Wednesday March 27 Ag News

Keeping an eye on markets and weather
Alfredo DiCostanzo, Nebraska Extension Beef Systems Educator

Currently, most conversations in the beef industry turn to how high cattle prices are going, whether we will have enough cattle to place on feed or to harvest, and how high are consumers willing to pay for beef. One might say this is the beef industry’s turn to capitalize on high prices, which usually trail years of high corn grain (and other feed) prices. On the supply side, drought has a lot to do with the current situation. On the demand side, consumers have been willing to buy beef at increasingly higher prices since spring of 2023.

Although economic news circulating in mainstream and social media may point to challenging times, the fact is that the Weekly Economic Index (a collection of indicators of consumer behavior, the labor market and production) 13-week running average is trending laterally at values similar to those immediately before the pandemic. From any perspective, this is great news. However, is this sufficient reason to trust that consumer willingness to purchase beef at higher prices will not waiver? No. However, it demonstrates that over a year where the boxed beef cutout climbed over 8%, the willingness by consumers to purchase beef has not declined.

On the demand side, it is worthwhile to remind ourselves that the true shrinkage in beef supply will come when the industry decides it is time to rebuild the herd resulting in a reduced supply of feeder heifers (this fall?). At that point, the next situation to watch is how many mama cows remain to expose to bulls in the summer and fall of 2024. Current, high cull cow prices (as high as the low in fed cattle prices during the last 10 years) indicate that the supply of cows is drying up.

For now, we have been concerned with packer chain speed holding back fed cattle price. Yet, last week, fed cattle sold in the North traded for $190/cwt. I have proposed that if, as we have been told so much before, the consumer is in the driver’s seat, then consumer demand for beef will drive chain speeds. Chain

speeds simply must catch up to demand and, under a tight supply, fed cattle price has to follow.

Where does this all leave the cow-calf operator? For the foreseeable future, feeder cattle prices should continue to trend upward. Astute cow-calf operators are working to get as many cows exposed this year to bulls bred while keeping calves alive and on track to heavy weaning or backgrounding weights. Calves weighing 600 lb have a chance of bringing in over $2,000/head this spring or fall.

What about cattle feeders? Markets finally reached $190/cwt last week (since a fleeting time in June). That is $2,850 for a 1,500-lb steer. We are all excited about this, but the sobering reality is: if these cattle were purchased as 600-lb feeders for $300/cwt, there was only $1,050 gross margin ($116.67/cwt breakeven cost of gain). We all remember corn grain prices were well over $6.00/bu in June of 2023. Corn grain prices only adjusted until after harvest in the fall of 2023. Yet, snowstorms in late 2023 and early 2024 kept cost of gain high until just recently.

Weatherwise we are beginning to hear that La Nina is making a comeback this summer. Never mind if this is climate newsworthy or if it has happened before. When I hear La Nina is back, I immediately think of hot and dry weather. If that is the case, then, weather will be another factor to watch as the beef industry enters the summer and fall months of 2024.

Hot and dry weather is a challenge to fertility in cow-calf operations, to health of young or weaning calves, and to sustained growth performance and conversion efficiency in cattle feedlots. Thus, although the promise of higher prices is driven by supply and demand, and demand may not be faltering (yet), summer weather may bring its own challenges to ever narrowing profit margins.



Agricultural exports via the Port of Baltimore
Mike Steenhoek, Executive Director, Soy Transportation Coalition

Given the dramatic events this week at the Francis Scott Key Bridge at Baltimore, I wanted to pass along some statistics regarding the Port of Baltimore as it applies to agriculture.  The U.S. Department of Agriculture has a helpful resource that monitors agricultural imports and exports by port region (https://agtransport.usda.gov/stories/s/U-S-Agricultural-Port-Profiles/7vku-v3nn/).

In 2020 (the most recent year available from USDA), the Port of Baltimore exported 142,152 metric tons of soybeans via container.  There are no reported soybean exports via bulk vessel.  The port imported 172,228 metric tons of soybeans via container and 34,185 metric tons of soybeans via bulk vessels.  In contrast, the Mississippi Gulf region – the leading export region for soybeans – accounted for 35.4 million metric tons of soybean exports by bulk.  There are no exports of soybeans via container from the Mississippi Gulf region.

The top five agricultural products handled (import and export combined) at the Port of Baltimore are:
    Sugar
    Soybeans
    Grain products (including corn and wheat)
    Coffee
    Grocery Items

The Port of Baltimore is the leading port for the import and export of automobiles and light trucks.  While the Port of Baltimore is not a significant port region for soybeans and grain, it obviously is a significant resource for the broader economy.  It also underscores the reality that while our oceans are vast and expansive, the ports that serve as the origins and destinations for global commerce can be vulnerable – whether due to weather, accident, or attack.  Investing in, maintaining, and securing these essential links in our national and global economy must remain a national priority.
 


How to Address Fertility Needs of Drought Damaged Pasture

Many pastures and hayfields across the state continue to recover from the dry conditions of 2023. One way to help boost forage production and help forages recover from these dry conditions is by addressing fertility needs.

Soil sampling in a pasture.Rebecca Vittetoe, field agronomist with Iowa State University Extension and Outreach, said that while fertilization for perennial forages is often overlooked, it's just as vital as it is for row crops to maximize productivity.

"It is important to know what nutrients – particularly phosphorus, potassium and lime – your forages really need," she said. "And the only way to know is to soil test."

Nutrient determinations
Two publications from ISU Extension and Outreach provide some useful guidance. "Take a Good Soil Sample to Help Make Good Fertilization Decisions" provides more information on soil sampling.

Soils that test low or very low will benefit the most from P and K fertilization, Vittetoe said, and the publication “A General Guide for Crop Nutrient and Limestone Recommendations in Iowa" can help you interpret your soil test results.

“For example, if your soil test for an alfalfa-grass pasture comes back as 20 ppm P (Bray P1) and 130 ppm K (dry), we can look at Table 10 in the crop nutrient publication and see that it would be recommended to apply 90 pounds P205 per acre and 250 pounds K20 per acre, because both the P and K are in the low testing category,” she said.

Also, remember that forage harvest removes a lot of P and K. Table 2 in the crop nutrient publication provides information to estimate crop removal rates. You want to put back at least what you take off; however, if you cannot afford a full removal rate, put on what you can afford. If you must choose between P and K, prioritize the K because forages have a higher K removal rate.

If soils are very low or low in P or K, the recommendation is to apply P and K either in the early spring or in the fall to help boost forage production. For soils that test in the optimum category, the timing of P and K applications is more flexible.

Vittetoe reminded producers not to forget about soil pH because it also impacts forage productivity and nutrient availability.

"In your soil test results, the soil pH indicates if we need to add lime, and the buffer pH tells how much lime is needed," she said. "A soil pH of around 6.0 is recommended for grass-based hayfields and pastures. To encourage and maintain legumes, try to maintain a pH of 6.5 for clovers and birdsfoot trefoil and a pH of 6.9 for alfalfa."

Also in the crop nutrient publication, producers should use Table 16 to determine lime needs, and follow the typical recommendations for the 2-inch or 3-inch depth when determining how much lime to apply in pastures.

"Producers often ask if pelletized lime or ag lime should be used. Both forms of lime are effective," Vittetoe said. "However, pelletized lime tends to work faster than the ag lime, which tends to take longer, but has more longevity. Like P and K, application is typically recommended in early spring or fall."

Nitrogen considerations
If producers take a first cutting of hay off prior to grazing, they may want a more aggressive nitrogen rate compared to resting their pasture prior to turn out. If you have tall fescue, be cautious to not over-fertilize with nitrogen.

Suggested N application rates are found in tables 1 and 2 in the publication “Boosting Pasture Production.” From a timing perspective, N can be applied either once annually or split-applied. Single applications typically are made in early spring, March or April. If split-applying N, apply in the early spring and again in August.

To minimize nitrogen losses, using ammonium sulfate or urea coated with a urease inhibitor is often preferred. Liquid nitrogen can work well if producers want to apply herbicide with the fertilizer, Vittetoe said. However, be aware you may see nitrogen burn on the forage. Let the grass recover from this prior to baling or grazing.



Iowa Nutrient Research Center opens request for new water quality research proposals, due May 3

The Iowa Nutrient Research Center is accepting new proposals for research projects designed to reduce nitrate and phosphorus in Iowa’s water. The center invites proposals for water quality projects that will benefit farmers, landowners, agribusinesses, policy makers and communities.

“This year’s RFP is informed by two meetings held this February that included more than 40 diverse stakeholders,” said INRC Director Matt Helmers. “We have tried to represent the top priorities that came out of a broad set of research ideas compiled by those who attended.”

This year the center will prioritize seven areas of research for funding:
    Sociological, economic, and policy incentives for nutrient practices that benefit both operators and landowners.
    Floodplain management and/or in-channel processes impact on nutrient export.
    Marginal land use alternatives to maximize biodiversity, environmental benefits, and nutrient reduction.
    Changing weather patterns effect on nutrient fluxes and/or practice performance.
    Crop and livestock systems research, including projects related to manure and nutrient management, optimizing cover crops and examining economic and environmental performance of integrated crop/livestock systems and/or diversified cropping systems.
    Cumulative impacts of nutrient reduction practice implementation at different scales.
    New technologies.

“Sound research projects that don’t fit these priorities will also be considered,” Helmers said.

Potential applicants are encouraged to review the full 2024 request for proposals (PDF) for complete details about the priority topics and application instructions. Proposals will be accepted from any Iowa nonprofit, agency or educational institution. Projects can last up to two years. Investigators that were funded in 2023 for multiple years do not have to reapply.

Selection will be based on the amount of funding available and how well projects reflect the priorities and instructions listed in the request for proposals. Specific elements that will be considered include the soundness of the research plan for the time period proposed, plans for data collection and management, and outreach activities. All proposals are judged by a set of reviewers who are not associated with any of the proposed projects.

Proposals are due by May 3, 2024, for projects that would begin in August. Award decisions will be made in July.

Questions about the request for proposals should be directed to INRC Program Specialist Malcolm Robertson, at 515-294-5692 or malcolmr@iastate.edu, or INRC Director Matt Helmers, at mhelmers@iastate.edu.

Established in 2013, the Iowa Nutrient Research Center selects promising proposals every year to fund research to help meet the goals identified in the Iowa Nutrient Reduction Strategy. Since its inception, the center has sponsored more than 136 water quality projects with $16.4 million in state appropriations.

Ongoing and past research projects can be viewed at https://www.cals.iastate.edu/inrc/projects.



Biofuel and Ag Groups Call on EPA to Issue E15 Emergency Waiver

Today, the Renewable Fuels Association, Growth Energy, National Corn Growers Association, American Farm Bureau Federation, National Farmers Union, and National Sorghum Producers sent a letter to the Environmental Protection Agency (EPA) calling on Administrator Michael Regan to act swiftly on an emergency waiver for E15 sales:

“New and ongoing conflicts across the globe continue to pose risks to the United States’ transportation energy supply. In addition to the conflict in Ukraine, now extending into its third year, the recent unrest and volatility in the Middle East present additional challenges to American energy security. In particular, attacks on shipping in the Red Sea have already had a disruptive effect on the transit of fuel in the region, raising the specter of constrained supply and increased gasoline prices at home,” wrote America’s top biofuel advocates.  

To remedy the ongoing disruptions to global energy markets, stabilize gasoline prices for American consumers, and support domestic energy security, the authors urged EPA to quickly authorize the summer sale of gasoline blended with up to 15 percent ethanol.  

“The consumer cost savings that result from allowing the year-round sale of E15, even on a temporary basis, are well-established. As a result of the emergency waivers issued in 2022 and 2023, consumers choosing E15 experienced average cost savings of 10-30 cents per gallon, with some locations offering over $1 off per gallon,” they added.



After drought, managing calf and cow health is critical

The effects of drought conditions on the cow herd can extend beyond the cow to the newborn calves, especially if they’re born into wet conditions, said Jess Hinrichs, DVM, with Zoetis beef technical services, and based in Sutton, Nebraska.

“It comes down to cows with poor body condition scores. It’s well documented that cows with poor body condition will have poor-quality colostrum, and that we get less colostral transfer to those calves,” Dr. Hinrichs said. “After a drought, these cows have been impacted and haven’t gained any body condition. Their calves are going to get less immunity through their colostrum than they would in a normal year. The calves are going to be more susceptible to early life or neonatal health challenges if we don’t have that foundation of immunity that we typically get from colostrum.”

As far as disease challenges facing these immunosuppressed calves, the main ones are scours (neonatal diarrhea) and respiratory disease.

“We’re going to be dealing with conditions at calving that are much wetter than we’ve expected and more favorable for stress and pathogen exposure,” Dr. Hinrichs said.

Scours tends to be more of a management disease, so reducing pathogen exposure and increasing the comfort for those calves is a good start to helping the calves get through the period of greatest risk.

If possible, he recommends employing a “Sandhills” style calving system which includes some rotation throughout the calving period with expecting cows removed to a fresh pasture and leaving cow/calf pairs behind.

Other practices that can help include giving cow/calf pairs more space, providing ample bedding and/or a sheltered area that calves can access. These areas need to be cleaned out and re-bedded on a routine schedule so they don’t become heavily contaminated.

For respiratory conditions, Dr. Hinrichs recommends focusing more on colostrum management and potentially supplementation, whether with actual colostrum from within the herd or from some of the commercial colostrum supplements on the market. “This might be a good year to try to manage colostrum better and provide extra supplementation for those calves,” he said.

He notes increasing the use of intranasal vaccines, such as Inforce 3®, early in life helps provide respiratory protection without maternal antibody interference sometimes seen with injectable respiratory vaccines.

Dr. Hinrichs also recommends giving calves a respiratory vaccine just before they’re turned out on grass. For cow/calf producers, respiratory disease is a large component of calf losses, so providing a boost with another vaccination at branding or turnout can help limit those losses. At turnout or branding, the two-month-old calf’s immune system is more mature than it was at a week of age, so there is going to be a stronger immune response to that vaccine, providing protection into the summer months.

These later vaccinations also help prime the calves for the next round of vaccines at preconditioning or weaning, Dr. Hinrichs said. If the immune system is primed from a branding vaccination for respiratory disease, there is a two-fold benefit from those vaccines: (1) calves are better protected while on grass, and (2) calves are set up for a quicker and higher level of protection at weaning.

With the calves set up for a strong start, it is also time to support the cow as she prepares for the breeding season. “The biggest thing we can do to help that cow is supporting her nutritionally. We’ve got to be heavily focused on rations and make sure we’re providing her with everything she needs,” Dr. Hinrichs said.

This means working with a nutritionist to make sure rations are meeting nutritional needs to get the cow herd into at least a maintenance state or better yet gaining body condition heading into breeding season. Micronutrients – vitamins and minerals – should not be neglected at this time, he said, as deficiencies are often seen after a drought and drought-stressed forages may have the same deficiencies. It may be more important to test forages this year as they may not contain the expected nutrient levels.

While the nutritional side of cattle management is important in the gestation period, producers should not neglect their vaccination programs either, Dr. Hinrichs said. “We want to do everything we can do to protect those fetuses because fetal losses can add up, and fetuses may be more fragile this year than other years due to the drought.”



Meat and Poultry Coalition: EPA’s Wastewater Guidelines True Cost Is Over $1 Billion and Over 100,000 Jobs  

A coalition of meat and poultry industry groups said the Environmental Protection Agency’s (EPA or the Agency) proposed wastewater guidelines will cost hundreds of millions more than Agency estimates, eliminate tens of thousands of jobs and close many processing facilities, resulting in hardship for livestock and poultry producers.

“We believe that the proposed Effluent Limitations Guidelines (ELG) would thwart the Biden administration’s efforts and limit, or reverse, these outcomes for small processors, rural job creation, producer livelihoods and a resilient food supply chain,” the coalition said.

The Meat and Poultry Products Industry Coalition (MPP or the Coalition) made the remarks in comments submitted in response to the EPA’s proposed rule revising the ELGs for wastewater discharged by meat and poultry processing and rendering facilities. Last amended in 2004, the meat and poultry ELGs currently apply to about 180 of the estimated 5,300 meat and poultry facilities nationwide. EPA estimates between 845 and 1,620 facilities would be subject to and incur costs should the proposed ELGs become final. The full comments are here.

The Coalition made the following key arguments in the comments:

The Agency has grossly underestimated closures for many MPP facilities:   
Industry analysis of the projected number of MPP facility closures for Option 1 without chlorides would jump from the 16 sites estimated in the proposed rule to 74 sites.  

The projected number of near-term job losses associated with these facility closures would increase from nearly 17,000 estimated in the proposed rule to nearly 80,000 direct job losses from plant closures.

The projected closures and job losses for the more stringent regulatory options would increase similarly. For Option 2 with chlorides, for example, the projected number of facility closures would increase to 139, 15% of facilities that exceed the Option 2 threshold, or 340 closures for Option 3.

The proposed rule harms the relationship between MPPs and publicly owned treatment works (POTWs):
Indirect discharging MPP facilities often make significant financial investments in maintaining and upgrading the POTW or shouldering major surcharges for the POTW’s continued operation and maintenance. This investment reduces public treatment costs for residential ratepayers and improves the quality of local and downstream waters.

EPA’s analyses of pollutant loadings are inconsistent with its cost analyses:  
EPA is taking credit for pollutant removals that are already occurring.   

EPA has not timely provided complete information on its analysis:
EPA has not provided complete information for public and industry stakeholder verification in a timely way.  
 
The Meat and Poultry Products Industry Coalition is made up of the American Farm Bureau Federation, the Meat Institute, National Chicken Council, National Pork Producers Council, National Turkey Federation, North American Renderers Association and the U.S. Poultry & Egg Association.



Merck Animal Health Introduces SEQUIVITY® with Microsol Diluvac Forte® Adjuvant Prescription Vaccine for Use in Gilts and Sows

Merck Animal Health, known as MSD Animal Health outside of the United States and Canada, a division of Merck & Co., Inc., Rahway, N.J., USA (NYSE:MRK), today announced it has received license approval from the U.S. Department of Agriculture (USDA) for SEQUIVITY® with Microsol Diluvac Forte® (MDF) adjuvant prescription vaccine for use in gilts and sows.

The vaccine utilizes the innovative RNA Particle Technology that is part of its legacy SEQUIVITY platform combined with the power of MDF, the same trusted adjuvant used in CIRCUMVENT® and PORCILIS® Ileitis products, to create safe, flexible, and precise vaccines to fit the unique needs of specific herds. MDF enhances the immune response to the antigens and increases the duration of immunity. The SEQUIVITY vaccine prescription platform creates custom products for influenza, rotavirus, PCV3, sapovirus and more.

The SEQUIVITY technology is a revolutionary, flexible, rapid and targeted vaccine production platform incorporating immuno-precision capabilities that protect against a wide range of disease-causing viral and bacterial pathogens in swine. While traditional vaccines can take years to develop, this technology can provide a solution in a very short timeframe. By using carefully selected gene sequences, the production platform enables the targeted creation of a vaccine as needed for rapidly evolving pathogens, thereby offering a precise solution to existing and evolving disease challenges.

“Merck Animal Health continues to shape the future of animal health by introducing innovative, science-driven ways to improve swine health and performance,” said Jeremy Maurer, V.M.D., associate director of U.S. Livestock Insights and Outcomes for Merck Animal Health. “We are excited to offer a new vaccine with an adjuvant using our SEQUIVITY technology that builds on the legacy of our innovative RNA Particle vaccine platform. It’s all supported by our web-based SEQUIVITY dashboard to help swine producers and veterinarians make data-driven decisions based on relevant insights to address herd-specific needs.”

The vaccine comes in two bottles, a frozen antigen bottle and a diluent bottle, and is mixed at the point of use.