within our operations. It means growing more while using less, and it means meeting the needs of a demanding American marketplace, and growing global population. We will communicate those benefits to senators every day until this bill is passed and signed into law."
NMPF Supports New Senate Food Labeling Bill Approved Today by Agriculture Committee
The National Milk Producers Federation today urged the full Senate to act quickly on legislation that would establish national regulations to bring consistency and transparency to the labeling of ingredients and processes used in the food supply.
The Senate Agriculture Committee today approved, by a 14-6 vote, a bill introduced last week by its Chairman, Sen. Pat Roberts (R-KS), that would create a common-sense, national food labeling standard offering consumers information about products that contain ingredients such as Genetically Modified Organisms (GMOs). The legislation would preempt state laws that create labeling mandates for foods with ingredients that have been genetically modified.
Food labeling “is an area where we need a clear federal standard, not a piecemeal approach across the 50 states,” said Jim Mulhern, president and CEO of NMPF. “We’ve learned from experience in the dairy sector that we need a strong federal policy governing labeling claims. Otherwise, we’ll end up with an unworkable series of competing and confusing state policies.”
NMPF urged the Senate to expedite passage of Roberts’s measure, in order to prevent confusing marketing environment in the food industry this summer, when Vermont’s new law, requiring labeling of foods containing GMOs, goes into effect on July 1st. The Senate’s approach “will provide information that shoppers want, without requiring that stigmatizing label claims be mandated at the state or federal level,” Mulhern said. “Any requirement, even at the state level, to use labels to call out GMO ingredients is a de facto scarlet letter being forced on many foods, without warrant. Mandatory GMO labels play into the fear-based marketing we see too frequently in the food industry.”
NMPF and its 31 cooperative members co-signed a letter last Tuesday with more than 600 other farm and food groups urging action on Sen. Roberts’ bill by the Senate. The House of Representatives already passed a version of a national food labeling bill last July.
Multiple studies have shown that the associated costs with Vermont’s GMO-labeling law, and a subsequent patchwork of similar state laws, will cost American families hundreds of dollars more in groceries each year – with low-income Americans being hit the hardest.
The Roberts bill “will gives consumers the information they want in a consistent and factual way,” said Mulhern. “It also reaffirms the authority of federal regulators over food safety and labeling, and prevents the creeping development of dozens of different state food labeling laws.”
Genetically modified food ingredients have been proven safe by nearly 2,000 studies from the leading scientific bodies worldwide. Included are the World Health Organization and the American Medical Association. Up to 80 percent of the food available in the United States contains genetically modified ingredients.
Policy to be Focus at Commodity Classic
When corn farmers from around the country gather in New Orleans this week for the 21st annual Commodity Classic convention and trade show, it's not going to be just to enjoy much warmer weather than back on the farm - a series of important policy meetings are also taking place for members and leaders of the National Corn Growers Association.
"Commodity Classic gives us the opportunity not just to celebrate great work, meet with friends and learn about new products and services, it allows growers to get together in one place to shape policy for our organization," said NCGA President Chip Bowling. "This year, all eyes and ears will be focused on the importance of protecting the farm safety net and building profitable demand for our farmers when corn production is high and corn prices are low."
On Wednesday, growers will meet for an issues briefing and open forum, followed by caucuses at the state level, where they will discuss proposed resolutions and organizational priorities to come before NCGA at the two Corn Congress sessions, held Thursday morning and Saturday afternoon. With such topics as potential free trade agreements, ethanol market development and environmental regulations up for discussion, growers will have a lot to talk about this week. Growers will also have the chance to meet with candidates for the NCGA Corn Board for the 2017 fiscal year.
Also this week, growers are scheduled to hear from Val Docini, the administrator of the U.S. Department of Agriculture's Farm Service Agency, and Alexis Taylor, USDA acting under secretary for farm and foreign agricultural services, at the Thursday Corn Congress session. And USDA Secretary Tom Vilsack will speak before several thousand Classic attendees at the show's general session Friday morning.
USDA Fats and Oils: Oilseed Crushings, Production, Consumption and Stocks
Soybeans crushed for crude oil was 4.81 million tons in January 2016, compared to 5.01 million tons in December 2015 and 4.97 million tons in November 2015. Crude oil produced was 1.86 billion pounds down 3 percent from December 2015 and down 2 percent from November 2015. Soybean once refined oil production at 1.30 billion pounds during January 2016 decreased 7 percent from December 2015 and decreased 9 percent from November 2015.
Canola seeds crushed for crude oil was 148.4 thousand tons in January 2016, compared to 165.8 thousand tons in December 2015 and 128.9 thousand tons in November 2015. Canola crude oil produced was 126.1 million pounds down 7 percent from December 2015 but up 17 percent from November 2015. Canola once refined oil production at 123.8 million pounds during January 2016 was up 28 percent from December 2015 and up 26 percent from November 2015. Cottonseeds crushed for crude oil was 131.6 thousand tons in January 2016, compared to 149.6 thousand tons in December 2015 and 135.7 thousand tons in November 2015. Cottonseed crude oil produced was 41.4 million pounds, down 12 percent from December 2015 and down 1 percent from November 2015. Cottonseed once refined oil production at 48.4 million pounds during January 2016 was down 10 percent from December 2015 and down 2 percent from November 2015.
Edible tallow production was 88.9 million pounds during January 2016, up 13 percent from December 2015 and up 6 percent from November 2015. Inedible tallow production was 276.7 million pounds during January 2016, down 4 percent from December 2015 and down 9 percent from November 2015. Technical tallow production was 91.1 million pounds during January 2016, down 3 percent from December 2015 and down 14 percent from November 2015. Choice white grease production at 111.9 million pounds during January 2016 decreased 5 percent from December 2015 and decreased 4 percent from November 2015.
2015 Fats and Oils Oilseed Crushings, Production, Consumption and Stocks Data Published
As part of the Current Agricultural Industrial Reports (CAIR) program, the 2015 Annual Summary of the Fats and Oils: Oilseed Crushings, Production, Consumption and Stocks contains data for May through December of 2015. Annual totals are not included in this report since a partial year was collected and summarized.
While the program was in place during 2015, monthly totals of soybeans crushed for crude oil ranged from 4.04 million tons in September 2015 to 5.10 million tons in October 2015. Crude oil production ranged from 1.53 billion pounds to 1.96 billion pounds. The two regions with the largest amount of
crush were the North and East Region, which is comprised of Indiana, Kentucky, Maryland, Ohio, Pennsylvania, and Virginia, and the Iowa Region.
Canola seeds crushed for crude oil spanned between 99.1 thousand tons crushed in October 2015 to 187.4 thousand tons in September 2015.
Tallow was published in three categories (edible, inedible, and technical). The largest percentage of tallow production was inedible tallow at approximately 63%. Choice white grease production ranged from 107.2 million pounds during August 2015 to 118.8 million pounds in May 2015.
USDA Grain Crushings and Co-Products Production
Total corn consumed for alcohol and other uses was 491.3 million bushels in January 2016. Total corn consumption was down 2 percent from December 2015 and down 1 percent from January 2015. January 2016 usage included 91.6 percent for alcohol and 8.4 percent for other purposes. Corn for beverage alcohol totaled 3.41 million bushels, up 21 percent from December 2015 and up 63 percent from January 2015. Corn for fuel alcohol, at 441.3 million bushels, was down 2 percent from December 2015 and down 1 percent from January 2015. Corn consumed in January 2016 for dry milling fuel production and wet milling fuel production was 89.3 percent and 10.7 percent respectively.
Dry mill co-product production of distillers dried grains with solubles (DDGS) was 1.87 million tons during January 2016, down 4 percent from December 2015 but up 2 percent from January 2015. Distillers wet grains (DWG) 65 percent or more moisture was 1.31 million tons in January 2016, down 6 percent from December 2015 and down 11 percent from January 2015.
Wet mill corn gluten feed production was 322.0 thousand tons during January 2016, down 5 percent from December 2015 but up slightly from January 2015. Wet corn gluten feed 40 to 60 percent moisture was 291.9 thousand tons in January 2016, down 5 percent from December 2015 and down 7 percent from January 2015.
2015 Grain Crushings and Co-Products Production
As part of the Current Agricultural Industrial Reports (CAIR) program, the 2015 Annual Summary of the Grain Crushings and Co-Products Production contains data and annual totals for January through December 2015.
Total corn consumed for alcohol and other uses for 2015 was 5.84 million bushels. Corn for beverage alcohol in 2015 totaled 33.9 thousand bushels. Corn for fuel alcohol was 5.22 million bushels in 2015. May 2015 was peak month for total corn consumed.
Dry mill co-product production of distillers dried grains with solubles (DDGS) was 22.3 million tons during 2015. Distillers wet grains (DWG) 65 percent or more moisture was 16 million tons in 2015. Distillers dried grain (DDG) was 5.12 million tons in 2015.
Wet mill corn gluten feed production was 3.90 million tons during 2015. Wet corn gluten feed 40 to 60 percent moisture was 3.63 million tons.
Dry and wet mill carbon dioxide captured was 2.50 million tons in 2015.
USDA Announces Commodity Credit Corporation Lending Rates for March 2016
The U.S. Department of Agriculture's Commodity Credit Corporation (CCC) today announced interest rates for March 2016. The CCC borrowing rate-based charge for March is 0.500 percent, down from 0.625 percent in February.
The interest rate for crop year commodity loans less than one year disbursed during March is 1.500 percent, down from 1.625 percent in February.
Interest rates for Farm Storage Facility Loans approved for March are as follows, 1.625 percent with seven-year loan terms, down from 2.000 percent in February; 1.875 percent with 10-year loan terms, down from 2.125 percent in February and; 2.000 percent with 12-year loan terms, down from 2.250 percent in February.
Cattleman Testifies to Importance of Voluntary Conservation
Today, Frank Price testified on behalf of the National Cattlemen’s Beef Association to the importance of voluntary conservation during the House Agriculture Subcommittee on Conservation and Forestry hearing “Voluntary Conservation: Utilizing Innovation and Technology”. Price is co-owner and operator of the Frank and Sims Price Ranch in Sterling City, Texas, and recipient of the 2014 NCBA Environmental Stewardship Award. Price, a member of the Texas and Southwestern Cattle Raisers Association and NCBA, told the committee that given the diversity of range lands across the country voluntary conservation programs are key to achieving meaningful results.
“A one-size fits all approach that accompanies a top-down regulation does not work,” said Price. “It’s the voluntary part of the conservation practices that really make them work for ranchers. We’ve had success using some of these conservation programs, but just because a system works for us does not mean it is right for everybody. If these programs were to become mandatory, the rules and regulations that follow would make it harder for farmers and ranchers to use unique conservation practices to ensure their individual operations thrive.”
Price stresses that voluntary conservation efforts have allowed him and his son to achieve their top goals: ensuring the ranch remains profitable and that they leave the land in better condition for future generations. While drought and wildfire decimated their ranch in 2011 and 2012, conservation and grazing management allowed them to improve their rangelands through these difficult times. One of the programs he says has helped him achieve their goals is the Environmental Quality Incentive Program.
“When wildfire came through our ranch in 2011, we had to rebuild miles of fencing,” said Price. “EQIP helped us do it through a cost-share. One of the reasons EQIP has become popular among ranchers is because it is a working-lands program. Conservation programs that keep land in production and do not limit its use are the best for both the ranchers and conserving our resources.”
While drought is a constant problem in West Texas, innovative practices and voluntary conservation programs have allowed the Prices to improve their ranch and make their grasslands resilient. For Price, the success of conservation and the ranch economy are not at odds in ensuring we can sustain our country’s natural resources and our way of life for generations.
“I believe that economic activity and conservation go hand-in-hand,” said Price. “We are always looking for new, innovative conservation programs that will have tangible benefits for the environment and help improve our ranching lands. USDA’s conservation programs have been a great asset to cattle producers and it is important that these programs continue to be implemented in the same practical, producer friendly, and voluntary manner for years to come.”
Pork Industry - A Little Profit for 2016
The outlook for the pork industry has turned somewhat more optimistic in recent weeks. The sources of that optimism include a $2 to $4 increase in spring and summer lean hog futures prices since the first of the year and slightly lower new-crop soybean meal prices. According to Purdue University Extension economist Chris Hurt, a bit higher hog prices and a little lower cost add to the potential for a profitable year.
"Currently, the 2016 pork outlook looks a lot like 2015, which featured losses in the first and fourth quarters with the second and third quarters providing some profit," says Hurt. "That pattern appears to be repeating this year. However, the industry is expected to register a $4 per head profit in 2016 in comparison to an estimated $3 per head loss last year."
Hurt says pork supplies in the first two months of 2016 were down about 1 percent from the same period a year ago. This is in alignment with the last hog inventory count from USDA. The relative accuracy of the last USDA count adds credibility to using their inventory numbers as a measure of spring and summer supplies.
"Based on that last report, March, April, and May pork production is expected to be down about 1 to 2 percent," Hurt says. "Summer pork production is expected to be unchanged from year-ago levels and fall production is expected to rise by 2 percent. These numbers would indicate that domestic pork production would be unchanged for the year, while USDA analysts suggest that production will rise by 2 percent."
The estimated cost of farrow-to-finish pork production in calendar 2015 was near $51 per live hundredweight. Hurt believes that is expected to drop a bit in 2016 to average near $50. The decline is related to lower costs for soybean meal. In 2015, high-protein soybean meal at Decatur, Ill. averaged $341 per ton, but is expected to drop to about $283 for all of 2016. If so, Hurt says this will be the lowest cost meal since 2007 when it averaged $231 per ton. For corn, the U.S. average price received for calendar 2015 was $3.71 per bushel. Current futures prices suggest that price will be similar for calendar 2016.
Live hog prices in 2015 averaged $50.23, according to USDA. "My current forecast for 2016 is for hog prices to average about $51 per live hundredweight," Hurt says. "Quarterly price estimates are $45 to $48 in the first quarter, $54 to $58 in the second quarter, $53 to $57 in the third quarter, and $45 to $49 in the final quarter.
"These forecasts suggest that the average cost farrow-to-finish pork producer lost about $3 per head in 2015, a near breakeven year in which producers nearly covered all of their costs, including depreciation and all hired and family labor costs," Hurt says. "The year of 2016 also appears to be one near breakeven, but with a more positive tone of about $4 per head of profit above all costs."
As the spring planting season approaches, Hurt says pork producers are well aware of the uncertainties of the upcoming growing season. Corn and soybean meal prices are at the lowest levels in nine years. Harmful growing season weather in the United States would increase feed costs. How could producers help protect against some of these price increases should they occur?
According to Hurt, one possible answer is to buy December 2016 corn calls and December 2016 soybean meal calls. At this writing, the premium for at-the-money December 2016 corn call options was 28.5 cents per bushel. If a pork producer were to buy the equivalent bushels to cover one year of feeding needs, this premium would raise the cost of production by an estimated $1.25 per live hundredweight. The at-the-money December 2016 soybean meal call option had a premium of $16.60 per ton. If a one-year's was purchased for the hog operation, the premium costs adds 44 cents per live hundredweight to costs. Therefore, to cover both corn and soybean meal with new-crop call options would be about $1.69 per live hundredweight.
"The calls provide potential financial protection if the new-crop futures prices for corn and soybean meal were to rise," Hurt says. "They do not eliminate the opportunity to buy corn and meal with even lower futures prices should another high-yield year develop. However, one has to pay the option premiums and any transaction costs for these rights.
"The more difficult question is 'should' pork producers use options to protect against the potential for rising feed prices," Hurt says. "That depends upon the risk preferences of each producer, their perception of the risk of harmful weather this summer, their financial situation, and their overall outlook."
Land O’Lakes, Inc. Announces Record Earnings in 2015
Land O’Lakes, Inc. today announced record net earnings of $308 million, up from $266 million in 2014.
“Delivering record earnings in the current market environment underscores the strength of Land O’Lakes’ core business strategy,” said Chris Policinski, president and CEO of Land O’Lakes, Inc. “This was a record earnings year for Land O’Lakes in spite of challenging commodity markets, declining on-farm income and increasing industry consolidation. Additionally, we completed the largest merger in our company history and extended our global reach to Africa.”
In 2015, Land O’Lakes successfully merged United Suppliers, Inc. crop protection and seed business with Winfield Solutions, LLC. Land O’Lakes also purchased a majority ownership stake in Villa Crop Protection, a leading crop protection products company based in South Africa, the company’s first commercial investment in Africa.
Land O’Lakes had a strong financial year in 2015. The balance sheet is the strongest in its 94-year history. Cash returned to members in 2015 totaled $161 million, the seventh consecutive year that cash returned to members has exceeded $100 million. Net sales in 2015 totaled $13 billion.
For the quarter ending December 31, 2015, Land O’Lakes delivered quarterly sales of $3.3 billion, a slight decrease in year-over-year sales. Net earnings for the fourth quarter were $119.4 million, with Dairy Foods, Feed and Crop Inputs delivering strong quarterly earnings well ahead of the same quarter in 2014.
Business Segments
Dairy Foods reported 2015 net sales of $4 billion in 2015, down from 2014. Pretax earnings for Dairy Foods totaled $83.1 million in 2015, up from $39.7 million in 2014. Dairy Foods earnings reflect a one-time gain on the sale of Land O’Lakes’ 35 percent interest in Advanced Food Products, LLC. The business saw growth in butter, branded cheese, foodservice and refrigerated desserts and successfully managed the downside in milk powder and overall commodity markets.
Crop Inputs reported 2015 net sales of $4.8 billion in 2015, down slightly from 2014. Pretax earnings totaled $189.6 million in 2015, down from 2014. Low commodity prices impacted results across the portfolio and was offset to some extent through strength in CROPLAN® corn, soybeans and alfalfa. The business continued to focus on productivity, sustainability and decision tools to help farmers make the right choices to increase on-farm productivity using fewer resources. The business introduced nine new products, experienced a strong year for data at more than 200 Answer Plot® locations across the country and world, and provided greater access to data and insights through decision technologies like the R7® Tool and AnswerTech™ platform.
Feed reported 2015 net sales of $4.2 billion, down from 2014. However, pretax earnings of $57.8 million in 2015 were up from $27.8 million in 2014. The core Purina-branded feed lines delivered record-setting performance as a result of the execution of operational strategies that drove market share and accelerated growth. The business experienced growth in all customer channels. Land O’Lakes, Inc. also launched PMI Nutritional Additives, a new segment of the business focused on products that optimize nutrient utilization and gut health and integrity.
Additionally, Land O’Lakes completed the divestiture of the commodity egg business, operated through Moark, LLC, which contributed pre-tax earnings of $13 million.
EPA Orders Widely Used Insecticide Pulled From Market
(AP) -- Federal regulators on Tuesday ordered the makers of a widely used insecticide to take it off the market because it harms tiny aquatic animals.
The Environmental Protection Agency ordered Bayer CropScience and Nichino America to cancel production of all products containing flubendiamide. The decision comes after studies showed the insecticide harms species at the bottom of aquatic food chains in streams and ponds, impacting the fish that feed on them.
Flubendiamide is used on more than 200 crops, including soybeans, tobacco, cotton and numerous varieties of lettuce, fruits and nuts.
"EPA concluded that continued use of the product would result in unreasonable adverse effects on the environment," the agency said in a statement issued Tuesday. "EPA had issued a time-limited registration to the companies with conditions that were understood and agreed upon. If unreasonable adverse effects on the environment were found by EPA, the companies would submit a request for voluntary cancellation of all flubendiamide registrations within one week of EPA notification."
In January, the EPA asked the companies to voluntarily withdraw products containing the problematic insecticide. After they refused, regulators moved to cancel the government registration required to manufacture the product.
Flubendiamide is the active ingredient in Bayer's Belt pesticide. The German chemical giant says its product is safe to use and has sought an administrative law review of the agency's decision.
The company says the methods used by the EPA exaggerated the environmental risk posed by the chemical and would deny farmers access to "a critical pest management tool."
"We are disappointed the EPA places so much trust on computer modeling and predictive capabilities when real-world monitoring shows no evidence of concern after seven years of safe use," Peter Coody, Bayer's vice president of environmental safety, said last month.
Nichino America is a subsidiary of the Japanese chemical maker Nihon Nohyaku Co. A woman who answered the phone Tuesday at the company's U.S. headquarters hung up when a reporter asked for comment on the EPA's decision.
The EPA said crops already treated with flubendiamide or that may be treated with existing supplies can still be sold.
MONSANTO, AMERICAN RED CROSS ANNOUNCE SAFETY PARTNERSHIP
Monsanto Company and the American Red Cross announced today a three-year partnership that adds rural safety content to the American Red Cross First Aid App. The collaboration will help ensure that individuals and families in both rural and urban communities have access to life-saving information and other safety resources.
“Spring planting will begin soon in regions across the United States, and may have already started in some locations,” said Rod Denton, Global Environmental Safety & Health Lead at Monsanto. ”It’s extremely important to keep safety top-of-mind during this busy time of year for farmers and everyone involved in U.S. agriculture. The Red Cross First Aid App and its new farm-focused content will be a valuable safety resource for both our customers and employees.”
Monsanto is the exclusive sponsor of the Red Cross’ award-winning first aid app, which now features videos, tips and other interactive content to promote topics such as child safety and emergency preparedness on the farm, as well as safety content related to all-terrain vehicles (ATVs), grain bins, farm electrical safety and more. Designed for Apple® and Android® mobile devices and tablets, the app features preloaded content that gives instant access to all safety information at any time, regardless of internet or data connection. To date, the app has been downloaded more than 3 million times.
“We are extremely grateful to Monsanto for their help bringing this lifesaving information to our agricultural communities. Our rural families will be safer and better prepared thanks to this partnership with Monsanto,” said Cindy Erickson, CEO, American Red Cross of Eastern Missouri.
“The Red Cross has had a strong presence in local communities throughout the country for more than 135 years,” said Denton. “The new content mirrors our strong focus on safety and support for rural communities, and we’re proud to partner with them through this unique sponsorship.”
Download the FREE Red Cross First Aid app by texting "GETFIRST" to 90999, searching "Red Cross First Aid" in the Apple® iTunes® app store, Google Play™ store or Amazon® Marketplace or by going to redcross.org/apps.
Zoetis Launches CLARIFIDE® Plus
Zoetis today announced the launch of CLARIFIDE® Plus, the first commercially available, U.S.-based genomic test that gives dairy producers the ability to directly predict disease risk in Holstein cattle.
CLARIFIDE Plus includes new genomic predictions for wellness traits that provide direct indication of the genetic risk factors for six of the most common and costly animal health challenges on dairies. CLARIFIDE Plus also includes an exclusive new selection index, called the Dairy Wellness Profit Index™ (DWP$™). By using DWP$ for their animal ranking, producers may incorporate all economically important traits, including the new wellness traits and the polled trait*, to make more comprehensive and profitable genetic selection decisions.
“For the first time, dairy producers can genomically select heifers based on wellness and other economically important traits to help build a healthier, more productive herd,” said David Erf, geneticist, Zoetis Dairy Technical Services. “CLARIFIDE Plus offers dairy producers an unprecedented opportunity to test Holstein animals early in life in order to make genetic management decisions that can significantly impact their future operation success.”
New genomic predictions for wellness traits
To help producers manage and reduce risk for costly health events, CLARIFIDE Plus provides reliable assessments at an early age for these six common dairy health challenges:
· Mastitis
· Lameness
· Metritis
· Retained placenta
· Displaced abomasum
· Ketosis
CLARIFIDE Plus derives genetic predictions based on data collected from millions of health records within U.S. commercial herds, so U.S. producers can be confident results will be relevant to their operations. CLARIFIDE Plus predictions have an unprecedented average estimated reliability of 49% to 51% for the six traits in young animals, compared with no existing information without CLARIFIDE Plus testing.
“We did a lot of research, which was published over 10 years ago, to show there are genetic differences between sire families and their chances of developing health challenges such as milk fever or mastitis,” said Kent Weigel, PhD, professor and chair of the Department of Dairy Science at University of Wisconsin-Madison. “Finally seeing this research get to the point of being an available tool that producers can use for making genetic selection decisions to raise animals with reduced risk for health problems is really encouraging. When you have traits that have an emphasis on health, longevity and wellness, all integrated into one package, this allows producers to make decisions earlier and invest in raising healthy animals. Healthier cows stay in the herd longer and make an enormous difference in a herd’s profitability.”
Use of economic indexes help support more profitable solutions
Zoetis also developed two proprietary economic selection indexes in CLARIFIDE Plus. These selection indexes are a critical component of all genetic selection strategies, as they provide a path for dairy producers to be able to select for comprehensive genetic improvement across a host of traits. These new indexes are:
· Dairy Wellness Profit Index (DWP$): CLARIFIDE Plus is the only genomic test that includes this multitrait selection index based on novel health traits along with other economically important traits that affect dairy production, profitability and saleable milk. DWP$ combines production, fertility, type and longevity traits, as well as the new wellness traits, to provide opportunity to make more profitable animal rankings and decisions.
· Wellness Trait Index™ (WT$™): This multitrait selection index focuses solely on the wellness traits — mastitis, lameness, metritis, retained placenta, displaced abomasum, ketosis and polled. This selection index directly estimates differences in expected profitability related to differences in genetic risk for disease.
Together, all of this information combined in CLARIFIDE Plus gives producers the most comprehensive package of trait predictions for Holstein cattle, enabling use of genetic selection along with good herd management to help reach their herd health and profitability goals.
CLARIFIDE Plus builds on the proven success of CLARIFIDE®, the most widely used genomic test in the dairy industry.1 As with CLARIFIDE, the new genomic test comes with industry-leading support to help producers make the best use of their genomic information and integrate test results with other Zoetis management solutions to achieve desired outcomes.
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