World Cattle News:

[Mustang Sally Farm]

Monday, April 02, 2012
Australia to Cash in on Growing European Beef Quota
AUSTRALIA - With a grainfed beef quota set to more than double from this August, producers can take advantage of new opportunities in the relatively small but high value European market, writes Meat and Livestock Australia.

The European Union (EU) is Australia’s highest value beef export market per tonne – at A$9,302/tonne it easily outperforms Hong Kong, the next highest value large market, at $A5,856/tonne.

Beef exports to the EU reached 12,838 tonnes swt in 2011, an increase of 30 per cent year-on-year, despite exports being restricted under a variety of quotas that limit access to a market of 500 million consumers.

Most Australian beef is shipped to the EU under both the high quality beef ‘Hilton’ quota (with 7,150 tonnes of Australian access) and the high quality beef grainfed beef quota (20,000 tonne access shared with eligible nations).

Changes in these quotas – rather than to the continent’s economic conditions and consumption patterns – is the most important factor impacting Australian beef exports to this prime destination.

From August this year, the high quality beef grainfed quota will increase from the present 20,000 tonnes to 48,200 tonnes – providing significant scope to further increase exports in the coming years.

Beef quotas unfilled
Figures from the International Meat Trade Association and European Commission indicate that most EU beef quotas were not filled during 2011.

The ‘Hilton’ quota is administered on a financial year basis and has a total allocation of 65,250 tonnes swt, with 23,333 tonnes swt unallocated in 2010-11.

Argentina is the largest quota holder with 28,000 tonnes swt – filling 93 per cent of its allocation in 2010-11. Brazil (allocation of 10,000 tonnes) and the US and Canada (11,500 tonnes) fell well short of using their full quota allocations, using only five per cent respectively.

Last year, Australia filled 90 per cent of its allocation, down from the 99% of the allocation filled in the previous three years.

The high quality beef grainfed quota was opened in 2009, with Australia gaining access in January 2010. Access is shared between the US, Australia, New Zealand, Uruguay and Canada and administered on a financial year basis.

In 2010-11, 90 per cent of the 20,000 tonnes was utilised, with Australia shipping 4,038 tonnes swt of grainfed product. This grainfed quota is to increase to 48,200 tonnes swt in August 2012.

Other beef quotas that Australia has access to were also significantly under supplied in 2011. Only 22 per cent of the 63,703-tonne manufacturing beef tariff rate quota was filled last year, which the 1,500-tonne frozen thin skirt tariff rate quota was only 53 per cent utilised.

Capacity to increase Australian supply
With quota increases, and European production declining, there is ample scope for Australian producers to fill this gap. Processors and exporters to Europe have expressed concerns over the supply of EU eligible cattle.

To be eligible for export to the EU, beef or meat products and some by-products, must have been obtained from cattle sourced from a European Union Cattle Accreditation Scheme (EUCAS)-accredited supply chain, which includes producers, feedlots and saleyards.

The EU has a number of market specifications including:

Steers and heifers of any breed in a 380-500kg lwt range
Cattle with a 320-420kg cwt and 7-2mm of fat
Guaranteed traceability of all animals through NLIS
No use of hormone growth promotants
Milk or two-tooth, requiring genetics and grazing management to turn-off cattle younger than 30 months.

[Mustang Sally Farm]

Dairy Cows Have individual temperaments
From a young age, dairy cows react differently from each other to stimuli from their surroundings. An animal’s temperament determines how it reacts in stressful situations, but may also influence its general health. In the future, temperament could be bred as a selective trait to improve the robustness and wellbeing of dairy cows. This is the conclusion reached by zootechnician Kees van Reenen, who will receive a PhD from the University of Groningen on 30 March 2012.


Mr Van Reenen studied black-and-white Holstein-Friesian cows as they developed from calf to cow. He carried out behavioural tests and physiological examinations in order to determine how the animals react to external stimuli. He focused on the following, among others: fear responses, lowing (vocalisation), stamping, pulse and the release of cortisol as the external characteristics of underlying traits – including timidity, the need for social contact and movement – that, taken together, determine the temperament.

Jerry can
In order to study the differences in the reactions, Mr Van Reenen subjected the animals to potentially stressful situations, namely securing them with a halter for a short period, separating them from the rest of the herd, and confronting them with a person or unfamiliar object.

The unfamiliar object he used was a jerry can. "In this test, the calf or cow enters an empty room in which, after a few minutes, a coloured jerry can appears using a pulley," Mr Van Reenen explained.

"The differences between the animals’ responses were very clear: some of them made contact with the jerry can after just a few seconds, while others didn’t dare to approach it at all during the ten-minute test."

Anxiolytic drug
Mr Van Reenen was also able to measure the fear response physiologically: the animals that investigated the jerry can thoroughly and for the longest time had lower levels of the stress hormone cortisol in their blood than the animals that were more cautious. In order to prove that the caution was indeed a fear response, Mr Van Reenen administered an anxiolytic drug (Brotizolam) to the animals.

"The length of contact with the jerry can increased considerably in the animals that had been given an anti-anxiety drug, and the cortisol levels fell more quickly after the test."

Lowing
Although lowing could be easily interpreted as a fear response in the first instance, this was not the case.

"The frequency of the lowing did not change when the Brotizolam was administered. Apart from that, calves that lowed a great deal when separated from others in the herd had a higher milk yield when they were milked for the first time later, as heifers, than the animals that were less vocal. Therefore, lowing is not a fear response, but probably a form of social behaviour: a sign that they like to be near other cows. Animals that exhibit this behaviour could benefit from social contact with other animals in stressful situations – when they are being milked, for example."

Robustness
Notably, the differences in temperament in individual animals proved consistent throughout the research period. "This shows that temperament is a stable underlying trait in the animal. We know from research into other species, such as coal tits and rats, that temperament can influence an animal’s health and wellbeing. If that also applies to dairy cows, temperament could be bred as a selective trait to produce robust animals, in the same way as traits such as good bone structure, fertility and low susceptibility to mastitis," he said.

March 2012

[Mustang Sally Farm]

Wednesday, April 04, 2012
Cattle Prices Expected to be Lower in 2012
AUSTRALIA - According to the latest National Australia Bank (NAB) Rural Commodities Wrap, the Eastern Young Cattle Indicator (EYCI) is still expected to decline during 2012, albeit by less than the 5.6% forecast earlier in the year.

NAB forecasts the EYCI to fall 3.6 per cent year-on-year, which would result in an average of 382¢/kg cwt for 2012.

Underpinning the expected decline in average cattle prices is the predicted rise in Australian beef production, which is forecast to increase 0.6 per cent in 2011-12 and a further 2.1 per cent in 2012-13. The report also highlights the strength of the A$ as a challenge to prices.

However, helping to maintain prices is the expectation that global beef production will contract for the fifth consecutive year in 2012, according to USDA forecasts. This tight supply is likely to push beef prices higher in Australia’s key competitor markets, notably the US and South America.

While cattle prices are expected to ease during 2012, NAB predicts an improvement in lamb prices from current levels. Historically tight global supplies are the underlying factor in the expected price rise.

[Mustang Sally Farm]

Thursday, April 05, 2012
Weekly Cattle Summary
AUSTRALIA - This report is a collection of weekly cattle price summaries from each Australian state by the Meat & Livestock Australia (MLA).

New South Wales
Short week lowers supply

Cattle supplies across the MLA’s NLRS reported markets decreased 21% ahead of the Easter holiday. Most of the fall in yardings occurred towards the end of the trading week, as processors anticipated limited processor demand due to the long weekend. Casino recorded the greatest drop in yardings as numbers reduced by more than half. The yarding at Goulbourn dropped 40%, while CTLX also offered fewer cattle. Forbes was the only market to record an increase in supply. The remaining markets maintained a similar offering of cattle to last week.

Once again young cattle were generally well supplied across all the markets , however overall veal supply and quality fell. There were a good proportion of cows presented but grown steers and bullocks were in reduced supply. The quality of cattle was overall fair to good, particularly in the yearling grades. Most of the northern and inland markets did report a drop in quality as cattle showed the effects of the recent dry and hot weather.

The cattle offered sold to all the usual buyers, though competition was not fervent due to the shortened processing week. The price trends across the markets varied with quality however most categories recorded a cheaper trend. An exception was in vealer heifers which managed to make some small gains. Heavy steer prices held their ground due to the limited supply.

The OTH market also recorded a cheaper trend as prices reduced across all categories. Processors required fewer consignments as the long weekend reduced slaughter capacity.

Cheaper trend

The majority of indicators decreased with yearling heifers experiencing the greatest losses. Light vealer steers to restock sold from 220¢ to 276¢ to be down by 12¢/kg. Medium weight C2 vealer steers remained in solid supply with the majority selling between 198¢ and 241¢ while those to the trade 224¢/kg. Heavy C3 vealers to process were up 3¢ to 225¢/kg. Vealer heifer prices were mostly cheaper as trade buyers secured the majority of stock. Medium weight C2 vealer heifers were 4¢ cheaper on 222¢/kg. Yearling steers to feed were dearer across the majority of categories. Medium weight dominated and ranged from 170¢ to 240¢/kg. Heavy weights were also in good numbers averaging 196¢ to be 1¢/kg higher. Yearling steers to the trade were from 204¢/kg. The majority of yearling heifers were purchased to process with the heavy weight topping 214¢/kg.

Grown cattle prices were varied, though lower overall. Medium C2 feeder steers were down 3¢ to 177¢ while those to processors were 6¢ lower at 190¢/kg. Light C3 grown heifers to processors were down 2¢ and sold around 169¢/kg. Medium D2 restocker cows made 11¢ less at 145¢ while those to processors made 127¢ being down 7¢/kg. Heavy D4 cows sold 3¢ cheaper at 149¢/kg. C2 bulls were cheaper at 154¢/kg.

South Australia
Smaller numbers

There were only two sales conducted due to the Easter Break that will see two short kill weeks and led to reduced numbers being yarded at the SALE and Naracoorte. Next week Naracoorte, Mt. Gambier and Millicent will hold sales.

The SA LE’s smaller mixed quality yarding of mainly young cattle and cows sold to fluctuating demand from the usual trade and export buyers. There was limited feeder and restocker orders operating. Most lightweight vealer steers were sourced by feeder orders at generally dearer levels, with trade purchases cheaper. The vealer heifers followed suit at lower levels to mainly trade competition. Light and medium weight yearling steers were sourced by feeders below 201¢/kg. Small lines of yearling heifers to the trade were unchanged to 5¢/kg cheaper, while the 2 to 4 score beef cows to processor demand tended to sell at basically unchanged prices.

Naracoorte’s smaller yarding contained mixed quality runs of young cattle and cows that sold to steady SA and Victorian trade and export competition. Feeder and restocker orders were active on a yarding more suitable to their requirements. While the yarding contained mainly local cattle, there were pockets of pastoral breds including some Brahman grown steers that sold at 180c/kg. Prime B muscled heavy vealers steers sold to a top of 244c/kg at improved levels, while feeder and restocker orders were very active on mainly lightweight Angus steers also at generally dearer levels. Limited numbers of yearling steers and heifers were yarded and sold at lower prices. Cows tended to lose ground as most sold to processors.

Erratic trends

The varying quality available only led to erratic trends for most categories from the limited number of trade and export buyers who were operating. Even feeder and restocker purchases were varied on the increased numbers they sourced. Most lightweight vealers to feeder and restocker inquiry sold from 195c¢ to 227¢, at prices unchanged to 18¢/kg dearer for mainly Angus steers. The trade sourced limited numbers between 193¢ and 244¢, with heavy B muscled sales 5¢/kg dearer. Vealer heifers were a little more erratic as most to the trade sold from 190¢ to 235¢/kg. This left some sales 11¢ to 13¢ dearer and others up to 50¢/kg cheaper on last week’s extremes. Feeders and restockers sourced increased numbers from 185¢ to 210¢/kg at generally lower levels. Yearling steers C3 sales were around 8¢ cheaper selling from 160¢ to 212¢, with the heifer equivalents 175¢ to 206¢ or unchanged to 3¢/kg less.

Small numbers of grown steers sold generally from 175¢ to 187¢ to be 7¢/kg cheaper. Cow prices tended to lose ground as most ranged from 133¢ to 160¢, or 260¢ to 300¢/kg cwt. This left some sales 1¢ to 3¢ dearer and others 1¢ to 3¢/kg cheaper.

West Australia
Quality mixed

There has been little change in seasonal conditions in the southern parts of the state. Temperatures were moderate with conditions remaining predominately fine and dry. This was despite the fact that a weak cold front crossed the southern corner of the country, which brought limited rain to most Agricultural regions.

Feed conditions subsequently continue to slide and with the majority of producers now calving supplementary feeding remains a daily chore on most properties in local districts. Conditions in the majority of the northern and eastern pastoral regions remain reasonable, with adequate feed levels reported.

Physical market numbers were affected by the Easter long weekend, which caused the cancellation of the Great Southern sale. Muchea’s saleyard total although marginally lower than the previous week remained moderate and the larger of the two sales held this week, while the south western sale at Boyanup continued to be reasonably limited with less than 400 head yarded.

With Muchea dominating total numbers as pastoral cattle accounted for a very healthy percentage of the weekly total. Prime drafts of local cattle in both trade and heavy weight steer and heifer categories were subsequently limited in numbers with the volumes of cows available also remaining only moderate.

Quality was mixed with the vast majority of cattle offered being in store condition. Processor demand throughout the classes remained relatively similar to previous week’s levels. Feeder and restocker demand for store classes remained very selective and quality dependant.

Cow market stable

The volumes of vealer in physical markets was only moderate with quality mixed with most producers now having sold most of last year’s drops and now down to their tail end drafts. Restocker and feeder demand throughout the weight classes in both heifers and steers were selective with quality a determinable factor in pricing levels. The tight supplies of finished trade weight yearlings were again predominately grass finished with few supplementary fed drafts available with quality in both categories mixed. Demand from the local trade and retailers however remained solid with little or no change recorded to price on prime drafts, while feeders and restockers were again active on plainer conditions consignments.

This was also the case in heavy grown steers, bullocks and heavy weight grown heifer sales with firm processor demand.

Cow quality remained mixed. Processor demand on prime heavy weight local and pastoral cows remained constant with price levels remaining similar. Both local and pastoral cows cow sales peaked at 155c/kg with the average around 148c/kg. The small numbers of heavy weight local bull sold at lower processor demand with prices reducing by 10c/kg lwt.

Queensland
Reduced supply

The supply of stock at physical markets covered by MLA’s NLRS leading into the Easter break fell 21%. Numbers at some markets early in the week increased with stock drawn from a wide area including some of the drier districts, and the Roma store sale on Tuesday also experienced a jump of 35%. However most other centres experienced smaller numbers and with no Longreach sale and the cancellation of the Roma prime sale due to the Easter break added to the downturn in supply.

Overall quality varied from centre to centre, with a fair percentage of the calves and vealers steers showing the effects of the changing season. There was also a slip in the overall standard of the export cattle at markets early in the week.

Values for young cattle experienced a mixed trend at the Roma store sale, highlighted by lightweight yearling steers which at the start of the sale met strong demand, however as the sale progressed restocker buyers become more selective and average prices fell. Calves and vealers at Warwick also eased, nevertheless by mid week despite a relatively good number of calves and vealers penned local and southern processors plus feeder and restockers were able to absorb numbers available. Prices were also able to maintain average prices close to last weeks level. A fairly good supply of yearling steers and heifers to feed generally maintained strong competition at all markets.

Heavy steers and bullocks to export slaughter experienced price reductions at early week markets and this trend continued as the week progressed. Cows also suffered falls, however losses were confined to 4¢ to 6¢/kg.

Export lines cheaper

Calves to the trade averaged close to 222¢ while those returning to the paddock averaged 227¢ with the occasional sale to 270.2¢/kg. The majority of vealer steers sold to restockers at 223¢ with a few to 248.6¢/kg. A good supply of vealer heifers sold to slaughter and feeder operators at 210¢ and a few slaughter lines made to 229.6¢/kg. A large selection of lightweight yearling steers returned to the paddock at 217¢/kg with some well bred lines to 257¢/kg. Medium weight yearling steers to feed were well supplied and most sold from 200¢ to 206¢/kg. Heavy weights to feed were also in large numbers and averaged 195¢/kg. Lightweight yearling heifers to the trade averaged 212¢ and medium weights to feed 188¢/kg. Medium weights to the local meat trade were in demand and gained 9¢ to average 195¢/kg.

Heavy steers to export slaughter across all markets averaged 3¢ less at 175¢, while the bullock portion fell 8¢ to average 176¢ with some to the wholesale meat trade at 190¢/kg. Medium weight 2 score cows averaged 5¢ cheaper at 124, and 3 scores lost 4¢ to average 140¢/kg. Good heavy cows were not as plentiful as the previous week and average prices eased 5¢ to 152¢ with the occasional sale to 164.6¢/kg.

[Mustang Sally Farm]

Thursday, April 05, 2012
Interesting Three Months Ahead for Markets
AUSTRALIA - With another very wet first quarter of the year coming to a close, the next three months are set to pose some interesting questions and challenges for cattle and beef markets. While the path of the A$ and the strength of export demand in coming months will make for interesting watching, the largest questions being posed surround the anticipated supply of cattle heading into the traditionally higher turnoff months of May and June.

With the two wettest years on record across the key cattle producing regions of Australia underpinning female retention and herd growth, supplies are anticipated to increase in the second quarter of 2012. Indeed, the disruption caused by flooding to the logistics throughout the first quarter of 2012 may even add to the number of cattle that enter the market between April and June.

However, when looking at the anticipated increase in cattle coming to the market in the second quarter, it must be noted that seasonal influences almost always see slaughter numbers increase into May and June, as producers in the north sell cattle following the cessation of the wet season, while southern producers look to reduce numbers heading into winter.

A review of historical numbers for the past decade shows that given the seasonality associated with adult cattle slaughter during the second quarter of the calendar year, throughput numbers have always been greater than the first quarter – averaging 11 per cent higher.

Given the increased supply in the second quarter, it should also be noted that a similar review of average prices between the first and second quarters of the calendar year shows a tendency to lower prices in the second quarter, but with no clear trend.

Indeed, according to MLA’s NLRS national saleyard averages, for the past 10 years, the average price for heavy steers in June has been below the average in March for six of the ten years, but only averaging a decline of one per cent over the ten year period. Demonstrating the contrasting market factors from year-to year, in 2011 the average heavy steer price in June was 12 per cent below the average in March, while the average monthly price in June was higher than March in 2008 (nine per cent), 2009 (three per cent) and 2010 (four per cent).

Assuming an increase in cattle supplies in the coming three months, there is expected to be additional downward pressure upon cattle prices. Indeed, if the current malaise for Australian beef in export markets, especially Japan and Korea, continues through to June, the pressure upon prices could be magnified. However the recent decline in the A$ will provide some hope for an improvement in export demand and prices, along with the expectation for demand from the US to remain positive.

However, the one elusive factor to consider for the coming three months is how producers will react to any decline in cattle prices, given that most would be flush with feed and water, providing the flexibility to hold cattle if prices are deemed unfavourable.

[Mustang Sally Farm]

Thursday, April 05, 2012
Could the Spanish Dairy Sector Collapse?
ANALYSIS - This week, the Spanish Small Farmers Union (UPA) has said that the Spanish milk market is on the brink of a collapse. The union says that rising production costs are crippling farmers, and farmgate milk prices are falling.
 


For the dairy industry, feed accounts for around 70 per cent of production costs. These feed costs have reportedly increased by 50 per cent since 2010 and the current drought situation is set to make this worse.

UPA has said that demand for dairy products is increasing, which should economically speaking increase prices, but as yet Spanish and European milk producers, have not seen this.

Spanish producers are set to organise protests over the coming month, demanding a fair price for milk.

Arnaud Petit, Director of Commodities and Trade for Copa-Cogeca told TheCattleSite that Spain was not the only country suffering from falling milk prices. In fact, it is a trend that has been seen across Europe in the last couple of months.

Passing the cost of production on from producers to retailers and onto the consumer is a global problem, he explained.

Whilst Spain is suffering from drought, it also has a feed advantage due to the trade deal it has with South America, he says. Through this trade deal Spain can import around two million tonnes of maize and sorghum at a low duty, providing low cost feed for producers. However, Mr Petit points out that South America is also currently suffering from severe drought, which has lowered harvest estimations, particularly for maize.

Whether the Spanish industry is on the brink of a collapse or not is unknown. Certainly producers are struggling with high production costs and a low milk price. Whilst it is too early to see any impact of the European Milk Package, which was given the go ahead last month, it is hoped that when it comes into play, it will give producers more power to negotiate with processors for a fair milk price.


Charlotte Johnston, Editor

[Mustang Sally Farm]

Wednesday, April 11, 2012
Ontario Cow Breaks World Record Milk Yields
CANADA - A Canadian cow is laying claim to the world’s record for lifetime milk production.


Gillette Emperor Smurf has produced 216,893 kilograms (or 478,167 pounds) of milk over her lifetime, according to recent reports.

“She is the best producer of all the cows in the world,” Ontario owner Louis Patenaude said.

And she’s not done yet. Gillette E. Smurf, as she is officially known, is awaiting the birth of her 11th calf next month.

The previous record was set in 2006 by a Michigan cow, Tacoma Mark My-Word, that was credited with 471,900 pounds of milk.

In 2011, Gillette E. Smurf was recognized for becoming the first Canadian cow to produce more than 200,000 kilograms of milk and now it appears she has gone on to break the world record.

[Mustang Sally Farm]

Thursday, April 12, 2012
CME: Cutout Values Still High, Feeder Cattle Still Low
US - Amid the carnage wrought by the LFTB situation over the past few weeks, we think some basic fundamentals of the current beef situation are getting overlooked, write Steve Meyer and Len Steiner.


While this is a demand hit that no one saw coming, there are still some factors — especially on the supply side — that are going to cause some major changes in the beef situation. The short-term impact of 50% CL trim prices plummeting are negative for sure but let’s remember some basic facts of the current situation.

Cutout values are still high by historical standards. Yes, it now appears that the magic $200 level may not materialize this year when just a few weeks ago it appeared to be a lock. But the Choice cutout still averaged over $180 last week. Monday’s $1 gain has been erased by two more down days but the value was still $177.09 yesterday. That is still higher than any cutout value prior to 2011 except for those two weeks back in 2003. Yes, we know costs are different and we agree that this situation is unfair but the cutout value is still nearly $180!

The number of feeder cattle available in the country is still VERY LOW relative to history. The Livestock Marketing Information Center (LMIC) in Denver estimates, based on USDA’s January 1 cattle inventory data, that there were 25.8 million head of feeder cattle outside of feedlots on January 1 this year. That is 4% fewer than one year ago and nearly 7% fewer than on January 1, 2010. This year marks the first time EVER that beginning-year feeder cattle numbers have been below 26 million head. And the trend will almost certainly continue this year. The last time that a U.S. calf crop was larger than the preceding year was in 1995.

There is no big move toward expansion at present. Heifers being held for beef cow replacement numbered 5.212 million on January 1 — 1.4% higher than one year earlier. Moreover, this year marks the first year since 2006 that the year-onyear change has been positive. A big reason for this positive but small number is, of course, the fallout of last year’s drought in the southwestern states that hold so many beef cow. Heifer numbers in Texas, Oklahoma and Missouri — the top three cow-calf states — were down 60, 55 and 30 thousand head, respectively, from one year earlier. The percentage declines are 9.8, 15.5 and 10 for those three states. Heifer numbers in New Mexico were down 20,000 or 21%. Numbers are growing in states that have grass —Nebraska, South Dakota, Colorado, Wyoming—but until the big cow-calf states know they have enough forage, cow numbers will not increase much.

The stage is set for expansion. The factors cited above point to exceptional returns for cow-calf operations in 2012 and 2013 provided the U.S. corn crop is not a complete failure. The chart at right shows LMIC’s estimates of cow-calf returns over cash costs (including pasture rent) since 1984. The next two years should shatter previous record highs based on current expectations for calf prices. The cattle business differs from other livestock/meat businesses, though, in that what people WANT to do and what Mother Nature ALLOWS them to do are sometimes very different things. Pasture conditions are improving in those big cow-calf states but it is only spring. The moisture situation, including pond/stock tank levels, is still far from good in many areas and it is only April. The summer months will be the test of whether the drought is over. The beef cow herd usually lags profits by two years. The 2012 herd is a function of losses in 2008 and 2009 plus the drought. Profits in 2010-11 and improving grass conditions should spur heifer retention and cow herd growth. More heifer retention will tighten feeder cattle supplies even further over the next two years — a major reason for those $200-plus per cow forecasts.

[Mustang Sally Farm]

Monday, April 16, 2012
EU Cattle Prices Surge
EU - Cattle prices within the EU surged to record high levels in late March, despite a slow start to the year, as concerns about the tightness of forward cattle supplies and falling herd numbers continue to influence the market.


Figures from the EU Commission showed that prices for O3 cows averaged €304.30 per 100kg deadweight (dw) for the week ending March 25, a 16.5 per cent increase year-on-year. Prices for R3 steers averaged €394.36 per 100kg dw, a 21.2 per cent increase on the same period in 2011. Prices paid for heifers and bulls were also at historically high levels.

The recent strength in cattle prices across the EU is closely linked to falling production levels, with cattle numbers down across the majority of large beef producing nations. Provisional figures from the EU commission indicate French cattle numbers were down 2.6 per cent, to 19.14 million head in 2011, the UK herd was back 2.2 per cent, to 9.68 million head, while German numbers were down 1.4 [er cent, to 12.53 million head.

Cattle slaughter throughout Great Britain, Northern Ireland and the Irish Republic so far in 2012 is well back year-on-year, indicative of the tight supply of slaughter ready cattle. Steer slaughter for the week ended 25 March in Great Britain was back 5.5 per cent year-on-year, while Northern Ireland and Irish Republic slaughter levels contracted 12.4 per cent and 27.2 per cent, respectively. Indicative of the very tight throughput in the UK, the O3 cow price in the UK was the highest of the top five EU beef producing nations, at €335.07 per 100kg dw.

The UK was the fourth largest producer of beef in the EU in 2011, producing 936,000 tonnes cwt, or 12 per cent of total EU production. France was the largest beef producer, at 1.56 million tonnes cwt, or 20 per cent of total production, followed by Germany (1.16 million tonnes cwt) and Italy (1.09 million tonnes cwt).

[Mustang Sally Farm]

Beef Prices Fell 19 Per Cent in Last Six Months

PARAGUAY - Since the 15 September cattle prices in Paraguay have fallen 47 per cent following the outbreak of Foot and Mouth Disease (FMD) in the country. The prices of cuts of beef in supermarkets also fell by 19 per cent.


The first outbreak of FMD by the National Quality and Animal Health (SENACSA), was dated as the 17 September 2011. Since then, the last six months have experienced a strong downward trend in prices of cattle in the four large spiker firms: Ferusa, Codega, El Rodeo and El Corral, reports ABC
 
The price of cows, on average, on 15 September 2011 was G. 7,575 per kilogram, while data from the 13 April 2012 shows that the price went down to G. 4,232 per kilogram, a 44 per cent reduction.
 
As for the prices of bulls, the drop is 40 per cent.

The average prices of different cuts of beef fell by 19 per cent.

[Mustang Sally Farm]

Wednesday, April 18, 2012
Market Access for Irish Beef to China
IRELAND - Speaking in Beijing earlier this week, the Minister for Agriculture, Food and the Marine Simon Coveney welcomed the agreement to set up a Joint Working Group on market access for Irish beef to the Chinese market involving the Chinese Inspection and Quarantine Service (AQSIQ) and his Department.


Minister Coveney said: "This is a major step forward and one of the few such joint working groups which have been established by the Chinese authorities."

He also said that he was very pleased that Vice Minister Wei from AQSIQ will visit Ireland from 13-16 June when, it was agreed, beef market access will be discussed further. The Minister expressed satisfaction at the priority and engagement of the Chinese authorities on this important issue for Ireland, which has been under negotiation for some time.

These developments follow the agreement and signature today of two separate Memoranda of Understanding between Minister Coveney and Minister Zhi Shuping of AQSIQ and Vice Minister Niu Dun of the Ministry of Agriculture. The signing of the Memorandum of Understanding on agricultural co-operation provides a new five year framework for exchanges of expertise in the agriculture and fisheries sectors. Minister Coveney said that Vice Minister Gao Hongbin will visit Ireland in May in a continuing build up of increased cooperation between the respective Ministries of Agriculture. Vice Minister Niu Dun also responded favourably to Minister Coveney’s invitation to visit Ireland again in the near future.

The Memorandum of Understanding with AQSIQ was highly significant, providing for the first time for cooperation across the full range of sanitary and phyto-sanitary issues in relation to agriculture and food and fisheries products. The Minister said that this will ensure clear communication channels between his Department and AQSIQ thereby facilitating trade and the exchange of technical data.

Minister Coveney said that the formal agreements reached today as well as the visits of Chinese Ministers will lead to an even greater understanding of the sustainable nature of Irish agriculture and food safety controls that are integral to the production of quality Irish food products. He concluded by saying that he was very pleased with the outcome of the visit on beef and looked forward to continuing dialogue with his Chinese counterparts which will facilitate increased trade with this expanding market.

[Mustang Sally Farm]

Thursday, April 19, 2012
Korean Cattle Slaughter Up 50 Per Cent
SOUTH KOREA - Korean government statistics released this week quantified the magnitude of the increase in Korean beef production so far in 2012, with total cattle slaughter for January and February up 50 per cent year-on-year, at 176,610 head.

Interestingly, while the year-on-year increases for the first two months of 2012 is compared to a disrupted period in 2011 (due to the foot and mouth disease outbreak); it was still 34 per cent above the same two month period in 2010, reports Meat and Livestock Australia.

A significant component of Korean slaughter so far in 2012 has been an increase in Hanwoo cow numbers, at 66,287 head – up 83 per cent year-on-year and 36 per cent on 2010. Hanwoo cows made up 38 per cent of total cattle slaughter (including Hanwoo, beef cattle and dairy), with assistance from government programmes aimed at helping to lower herd numbers, given the prolonged period of lower cattle prices.

Total Korean beef imports in the first two months of 2012 decreased seven per cent year-on-year, but were still 10 per cent above the same period in 2010 (KITA).

[Mustang Sally Farm]

Friday, April 20, 2012
India to Become World's Largest Beef Exporter

INDIA - India is forecast to become the world’s leading beef exporter in 2012 due to an expanding dairy herd, efficiency improvements, increased slaughter and price-competitiveness in the international market particularly compared to Brazil.


Exports currently account for 44 per cent of production.

According to the USDA Livestock & Poultry: World Markets & Trade, India’s exports are exclusively deboned frozen buffalo meat (carabeef) which is included in USDA’s global estimates of beef (bovine) meat production.
 
Export sales have made significant inroads in the Middle East, North Africa and Southeast Asia (key Brazilian markets) as all carabeef is lower priced and produced according to halal standards.
 
In 2012, additional export orientated slaughterhouses are expected to come on line, increasing supplies. Production gains are largely destined for the export market. Domestic demand is constrained by cold-chain facilities and consumer preference for non-bovine proteins such as poultry products, dairy products and pulses.
 
India is the only country expected to significantly increase beef production in 2012 to 3.5 million tonnes. Australia are some way behind India forecast to produce 2.2 million tonnes (an increase compared to 2011 production), whilst the US stays at the top beef production at 11.5 million tonnes.

[Mustang Sally Farm]

Friday, April 20, 2012
Chinese Invest in New Zealand Dairy Farms, Fonterra Invests in China
NEW ZEALAND - This week New Zealand has given the thumbs up for Chinese investors to purchase the former CraFarms.
 


The topic has been one of controversy in New Zealand, with concerns over large scale overseas investment particularly in farmland.

Today, after nearly a year of discussions, the New Zealand government has approved a new recommendation from the Overseas Investment Office (OIO) to grant consent to Shanghai Pengxin to acquire the 16 Crafar farms, in the Central and North Island.

Shanghai Pengxin will run the 16 farms (covering 7,892 hectares), through Milk New Zealand Holding Limited, a wholly owned subsidiary of Pengxin.

New Zealand Land Information Minister Maurice Williamson and Associate Finance Minister Jonathan Coleman have said that the consent comes with stringent conditions.

“Twenty seven conditions have been imposed to ensure Milk New Zealand’s investment delivers substantial and identifiable benefits to New Zealand,” Dr Coleman said.

The conditions require Milk New Zealand to invest $16 million into the farms and to protect and enhance heritage sites.

“The combined effect of the benefits being delivered to New Zealand as a result of this transaction is substantial.”

Back in February, the government had to reconsider its approval of the sale after the High Court said that there was no real economic benefit from the sale to New Zealand.

Overseas investments of land, involving more than five hectares of farmland, must be approved by the OIO.

It is reported that Shanghai Pengxin put in a bid of NZ$210 million for the farms, whilst a New Zealand bidding group, Crafar Farms Purchase Group bidded NZ$171.5.

The decision is likely to be challenged by the Crafar Farms Purchase Group.

"It's a bad day for New Zealand," said Sir Michael Fay, a member of the bidding group. "Three out of every four New Zealanders are against selling these farms into foreign ownership."

Bruce Wills, Federated Farmers President said that the ongoing purchases of farmland from foreign investors is worrying New Zealanders.

"Many fear they will become tenants in their own land."

However, he said there were larger concerns, including the growth on forestry and lifestyle blocks.

“Given there’s 1.6 million hectares of dairy farms, overseas investors over that time bought less than one per cent. Even with a spike in the first quarter of 2012, less than 1.3 per cent of dairy land was consented to go into overseas hands.

“We are also missing the bigger picture by focusing on the former CraFarms farms. Landcare Research shows 873,000 hectares of farmland are now in less productive lifestyle blocks. That’s equivalent to 110 Crafar farms being taken up by our expanding cities.

“This is the big picture we should be looking at in this debate,” Mr Wills concluded.

Had the government not approved the deal, there are concerns about what affect it may have had on NZ-Chinese relations. China is currently New Zealand's second largest exporting nation and New Zealand seems keen to invest there.

Last week, Fonterra (a New Zealand owned co-operative) announced plans to develop two new large-scale dairy farms in the Hebei province. With two additional units, Fonterra has committed investment to five farms in the Hebei Province, in the north east of China, with two currently operational.

Combined, the five farms will have a herd size of around 15,000 milking cows producing 150 million litres a year.

Chief Executive Theo Spierings said the success of Fonterra's farming operations in China, and their future growth would not be possible without the support of local Government.


Charlotte Johnston, Editor

[Mustang Sally Farm]

Wednesday, April 25, 2012
US Confirms BSE Case: Beef Products Still Safe
US - The US's fourth case of bovine spongiform encephalopathy (BSE) has been detected in a dairy cow in California, reports USDA Chief Veterinary Officer John Clifford.
 

"As part of our targeted surveillance system, the US Department of Agriculture's (USDA) Animal and Plant Health Inspection Service (APHIS) has confirmed the nation's fourth case of bovine spongiform encephalopathy (BSE) in a dairy cow from central California.

"The carcase of the animal is being held under State authority at a rendering facility in California and will be destroyed. It was never presented for slaughter for human consumption, so at no time presented a risk to the food supply or human health. Additionally, milk does not transmit BSE.

"The United States has had longstanding interlocking safeguards to protect human and animal health against BSE. For public health, these measures include the USDA ban on specified risk materials, or SRMs, from the food supply. SRMs are parts of the animal that are most likely to contain the BSE agent if it is present in an animal. USDA also bans all nonambulatory (sometimes called "downer") cattle from entering the human food chain. For animal health, the Food and Drug Administration (FDA) ban on ruminant material in cattle feed prevents the spread of the disease in the cattle herd.

"Evidence shows that our systems and safeguards to prevent BSE are working, as are similar actions taken by countries around the world. In 2011, there were only 29 worldwide cases of BSE, a dramatic decline and 99 per cent reduction since the peak in 1992 of 37,311 cases. This is directly attributable to the impact and effectiveness of feed bans as a primary control measure for the disease.

"Samples from the animal in question were tested at USDA's National Veterinary Services Laboratories in Ames, Iowa. Confirmatory results using immunohistochemistry and western blot tests confirmed the animal was positive for atypical BSE, a very rare form of the disease not generally associated with an animal consuming infected feed.

"We are sharing our laboratory results with international animal health reference laboratories in Canada and England, which have official World Animal Health (OIE) reference labs. These labs have extensive experience diagnosing atypical BSE and will review our confirmation of this form of the disease. In addition, we will be conducting a comprehensive epidemiological investigation in conjunction with California animal and public health officials and the FDA.

"BSE is a progressive neurological disease among cattle that is always fatal. It belongs to a family of diseases known as transmissible spongiform encephalopathies. Affected animals may display nervousness or aggression, abnormal posture, difficulty in coordination and rising, decreased milk production, or loss of body weight despite continued appetite.

"This detection in no way affects the United States' BSE status as determined by the OIE. The United States has in place all of the elements of a system that OIE has determined ensures that beef and beef products are safe for human consumption: a mammalian feed ban, removal of specified risk materials, and vigorous surveillance. Consequently, this detection should not affect US trade.

"USDA remains confident in the health of the national herd and the safety of beef and dairy products. As the epidemiological investigation progresses, USDA will continue to communicate findings in a timely and transparent manner."

“American beef and dairy products are safe. The safeguards our government has in place to detect any incidence of this disease are clearly working. The report of