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Established 1938 ISSN 1196-8923 CATTLEMEN EDITORIAL Editor: Gren Winslow 1666 Dublin Avenue, Winnipeg, MB R3H 0H1 (204) 944-5753 Fax (204) 944-5416 E-mail: gren@fbcpublishing.com

Contents CANADIAN CATTLEMEN · NOVEMBER 2013 · VOLUME 76, NO. 12

 B R E E D I NG

Field Editor: Debbie Furber Box 1168, Tisdale, SK S0E 1T0 (306) 873-4360 Fax (306) 873-4360 E-mail: debbie.furber@fbcpublishing.com ADVERTISING SALES Deborah Wilson RR 1, Lousana, AB T0M 1K0 (403) 325-1695 Fax (403) 944-5562 E-mail: deb.wilson@fbcpublishing.com HEAD OFFICE 1666 Dublin Avenue, Winnipeg, MB R3H 0H1 (204) 944-5765 Fax (204) 944-5562 Advertising Services Co-ordinator: Arlene Bomback (204) 944-5765 Fax (204) 944-5562 E-mail: ads@fbcpublishing.com Publisher: Lynda Tityk E-mail: lynda.tityk@fbcpublishing.com Associate Publisher/Editorial Director: John Morriss E-mail: john.morriss@fbcpublishing.com Production Director: Shawna Gibson E-mail: shawna@fbcpublishing.com Circulation Manager: Heather Anderson E-mail: heather@fbcpublishing.com President: Bob Willcox Glacier Media Agricultural Information Group Email: bwillcox@glaciermedia.ca

Putting records to work.

DATA WINS OUT AT R & R ACRES 18  W I N T E R F E E D I NG

FEATURES Looks can be deceiving . . . . . . . . . . . . . . . . . 10

Contents of Cattlemen are copyrighted and may be reproduced only when written permission is obtained from the editor and proper credit is given to Cattlemen.

A custom grazier’s best friends . . . . . . . . . 14

Cattlemen and Canadian Cattlemen are Trade Marks of Farm Business Communications.

Data wins out at R & R Acres . . . . . . . . . . . 18

Cattlemen is published monthly (with the exception of July and 2 issues in January and October) by Farm Business Communications.

Head office: Winnipeg, Manitoba. Printed by Transcontinental LGMC. Cattlemen is printed with linseed oil-based inks.

Mixed farming spirit thrives at Tee Two. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

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Bunching saves a bundle . . . . . . . . . . . . . . . 26 Revisiting feeder and breeder co-ops . . .30

Mixed farming spirit thrives at Tee Two

24

Making the most of crop trash.  M A R K ET I NG

DEPARTMENTS Comment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4 Newsmakers . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6 Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6 Our History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

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Beef Watch. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Verified Beef Production . . . . . . . . . . . . . . .49

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The editors and journalists who write, contribute and provide opinions to Canadian Cattlemen and Farm Business Communications attempt to provide accurate and useful opinions, information and analysis.

However, the editors, journalists, Canadian Cattlemen and Farm Business Communications, cannot and do not guarantee the accuracy of the information contained in this publication and the editors as well as Canadian Cattlemen and Farm Business Communications assume no responsibility for any actions or decisions taken by any reader for this publication based on any and all information provided.

Avoid allergic reactions . . . . . . . . . . . . . . . . .40

Vet Advice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Holistic Ranching . . . . . . . . . . . . . . . . . . . . . . . 36

Revisiting feeder and breeder co-ops Farmers helping farmers.

Congratulations!

30

Straight from the Hip . . . . . . . . . . . . . . . . . . . 38 Research on the Record . . . . . . . . . . . . . . . . 42 CCA Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Prime Cuts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 News Roundup . . . . . . . . . . . . . . . . . . . . . . . . . 5 1

To our November survey winner, Donald Hughes of Merville, B.C. This month’s survey is on page 48.

Purely Purebred . . . . . . . . . . . . . . . . . . . . . . . . 58

Cover Photo: Debbie Furber

Sales and Events . . . . . . . . . . . . . . . . . . . . . . . 64

The Markets. . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Market Talk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

C AT T L E M E N · N O V E M B E R 2 0 1 3

3

 COMMEN T

By Gren Winslow

Hurrah for CETA

It’s good news, but the money will be in the details

T

he timing couldn’t have been better. Right when we’re facing a November enforcement deadline on a new country-of-origin (COOL) regulation Prime Minister Harper signs an agreement in principle to open up the European Union (EU) to a lot more Canadian beef.

A general sigh of relief swept across the industry last month before the real world started to creep back in with a splash of reality.

First, it must be said this is a major accomplishment for this government, and a large amount of praise is due to the Canadian livestock industry. Cattlemen, hogmen, packers and processors have spent years pressuring the federal government to stand firm on its demand for greater access to the EU for Canadian beef and pork.

That has paid off with this agreement.

As Canadian Cattlemen Association (CCA) president Martin Unrau spells out in his column this month: CETA (the Canada-EU Comprehensive Economic and Trade Agreement) provides new duty-free access for 64,950 tonnes of Canadian beef. Better yet 50,000 tonnes of this extra quota are reserved for Canadian beef — 35,000 tonnes of it fresh chilled and 15,000 tonnes frozen product from any grade of cattle.

Plus the 20 per cent duty on the 14,950 tonnes of Hilton quota we share with the U.S. will drop to zero and we still retain access to the duty-free quota ordered by the WTO in compensation for the hormone dispute.

Finally all live cattle, genetics and most beef offal, tallow and rendered products processed beef products, hide and skin will gain unlimited duty-free access once the deal is ratified.

And there is the rub. The deal still has to be ratified by the provinces, the Parliament of Canada, all EU nations and the EU Parliament and a lot of the details in each section still have be worked out.

So the prize has been set out but there will be plenty of horse trading before we can seize it and gain this welcome access to the EU. The betting is it will take 18 months to two years. Mr. Harper says it should be signed by the next election, but there is no surety in that.

The dairy lobby started running soft TV ads in support of the cheese industry within days of the deal being announced. Ottawa agreed to double the amount of European cheese that can enter the country duty free to 30,000 tonnes. That’s about eight per cent of annual consumption, and the powerful dairy lobby isn’t going to let it go without a fight.

Negotiations on the beef side will focus on the technical barriers to the EU market. Anyone who has sold beef there under the current regulations will tell you there is

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more involved than simply raising cattle without hormone implants or beta-agonists. You have to certify that they are free and there is a very long list of requirements for segregation, transport and processing that must be fulfilled, all of it under the watchful eye of the Canadian Food Inspection Agency. The cost in terms of time and money is high but those who have done it successfully say it is worth the trouble.

One of the key goals now will be to reduce those restrictions to a manageable level that makes it attractive to our large packers. Ten smaller specialized packers are approved to process EU beef today. But more hooks will be needed when this agreement is ratified.

he prize has been set out but T there will be plenty of horse trading before we can seize it and gain this access to the EU The CCA says 500,000 head of cattle would be needed to satisfy the duty-free quota for EU-approved beef. That would amount to 20 per cent of our domestic slaughter or 61 per cent of our live exports to the U.S. in 2012. Certainly it is a large enough volume to attract the interest of the large packers, and their marketing departments.

The question is would it interest them if they had to go through all the hoops that are currently required to ship to the EU? In the meantime we have the November COOL deadline staring us in the face. Packers have already been laying out what they will and will not handle under the new regulations and the basis is widening. Despite sky-high prices, the end result will be less money in the pockets of Canadian producers than there would be without this malicious COOL rule.

As I write this hopes were being pinned on an Appeal Court ruling to grant a preliminary injunction until the industry’s case against COOL can be heard in court. Others were looking to the congressional conference on the Farm Bill to bring some relief. Both would have to be considered long shots.

CETA provides real hope for some relief from the U.S. border wars but we can only wish that it had been signed two years earlier so we could turn on the taps to Europe today instead of two years down the road. c

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 THE INDUST RY

NewsMakers The Canadian AgriFood Policy Institute (CAPI) has appointed Brenda Schoepp to its board of directors. Schoepp is an Alberta-based rancher and market Brenda Schoepp analyst for her company Beeflink, an active mentor to young entrepreneurs and founder of Women in Search of Excellence. She is also a 2012 Nuffield Agricultural Scholar, board member of Farm Credit Canada and a regular columnist in this publication. CAPI is an non-profit independent policy forum established by the federal government in 2004 that is dedicated to the success of Canada’s agriculture and agri-food sector.

beef operation in Ontario. She will focus her study on traceability in beef and how we can maximize what we have in order to meet the needs of consumers. Wolfgram is a swine veterinarian and Chubb operates an agriculture consulting firm, DeNovo Ag.

Letters

Fiona McLellan of Virbac Canada Inc. is the new chair of the Canadian Animal Health Institute. Other executive members are past chair, Paul Lake of Bio Agri Mix LP; vicechair Dr. Jair Garcia, Zoetis Canada; secretary/treasurer Diane Bourassa, Vétoquinol Canada Inc.

The Ontario Cattlemen’s Association was officially renamed Beef Farmers of Ontario (BFO) complete with a new logo on October 15. The decision to rename the provincial organization was taken at the group’s 2013 annual meeting. This is the second name change for the association that was formed in 1962 as the Ontario Beef Improvement Association. More is available on the new website www.ontariobeef.com or on Twitter @OntarioBeef.

The Canadian Nuffield Farming Scholarship Trust has announced its 2014 recipients: Cheryl Hazenberg of Calgary, Steve Wolfgram of Stratford, Ont., and Cheryl Hazenberg Daryl Chubb from Iricana, Alta. Hazenberg is the director of technical services for the Canadian Angus Association and grew up on a commercial

Youth teams representing Canada at the 2013 PGG Wrightson World Angus Forum in New Zealand have won both champion and reserve champion titles.

The Canucks with team members Jared Hunter, Didsbury, Alta. (captain); Patrick Holland, Montague, P.E.I.; Melissa McRae, Brandon, Man.; and Michael Hargrave, Maxwell, Ont., brought home the world champion title along with NZ$10,000 prize money.

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Merck Animal Health has named Kevin Ryan as its Canada Cattle and Equine Business Unit director. He has previously held positions with Pfizer Animal Health, Merial and the Kevin Ryan Agri-Food Division of the Angus Reid Group, based in the United States, Europe and Canada.

Precautionary principle

Your comment of September (The Beef Muddle) caught my attention. For the last 40 years I had worked in the health profession and owned a small hobby beef farm. In the health profession “the precautionary principle” in relation to food is “when in doubt throw out.”

It wouldn’t surprise me if the next crisis in the beef industry involved either the mandatory labelling of all beef that originated from animals given growth promotants or the use of growth promotants in the beef industry.

As you know the Canadian beef industry is using these products purely for economic reasons. The public is not demanding their use.

It appears to me that in Ontario (and probably in many other provinces), organizations like the Ontario Milk Marketing Board (and the chicken and pork producers) are taking a strong stance that their products originate from animals that are not given “additives” to promote either milk or meat production. I understand both the public image and the economic aspects to the use of chemical “additives” in the beef industry. This may be a rather tough issue but is one that needs to be addressed. How would the public react to the labelling of all beef products originating from animals given meat promoting products? The public may demand this so that they have the choice in deciding whether or not to switch to “organic beef.” This may not be driven by a science argument but a consumer one.

Currently in my town we have seen the opening of a new beef/hamburger chaintype restaurant (Paradise Farms) that advertises that its product is sourced from healthy “organic beef.”

Good luck with this issue.

Dave Dorman, Erin, Ont.

www.canadiancattlemen.ca

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 OUR HISTO RY

RAILROAD YARNS

T

his is an excerpt from “Some Railroad Yarns” written by R.E. Gard, University of Wisconsin, in the March, 1946 issue of Canadian Cattlemen.

Alberta is a great railway province. Do you know that there have been something like 125 railways chartered in Alberta? Of course, only a very small per cent of this number actually exist and function today, but just think what Alberta might be like if all 125 of these railroads had been actually built and were functioning. Alberta would be a spiderweb of steel — a network of criss-crossing railway lines.

And a few of these railways which were actually built, or partly so, had names which were more glorious than the actual railway.

The E.Y. and P. for instance — the Edmonton, Yukon and Pacific — truly a name to be proud of, and a name of dreamy accomplishments — which never came to be. Or take the old Edmonton, Dunvegan and B.C. Railroad, the line which is now part of the Northern Alberta Railways. There were dreams in that name, too. For Dunvegan, on the banks of the Peace River was to have been

a wonderful city — the dream city of the North. Around 1912 Dunvegan had a real estate boom. There wasn’t anything much at Dunvegan, just a Hudson’s Bay Post, a Catholic mission, an Anglican mission and a few Indians. But the real estate boom was big-time stuff. Picture-posters were made portraying Dunvegan as a mighty metropolis, set along both sides of the mighty Peace River. Dunvegan, in fact, became so well marked on all the maps that it was at that time undoubtedly the best-known place name in the Peace River country. Little wonder then, that the railway’s name should be Edmonton, Dunvegan and B.C. Then there’s the railroad to Waterways, way down on the Athabaska River. This road is also now part of the Northern Alberta Railways System, but it was not always thus. The line was once called the Alberta Great Waterways Line, and was the subject of perhaps the most heated debate ever held in the Legislative Assembly. R.B. Bennett in 1910, then a member from Calgary, spoke against the construction of the railroad for five solid hours, while the Hon.

C.W. Cross staunchly defended it. Mr. Cross spoke glowingly of the entire northland — of the richness of mineral wealth to be topped by the railway.

Mr. Cross and his side won, and the railway was completed. Early travellers on this line, however, were not sure that it had been completed. The early train had a very bad habit of jumping the track, bucking like a mean horse, and making life generally miserable for the travellers.

One traveller making the northern trip got very hungry. There had been so many washouts, and the train had been derailed so many times that it took five days to go 60 miles. There wasn’t anything to eat. The traveller went to the conductor and complained very loudly. “Now, now, now, said the conductor, patting the ravenous traveller on the shoulder, “you just wait. In fact, sir, we’ll be stopping for dinner in exactly three minutes.”

When they had gone three miles the train pulled up beside a patch of blueberries.

“First call for dinner,” yelled the conductor.

“Get out there and help yourselves.” c

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 breeding

By Debbie Furber

Looks can be deceiving Eyeballing isn’t body condition scoring

B

ody condition scoring is a method of actually measuring the fat reserves you think you see on a cow. The system is not new, but using it might be if you’ve always relied on eyeballing to sort out your thin cows.

Looks can really be deceiving because cows carry their weight in different places, says Naomi Paley, regional livestock specialist with the Saskatchewan Ministry of Agriculture at Yorkton. At a glance, fluffy winter hair coats, slick summer coats, full, round abdomens, and even the conformation of an older cow can easily throw you off.

Most beef cows tend to carry fat on either side of the short ribs, around the tailhead, and over the hip (hook) and pin bones. Once cows slick up in summertime, you might be able to see the long ribs on some of them, but when you place pressure on the ends of the short ribs (along the loin area between the last long rib and hip bone) you could be pleasantly surprised to find a nice layer of fat.

Conversely, you might think the cows are in fine shape out on pasture in late fall, only to find that winter hair coat is disguising poor body condition on many of them.

There is no muscle tissue between the ends of the short ribs and the hide, so what you feel is all fat, making this the best place to start body condition scoring, Paley explains.

Place the palm of your hand on top of the short ribs and apply firm pressure to the end of the ribs with your thumb. If you can feel the ends of the short ribs, but can’t distinguish the individual ribs or make a dent between them with your thumb, and you can feel fat around the tailhead and over the hip bones, then the cow is in ideal body condition. On the Canadian body condition score (BCS) scale of 1.0 to 5.0, the ideal score is 2.5 to 3.0.

If a cow is quite cushioned around the tailhead and well rounded over the hip bones, you might bump up her score to 3.5.

She’s a 4.0 if you can’t feel the ends of the short ribs at all and the fat around the tailhead has a bulgy look.

On the two ends of the BCS scale are 5.0, which is grossly fat with a blocky appearance, and 1.0, being very thin with the ends of the short ribs feeling quite sharp and other bones very noticeable.

While it’s easy to see that a cow with BCS

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C at t l e m e n · n o v e m b e r 2 0 1 3

Naomi Paley, regional livestock specialist with the Saskatchewan Ministry of Agriculture at Yorkton.

of 1.0 needs a lot of special attention, cows scoring around 2.0 are the ones that can be particularly deceiving and lead to problems down the road with poor weaning weights and low conception rates if they don’t receive additional energy.

At a BCS of 2.0, you will be able to feel the individual short ribs, but there will be enough fat cover on the ends to give them a bit of roundness. Likewise, there will be a slight covering of fat over the hip bone and around the tailhead.

The distribution of fat cover changes with age, too. Older cows tend to carry less fat along the top line, but may show adequate reserves elsewhere.

There can be differences among breeds, so it’s important to get to know your herd and to be able to identify what the ideal BCS feels like.

There’s no need to worry about starting off “wrong” by scoring too high or too low, Paley says. She suggests starting with three categories as simple as too thin, moderate, and fat, to get a feel for the variation among your cows, and then learn to feel for what you want.

The best thing about body condition scoring is that it works great if you manage accordingly. It’s easy to learn and doesn’t cost anything but a few minutes’

time if you do it at spring and fall processing when the cows are going through the chute anyway.

“The best, easiest and cheapest time to put BCS back on is fall time after weaning,” Paley says. “That’s when the cows’ feed requirements are lowest because they’re not lactating and it’s early on in gestation.

Supplementing with grain, pellets, or goodquality stockpiled grass at this time will give the biggest bang for your buck.”

The fall and winter feeding period is not a time to “let the cows give a bit back” as has been a popular train of thought in recent years, she stresses. In fact, letting cows burn fat to save on feed any time of year will cost you in the long run, either in reduced calf weaning weights, lower conception rates or having to flush thin cows with additional feed before breeding season next year.

Looking at the direct cost alone of letting a cow with an ideal BCS of 3.0 drop just one BCS unit, she finds a savings of 900 megacalories of feed energy, but it will take 1,900 megacalories of energy to put that unit of BCS back on before calving and breeding season.

“That’s 50 per cent less efficient, so not a good plan when you consider the net loss of energy,” she adds.

Cows are most efficient at using feed energy and most productive at a BCS of 2.5 to 3.0. They will be able to winter on average-quality hay and maintain their condition for calving and rebreeding. If they slip to 2.0 or less, you’d need to feed an extra seven pounds of barley or 11 pounds of good-quality hay each day to bring them back up to 3.0 by calving time.

If you’re still not convinced that actually scoring the cows is better than eyeballing, Paley and her colleagues, Jenifer Heyden and Chelsey Carruthers, offer up more motivating economic evidence in their webinar discussing how cow body condition affects your bottom line.

You will be setting yourself up for a double whammy if cows come off grass in thin condition and receive nothing more than a maintenance diet through the winter.

One: Her calf to be born that spring will wean off at a lighter weight because she won’t reach her full potential for colostrum and total milk production. The lost

www.canadiancattlemen.ca

breeding

weaning weight can be as much as 25 per cent for every cow with a BCS of 2.0 or less at calving or losing weight after calving. If you’d expect your cows to wean 500-pound calves when they are in good shape and to sell them in the fall for $1.55 per pound, you could be out as much as 125 pounds on each calf, or $194 per calf.

Two: Her calf one year out is likely to be lighter just because thin cows take longer to return to estrus and conceive later in the breeding season. A calf gains about two pounds a day, which adds up to 40 pounds for every 20 days conception is delayed. At $1.55 per pound sale weight, that’s $62 lost for every cycle she misses.

The tally so far is a loss of $256 per calf, against zero for body condition scoring and grouping calves accordingly for winter feeding.

Flushing thin cows by providing extra energy from about three weeks before and through the first four weeks of breeding season can help limit the snowballing effect. The weight-gain period can put the conception rate for borderline thin cows on par with cows in ideal condition.

That said, there is no advantage to flushing cows already in ideal body condition.

The half-unit of BCS to take cows from 2.0 up to 2.5 represents about 100 pounds on a 1,300-pound cow. Early-spring pasture can’t be relied upon because flushing has to start at least 35 days ahead of breeding season, which may not be in synch with pasture conditions for turnout.

The moisture content of some earlyspring forages can be as high as 75 per cent and it’s physically impossible for cows to consume the 150 pounds of grass a day it would take to meet their requirements.

You’d have to provide an additional five pounds of barley per head per day for 60 days, or eight pounds for 45 days.

If you don’t do anything and the 2.0 cows slip to 1.75 after calving, you’re going to be out as much as 70 per cent on your potential whole-herd weaning weight, which takes into account the weaning weight of the calves as well as calves that were not born (open cows). The total weaning-weight loss could add up to as much as $543 per calf. Feeding to maintain condition at 2.0 will cut your total weaning-weight loss to about 40 per cent, or to $310 per calf. Even if you flush cows to bring their scores up to 2.5, you’ll still be out about 15 per cent, or $116 per calf.

Flushing with six pounds of barley per cow per day for 35 days, with barley priced

lace the palm of P your hand on the top of the short ribs and apply firm pressure to the end of the ribs

at $4.80 a bushel, would cost approximately $21 per cow. In effect, you would be spending $21 per cow to save at least $194 ($310$116) per calf when all is said and done.

Money spent up front can pay off in the big picture as illustrated in the CanFax research report “Focus on Productivity,” which looks at cash costs relative to the cost of production on cow-calf operations. The low-cost ($575 per cow) producer’s break-even for weaned calves was 10 cents higher than the high-cost ($625) producer’s break-even and it all came down to lower reproductive efficiency (88

per cent versus 92 per cent calving rate, respectively) and lower weaning weight (525 pounds versus 585 pounds, respectively). The full fact sheet is available at www.canfax.ca.

The webinar, “Feeding for Productivity and Profit: How cow body condition affects your bottom line,” can be viewed at www2.gotomeeting.com/reg ister/887311962. A link on the ministry’s website, www.agriculture.gov.sk.ca, will take you to Paley’s video on how to body condition score, or she can be reached at 306-786-1686. c

“Cattle coming into my feedlot are usually heavier, so I treat ’em with long lasting ZACTRAN on arrival.”

Heavier weight cattle are often at lower risk to BRD so it makes sense to treat them with the fast acting,1 long lasting2 product that won’t break the bank. (And it’s plastic, so you won’t break the bottle either.) ®

Treat them with ZACTRAN .

Ask your veterinarian why ZACTRAN is ideal for cattle in your feedlot.

1. Giguère S, Huang R, Malinski TJ, Dorr PM, Tessman RK & Somerville BA. Disposition of gamithromycin in plasma, pulmonary epithelial lining fluid, bronchoalveolar cells, and lung tissue in cattle. Am. J. Vet. Res. 72(3): 326-330 (2011).

2. Based on label claims.

ZACTRAN® is a registered trademark of Merial Limited. © 2013 Merial Canada Inc. All rights reserved. ZACT-13-7560-JAD-E

www.canadiancattlemen.ca

C at t l e m e n · n o v e m b e r 2 0 1 3 2792 Zactran Metaphylazis-CndCttl.indd 1

Client: Merial Project: Zactran Metaphylazis Ad Date: Nov 2013

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2013-10-11 10:25 AM

Publication: Canadian Cattlemen Size: 4.58” x 5” Bleed: none

Agency: ON Communication Inc Agency Contact: Raellen Seaman Telephone: 519-434-1365 Ext.228

DoIng More. uSIng leSS.

A series on being ready for the farming challenges ahead

Case IH enhances lineup for livestock, Hay & Forage uses

By ZaCH HetterICk Case IH Livestock Equipment Marketing Manager

t

he new models and significant redesigns across the entire lineup of hay and forage tools and compact and utility tractors are all based on customer feedback. To further support livestock and hay producers, Case IH has hired nine new hay specialists to work side by side with dealers and producers.

Here are the newest Case IH products:

WD3 II SerIeS WInDroWerS Redesigned Case IH WD3 series windrowers are the first launched in the industry to offer a factory-installed autoguidance system managed through the Case IH AFS Pro 700 control center to increase productivity and reduce operator fatigue.

Windrowers are one of the hardest pieces of equipment to drive.

However, Case IH has made it much easier with AFS autoguidance and a new hydraulic steering system with fewer linkages and pivot joints. Operators will appreciate the improved drivability in the field, as well as the great steering responsiveness on the road, which creates the ability to operate at higher road speeds.

WD3 series windrowers can now top out at 24 mph road speed – the fastest in the industry – so operators can get to one more field before calling it a day.

DH3 SerIeS Draper HeaDerS Case IH DH3 series draper headers for windrowers help producers cover more acres faster and more efficiently with an all-new 40-foot header. A shallow, angled top section offers higher throughput capacity, crop feeding and crop flow.

Crop quality also is protected through the draper heads’ agronomic design. A two-circuit hydraulic system offers more consistent flow and power across the header, so producers get more even crop feed, resulting in more consistent, well-formed windrows.

Improved crop feeding also is assisted by an all-new, heavy-duty frame design with larger reel arms and increased strength. The rugged Case IH cutterbar offers additional protection, even in harsh conditions.

DC3 SerIeS DISC MoWer ConDItIonerS Case IH DC3 series disc mower conditioners simplify the path to high-

quality hay with a new cutterbar design with wide discs for a closer, cleaner cut. That puts more hay into windrows.

The modular cutterbar design provides superior lubrication compared to competitive systems and eliminates crosscontamination if a disc breaks. Designed to improve dry down for better hay quality, these mower conditioners enhance crop flow and windrow consistency, while new shielding minimizes material buildup during use.

DC3 series disc mower conditioners are built tough for longtime use, with larger gears, bearings and interconnecting shafts.

Lightweight, impact-resistant plastic access doors provide easy access for adjustments in the field. A shock protection system saves time and money when obstacles are encountered, while the simplified drive system helps minimize horsepower consumption and maintenance needs.

rB565 rounD Baler The new RB565 provides 20 percent more capacity than previous models. The new overshot feeder between the pick-up and bale chamber creates a quick and even feed of material into the bale chamber. The new roller windguard and five bar pick-up comb the crop off the ground for fast and even feeding.

The new RB565 is built to last. It features a total redesigned pick-up that has been strengthened from the inside out. Some of the new enhancements include double spider gears, solid line bars, and rubber mounted teeth that provide five times the wear life of the previous generation teeth. Belt tracking and durability has never been better using all-new premium belts available in a laced or endless design.

The baler also has been made easier to operate with the Case IH ISOBUS-compliant control system. You can now run the baler thorough the AFS Pro 700 display in your tractor, giving you a simple layout with the large touch screen monitor.

In the past 12 months, Case IH has added several other new products to the Case IH livestock/hay/forage product lines to better meet livestock producers’ unique needs, including Farmall® C, U and B CVT tractors, and the LB4 large square baler.

To learn more about these models, visit www.CaseIH.com.

1. Yield impact statistics based upon Purdue University Department of Agronomy Publication AGRY-91-01 "Stand Establishment Variability in Corn" 2. Yield impact statistics based upon Purdue University Department of Agronomy Publication AGRY-91-01 "Stand Establishment Variability in Corn." Based on a 200-bushel yield potential and 26,000 to 30,000 seeds per acre with spacing variability with standard deviation of about 2 inches.

caseih.com

MaxxumÂŽ series tractors are designed to handle everything from roadside mowing, livestock operations, to row-crop applications. SurroundVision cab with high-visibility roof panel offers outstanding visibility in all directions while optional cab suspension makes the ride feel more like a truck than a tractor. Tier 4A Efficient Power with patented SCR-only solution improves fuel efficiency and reduces maintenance intervals. And now Maxxum tractors offer a CVT option that simplifies operation by automatically selecting the most efficient transmission range for the desired speed or load, eliminating the need for clutching and shifting. See your Case IH dealer or visit us online at www.caseih.com/maxxumcanc1113.

BE READY.

Š2013 CNH America LLC. All rights reserved. Case IH is a registered trademark of CNH America LLC. www.caseih.com

 grazing

By Steve Kenyon

A Custom Grazier’s Best Friends

I

am a custom grazier. I do not own any land, nor do I own any cattle, but I make my living with both. I rent land from my landowners, and I bring in customers’ cattle to graze. I deal with human resource issues on two fronts and let me explain why this is the most important part of my business.

It does not matter how good of a grazier I am, if I don’t have the land to graze or I can’t get the cattle to graze it. Human resources come first.

My landowners are great… all 21 of them. Each one is unique and they all have different ideas and backgrounds. Some are old school and are simply retired from farming. I enjoy going for tea with these landowners as it takes me back to the days of the handshake. I have other landowners who have inherited the land but do not farm it.

Maybe they grew up on the farm but left years ago. These landowners still have an emotional tie to the land but are not too concerned about the details. I also have urbanites who just want to live in the country so they bought a chunk of land. Some are concerned about how the land is managed and others are very new to the rural mentality. I also have an investment strategy for people who want to own land but I provide the management services to tend it. I will tell you however, that most of my landowners all deal on a handshake now. We might start off with a contract but then a trust is built and we now have a positive relationship. Of all my landowners at present, I have one actual signed contract in place. In this side of my business, I believe the handshake still works.

On the other hand, each year about this time I get a few phone calls from other custom graziers asking me about my contract. They have a customer refusing to pay their final bill for some reason or another and are asking me how to deal with them. I’m afraid that on this side of my business, the handshake is long gone.

I have had up to eight different customers in one season who supply me cattle. I have found that customers come and go. Sometimes it is their decision not to return, sometimes it is mine, but I will say that I never want to burn a bridge on purpose. This is not always possible when dealing with human resources but I look at business relationships as advertising. Each relationship I have with a customer, landowner, buyer, trucker, salesman or anyone else associated with my business, is advertising for the next relationship. Word of mouth is a powerful force and I would love to keep it in my favour, if possible.

I consider this to be a type of marketing as I am marketing myself.

But I am a realist. I know that this is not always possible when dealing with people, but I put a lot of effort into keeping my customers happy. It’s a little different relationship though. I always make sure there is a signed contract. It’s a tough business and when margins are thin, the contract is important.

My contract was drafted by my lawyer. I adjust it slightly depending on the situation but every customer has to sign one to bring cattle in. It begins with the basic contract information of both parties.

Between all the fancy lawyer talk it contains the basic components of a typical agreement. It states the start and end dates with the end date being at the discretion of the grazier in case of a drought and destocking is necessary. The cost for each type and weight of livestock being grazed is included along with payment requirements.

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A custom grazier today needs more friends than a good dog to be successful.

For me the requirement is monthly payments that are paid in advance each month.

I always charge on a per-head-per day basis and not by the rate of gain. The type of animal, the condition of the animal, previous feed, sickness and the weather all have a huge effect on the rate of gain which are all beyond my control. I also do not want to fight over when, where and how the animals are weighed at the beginning or at the end of the season. As I said, on this side of my business, the handshake does not work. The contract has to be clear.

My contract also includes any additional costs and they need to be described and determined as to who is responsible for them. These might include minerals or salt, supplements, vaccines or medications, veterinary treatments, incidental transport and additional labour.

I also have a clause in there to deal with uncontrollable or unsafe animal units. They are removed at the expense of the owner. All injury, sickness, missing animals or death losses are the responsibility of the owner, plain and simple. I believe you have a risk in what you invest in. I do not invest in livestock, therefore I do not have any risk in them.

My contract, with all the lawyer talk, is quite simple, but by itself it is about as worthless as the piece of paper it is written on. What makes it strong is the Animal Keepers Act. The Animal Keepers Act is a provincial act designed to protect custom feeders or graziers in the event that a client fails to pay his Continued on page 16

www.canadiancattlemen.ca

Make ZUPREVO your on-arrival antibiotic of choice for cattle at high risk of developing BRD. TM

The longest-lasting on-arrival antibiotic on the market today High and sustained concentrations in the lungs for up to 28 days1

Ask your veterinarian about the Breathe Easy Pledge, and how it can help you further reduce the impact of BRD on your operation.

1. Menge, M., Rose, M., Bohland, C., Zschiesche, E., Kilp, S., Metz, W., Allan, M., Röpke, R., Nürnberger, M. Pharmacokinetics of tildipirosin in bovine plasma, lung tissue, and bronchial fluid (from live, non-anesthetized cattle). J. Vet. Pharmacol. Therap. doi: 10.1111/j.1365-2885.2011.01349.x.

ZUPREVOTM is a trademark of Intervet International B.V. Used under license.

RESFLOR® is a registered trademark of Intervet International B.V. Used under license.

Merck Animal Health, operating in Canada as Intervet Canada Corp., a subsidiary of Merck & Co., Inc., Whitehouse Station, NJ, USA. MERCK is a trademark of Merck Sharp & Dohme Corp., a subsidiary of Merck & Co., Inc., Whitehouse Station, NJ, USA. Copyright © 2013 Intervet International B.V., a subsidiary of Merck & Co., Inc., Whitehouse Station, NJ, USA. All rights reserved.

g r a z i ng

Continued from page 14

bill. It replaced the old Livery and Stable Keepers Act a few years ago. It gives you a lien on the animals in your care so that in the event that you are not paid you can sell the animals at auction to recoup your fees.

The big issue with this act is that our lien has priority over the lending institutions.

That is great for custom operators as it is the best protection we can have. The issue arises because the lending institutions sometimes insist on the custom operator signing a separate contract with them that releases our lien. My advice is DON’T DO IT!! They’ll try to convince you that it is in your best interest to sign their contract, but it is not.

The act, as it is, gives us the best protection we can get. However, it is a lien of possession.

If you allow animals to be removed from your control, your lien is gone. Do not let the animals go unless you have been fully paid.

Only once I had to retain animals and threaten to use the lien. I never did have to sell them. My fees were eventually paid and I returned the animals. I continued to feed the animals and the bill kept getting bigger but I had retained enough animals to make sure I could cover my bill and then some.

If it comes down to it I would remove the animals from the site so that the owner cannot take them. Yes, it was attempted by one of my customers. Luckily for me he took

the wrong animals and I still had a group of his cattle that I removed to a new location.

I then let the brand inspector know where they were and why they were being held. If I can, I also inform the lending institution about the situation.

It is frustrating to me that one side of my business works on a handshake, but the other does not. But it is just part of the game. For this side of my business, the Animal Keepers Act and a contract are an Alberta custom grazier’s best friends. c Steve Kenyon runs Greener Pastures Ranching Ltd. in Busby, Alta., www. greenerpasturesranching.com, 780-307-6500, email skenyon@greenerpasturesranching.com.

Plan to attend the Shorthorn Sale, 2:00 P.M., nov. 14 and the Shorthorn Show 9:00 a.M., nov. 15 at Canadian weStern agribition.

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www.canadiancattlemen.ca

 Nutriti o n

By John McKinnon

Feed Grains:

What a Difference A Year Makes!

A

s this column goes to print, harvest is drawing to a close and for many grain producers it has been a banner year. For example, after several years of drought, the U.S. corn crop is predicted to come in at just under 14 billion bushels while in Canada the wheat crop may reach 30 million tonnes. Cattle feeders are already seeing the impact of this large harvest with grain prices dropping dramatically from the highs of the last few years.

Lower prices and increased feed grain supply offers cattle feeders the opportunity to diversify their feeding program and reduce costs by incorporating alternatives to barley grain such as feed wheat, rye or triticale.

In particular, many feeders are looking at wheat as part of their feeding program. In this column we have discussed the issues with feeding wheat (Cattleman December 2011), however, it is timely to review some of the differences between wheat and other common feed grains as well as look at some of the issues specific to this year’s crop.

Normal feed wheat has a test weight of 60 pounds per imperial bushel. In terms of net energy content, wheat has an average value of 2.2 and 1.59 Mcal per kilogram of dry matter (DM) for maintenance (NEm) and gain (NEg), respectively. Its NEg value is approximately eight per cent higher than that of barley and two per cent lower than corn grain. Feed wheat typically weighs in at less than 60 pounds (i.e. 50 to 56 pounds or less) with an energy value similar to or slightly higher than barley grain, depending on the reason for downgrading. Protein content ranges from 13 to 15 per cent.

Of particular interest is its starch content. At 60 to 65 per cent starch, wheat is intermediate to barley (55 to 60 per cent) and corn (65 to 70 per cent). However, of the three, wheat has the fastest rate of rumen starch fermentation. This characteristic has important implications for feeding management as its high starch content and rapid fermentation can predispose cattle to rumen acidosis (i.e. gain overload). Too much wheat, too quickly will result in rapid production and accumulation of acid in the rumen. This drops rumen pH and leads to acidosis which can range in severity from acute to subacute. Symptoms of subacute acidosis include erratic feed intake, reduced gains, poor conversions, lameness and liver abscesses. With severe acidosis death can occur within a 48-hour period. To minimize these issues, most nutritionists recommend blending wheat into the ration and have an upper limit on the amount fed, typically 50 per cent of the grain portion

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of the ration. In a finishing diet, this means a maximum of 40 to 45 per cent wheat (DM basis). Wheat should also be introduced in steps, replacing barley (or corn) at 10 per cent increments (DM basis). At each step, cattle should be given two to three days to adapt, after which if they are eating normally it is safe to move to the next step. Properly adapted wheat-fed cattle will have superior feed conversions relative to barley-fed cattle and if wheat is priced competitively, lower feed costs.

Other feed grain choices include rye and triticale, although availability will vary greatly with location.

From an energy perspective, both are similar to or slightly higher than barley grain (i.e. 2.06 and 1.4 Mcal NEm and NEg per kilogram of DM, respectively). Cattle fed too high a level of rye can have reduced feed intake. All cereal grains discussed require processing prior to feeding, typically by dry rolling or tempering and subsequent rolling. With wheat and rye, it is particularly important not to overprocess, as excessive fines can compound the negative effects of these grains on rumen function and performance.

One final consideration is the potential for ergot contamination. This problem appears to be on the rise in Western Canada, with several hot spots in Alberta and Saskatchewan in 2013. Ergot poisoning is a very serious issue impacting the health and performance of cattle. While traditionally a problem with rye, ergot has increasingly been found in barley, wheat, oats as well as several grasses. The maximum concentration of ergot that has traditionally been regarded as safe for feeding is 0.1 per cent (one ergot body per 1,000 kernels). For grain with greater concentrations, producers were advised to clean the grain or dilute with non-contaminated grain to reduce the potential for poisoning. However, this recommendation is being questioned by researchers at the University of Saskatchewan who are looking at the concentration of ergot alkaloids and not just the number of ergot bodies. While this work is preliminary, recent field cases of ergot poisoning suggest that if you have concerns with contamination, have the grain tested. Ergot alkaloid testing is now available in Canada through the Prairie Diagnostic Centre of the Western College of Veterinary Medicine at the University of Saskatchewan (pds. info@usask.ca).

As you can see there are a number of challenges when feeding wheat and to a lesser extent rye and triticale.

Your reward for a little extra management — superior close-outs! c

John McKinnon is a beef cattle nutritionist at the University of Saskatchewan

C at t l e m e n · N o v e m b e r 2 0 1 3

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 breeding

By Debbie Furber

data wins out at R & R acres Selection is done by the numbers in this Limousin herd

S

ome 8,000 vehicles a day pass by R & R Acres’ home pasture bordering the QE2 Highway north of Airdrie, Alta. The location is a unique showcase for Randy, Rhonda, Brandon and Kate Bollum’s herd of predominantly Limousin cattle, but the number seems trivial in comparison to all the data they’ve collected on individual animals in their herd.

It’s all about gathering information and using it when they start chalking up the firsts since establishing the ranch in the early ’80s from a base of Randy’s Limousin cattle brought up from his family’s farm in Minnesota, where the Bollums were Limousin pioneers in the early ’70s.

Largely Angus, but some Simmental and Gelbvieh genetics have also been used to breed up today’s herd of 130 high-percentage and purebred Limousin females registered with the Canadian Limousin Association (CLA).

The world’s first all-homozygous polled Limousin bull sale, Canada’s first all-black Limousin sale, the first Limousin herd to test all offspring for residual feed intake (RFI), the first Limousin outfit to annually DNA profile its entire bull sale offering, the country’s top-ranked bull and cow for docility, and the most CLA elite dams in the past three years, are a few of the hallmarks of their breeding and marketing programs to date.

The accomplishments have been made possible only because of their extensive schedule of measuring traits and using the data to make informed breeding decisions. In fact, they market their herd as having more years of data for more traits than anyone else in the Canadian beef seedstock business.

It all boils down to learning more about their cattle so they can accurately predict what their cattle should do and what they actually will do as breeding stock and market animals, Bollum says. The days of prizing the “art” of designing the perfect mating are long gone. Today, it’s a science driven by data.

At times that has meant disciplined culling of top-performance animals. “For example, we’ve worked hard at improving calving ease and docility right from the start, so the hard calvers and wild ones have to go,” he explains. “Some of our most

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They started by figuring out what their markets would be and then worked backward to select bulls and replacement heifers that would give them the performance needed to meet the targets for top value.

The Bollums’ goal is to produce topquality lean beef and they have two yardsticks to measure their success. Market animals have consistently hit the top price grid when sold to Laura’s Lean Beef and Norwich Packers in Ontario. Perhaps the testimony they value most is that from their local freezer beef customers — they love it.

On the breeding stock side, it’s positive customer feedback and repeat customers.

Feed efficiency testing

All the calves, bulls and heifers, are tested for feed efficiency after weaning Brandon Bollum (at left) Airdrie, Alta.

efficient bull calves for RFI have been castrated because they are not as salable as they should be on other traits.”

He looks to the pork, poultry and dairy industries as leaders because these industries welcomed the use of information and technology, turned it into predictability and improved results. He acknowledges this has been more of a challenge for the cattle industry because producers choose cattle and systems to fit their land, climate and markets.

That said, he feels it’s not an insurmountable obstacle in this day and age. Big herds now have technology for predictable performance to produce large numbers of “peas in a pod” kind of cattle from birth to carcass. Herds of all sizes can use programs like the Beef InfoXchange System to align with others toward producing a predictable end product.

The real challenge is for seedstock producers and extension people to get all of this information out to commercial producers and promote its use in a way that’s not overwhelming, Bollum says. It can be an information overload, but you have to start somewhere.

R & R Acres uses whole-herd reporting to be eligible to obtain EPDs (expected progeny differences) on their animals. This requires production information be submitted for every breeding female to the CLA every year. This not only improves the accuracy of their own EPDs but the breed’s EPDs as well, because of the greater volume of data compared to when producers only report animals they want to register.

The Bollums record birth weight, calving ease, gestation length, weaning weight, docility score at weaning, yearling weight and hip height. A certified ultrasound technician measures each animal at approximately a year of age for rib-eye area and backfat depth to predict marbling and per cent lean meat yield. They also score each female on teat and udder conformation within 24 hours of calving and weigh and body-condition score the cows at weaning.

More recently, they’ve added feed efficiency testing, including RFI and straight feed conversion (F:G). After weaning the June-Julyborn calf crop in December, all of the calves go to Morison Farms Feedlot west of Airdrie for a 90-day performance and feed-efficiency test using the GrowSafe system. While on test, they receive the lightest starter silage ration available, and no beta-agonists are used. Back at home they go onto native grass pasture and then coast through the winter on free-choice hay and a no-starch complete mixed ration.

The Bollums were among the first herds Continued on page 20

www.canadiancattlemen.ca

“Incorporating Draxxin into our business model has given us the opportunity to capitalize on buying cattle with varying levels of risk, yet maintaining the same cost at the end of the day.�

- Schooten & Sons Custom Feedyard Ltd., Diamond City, Alberta

EntEr thE Draxxin ProDucEr aPPrEciation contEst Tell us how Draxxin has changed your work day and improved your business bottom line.

Each testimonial received will give you the chance to win 100,000 PLP points valued at $2,000.

For all contest details and to participate, go to our Facebook page (http://apps.facebook.com/draxxin) or ask your Zoetis Territory Manager to assist you !

Zoetis and Draxxin are trademarks of Zoetis or its licensors, used under license by Zoetis Canada. DXN JADP01 0713 E

M-1884_CANCAT_AD_DraxxinTesti_EN.indd 1

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B R E E D I NG

Continued from page 18

in Canada to start RFI testing all of their bull calves when Cattleland Feedyards of Strathmore, Alta., made the test commercially available in 2004. In fact, they feel safe in saying that theirs was the first Limousin herd in the world to do RFI testing on all of its bulls because the research proving RFI was carried out by Dr. John Basarb and his team just down the road at the Lacombe Research Centre and Olds College using GrowSafe Systems’ computerized feeders, another hometown company.

Every animal draws energy from the feed it consumes. What’s left after meeting its maintenance needs, the residual, is available for growth and production.

Animals with negative RFI values are the feed efficient ones that consume less feed than expected (by National Research Council recommendations) for maintenance and growth. Others that eat more to achieve the same level of production have higher RFI values. Most of the energy from the additional feed is simply lost as heat, so keeping high RFI animals in the herd is like throwing money to the wind.

Bollum says an easy way to remember which is which is to think of RFI as a golf score — the lower the better.

After testing all of their bull calves for the past nine years and all of their heifer calves for the past five years, they have seen considerable variation in RFI values, ranging from the most efficient bull with an RFI of -6 to the least efficient with an RFI of +8. By paying attention to this detail they’ve been able to narrow that variability. Today the top-to-bottom range is from -2.0 to +2.36.

The Feed:Gain ratio has also improved with most bulls now posting 4.0 to 5.0 pounds of feed (dry-matter basis) per pound of gain, with several getting down to 2.71 to 3.0 pounds of feed to pound of gain.

“I measure both RFI and F:G because I want to know the feed efficiency figured both ways, as more people in the business are more accustomed to using straight F:G than the RFI way of figuring feed efficiency,” Bollum says. “Sometimes an animal is superior with both ways of figuring and that’s probably the complete package.”

As research has shown, just because an animal has a low RFI doesn’t mean it will

have top performance. Some eat less but don’t have great genetic potential for other traits of importance.

There is more variation within each breed today than across breeds because RFI is a relatively new trait and the cost of testing is still limiting its use. The wide variation represents a big opportunity for the industry as a whole, because RFI is 40 per cent (moderately) heritable, that is, 40 per cent of the variability in RFI among cattle is due to genetics, so it will respond fairly quickly to selection pressure.

“RFI and straight feed efficiency are cow traits, not just feedlot traits,” Bollum stresses.

“Low RFI cattle will benefit feeders for the 180 days or so that calves are on feed, but a feed-efficient female will benefit your bottom line 365 days a year for as long as she is in your herd and contribute superior daughters that will be in the herd 10 or 15 years.”

Recent research looking at the cow side of RFI shows that a low-RFI heifer will be a low-RFI cow and that low RFI doesn’t appear to have any negative effects on important reproductive traits.

“RFI is still such an underrated trait com-

Plan to attend the...

2013 CFGA Conference & AGM December 9-11, 2013

POMEROY Inn and Suites at Olds College, Olds, Alberta

hosted by the: Alberta Forage Industry Network (AFIN)

“TAKING FORAGES MAINSTREAM CHALLENGES, PITFALLS AND OPPORTUNITIES”

Canadian Forage & Grassland Association Association Canadienne pour les Plantes Fourragères

For more information please contact: Canadian Forage & Grassland Association Ph: (204) 726-9393

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breeding

pared to the benefits it can offer,” he says. “A 10 per cent improvement in feed efficiency in a moderate-size herd can add up to a free pickup every so often just by being wiser in genetic selections.”

DNA testing

R & R Acres has also been among the early adopters of DNA profiling, first with DNA testing for single traits, such as the leptin gene when it became available in the late 1990s, then becoming one of the few Limousin herds in the world to use the multi-trait Igenity panel for basic beef. This year, R & R Acres became the first Limousin herd in North America to use the new Igenity 50K panel for Limousin cattle on all of its bull calves.

The 50K panel reflects additional research to verify traits specifically in Limousin cattle, Bollum explains. All DNA markers have # 1106844 to beJob verified with actual field data and the client: Novartis only way to get more accuracy is to keep testSpecs: 7x5 // genotype 4C ing the population and T: relating to phenotype (actual performance).

1. Desktop:JhW 3. aD: “The 50K for Limousin results showed higher correlation with the actual data 2. Proof: 4. cD: and EPDs for our herd and we have high

Kate Bollum and her family put a premium on selecting for temperament as well as performance.

accuracies because we use proven bulls and have been putting inaD our#:nvcSB06126844 data from the beginning,” he says.

They’ve recently gone back to using the DNA test for the leptin gene as well as a 5. cW:with tendersingle gene, PMCH, associated ness. Several of the bulls6.inProd. this Mgr: year’s sale tested homozygous favourable for one or

both of these traits. They continue to DNA test for the horned/polled gene and black colour gene as well.

That makes 18 trait measurements in all to back the merit of R & R Acres’ breeding stock.

7.information, aS: For more contact the Bollums at 403-948-4768, or see their family website online at www.limousinleader.com. c

A DVE RTOR I AL

ScourS Prevention StartS With the coW Ensuring next year’s calves get off to a fast, healthy start begins long before calving season through careful management and vaccination of the dam.

Vaccinating pregnant cows with SCOUR BOS® 9 has the added benefit of reducing the number of disease-causing pathogens shed in manure, thus reducing the calf’s chances of exposure.

Calf scours, or neonatal diarrhea, continues to be a leading cause of mortality and sickness among calves. Viruses and bacteria that can cause calf scours are naturally present in every calf’s environment.

So how do you ensure that your calves are equipped to deal with this challenge?

Of course, vaccination and good colostrum management are only part of an effective scours prevention strategy. To ensure the health of your calves it is essential to incorporate other management strategies, including:

The most vital factor in the control of calfhood diseases, particularly scours, is colostrum. Newborn calves depend on colostrum for immunity against diseases until they are old enough to generate their own protective immunity.

Vaccinating your pregnant cows and heifers against the common scours pathogens with SCOUR BOS® 9 will increase the protection against scours through their colostrum.

Two things need to happen in order for this method to be effective.

First, the cow must have optimum antibody concentrations present in her blood before she starts to make colostrum. Since cows begin to make colostrum 4 to 6 weeks before calving1 vaccination should occur ahead of this, following label directions.

Second, the calf needs to receive 4 – 6 liters of colostrum within the first 24 hours of its life. If you’re not sure whether a calf has received enough colostrum, provide additional colostrum from the calf’s mother or a high-quality supplement.

• Reducing manure contamination in the calving area by moving cows away from the calving area when possible.

• Providing adequate shelter for your cow-calf pairs in the calving and nursery areas.

• Keeping calving and nursery areas well-bedded and well-drained.

• Refraining from bringing in new animals to your herd during mid-to-late pregnancy and calving to reduce the spread of disease.

• Isolating scouring calves in a separate area, away from the herd.

Calf scours is a complex and multi-factorial disease, but with the right tools and timing you can reduce the risk it poses to next year’s calf crop. Plan ahead and talk to your herd veterinarian about making SCOUR BOS® 9 a part of your fall management to provide the best preventative strategies for your herd.

Scour BoS

EARLIER

BETTER

LONgER

1 Radostits O, gay C, Hinchcliff K, Constable P (editors). Veterinary Medicine, 10th ed., 2007. Scour Bos is registered trademark of Novartis Ag; used under license.

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 vet aDv i c e

An Imposter Among Us

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pizootic hemorrhagic disease (EHD) is one of the most important diseases of deer in North America. The viruses that cause EHD are widespread in whitetail deer and cause serious epidemics in wild populations.

Some of the EHD virus strains causing disease in deer can also affect cattle. While EHD is rarely fatal in cattle and usually associated with epidemics in deer, the confusing array of lesions in cattle can be mistaken for foot-and-mouth disease (FMD) — a potentially serious mistake, especially if inadvertently made during large runs of cattle in the fall of the year. Even the temporary suspension of commerce in the cattle business because of mistaken identity could wreak havoc. The cattle industry in Canada is all too familiar with how quickly U.S. partners can slam the door on north-south beef trade, and how stubborn the resumption of trade can be.

The significance of EHD sits on two fronts: First is the close relationship the EHD virus maintains with bluetongue virus in the large genus of insect-transmitted viruses known as Orbiviruses.

Two consecutive outbreaks of EHD Type 2 and bluetongue Type 11 occurred in the Okanagan Valley in 1987 and 1988, the last time the diseases were identified since a major incursion in 1975. The EHD virus is also closely related — some consider it identical — to the Ibaraki virus that causes extensive disease outbreaks in cattle across Japan, Korea and Taiwan.

In North America EHD has been identified in white-tailed deer, mule deer, and pronghorn antelope. Sheep can be experimentally infected, but rarely show clinical signs, and goats do not seem to be susceptible to infection. Exposure to the EHD virus and midges capable of carrying the virus appears extensive. EHD outbreaks in deer are regularly reported from Michigan, Virginia, New Jersey, Pennsylvania, and New York. Outbreaks have also occurred in Kansas, Montana and California.

Three syndromes may be seen in deer: • Peracute disease and rapid death with swelling of the head and neck. Deer are often found dead alongside of bodies of water, to which they are driven by thirst.

• Acute form with extensive hemorrhage in many tissues and bloodtinged salivation and nasal discharge from ulcerations.

• Chronic form with sloughing of hooves and extreme lameness.

Deer may be seen crawling on their knees and chest. Some animals recover. Hoof deformities may linger through the year.

Outbreaks of EHD in deer typically occur in late summer and early fall. The onset of freezing weather usually stops the appearance of new cases.

Biting midges primarily responsible for transmitting EHD belong to the genus Culicoides. Some species of gnats and mosquitoes can also transmit EHD virus. The biological range of midges capable of transmitting EHD virus is creeping northward. Factors like the severity of winters, ambient temperatures during vector season and summer humidity will govern how far north midge vectors penetrate into Canada.

The second reason EHD is a significant issue for the cattle industry is the confusing array of lesions EHD causes when clinical signs emerge in cattle. Fever, anorexia (off feed) and difficulty swallow-

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ing are seen initially. Hemorrhages, erosions and ulceration develop in the mouth, on the lips and around the coronary band (hornhoof junction). Animals frequently drool and appear stiff and lame.

Abortions and stillbirths have been reported. Some affected cattle die. These are all symptoms that can be easily confused with footand-mouth disease.

Confirmed cases of epizootic hemorrhagic disease in cattle through the summer and fall of 2013 have occurred in Iowa, Wisconsin, Nebraska, and North Dakota. This summer has seen significant EHD activity in the northern reaches of its known range. The disease has been confirmed in white-tailed deer from Wyoming, South Dakota, Nebraska, Iowa, Wisconsin, Indiana, Illinois, Michigan, Ohio, Pennsylvania and New Jersey. As the disease reaches northern states, there is always concern among hunters, wildlife managers and disease specialists whether or not the potential exists for outbreaks in deer north of the 49th, and subsequent infections in cattle.

Through September and October of 2013, the Nebraska Department of Agriculture investigated multiple cases of cattle with severe oral, nasal and ocular lesions. Because the lesions look very similar to vesicular stomatitis and foot-and-mouth disease, foreign animal disease investigations were initiated with submissions to the Foreign Animal Disease Diagnostic Laboratory at Plum Island, N.Y. The investigation revealed 10 confirmed cases of EHD. Preferred tissues for laboratory diagnostics in deer include spleen, liver, lung, lymph nodes, and unclotted whole blood in EDTA or heparin. Both fresh and fixed (formalin) tissues should be collected if possible. Samples for virus isolation should be transported under refrigeration. For suspect cases in cattle, blood should be collected into anticoagulant (calcium citrate, EDTA, or heparin) and sent chilled for virus isolation or RT-PCR. Paired serum samples (during clinical signs and through recovery stages) should also be collected if possible. To rule out FMD and vesicular stomatitis, fluid from intact vesicles as well as aggressive swabs or biopsy samples near lesions are also suggested.

While EHD is a disease of great concern for deer in North America, the association of disease in cattle with EHD outbreaks in deer is troubling. The role of insect vectors, especially biting midges, gnats, and mosquitoes and the emergence of significant changes in their distribution induced by climate change always needs to be a factor in our thinking. Both veterinarians and producers can make mistakes should signs suddenly appear in cattle.

Knowing a disease imposter might be among us is critically important so appropriate diagnostic steps can be taken. It’s also important that veterinarians, producers and wildlife officials remain aware of what’s happening in wildlife. Regulatory and political intemperance with far-ranging consequences could be the result of inadvertent oversight in the field. c Dr. Ron Clarke prepares this column on behalf of the Western Canadian Association of Bovine Practitioners. Suggestions for future articles can be sent to Canadian Cattlemen (gren@fbcpublishing.com) or WCABP (info@wcabp.com).

www.canadiancattlemen.ca

S ALL M SERIE

 winter f e e d i ng

By Debbie Furber

MIXED FARMING SPIRIT THRIVES AT TEE TWO Making the most of crop residue

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arvesting grain and putting up feed is one in the same operation for Duane Thompson of Tee Two Land and Cattle near Kelliher, Sask. Crop residues fed in the field have improved soil organic matter and fertility for annual crop production and reduced winter feed costs on the cattle side.

Thompson says the symbiotic relationship between grain and beef farming makes the most efficient use of resources across his land base and helps to selfinsure the farm against market volatility in both sectors.

Annual crops include cereals, oilseeds and pulses, while forages for grazing and silage cover approximately half the 7,000-acre land base. The commercial cow herd has grown from 600 head to 1,000 in recent years as he and his wife, Paula, worked toward taking over the operation from his parents. A 2,000head feedlot for backgrounding the calves gives him the option of selling any time the markets are right from weaning in fall, to off grass in late summer, to finishing them on the farm.

Through the years, he has tried several strategies for extending grazing beyond the summer months and has settled on a system that makes efficient use of crop residues — a plentiful, readily available, and low-cost resource at Tee Two. The less you have to handle chaff and straw, the more valuable it becomes.

His fields and those he rents from neighbours are left as is after combining for stubble grazing, giving the herd access to forage in areas not suitable for cropping. This averages about 25 acres on each quarter in his area of east-central Saskatchewan dotted with potholes, sloughs and aspen parkland bush.

This is the main winter feed supply for the mature cows in top body condition (score of 3.0 or better) at weaning, which could be any time from September to November, depending on pasture conditions, Thompson explains. He primes the herd for winter stubble grazing by maintaining high-power summer pastures containing lots of legumes so that the cows and calves are nice and fat come fall.

This group receives alfalfa-based silage

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during cold snaps when the temperature drops below -27 C and every third day if they are still out grazing during their third trimester.

First and second calvers along with older and thinner cows are sorted into a second herd that grazes stubble and straw-chaff piles on fields closer to home so they can be supplemented with silage every second day.

Straw and chaff are blown together into a chaff wagon trailed behind the combine while harvesting barley, oat and pea fields. One combine has a chaff drop box attached to the rear axle. It is counterbalanced to automatically tip when full leaving windrows of small chaff piles that are later gathered with a stacker and placed for winter grazing. Largely that’s on the knolls and side hills, which are the best place for them given that stacks left in the hollows can quickly disappear under heavy snow drifts.

Only chaff is collected from canola and wheat and both are fed to backgrounding cattle. Canola chaff has good feed value, but low palatability, so it works best in mixed rations, whereas wheat chaff isn’t the greatest feed, but animals like it, so it’s used to start cattle unfamiliar with silage.

If Thompson could give only one word of advice from what he has learned about grazing crop residues, it would have to include several points: test residues so you know their feed values, sort cows into groups based on their nutritional needs, supplement accordingly, and have a backup plan if Mother Nature plays a trump card.

“When the snow gets an ice crust, the grazing is finished,” he says. Fall 2010 started off that way and the mature-cow group never did get out to graze the stubble fields that winter. Most years, they’ll be out until February and some years as late as April. Calving starts at the end of April on pastures with stockpiled grass.

“Be sure to train cattle to an electric fence before freeze-up because frozen ground insulates them from the full effect,” he adds.

“If you can’t control the animals it’s nearly impossible to manage this system.”

To handle the temporary fencing, he built a wire roller driven by a five-horse-

Duane Thompson

power motor that can string a half-mile of high-tensile wire in five minutes.

The in-field chaff-straw stacks are fed with a hot wire giving the herd access to three or four days’ worth of stacks at a time.

All of the leased stubble fields have singlestrand temporary fences, although he says he’s willing to pay extra if the owner allows him to put up a permanent fence.

Consistency of the manure tells him whether the cows are maintaining an even plane of nutrition. Moving the mature herd to a new quarter section every three to five days seems to work best. Part of the reason he can do this quite easily is because all of the quarters are connected.

Portioning out the feed prevents a boom-to-bust scenario where the cattle do well when rummaging through and picking the best feed, then lose weight when cleaning up the remainder unless they get some supplement.

“Not all cows are built to work for a living,” cautions Thompson. He removes the two to three per cent that fall behind using a field sorting corral of about 60 portable panels. This saves supplementing the entire herd to meet the needs of a few high-maintenance cows.

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WINTER FEEDING

Thompson supplements with alfalfabased silage because of its high protein content and digestibility to keep the rumens functioning efficiently so they make the best use of the roughage. He prefers silage over bales because there’s less worry about weather downgrading the quality or delaying the harvest during the best part of summer when he should be spending time with his family.

“Silage isn’t ‘just’ cow feed. I put labour, fuel and iron into it so I want it to be the best. That is about 16 per cent protein,” he explains. He likes a legume-grass mix with a high percentage of alfalfa and some clovers, which persist better than alfalfa in wetter areas. Meadow brome and creeping red fescue are the go-to grasses.

He manages for top quality by harvesting new forage stands for the first couple years, then turning them over to the summer grazing rotation for another three to five years before returning the land to the annual crop rotation. The stand is sprayed out and any regrowth grazed to weaken the plants before the oats or barley are drilled into the sod the following spring.

Temporary hot wire fencing is used to give the herd access to three or four days of stacks at a time.

While this mixed farming formula offers a lot of flexibility year to year, any major changes have to be well planned in advance.

Altering one enterprise can have a significant impact on all the others.

It’s also a fairly intense 365-day-a-year venture that wouldn’t be possible without extra hands. He and Paula, who kept up with her nursing career through the years, consider themselves fortunate to have had very good

longtime employees and the role his parents played bringing them into the business.

Their goal has been to create a business that any or all of their four children could join and that time is nearing with three of them already in post-secondary programs.

The kids are no strangers to the workload on a mixed farm, he says, and at this point it’s looking like three of them are interested in joining the family farm. c

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2013-10-15 9:57 AM

 winter f e e d i ng

By Debbie Furber

Bunching Saves a Bundle Management is the key

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unch grazing crop residues has cut Greg and Paulette Selzler’s winter feed costs by as much as $200 per cow and flip-flopped their strategy for building soil fibre and fertility. Instead of growing forages in rotation to give soil a boost for annual crop production, they now use the annual cropping years and bunch grazing to build soil for the forage years in their integrated beef and grain operation near Mayerthorpe, Alta.

They work a five-year rotation of alfalfa-orchard-brome forage into their annual crop rotation, but the cows don’t graze the hay land, summer or winter, Selzler says. They feel bale grazing is a viable way to build soil and improve yield, especially for farms not set up for cropping, however, they need to maintain the highest quality and tonnage possible to supply their long-established horse-hay market.

Nor do they swath graze cereal crops. He and his parents tried swath grazing on and off for 25 years, but it seemed there were always weather-related problems with the timing of sowing and feeding the crop. If mould from rain and melting snow didn’t set in, they’d be iced down or buried under heavy snow. Lots of years they’d end up baling the swaths, mouse droppings and all, in the spring just to get them off the field before seeding.

As land values and the expense of sowing annual crops for swath grazing went up, so too did the risk. “I just felt a lot more comfortable taking the grain out first,” Selzler says. “That way I’m not out anything if I lose the feed under snow or ice because it’s just straw and chaff that would have been chopped and spread behind the combine anyway and I can limit feed the grain as a supplement if needed.”

Slim margins on both sides of the operation sent him in search of an efficient and cost-effective way to make use of crop residues in his winter feeding program. He didn’t have to look far because his uncle, Jim Hole of Calgary, had pioneered the concept of bunch grazing residues and had often tried to convince the family of its merits. It’s an

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Greg Selzler is sold on bunching straw and chaff piles to cut his winter feeding costs.

oversized pitchfork-like attachment that fits onto the rear axle of the combine to collect straw and chaff on the fly. The counterbalance mechanism lets the pile drop once 50 to 70 pounds of residue collect on the tongs, leaving it in piles two or three feet high.

Selzler says the design might seem simple at first glance, but there’s more to it than meets the eye. He built his own and based on that experience, recommends doing yourself a favour and buying The Whole Buncher from the people at A.J. Manufacturing (www.ajmanufacturing.ca) who know how to build and use it. They’ll have you up and running in no time, whereas, harvest could be half over by the time you get a home-built model working properly.

Jim Sutton of A.J. Manufacturing says the buncher concept was further developed and patented as The Whole Buncher out of respect to Jim Hole, and his partner, Allen Jones, who has been using one in his beef and grain operation since 2002. The buncher with mounting brackets and hardware sells for $4,500 f.o.b. Okotoks, Alta. Installation infor-

mation is provided with support just a phone call or email away.

The only problem Selzler has run up against is when he drives over a bunched pile while combining. The straw accumulates behind the bar of the buncher so the counterbalance system that triggers the drop can’t do its job and straw starts backing up into the combine walkers.

In his six years of experience feeding bunches, the savings on winter feed costs have been in line with ARECA’s (Agricultural Research and Extension Council of Alberta) data reported in the publication, Year-Round Grazing 365 Days. It shows an average savings of approximately $200 per cow a year compared to the feed and yardage costs associated with the traditional method of dry-lot feeding hay and straw.

“In other words, I’m making $200 a year more from each cow,” Selzler says, adding that even though the dollar figures have gone up since publication, the savings difference has remained fairly constant.

Continued on page 28

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w i n t e r f e e d i ng

Continued from page 26

The reported cost per day per cow for feeding bunched crop residue in the field was 72 cents or less, compared to $1.75 for dry-lot feeding, 90 cents for swath grazing, $1 for grazing stockpiled perennial forage, and $1.35 for bale grazing.

These averages include yardage (nonfeed costs), but don’t begin to touch on the bonus that comes with in-field feeding — a

35 per cent reduction in fertilizer expense for the following crop because of the efficient soil nutrient cycling system.

The soil-building potential is where bunch grazing really shines. “It’s the fastest, cheapest, most cost-efficient and best system we’ve seen for building soil,” Selzler says.

Cows take in the residues and process them through the digestive system into plant-available forms of nitrogen, phosphorus and minerals that will show up in

soil tests the next spring, so the return is immediate. Chopping and working in residues gives returns but in the longer term because soil nitrogen is used up in the process of breaking down the residues. Removing straw from the field will cost in the long run because you’ll need to replace those nutrients.

Alberta Agriculture’s fact sheet Estimating the Value of Crop Residues gives general guidelines on how far crop residues will carry the cows. On average in the black soil zone, barley and oat crops yield about 45 pounds of straw per bushel of grain, assuming 80 per cent recovery with two to four inches of stubble. Chaff yields are five to 10 pounds per bushel of grain. Wheat, canola and pea crops yield about 60 pounds of straw and 15 to 25 pounds of chaff per bushel of grain.

In years with average rainfall, Selzler estimates a one-to-one ratio of cereal grain (bushels) to straw/chaff (pounds), but also takes into consideration whether the straw is longer or shorter than normal, bushel weight of the grain and dockage. Some years, some fields could yield lots of bushels with belowaverage straw yield, and vice versa.

An example estimates a chaff yield of 600 pounds per acre with 20 per cent wastage and daily estimated intake of 30 pounds per head per day for a 30-day period works out to about two acres of crop residue per cow per month. [30 lbs./day x 30 days/600 lbs. residue x 80% (20% roughage) = 1.9 acres per cow.]

He controls access with temporary electric fencing to achieve even manure distribution across the field and to prevent the cows from picking the best out of the piles and using the rest for bedding. Snow does a good job of that, too, because once a cow opens a pile, others will follow in to clean it up before moving on.

One pass with the heavy harrows is all that’s needed to spread any remaining residue before direct seeding in the spring. A pre-seeding burn-off with glyphosate and an in-crop pre-harvest pass with glyphosate to hit perennial weeds like quack grass and dandelion take care of weed issues.

Success is 80 per cent management

The success of a bunch-grazing system depends somewhat on cow type and the residue, however, adjustments can be made to accommodate those differences.

When it comes right down to it, the system is only as good as the manager, Selzler

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WINTER FEEDING

says. It will pay if you are willing to learn and really want to do it for the extra money, not just because you happen to have cattle and crops and it sounds like a reasonable, easy way to feed cows.

In fact, bunch grazing requires a lot more management than feeding cows the conventional way because you are limit feeding by virtue of the high-fibre, low-energy feedstuff itself. A cow will eat as much straw and chaff as she can, but the high fibre content limits how much of it she is physically capable of eating, he explains. If what she takes in isn’t meeting her energy requirements, body condition will drop fast or you’ll end up with impaction problems.

Selzler’s top recommendation is to get the numbers by feed testing the bunches and your hay, and using a beef nutritionist to help put together a plan because the proper balance of macro- and micronutrients.

“You’ve got to feed them to gain weight and you’ve got to really watch the cows to tell right away if they start to lose weight and when something’s not right before disaster happens,” he stresses.

Piled manure pats are one good sign that they need more energy and protein to process the fibre. He uses mega-calories as the measure to account for the energy value of all feed ingredients, including protein.

“Alfalfa really is king as far as protein source for beef. There’s just something in it that works with straw. If required, use a custom mineral blend with Rumensin,” he suggests.

He supplements with hay, grain or pellets every few days in cold weather and more regularly as the cows enter their third trimester. Hay is fed at eight to 10 pounds per cow per day using a DewEze bale bed to roll bales out over top of where the bunches were dropped along the swath rows.

“Don’t expect cows to do well on bunch piles and your regular supplement when it’s 20 or 30 below,” he cautions. His strategy is to feed them their full requirement during cold spells and let them return to the bunches when the weather improves.

He wouldn’t recommend bunch grazing for heifers, older and thinner cows.

It’s easier just to feed them their requirements in a separate system from the start rather than having the worry of the possibility of dealing with problems in the dead of winter.

“Cows properly trained will take to this system quite easily. Even if they aren’t highcapacity type, you can adjust for that and still save a pile of cash and improve your soil at the same time,” he says. c

The buncher is set up to drop a pile of straw and chaff when it has 50 to 70 pounds on the tongs

“We know this farm like no one else.”

Joel Dykstra – FCC Customer

More of Canada’s farm experts choose to do business with FCC Together, we’ll create the financing plan that works for you. We get to know you, your farm and how you want to grow. If you’re ready to get down to business, talk to one of our farm business experts.

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10/21/13 12:28 PM

 MARKETI NG

By Debbie Furber

REVISITING FEEDER AND BREEDER CO-OPS

… more than a low-cost way to finance cattle

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overnment backing for a percentage of bank loans taken out by feeder associations was a product of the Depression years in Alberta.

Though it took nearly 50 years for the loan guarantee program to start gaining a foothold in other provinces, the long-standing success of feeder finance co-operatives and the addition of breeder finance co-operatives in recent years speaks for itself.

In 2012 alone, the 150 feeder associations from British Columbia to Ontario purchased nearly half a million feeder cattle for members at an average price of $900 per head and a total of $450 million worth of business.

All the co-operatives are run by members who hire an administrator and inspector to look after the day-to-day business.

Provinces oversee the program and most guarantee 25 per cent of the loans. Alberta guarantees 15 per cent.

Despite a decade of turmoil in the beef industry, co-op financing of cattle has held its ground. While the number of associations has decreased with amalgamations and changing industry demographics, the number of cattle financed by co-ops has rebounded with the turnaround in the market.

Loan limits vary by province but all have increased in recent years to accommodate higher feeder prices.

The standard program design across Canada calls for each association to secure its own lender. Once a member’s credit

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limit is approved, that amount is available like a revolving line of credit without having to reapply. Ontario has tighter controls and requests for financing are approved on a regular basis.

Unlike financing schemes that require cattle to be sold in certain markets, association members are free to buy and sell where they please. Cattle are purchased in the name of the association, identified with the association’s brand or tags and notches, and sold in the name of the association or jointly, depending on the province. Payment is sent directly to the association, which retires the member’s loan and forwards the remainder.

All associations require a refundable five per cent security deposit be set aside in the co-op’s assurance fund held by its lender. In the event of a default, the member’s deposit and then the pooled fund are used to cover the debt before the government guarantee kicks in. Security deposits for breeder financing are higher (at least 10 per cent of borrowing) because of the higher risk associated with the longer repayment period of five to seven years, versus one year for feeder cattle.

POPULAR FEATURES

Low interest rates, a one-time application to obtain a credit limit, and the comfort of dealing with peers who understand the business were common replies when we asked why people finance cattle through an association.

Rob Smith of MacGregor, Man., is a former member and current supervisor of Green Tree Cattle Feeders Co-op as well as executive director of the Association of Manitoba Feeder Co-operatives. He says most members in Manitoba are cow-calf producers who finance their own calves to free up cash flow for other obligations or purchase calves for backgrounding on their own farm or custom operations.

Competitive interest rates are a strong draw. “Green Tree members are currently paying a half per cent over prime, which just wouldn’t be available to individual producers,” he says. The one-time approval process and not having to tie up farm assets as security just to buy cattle are other benefits. The cattle purchased and security deposit are the only security requirements.

The shared-risk aspect can be both a drawback and an advantage. “The disadvantage is that someone else’s bad management can seriously affect your operation,” explains Dennis Edwards, a founding director and the only president in the Craik (Sask.) Feeder Association’s 22-year history. He speaks from experience because his association endured two member bankruptcies and one crooked accountant, two of which resulted in all members sharing the losses. On the other hand, an association is more likely than a commercial lender to stand behind its members in times of turmoil.

Continued on page 33

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Continued from page 30

Edwards still wonders whether the lender would have had the same confidence in him and agreed to increase his borrowing limit had it not been for the association’s support and sharing the risk.

Edwards says the shared risk and the various fees every association has to charge to cover operating costs are things you have to accept if you want to use the livestock loan guarantee program.

He finances all of his cattle purchases through the association, mainly using the feeder option to retain replacement heifers. The biggest advantage in his view is having standing credit approval, which makes it possible to take advantage of market opportunities without going to a lender, doing the paperwork, and waiting for approval each time.

Stacy Esau, who runs a cow-calf and backgrounding operation in the Dawson Creek, B.C. area, says the program’s flexibility on the marketing side is all important to him.

Timing is everything with a commodity that can lose a quarter of its value depending on marketing, so you have to focus on marketing and the association is very accommodating in that respect, he explains. For instance, if a member has a 12-month contract coming up and the market isn’t right, the association will allow an extension. Banks may not understand how to work with a volatile market and tend to have more of a set plan, whereas, the co-op is managed by cattlemen who understand the market, why

you do what you do and why you need to change your plan.

“The ultimate would be not having to finance cattle, but that’s not really an option for most beef producers,” he adds.

“Feeder co-ops are popular because any system that allows flexibility is the ultimate financing choice.”

Esau has been a member of the South Peace Feeder Co-op for the past 21 years and his dad for at least 30 years. They have also participated in the South Peace Breeder Co-op through the years because their operation fluctuates as the market dictates.

Currently, the cow-calf end is in expansion mode after a significant retraction in the wake of BSE. They also background 2,500 head a year, mainly heifers because that market seems to click the best for them.

He estimates half their members finance their own calves to extend cash flow, but like him, lots buy and sell on a seasonal basis for a backgrounding lot, grass, or on the bred heifer side. Having access to a standing financing limit allows members to purchase more heifers than they intend to keep, watch how they develop, and then choose the best for their herd.

Tom Cunningham of Wiarton, Ont., is president of the Bruce Grey Breeder Finance Club. It was the very reasonable interest rates that first drew his attention to the club three years ago when he and his wife were in the middle of a herd expansion that has taken them up to 200 cows.

He especially appreciates the ease of Continued on page 34

 feeder co - o ps

Across Canada British Columbia has seven feeder coops and five bred heifer co-ops. Two are working to merge to offer both programs under one roof.

Alberta has 48 feeder associations, down from 61 in 2002, when they were backing some 400,000 head a year.

They bottomed out at 270,000 in 2008-09, but bounced back to 336,000 last year, which ended August 31, 2013.

Most of Saskatchewan’s 71 associations offer feeder and breeder loans to 1,700 active members. In 2012 they booked $46 million in loans for 55,000 feeders and $37.8 million

www.canadiancattlemen.ca

for breeding cattle. The 2012 breeder portfolio included $18.6 million in new loans for 14,800 head.

Manitoba has seven feeder associations, three less than the peak but a new provincial breeder association was added in 2007.

Ontario, feeder co-ops have financed more than 1.5 million head of cattle since 1990. There are 18 feeder coops today that offer loan guarantees, down two since 2003. Eight of the nine breeder co-ops formed in 2002 are still in operation without the advantage of loan guarantees.

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C at t l e m e n · N o v e m b e r 2 0 1 3

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m a r k et i ng

Continued from page 33

grain farm near Wroxeter, Ont. Jeffray, who is a past chair and current vice-chair of the Ontario Feeder Committee, agrees young farmers can be hard pressed to secure funding from a bank without the feeder finance co-op membership. Clubs are always looking for more members, especially younger ones to keep the ball rolling.

His membership in the Queen’s Bush Feeder Finance Co-op since it was formed in 1994 and Mike’s for eight years now has helped finance more calves through the years than they would have been able to buy independently, and at more favourable interest rates. The backgrounding operation is set up for 500 head, with approximately half financed through the co-op and the remainder fed on a custom basis. To spread marketing risk, they buy calves or light yearlings about four times a year to sell as short-keeps and 200 head to go to grass on rented pasture.

Reg Schmidt of Thorsby, Alta., says just having access to capital and the low equity requirement through the 21 years he was a member of the Pigeon Lake Feeder Association were instrumental in the transition from a family dairy operation when he and

doing business through the club. “I fill out my application, talk with the association’s supervisor, then go before the board and tell my story. It’s relaxed and more comfortable than going to a lender because all of the directors are farmers from the area who know the business.”

He and others use club financing to retain and purchase heifers, not only to expand but to keep their herds on the younger side than they would if reasonable financing wasn’t available.

He says it’s a great tool for young guys wanting to expand or get back into beef cows because it’s really tough for them to get financing through a bank. Financing your own calves also frees up money to use elsewhere. The Bruce Grey club works closely with the Twin County Feeder Club, so some members with feeder loans roll them into breeder loans to retain heifers, giving them six years to repay with the first year being an interest-only payment.

Ross and Wilma Jeffray, along with their son, Mike, 26, run a mixed beef, hog and

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34

his wife established their beef business. By custom feeding, financing their own calves when they ran cows, and purchasing calves, they went from backgrounding a few hundred head to 2,800 head a year up until their recent exit from cattle feeding.

Putting on his cap as Feeder Association of Alberta (FAA) general manager, Schmidt says two barriers to producer participation that he frequently came across have recently been addressed.

As in other provinces, all of the cattle purchased under a contract have to be sold as a group, which can be an issue in terms of cash flow. Now, Alberta members are allowed to draw on equity they build in the cattle as the feeding period progresses.

The borrowing limit per member has also been increased from $300,000 to $500,000 per family member or business partner with a maximum of $3 million per operation and more with special provisions. Even at that, there is demand to boost it again due to continued consolidation within the industry.

The FAA is optimistic about the November launch of its first-ever breeder finance program even though it will have to operate without a loan guarantee. It will run under a unique model wherein loan management, borrowing and security deposits will be leveraged across all breeder associations to maintain reasonable operating costs and attract competitive lending without a guarantee. It is their hope that the 15 independent breeder co-ops now in existence will come on board.

An initiative that will encourage participation in Alberta and Saskatchewan is an agreement in the making to allow members of their associations to background, grass or finish calves in either province. This mirrors the practices of many beef producers to capture economic advantages in both provinces.

Program details vary from province to province. For more information on provincial programs or Ag Canada’s advance payment program, which offers interest relief on the first $100,000 of borrowings for feeder association members and full cash advances contact: • Ontario — Cheryl Russwurm, 519-367-5590; www.ontariobeef.com • Manitoba — Michael Knudson, 204-746-7507; www.masc.mb.ca • Saskatchewan — Ken Hamilton, 306-642-7232; www.agriculture.gov.sk.ca • Alberta — Reg Schmidt, 780-674-2622; www.feederassoc.com • British Columbia — Lindy Gilson, 250-992-8483; www.bcbfa.ca c

C at t l e m e n · N o v e m b e r 2 0 1 3

2792 Zactran Therapeutics-CndCttl.indd 1

Client: Merial Project: Zactran Therapeutics Ad Date: Nov 2013

www.canadiancattlemen.ca 2013-10-11 10:26 AM

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 Holistic R a nc hi ng

By Don Campbell

FINANCIAL PLANNING

F

inancial planning is one of the tools we use in HM to help us create profit and success.

This article will come out towards the end of Nov. This is an ideal time to think about planning for the upcoming year.

There are several areas where Holistic Financial Planning may differ from what you currently do. Let’s review these.

1. We are always planning for the future.

2. We set our profit before the year begins.

3. We have a method of sorting our expenses and spending our expense money wisely.

4. We monitor our financial plan on a monthly basis.

There are a couple of pre-planning steps: 1. Look for and identify the log-jam. A log-jam is defined as “something that is consistently preventing me from moving towards my goal.” You may or may not have a log-jam in your business. If a log-jam exists it must be corrected before significant progress will be achieved. If a log-jam exists a plan of action to correct the situation is implemented. Money to cover these expenses becomes a No. 1 priority. Do you have a log-jam in your business? Have you ever thought about this question?

2. Gross profit analysis is used to compare different enterprises. The formula is income per unit minus variable expenses equals gross profit. Gross profit can help us pick enterprises that are profitable. Once we have selected our enterprises for the year we begin to do a financial plan.

There are eight steps to financial planning: 8. Plan, monitor, control, replan.

7. Ending net worth.

6. Do a cash flow.

5. Sort and plan the expenses.

4. Determine the weak link.

3. Set your profit.

2. Plan the income.

1. Starting net worth.

Let me give you a brief explanation of the steps: 1. Starting Net Worth: This is a list of your assets minus your liabilities at the start of the year.

2. Income: Here we do a detailed analysis of all the income we expect during the next 12 months. We want a date, a weight and a price for each type of income. The information must be recorded.

3. Profit: At this stage we determine the profit level that we want to achieve in the coming year. Profit is defined as an increase in net worth after all expenses including living have been paid. We decide how much profit we want in dollars and then plan to make it happen.

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C a t t l e m e n · N O V EM B E R 2 0 1 3

4. Weak Link: There are three basic steps to our business. These are growing, harvesting and marketing.

Growing is capturing the solar energy. Harvesting is converting the energy into a marketable product.

Marketing is selling at a profit. At a given point in time only one of these three steps will be the weakest.

We determine where we are weak and then set out to strengthen that step.

5. Sort and Plan Expenses: The first step here is to sort our expenses according to our weak link. Expenses are sorted into three categories: W expenses are those that fix the weak link. I expenses are inescapable.

These are things that we must do. These expenses are set and can’t be changed. An example would be land taxes. M or maintenance expenses are all other expenses. The idea here is to put as much money as possible into W expenses. This is like investing in our business. These expenses will make our business stronger. I expenses will be a set amount of money.

We set this aside and don’t worry about it. M expenses are reduced or eliminated to free up the money for the W expenses. Each M expense is challenged. Do I need to do it? Can I reduce the amount? This is where our human creativity comes into play. It’s amazing how many expenses can be reduced or eliminated when that is our focus. Once our expenses are sorted we plan the individual expenses. Here again we want detail. Expenses are broken down on a monthly basis.

All expenses are recorded.

6. Cash Flow: At this stage record our monthly income and expense. We are able to determine if we can cash flow our business or if we will require an operating loan. If we require a loan we will know how much will be required each month. A cash flow will also show the cost of our loan.

7. Ending Net Worth: This is a list of our assets minus our liabilities at the end of the year. Profit is the difference between our starting and ending net worth. We plan and replan until we achieve the result we want.

8. Plan, Monitor, Control, Replan: We now implement our plan. We monitor monthly to record our progress.

Small deviations are controlled. If the deviations are large we do a replan to achieve our profit.

Holistic Financial Planning works. It has given positive results to many, many people. I encourage you to investigate the process. I believe you will find it valuable.

I wish you success in planning a profitable 2014.

Happy trails. c Don Campbell ranches with his family at Meadow Lake, Sask., and teaches Holistic Management courses. He can be reached at 306-236-6088 or doncampbell@sasktel.net.

www.canadiancattlemen.ca

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 straigh t f ro m t h e h i p

By Brenda Schoepp

GROOMING A CHAMPION

T

he grooming of a champion does not come without a lot of work and finesse. It is working with details that highlight the very best in the individual. Boys or girls, men or women, there is a champion among us all.

I am a great fan of the Cattlemen Young Leaders (CYL) program. This mentorship program matches young people (anyone under the age of 40 is young in my books) with mentors across Canada. The profiles of the mentees and mentors reads like the “who’s who” of the cattle business. Interests are broad and it is always exciting to see them featured in this magazine.

What does it take to be a champion? How does this morph into great leadership? I answered that question last spring when I had the privilege of addressing the incoming and graduating class of the CYL program.

Speaking from experience, an honest place of many failures and success, I discussed the heart and soul of champions and the characteristics of leadership.

Leadership comes from a deep conviction — from within and everything we do should be a reflection of core values, principles and beliefs. Great leaders like Nelson Mandela show true grit and conviction. After 27 years of imprisonment, Mandela never lost faith in himself or his cause. He believed with his heart and soul in democracy and he did not stray from it. His body may have been broken and his lungs infected but nothing could drive away his conviction.

The genuine leader takes complete accountability.

In doing so they understand their responsibility for all their words and actions and the words and actions of their team. Although a certain amount of order is needed there is no “ruling” in leadership rather those around you have a high respect because they are inspired by you.

For our industry a good example of responsibility is the immediate ownership of the listerosis outbreak at Maple Leaf Foods in 2008. Company CEO Michael McCain owned the problem and won the respect of his team and his advisories in doing so. Owning the problem, also left head space for everyone to find solutions for preventing contamination in the future. The result was continued goodwill in the community and within the company.

It takes great commitment to lead against all odds to pledge yourself to a life that does not allow for judgment.

I look to women leaders like Lehmah Gbowee, Liberian peace activist, who quietly and with deep conviction and utter commitment lead a country to a historical peace treaty. Because of the actions of one woman who engaged with everyone to build a forceful team, regardless of class or caste, a nation starts to heal.

Perhaps the finest trait in leadership is the ability to be gracious and hospitable. This grows into a kindness

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C a t t l e m e n · N O V EM B E R 2 0 1 3

that is evident and grants the heart the opportunity to be very charitable without the expectation of getting something back. One of our well-known businessmen in Canada, Ray Price, has these characteristics. I don’t visit with him often but when I do he always remembers, treats the young leader I am with the same level of respect as a high-level influencer, asks personal questions and remains passionate and encouraging throughout the conversation. In an interview with KPMG he states, “It is easy to build a team if you are passionate about what you (and they) do.” That leads to a great level of confidence in yourself as the leader and in your team!

The level of preparedness in leadership is extraordinary and the ability to adapt to any situation is outstanding. I have often used the analogy of the farm kitchen and the men and women on the farm who are always prepared. From out of nowhere a full and hearty meal can be presented in moments. That is because the pantry or freezer always has a “just in case” department. As we prepare for leadership we must also prepare our lives for our successes. We are called to live our lives with a high level of excellence and to do that we have to be well researched and deliver on our promises. That includes booking ourselves in at home for play and spiritual growth. It is much easier to be gracious and smiling when a group of 10 “drop in” or an unexpected business call “pops up” when we have prepared in advance. That easy grace that leaders have is because they are prepared and their staff and families support them.

The final touch and defining moment in grooming a champion is when there is a full realization of the importance of servitude. The time when we understand that we are here to serve. I am often asked by educational institutions how to build “soft skills” in students. My answer is always the same — with servitude. Mandela’s first speech was in front of 100,000 roaring supporters and he responded to that support, after 27 years in prison with these words, “I stand here before you not as a prophet, but as a humble servant of you the people.”

There is always a champion among and within us.

The CYL program grooms men and women to serve their industry and their communities. In supporting these young leaders we too benefit from their growth — and ours. c Brenda Schoepp is a Nuffield Scholar who travels extensively exploring agriculture and meeting the people, who feed, clothe and educate our world. A motivating speaker and mentor she works with young entrepreneurs across Canada and is the founder of Women in Search of Excellence. She can be contacted through her website www.brendaschoepp.com.

All rights reserved. Brenda Schoepp 2013

www.canadiancattlemen.ca

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 animal h ea lt h

By Roy Lewis DVM

avoid allergic reactions

W

ith only the rare occurrence of allergic reactions in cattle they are not mentioned much in the literature. However, today’s modern producers give more in the way of vaccines and antimicrobials. With longeracting products that are only approved subcutaneously or intramuscularly and not intravenously the risk level is elevated.

The carrier or base in the products also can cause allergic reactions so you never know when one will arise. The treatment is very effective if given in time so I thought this was an ideal time to raise the whole issue of allergic reactions in the cattle sector.

Most allergic reactions come about from the administration of products such as vaccines or antibiotics. It is clearly marked on all labels by pharmaceutical companies that these products can rarely cause allergic (anaphylactic) reactions and to administer epinephrine. Less commonly an allergen can be inhaled or taken in orally. The reaction may be local such as can happen with a bee sting where the surrounding tissue becomes very swollen. In the cattle industry we are more concerned with the full-blown reaction where eventually the lungs can fill with fluid resulting in pulmonary edema and death.

Generally speaking severe reactions happen within 15 to 20 minutes of the insult.

Clinical signs might include uneasiness, and increased respiration. The most noticeable signs, can be swollen, puffy eyelids and copious amounts of salivation. Bloat and staggering often follow and can progress to collapse from the lack of oxygen, the animal turns blue and dies.

It is a good routine to take a quick look at cattle after processing once they have settled, to observe anything abnormal. When castrating cattle with a knife and covering with penicillin we always observe the pen for two things, excessive bleeding and any telltale signs of an allergic reaction.

It has been my experience with antibiotics that if you get one reaction there may be several. There can be a genetic susceptibility in a herd to a specific allergen so if you inject a number of animals and you get one reaction watch very closely for others. Mark down the animal affected especially if it is

40

a breeding animal as it could reoccur next time and that product needs to be avoided on that animal for sure.

Treatment kits should always contain a bottle of epinephrine, the universal antidote for allergic reactions. If you never need to use it that is a good thing. The bottle will often get covered in dust and expire, so check once in a while and replace it as necessary. It will be way too late to go to the neighbours or rush to the veterinary clinic to purchase a bottle.

Having a bottle on hand could prove to be a very worthwhile investment and it is not an expensive product. Allergic reactions happen fast. Even if the bottle you have has expired it can still be used in a pinch. The efficacy may be decreased and you may need to use more to get the desired results. The one good thing about allergic reactions is you know right away if the treatment is working.

efore you face a B life-or-death situation check your treatment kit for epinephrine The dosage of epinephrine is generally one cc per 100 pounds given subcutaneously or intramuscularly (the product comes in the strength of one mg per ml). One may want to hurry up the process by giving it intravenously but that can cause heart fibrillation. If given this way it should be diluted to a 10 per cent solution with saline and at only one-quarter of the normal dose. I personally don’t recommend it. If the animal is having difficulty breathing it is fractious so it is better to give it quicker by the other routes described on the label. I have a tendency to split the dose in two and give one subcutaneously and the other intramuscularly. Clinical signs will begin to decrease within minutes. You are not done yet. Often the treatment needs to be repeated several times as the epinephrine wears off so keep the animal under close observation until it has completely recovered. Wait at least an hour after the last treatment before being fully confident the allergic response will not return.

C at t l e m e n · n o v e m b e r 2 0 1 3

Corticosteroids such as dexamethasone may also be prescribed for longer coverage or a diuretic to remove excess lung fluid. Do all this in consultation with your veterinarian. It is good if he/she is aware of any allergic reactions as several steps may be taken. Often if a product is involved the pharmaceutical manufacturer wants to know about it and check the product. You may be advised not to use the product if there is thought to be a genetic susceptibility. Record the animal to avoid using the same product on it in the future. If several animals are involved that product may need to be avoided completely.

Individual reactions can occur with some products if they are not approved for intravenous usage and you happen to hit a small arteriole when injecting. The likelihood of this happening has been dramatically reduced since most products are now approved for use subcutaneously. If a subcutaneous injection is given properly it is almost impossible to hit a big enough vein or artery to cause a problem. With intramuscular products like daily penicillin it is a good precaution to first place the needle and then attach the syringe with the product. If blood comes bubbling out of the needle it is best to pull it out and place it in another location. I always tell farmers I could induce an allergic reaction every time by giving penicillin intravenously.

Our management practices have reduced many individual allergic reactions. Pharmaceutical companies also monitor which carriers and immune stimulators cause reactions and try to develop equally effective but less reactive ones. Hopefully you will never have an allergic reaction on your farm. But if you do you will want to have epinephrine on hand. It is cheap insurance and when needed can definitely save several lives. Make sure and keep the expiry date in mind and replace it when necessary.

Before you face a life-or-death situation I want you all to go out to your treatment kits and make sure they are stocked with a bottle of epinephrine! c Roy Lewis is a Westlock, Alta.-based veterinarian specializing in large-animal practice. He is also a part-time technical services vet for Merck Animal Health.

www.canadiancattlemen.ca

BEE-098 - Key - Canadian Cattlemen 8.125x10.75 - Oct 18

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 researc h o n t h e r eco r d

By Reynold Bergen

More Than One Way to Skin a Cow

T

his time last year, Canada’s beef industry was coping with the Lakeside-XL beef recall.

That event focused attention on the safety of Canadian beef, and the practices that the beef-packing industry uses to manage food safety risks.

Since the late 1990s, North America’s beef processors have used Hazard Analysis Critical Control Point plans (also called HACCP, and pronounced “hassip”) to improve food safety. An HACCP plan identifies food safety hazards, identifies the steps that can adequately control those hazards, actively monitors the controls that are implemented, outlines how to fix problems that arise, develops ways to verify that these management practices are working, and keeps records to document that these steps are being done right. Not all packing plants are designed and built from the same blueprint, so each plant has unique challenges.

Rather than impose a one-size-fits-all solution on every packer, HACCP plans are tailored and customized for different plants. Federally inspected beef-packing plants develop their own HACCP plan, and the CFIA audits the plant to ensure they are following the plan.

In the case of bacterial hazards like E. coli, HACCP plans aim to prevent bacteria from dust, hair, tag, manure and gut contents from contacting the meat. The most obvious critical control points are on the kill floor, when the hide is removed and the carcass is eviscerated. Large companies can afford more costly and complex technologies to combat E. coli at high line speeds. Small plants can’t afford these technologies, but they can take more time to skin and dress carcasses. In a recent Beef Science Cluster study, Dr. Colin Gill, Xianqin Yang, Madhu Badoni and Mohamed Youssef from AAFC’s Lacombe Research Station compared E. coli levels on beef carcasses at commercial beef plants. These results were presented at the 2012 International Congress of Meat Science and Technology, and published in the Journal of Food Protection (75:144-149).

What they did: These researchers visited a large (up to 280 cattle per hour), and a small (200 head per week) beefpacking plant. The large plant had installed a battery of technologies to combat bacterial contamination. Hide-on carcasses were first washed with 1.5 per cent caustic soda at 55 C and rinsed with chlorinated water. After skinning, but before dressing, carcasses were washed then spray washed with 5.0 per cent lactic acid. Dressed carcasses were trimmed to remove visible contamination. After splitting, carcass sides were washed and sprayed with 5.0 per cent lactic acid before being steam pasteurized (over 90 C) and chilled. The small plant used fewer interventions. Skinned carcasses were simply washed and trimmed to remove visible contamination before chilling.

Swab samples were collected from several sites on 25 randomly selected carcasses as they moved through each packing plant. Numbers of E. coli were counted in each sample.

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C at t l e m e n · N o v e m b e r 2 0 1 3

What they learned: In the early 2000s, commercial beef-packing plants in Canada were capable of producing carcasses with as few as 40 viable E. coli cells per carcass. This study showed how food safety interventions have improved since then. In the large plant, some E. coli were found after skinning, fewer after washing and none after the first acid spray. No E. coli were found on the freshly dressed carcasses, either.

Some E. coli reappeared on the carcass sides after splitting, but these E. coli were nearly eliminated by the next washes and acid sprays. There were so few E. coli left that the steam pasteurizer didn’t appear to help very much. The large packing plant produced carcasses with as few as four viable E. coli cells per carcass (90 per cent fewer than in the early 2000s). The small plant had fewer, simpler tools at its disposal. But it allowed carcasses to dry as they chilled, and this resulted in only 40 E. coli per carcass. The small plant did as well as large plants could in the early 2000s.

“ With current practices at Canadian plants, the risk from pathogens on carcasses is largely eliminated.”

What it means: Different HACCP solutions work for different packing plants. Careful dressing and effective carcass-cleaning practices used in large commercial packing plants can essentially eliminate E. coli from carcasses. Smaller plants that cannot afford costly equipment can still produce carcasses with very few E. coli by drying carcasses during chilling. Carcass decontaminating treatments and carcass drying are likely just as effective against E. coli 0157:H7 and salmonella as they are against generic E. coli. With current practices at Canadian plants, the risks from pathogens on carcasses are largely eliminated.

Alert and skeptical readers will ask why E. coli recalls continue to occur, given that Canada’s beef processors can produce virtually pathogen-free carcasses. Next month’s column will help to answer that question.

The Beef Research Cluster is funded by the Canadian Cattlemen’s Association and Agriculture and Agri-Food Canada to advance research and technology transfer supporting the Canadian beef industry. Visit www.beef research.ca for more on Beef Cattle Research Council activities funded by the National Checkoff . c Reynold Bergen is the science director for the Beef Cattle Research Council.

www.canadiancattlemen.ca

Peak Dot Ranch Ltd.

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or phone Carson Moneo 306-266-4414 Clay Moneo 306-266-4411 Email:peakdot@gmail.com

 CCA repo rts

By Martin Unrau

CETA signed

T

he fall meetings of our provincial association members are underway and I expect a significant focus of those meetings will be on the landmark Canada-EU Comprehensive Economic and Trade Agreement (CETA) and what it means for producers. This agreement is a huge win for Canada’s beef cattle industry. Canadian Cattlemen’s Association (CCA) representatives presenting at the fall meetings of the Alberta Beef Producers, Saskatchewan Cattlemen’s Association and Manitoba Beef Producers will provide as much information as possible to assist those cattle producers sharpening their pencils now to assess the opportunity and what it means for their operations.

The CCA calculates that Canadian producers will have to raise 500,000 head annually under the EU hormonebeta-agonist-free protocols to use up the CETA duty-free quotas. In Brussels, following the signing of the declaration for an agreement in principle, Prime Minister Stephen Harper said he anticipates the CETA to come into force before the next federal election which is scheduled for October 2015.

The CETA provides new duty-free access for 64,950 tonnes of Canadian beef valued at nearly $600 million, with the majority of the quota reserved for Canada alone. Of this 35,000 tonnes of fresh/chilled beef and 15,000 tonnes of frozen beef, are reserved for Canada and can come from any grade of cattle, including veal.

In addition, Canada will see the 20 per cent duty on the existing 14,950-tonne Hilton quota shared with the U.S. reduced immediately to zero. Canada will also continue to have access to the existing shared duty-free quota provided as compensation in the World Trade Organization hormone dispute case. Beef exported to the EU under either of these existing quotas has to meet a high-quality grain-fed specification. Additionally, all live cattle, genetics and most beef offals, tallow and rendered products, processed beef products and hides and skin will benefit from immediate unlimited duty-free access.

For beef to be eligible for shipment to the EU, it must come from cattle raised without growth promotants such as hormone implants or beta-agonists and documented in a particular manner. We’ll be publishing more information on that in an upcoming edition of our CCA Action News.

Also included in the agreement is a clear path forward toward resolution of the technical barriers for exporting Canadian beef to Europe. Details remain to be worked out on the technical issues, but for the first time, there is a written commitment between Canada and the EU, including a timetable, to resolve the technical barriers.

44

C at t l e m e n · n o v e m b e r 2 0 1 3

Moving forward, individual producers will be assessing if the protocol requirements make economic sense for their operation and enable them to produce beef profitably. Price signals will also be a major factor in decision-making as well as herd expansion considerations.

Throughout the CETA negotiations the CCA had insisted that the access granted and the conditions of access would have to be sufficient to encourage both producers to raise the cattle under EU requirements and for packers to develop the EU market.

Achieving an agreement in principle for a CETA deal is a proud moment in the legacy of the CCA. I was especially pleased that CCA was in Brussels to witness the signing of this historic agreement and to thank the prime minister personally for achieving an outstanding agreement for Canadian beef producers.

Martin Unrau is president of the Canadian Cattlemen’s Association

anadian producers will have C to raise 500,000 head annually under EU protocols to use up the CETA duty-free quotas From the outset of the CETA negotiations in 2009, the CCA has been engaging with the Canadian negotiating team and conducting advocacy with key EU and Member State officials and industry representatives. CCA representatives attended numerous negotiating rounds in Brussels and Ottawa and met regularly with the Canadian negotiators of CETA to ensure they clearly understood the needs of Canada’s beef sector. The beef access achieved for Canada is a reflection of the CCA’s unwavering work, and that of International Trade Minister Ed Fast, Agriculture and Agri-Food Minister Gerry Ritz and of course Prime Minister Harper.

Annual beef consumption in the EU is approximately eight million tonnes. The CCA has long held that achieving meaningful market access will improve the Canadian cattle industry’s competitiveness for the long term and significantly boost the value of exports for Canadian beef producers.

The CETA deal may create additional opportunities for increased exports of Canadian beef to countries like Russia and China that have similar production protocols to the EU. Exports are the lifeblood of Canada’s beef cattle industry. This CETA deal is an excellent outcome and a benchmark for future trade deals with other nations to come. c

www.canadiancattlemen.ca

Beef Watch is prepared by the staff of Canfax and Canfax Research Services, divisions of the Canadian Cattlemen’s Association

BeefWatch

 The July 1 cattle inventory reports showed a stable Canadian herd, with no indication that expansion was on the horizon. With the drought in the U.S. receding and pasture conditions improving, look for inventories to stabilize moving into 2014.

canadian cattle inventories July 1 (1,000 head)

 Canadian Beef Cow Inventory July 1 Canadian Beef Heifers (Breeding) 6.0

Million head

5.5 5.0 4.5 4.0 3.5 3.0 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12

Source: Statistics Canada

www.canadiancattlemen.ca

2012

13 vs 12

228.8

228.6

0.1%

Beef cows

3,939.4

3,951.3

-0.3%

Dairy cows

952.9

951.5

0.1%

Dairy heifers

462.9

462.4

0.1%

Beef heifers (brdng.)

673.9

669.0

0.7%

1,225.0

1,212.0

1.1%

Bulls

Canadian herd stable Total cattle inventories on July 1 were steady at 13.54 million head. This was the first year without a decline since 2005, although the declines over the last two years have been small (1.2% and 0.1%). The national breeding herd was down 0.2% or 7,000 head to 4.61 million head with the 0.3% decrease in beef cow numbers offsetting the 0.7% increase in heifer retention. The 2013 calf crop was down 1.3% to 4.38 million head, following a steady calf crop in 2012 and a decline of 1.3% in 2011.

Regionally, the West accounts for 87% of the beef cow herd, while the east accounts for 13%. Alberta was the only province with larger beef cow inventories, up 2.8% to 1.64 million head. Manitoba posted the largest drop with the numbers down 5.3% to 443,700 head, followed by the Atlantic provinces (-3.6% to 229,800 head), Ontario (-3.1% to 276,300 head), Saskatchewan (-1.3% at 1.16 million head) and British Columbia (-0.8% at 195,200 head).

The increase in total cattle inventories came from steers (+4.3%) and slaughter heifers (+1.1%). Larger steer numbers were seen in most provinces — Alberta (+5.1%), Saskatchewan (+5.2%), Manitoba (+6.6%), Ontario (+3%), and Quebec (+3.1%). Cattle on feed as of July 1 was estimated to be up 0.2%, leaving feeder supplies outside of feedlots up 0.5% from last year.

Dairy cows at 952,900 head were up 0.1% from a year ago with Quebec and Ontario accounting for 70% of the national total. Dairy heifer retention was also up 0.1% to 462,900 head. The increase in dairy heifer retention was driven by British Columbia (+9.5%), Manitoba (+6.9%), and Saskatchewan (+4.8%) with declines in all other provinces.

2013

Beef heifers (sltr.)

Steers

1,669.9

1,600.7

4.3%

Calves

4,387.2

4,444.5

-1.3%

Total

13,540.0

13,520.0

0.1%

Source Statistics Canada

U.S. herd still contracting USDA has cancelled the July 1 cattle inventory report.

While there are no official survey results, estimates have been compiled by the Livestock Marketing Information Center (LMIC).

Total cattle inventories were estimated to be down 1.8% to 96.1 million. Beef cow numbers were estimated to be down 2.1% to reach a new low of 29.9 million head. Beef replacement heifers were estimated to be steady at 4.2 million head, as no significant heifer retention had occurred with forage shortages in the first half of 2013. The calf crop in 2013 was estimated to be down 2.1% following a 2.4% decline in 2012.

At 33.5 million head, the 2013 calf crop would be the smallest since 1949. This is expected to continue to tighten the U.S. cattle supply over the next couple of years. Feeder cattle and calves were all down: steers (-2.1%), slaughter heifers (-3.4%), and calves less than 500 lbs. (-2.3%).

Dairy was the only category posting year-over-year increases with dairy cow numbers up 0.5% to 9.3 million head and dairy replacement heifers up 1.2% to 4.2 million head.

While the LMIC estimates suggest continued liquidation of the U..S cow herd, improvements in moisture conditions and producer margins this fall are expected to slow the decline.

Improved pasture conditions and a 17% larger hay crop, have pushed U.S. beef cow slaughter below year-ago levels.

July and August cow slaughter was down 8% and 13% from 2012. Producers may also start to consider retaining heifers with lower corn prices and stronger feeder cattle prices this fall. Focus will be placed on maintaining the herd size, after several years of forced liquidations due to drought. Given the breeding season is over, increased heifer retention will not show up in a larger herd or calf crop until 2015 at the earliest, and not impact beef production until 2016.

Continued on page 46

C a t t l e m e n · n o v e mb e r 2 0 1 3

45

BeefWatch Continued from page 45

 Canadian Slaughter Cow Marketings

u.s. cattle inventories July 1 (1,000 head)

1200

2012 (USDA)

13 vs 12

96,050

97,800

-1.8%

Total cattle All cows

39,100

39,700

-1.5%

Beef cows

29,850

30,500

-2.1%

Dairy cows

9,250

9,200

0.5%

Heifers >500 lbs.

15,500

15,700

-1.3%

Beef rep. heifers

4,200

4,200

0.0%

Dairy rep. heifers

4,150

4,100

1.2%

Other heifers

7,150

7,400

-3.4%

Steers >500 lbs.

13,700

14,000

-2.1

Bulls >500 lbs.

1,850

1,900

-2.6%

Calves <500 lbs.

25,900

26,500

-2.3%

Calf crop

33,500

34,500

-2.9%

Cycle Indicators Cow culling rate up in 2013 The beef culling rate is up in 2013 to a projected 13% compared to 10% last year and the 20-year average of 11%. While domestic cow slaughter is anticipated to be down 3%, cow exports have been running well above year-ago levels and anticipated to finish the year up at least 36.5%. From January to July cow exports are up 64% in the West and 194% in the East. Overall, cow marketings (domestic slaughter + exports) in 2013 are projected to be up 8% to 680,230 head. This is not surprising, even in the 1980s with a smaller cow herd, cow marketings averaged 843,000 head.

Cow prices continue to be strong with Alberta D1,2 cow prices ranging between $70-$85/cwt, steady with 2012 and up 30% from the five-year average. In the U.S., cow prices have been trading at a CDN$1-$6/cwt premium to Alberta in the first three quarters of 2013. Moving into the fourth quarter with improved pasture conditions and smaller cow slaughter in the U.S., demand for Canadian cows stateside will be strong.

Moreover, there is strong competition from emerging markets for manufacturing beef and declining world beef production.

Lean trim supplies are expected to be tight in North America, supporting cow prices this winter.

As cow marketings are not likely to see a significant drop in the short term, heifer retention has to increase in order for the Canadian herd to remain stable, let alone grow.  Canadian Beef Cow Culling Rate 18%

20-yr. avg. = 11%

16% 14% 12% 10% 8% 6% 4% 2% 0%

81

84

87

90

93

96

99

02

Source: Canfax Research

46

C at t l e m e n · n o v e m b e r 2 0 1 3

05

08

11

1000 Thousand head

2013 (LMIC)

Exports

Slaughter

800 600 400 200 0

81 83 85 87 89 91 93 95 97

99 01 03 05 07

09 11 13p

Source: CBGA, AAFC, Statistics Canada

Heifer Retention — modest at best The number of beef heifers retained for breeding on July 1 was up 0.7% at 673,900 head. This increase is significantly lower than the 4.5% in 2012 and 6.6% in 2011. In August and September, heifer placements into feedlots were up 9.5% and 29% from last year. Some of the heifers retained for breeding may have been preg checked early and opens placed into feedlots, taking advantage of the solid feeder cattle prices during the third quarter. Producers are not interested in expanding right now.

Another important indicator for heifer retention is heifer slaughter ratio which illustrates the number of heifers marketed for every 100 steers. Heifer marketings in 2013 are anticipated to be down 5.8% to one million head compared to steer marketings which are projected to be down 4%. A smaller percentage of heifers in the mix, indicates more are being held back in the herd for replacement. At 67%, the heifer slaughter ratio in 2013 is estimated to be up from 65% in 2012, but slightly lower than the 20-year average of 68%.

Bred heifer trade in 2013 has been thin. Prices inched up from $1,200/head in January to $1,340/head in April but remained lower than 2012 levels as a result of significantly lower calf prices in the first half of the year. In the second half of the year, bred heifer prices are expected to gain strength with stronger calf prices.

The female-to-male disposal ratio (slaughter + exports — imports of all classes of cattle) gives an indication on how heifer retention relates to cow marketings. With 1.02 females being slaughtered for every male, the ratio indicates heifer retention has not made up for larger cow marketings this year. Beef cow inventories on January 1, 2014 will most likely be lower than year ago. More heifers will need to be retained in 2014 to prevent further declines.

Feed grains — a race downhill Larger feed grain production on both sides of the border has brought renewed optimism to the cattle market. Lethbridge barley prices fell 33% from the $293/tonne in June to $196/ tonne in September; while Omaha corn prices fell 30% from $314/tonne to $220/tonne.

For the 2013-14 crop year, Canadian barley production is projected to be up 6.7% at 9.0 million tonnes with a recordhigh yield estimated at 64.1 bushels per acre, up 18% from

www.canadiancattlemen.ca

BeefWatch Slaughter + Exports - Imports (All Classes)

1.3

20-yr. average = 1.00

1.2 1.1 1.0 0.9 0.8 0.7 0.6 75

79

83

87

91

95

99

03

07

11

Source: AAFC, CBGA, CanFax

2012’s disappointing levels. Despite the year-over-year increase, barley production is still 23% below the long-term average. Ending stocks were at a record low on August 31, 2013 at 801,000 tonnes. They are expected to increase marginally to 1.2 million tonnes in 2014 with slightly smaller exports as global coarse grain supplies are replenished. With this small change in ending stocks, feed grains in Western Canada are still reliant on a larger U.S. corn crop to bring prices down.

In the U.S, corn production is projected to be 13.8 billion bushels, up 28% from last year’s low, and will be a record high surpassing 2009 production. Average farm prices are forecast by the USDA to decline by 30% to range between US$4.40-$5.20/bushel (approximately CDN$191-$226/ tonne). The decline in feed prices is definitely a positive factor supporting feeder prices this fall. However, a cost of gain advantage in the U.S. will encourage feeder exports from Canada even with implementation of the COOL amendment.  Feed Grain Prices Lethbridge and Omaha in barley equivalents

Cdn $/tonne

$350

Lethbridge Barley Omaha Corn

$300 $250 $200 $150

Jan-13

Jan-12

Jan-11

Jan-10

Jan-09

Jan-08

Jan-07

$100

Source: Alberta Ag, Cattlefax, AB Canola, AgValue

Calf Prices and Profitability Profitability in the cow-calf sector is an important factor affecting producers’ decision on herd expansion or contraction. In the past couple of years, cow-calf producers have been in the black with Alberta cow-calf returns estimated at $67/ cow in 2011 and $119/cow in 2012.

www.canadiancattlemen.ca

With feed prices moving significantly lower since July, calf prices have picked up. Alberta 550-lb. steer prices jumped $10/cwt higher the end of August to $160/cwt and have been steady throughout September. As we move into the fall run, calf prices could move into the high $160s/cwt. With calf prices expected to average $160/cwt in the fourth quarter, cow-calf producers are expected to see positive margins around $166/cow, up $47 from 2012. The question remains, if this is high enough to encourage heifer retention at levels that will keep the herd stable in the face of higher cow marketings.

Looking forward to winter feeding costs this fall, Alberta hay prices are up 17% from last year as many producers depleted supplies this spring feeding much later than normal.

Higher hay prices will also put a cap on what backgrounders are willing to pay for calves this fall, despite lower grain prices.  alberta cow-calf returns $250

Annual profit/loss 1,200-lb. cow long-term average

$200 $150 $/cwt

 Canadian Female to Male Disposal Ratio

$100 $50 $0 -$50 -$100 -$150

-$200 -$250 91 93 95

97

99

01

03

05

07

09

11

13p

Replacement ratios Replacement ratios show how much higher feeder cattle are per pound of fed cattle. The lower the ratio implies the feedlot needs fewer dollars to replace an animal. Conversely a higher ratio implies the feedlot must pay more per pound to replace an animal. Consequently a higher ratio has negative implications on feedlot profitability as more dollars are spent on placing cattle. It should be noted that the replacement ratio does not take into account changes in feed costs, which have a significant impact on the willingness of feedlots to pay for replacement cattle.

In the third quarter of 2013, fed-cattle prices were 8%-13% higher than last year, while feeder prices were only 2%-7% higher. Consequently, replacement ratios for all categories are lower than 2012. Heifer calves were down the most at 1.22 in the West and 1.19 in the East, compared to 1.32 and 1.27 last year. The declines were smaller for heavier cattle with yearling steers at 1.23 in the West and 1.20 in the East, down from 1.30 and 1.24 last year. Shortkeep steers at 1.18 in the West and 1.17 in the East, were down from 1.23 and 1.24 last year. Look for replacement ratios to increase in the fourth quarter as feeder prices improve.

Continued on page 48

C at t l e m e n · n o v e m b e r 2 0 1 3

47

BeefWatch Continued from page 47 Replacement Price Ratio (Replacement cattle price divided by slaughter price) Heifer calves (4-5)

Steer calves (5-6)

Yearling heifer (6-7)

Yearling steers (7-8)

Shortkeep steers (8-9)

1.20

1.32

1.11

1.15

1.11

WEST

1.24

1.38

1.14

1.21

1.15

Q2 EAST

1.16

1.27

1.12

1.15

1.10

WEST

1.21

1.33

1.13

1.16

1.09

Q3 EAST

1.23

1.29

1.16

1.18

1.14

WEST

1.30

1.37

1.20

1.25

1.18

1.35*

1.39

1.20

1.21

1.15

1.34

1.39

1.18

1.23

1.17

1.32

1.40

1.20

1.22

1.16

YEAR

QUARTER

2010

Q1 EAST

Q4 EAST WEST 2011

Q1 EAST WEST

1.34

1.42

1.19

1.20

1.13

Q2 EAST

1.22

1.31

1.15

1.18

1.11

WEST

1.34

1.44

1.21

1.22

1.13

Q3 EAST

1.26

1.31

1.17

1.18

1.16

WEST

1.38

1.45

1.24

1.28

1.21

Q4 EAST

1.32

1.35

1.16

1.17

1.16 1.16

WEST

1.37

1.39

1.18

1.23

YEAR

QUARTER

2012

Q1 EAST

2013

Heifer calves (4-5)

Steer calves (5-6)

Yearling heifer (6-7)

Yearling steers (7-8)

Shortkeep steers (8-9)

1.28

1.37

1.19

1.21

1.15

WEST

1.48*

1.56*

1.27

1.31*

1.22

Q2 EAST

1.35*

1.43

1.25*

1.27*

1.22

WEST

1.47

1.56*

1.29*

1.32

1.22

Q3 EAST

1.34

1.40*

1.24

1.24

1.24*

WEST

1.41

1.46

1.27

1.30

1.23*

Q4 EAST

1.27

1.35

1.15

1.19

1.17

WEST

1.32

1.37

1.14

1.19

1.14

Q1 EAST

1.12

1.24

1.04

1.13

1.10

WEST

1.27

1.35

1.13

1.16

1.10

Q2 EAST

1.10

1.18

1.04

1.10

1.06

WEST

1.16

1.28

1.07

1.12

1.05

Q3 EAST

1.19

1.29

1.12

1.20

1.17

WEST

1.22

1.32

1.15

1.23

1.18

* Record highs, East and West

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BUILDING TRUST IN CANADIAN BEEF

Get more from your vaccines Vaccine management cornerstones for farm and feedlot Hands up if you’ve ever had an animated conversation about the value of vaccines.

Ever wondered why costs are what they are or what the newest technology will offer? Or, as a seller, how best to explain why these products are worth it?

At some point nearly every producer, vet or animal health professional has had this discussion. While they may disagree on some things, one thing both buyer and seller can agree on is that once you’ve bought the product, don’t waste it with poor handling.

Dr. Roy Lewis has been a practising vet for many years. Now with Merck’s technical services, he’s picked key things for producers to focus on to get full value from vaccines.

Protect the product. You’ve spent good money on product so make sure it’s protected, says Lewis. Vaccines, especially modified live virus products, can’t be frozen and/or heated, and they should be protected from ultraviolet light. Lewis recalls producers who came to pick up vaccines prepared with an insulated container. “We hear problems of vaccine efficacy,” he says, “but many times it is a matter of how they have been handled between the time they were bought and when they were administered to the animal.”

Mix small batches. Only rehydrate the amount of product you will use within an hour. Don’t mix up large batches ahead. Once rehydrated, products only have a shelf life of a few hours.

Watch disinfectants. Modified live vaccines are fragile. If you disinfect with alcohol between uses this can render the vaccine useless.

Don’t mix products. Label syringes and keep vaccines apart.

For example, blackleg vaccine contains formalin. If you accidently fill that same syringe with a modified live virus vaccine, a small amount of formalin will destroy all the vaccine in the syringe.

Double check volumes. Overdosing wastes product and underdosing will not produce the desired effect.

Spread out injections. Producers have gotten the message of injecting subcutaneous and in the neck, says Lewis. But they need to make sure they spread the vaccine out. In many

Keeping vaccine out of sunlight can help prolong its effectiveness.

cases they find a sweet spot and inject vaccines too close to one another. That’s the same as mixing product in the syringe. Keep injections about a hand’s breadth apart and have a consistent pattern, like high then low. If you have the manpower, inject in opposite sides of the animal.

Keep current

Some of the most powerful technology in beef production today comes as vaccines. It’s a field moving quickly so it pays to ask your veterinarian about the latest products and information, says Lewis.

Don’t assume that what you did last year is still the best option today. Ask each year what will work and know clearly why you are using it. Just another way to get full value from your vaccine investment.

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REV-XS Canadian Cattlemen QSHere.indd 1

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 prime cuts

By Steve Kay

Be thankful for Canfax

C

anadian cattle producers should be thankful their leaders more than 40 years ago set up a division of the Canadian Cattlemen’s Association to provide market analysis and weekly price data.

Canfax has been invaluable ever since in providing producers with timely information about many aspects of the North American cattle and beef business.

Canfax’s reports cover everything from feeder cattle to wholesale beef prices. Its cattle prices (from feeders to cows and bulls) come on a voluntary basis from cattle feeders and auction markets and cover Alberta, Saskatchewan, Manitoba and Ontario. Canfax even publishes a feeder cattle index on a daily basis. It also publishes weekly boxed beef prices after collating information gathered from federally inspected processing plants by the Canadian Meat Council. All this data and more come from the industry itself. Even data on weekly slaughter and meat production numbers come from a private, non-profit corporation, the Canadian Beef Grading Agency.

Imagine if the above data came instead from Agriculture Canada and that overnight it was no longer available.

That’s what almost occurred in the U.S. on October 1 when the federal government shutdown began. USDA sent home its entire Market News staff, plus tens of thousands of other employees. This meant that dozens of daily market reports that the U.S. meat and livestock industry rely on were suddenly unavailable. Data darkness began and continued at least until time of writing this on October 15 (most went back on Oct. 17- Ed.).

The U.S. industry has relied more and more on USDA data since the advent of mandatory price reporting in 2001. Since that time, more cattle and beef at the wholesale level have been priced on a formula basis. But the catch-22 is that the basis is still based primarily on weekly cash price averages reported by Market News. So the alarm bells went off in packing plant and feedlot offices on October 1.

50

C at t l e m e n · N o v e m b e r 2 0 1 3

Packers worked quickly to develop pricing mechanisms that they hoped would be acceptable to cattle feeders. The mechanisms varied from feeding region to region. In the Texas/Oklahoma/New Mexico region, packers started using weekly prices reported by the Texas Cattle Feeders Association. Kansas, Colorado and the Northwest region used Cattle Fax prices for formula pricing. Nebraska and Iowa-southern Minnesota used Cattle Fax prices with some adjustments agreed to between packers and cattle feeders. So live cattle sales continued uninterrupted. But cattle feeders in Western Canada found it harder to sell to U.S. packers on a formula basis.

U.S. packers also informed their beef customers they would use their own weighted prices for beef cuts, grinds and trim based on what they would keep reporting to USDA under MPR. Some also used prices put out daily by private reporting service Urner Barry. Such moves were critical because between 45 and 50 per cent of all beef loads reported in USDA’s weekly comprehensive boxed beef report are formula sales. But uncertainty about the direction of wholesale beef prices persisted for two weeks.

Dozens of other USDA reports pertaining to U.S. agriculture were all unavailable after the shutdown.

This meant no one knew exactly how many livestock were slaughtered and how much beef and pork was produced. One casualty was the postponement of USDA’s World Agricultural Supply and Demand estimates report, which would have given USDA’s first forecast of this year’s corn crop. Another casualty was USDA’s monthly Cattle on Feed report that was due out October 18.

The shutdown hopefully ended mid-October. But it showed how daily USDA data are the lifeblood of the U.S. meat and livestock industry and that having, and supporting as much as possible, an industry service like Canfax is so important. c

A North American view of the meat industry. Steve Kay is publisher and editor of Cattle Buyers Weekly

www.canadiancattlemen.ca

ď ľ THE INDUST RY

NewsRoundup education

Report from the OAC Beef Science Club

In early October the OAC Beef Science Club, from the University of Guelph, made the long trek north to visit cattle farms in the New Liskeard area. The stops included a certified organic birth to beef operation, a mixed farm raising beef and sheep, some local purebred and commercial farms and the New Liskeard research station. The final stop was the Ontario Stockyards market at Cookstown.

The group learned about organic farm gate marketing, gravity-fed watering systems, genetic evaluations for tenderness and the challenges faced by the beef industry as a whole.The OAC Beef Science Club was formed two years ago to cater to Guelph students interested in the beef industry. They hold monthly meetings and run bus tours in the fall and spring semesters. For more information email Elliott Armstrong at earmst01@uoguelph.ca.

Continued on page 52

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Aside from dairy producers and cheese processors it was hard to find anyone connected to the livestock industry that wasn’t delighted by the signing last month of the Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union.

Canadian Cattlemen’s Association (CCA) president Martin Unrau called it a game changer for Canada’s beef industry. CETA provides new duty-free access for 64,950 tonnes of Canadian beef valued at nearly $600 million.

Of this, 50,000 tonnes, consisting of 35,000 tonnes of fresh/ chilled beef and 15,000 tonnes of frozen beef, are reserved for Canada. In addition, Canada will see the 20 per cent duty on the existing 14,950-tonne Hilton quota shared with the U.S. reduced immediately to zero. Canada will also continue to have access to the existing shared duty-free quota for high-quality grainfed beef. Combined with the new access, there is a potential to reach more than 100,000 tonnes per year of duty-free access for

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Canadian beef. Additionally, all live cattle, genetics and most beef offals and processed beef products will benefit from immediate unlimited duty-free access.

“The removal of long-standing barriers in this agreement, such as high tariffs, finally enables Canadian beef producers to benefit from the high value that the European beef market represents,” Unrau said. “We are confident that the remaining technical barriers with the EU will be resolved, and we look forward to continuing to work with the Government of Canada in this regard.”

As important as the new tariff conditions are, resolution of the technical barriers for exporting Canadian beef to Europe are also vital. Details remain to be worked out on the technical issues, but for the first time, there is a written commitment between Canada and the EU, including a timetable, to resolve the technical barriers.

Annual beef consumption in the EU is approximately eight million tonnes.

The Canadian Pork Council (CPC) was “extremely pleased” with the agreement in principle that was signed. In addition to securing free access for processed pork products on the day the new agreement Continued on page 54

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OPPORTUNITIES for DIVERSIFICATION in the CHAROLAIS INDUSTRY There has never been a better time…

NOVEMBER 22 • SPROULE CHAROLAIS COMPLETE DISPERSAL SALE 1:00 p.m., Highwood Auction Mart, High River, AB • 200 White, Red & Black Charolais

NOVEMBER 23 • WAWEDASH FARMS COMPLETE DISPERSAL SALE • OVER 300 HEAD 1:00 p.m., Dryland Cattle Trading Corp, Veteran, AB • Canada’s 1st All Red Factor Dispersal

NOVEMBER 26 • FORSYTH BROS CHAROLAIS COMPLETE DISPERSAL SALE 1:00 pm, Ste. Rose, MB Auction Market • Over 200 head – mainly White but some Red Factor

NOVEMBER 29 • STERLING COLLECTION SALE 1:30 p.m., Saskatoon, SK Livestock Sales • Consignment sale with a high quality offering from some of Canada’s top breeders

DECEMBER 6 • ALBERTA SELECT SALE Red Deer, AB Westerner • Alberta's Association Sale & Bull Show • Top Quality Offering

DECEMBER 10 • NO BORDERS SELECT SALE 1:00 p.m, Heartland Livestock, Virden, MB • Quality offering from French to Red Factor

DECEMBER 18 • LANOIE BROS CHAROLAIS COWHERD DISPERSAL 1:00 p.m., Johnstone Auction Market, Moose Jaw, SK • Over 200 Bred Cows & Heifers

Catalogues available online a month before the sale at www.bylivestock.com Contact us for more information 1-306-584-7937 Sale Manager Helge By 1-306-536-4261 Candace By 1-306-536-3374 charolaisbanner@gmail.com

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More Efficient Means More Hereford

News Roundup Continued from page 53

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takes effect, Canada will acquire a quota volume equivalent to over 80,000 tonnes of pork cuts.

The CPC says the current exports of Canadian pork cuts to the EU are virtually non-existent even though Canada imports a significant volume of high-value pork ribs from the EU. Once the tariff barriers are removed the CPC estimates sales of Canadian hams and other pork cuts to the EU would quickly climb to about $400 million per year.

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A barrage of floods and droughts across Canada in recent years and the ensuing calls for assistance for cow-calf producers has kindled interest in reviewing provincial forage insurance programs with a view to improving the products and the uptake.

“Agri-Recovery provides ad hoc assistance, but it pales in comparison to what would be available through an insurance program, and only 15 to 20 per cent of forage acres across Canada are insured each year,” says Scott Surgenor, an Agriculture and Agri-Food Canada (AAFC) representative on a national forage task team struck by AAFC and the provinces in July 2011 to lead the discussion on forage insurance Canada. 12/9/03 11:21 AM CSA Bus. CardinJan04 The provinces, which are responsible for

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NEWS ROUNDUP

the design and delivery of agricultural insurance programs, and the Canadian Cattlemen’s Association agreed to make it a priority.

The team has representatives from AAFC and the provinces plus beef, dairy, forage and general farm groups, as well as individual farmers.

They were asked to assess what producers like and don’t like about current forage insurance plans and come up with suggestions for making them more popular.

“What we found, and it’s a problem in the U.S. and Europe as well, is forage is primarily an input crop rather than a revenue crop and producers tend not to insure inputs,” Surgenor explains. “Ninety per cent of forages are fed to cattle and producers have the ability to manage feed risks on farm and would rather manage them than pay a premium for insurance.

Purchasing feed, changing the herd size, and planning for carry-over are strategies commonly used to manage risk. The problem is when there is a disaster.”

Crop insurance, on the other hand, is popular because when producers invest in putting seed in the ground each spring, that’s their only revenue stream, so insurance is important to them. As a result 70 per cent of cropland across

Canada is insured and the percentage is even higher in Western Canada.

Recommendations from the team cover two broad themes.

First, improvements could be made to existing insurance programs. One example would be to insure against sharp spikes in feed costs due to feed shortages by offering products that reflect replacement value. Area-based programs, such as rainfall insurance, are best, but the problem is lining up the triggers so they are more responsive to local conditions. That’s not impossible, but it would be a long-term initiative.

A second method would be to match the insurance to the end use of the forage. For example, when forage is grown as an input the insurance could be based on feed requirements. And forage grown for a cash hay market could be based on existing insurance schemes.

However, insuring forage like an annual crop is difficult because there are no standards for weighting and grading hay.

The provinces are currently assessing the team’s recommendations in terms of their own regional needs and are expected to respond later this year.

Continued on page 56

Nov. 23 - Wish List Canadian National Sale, Red Deer, AB Nov. 30 - Maternal Edge Gelbvieh Influenced Female Sale, Ponoka, AB Dec 14 - Prairie Gelbvieh Alliance Sale, Moose Jaw, SK Jan. 10 - AGA Annual Convention, Denver, CO Jan. 13 - National Gelbvieh & Balancer Show, Denver, CO Jan. 25 - M.C. Quantock “Canada’s Bulls” Bull Sale, Lloydminster, AB Feb. 15 - Prairie Hills Gelbvieh Bull Sale, Gladstone, ND Feb. 22 - Beck McCoy Bull Sale, Regina, SK Mar. 1 - Davidson Gelbvieh & Lonesome Dove Ranch Bull Sale, Ponteix, SK Mar. 3 - Severtson Land & Cattle Bull Sale, Innisfail, AB Mar. 8 - Foursquare Gelbvieh Bull Sale, Olds, AB Mar. 15 - Gelbvieh Advantage Bull Sale, Innisfail, AB

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Surgenor is optimistic. “Changes won’t happen overnight and industry has to be involved in the design and buy in, but there is a will and interest on all sides,” he says. “Experience shows that a new insurance plan takes at least six months from the start of development to implementation, so new products could start rolling out as early as next year.

The team’s findings couldn’t have been more timely for Ontario, where the hot, dry weather in 2012 hastened along a joint public/private review of the provincial forage rainfall plan headed up by Agricorp, the provincial agency that helps producers manage agricultural risks. Their report is due out later this year (www.agricorp.com).

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Vesta and his son Jeremy have set up temporary headquarters for a new familyowned company, Harmony Beef on site to supervise $18 million in renovations to the nine-year-old plant.

The renovations include a water recycling system developed in Europe that Vesta says will cut the plantâ&#x20AC;&#x2122;s daily consumption of fresh water to 35,000 gallons per day.

A plant of this size would normally use 350,000 gallons per day when operating at

full capacity. Observers say the lack of available fresh water supplies was a concern that held up the reopening of this plant. A portion of water for the Harmony Beef operation will be piped in from a nearby lake.

Vesta expects to have Harmony Beef processing up to 775 head per day by June 1, 2014. Their plan is to create an EU-approved plant capable of processing branded beef products for European and Asian markets. â&#x20AC;&#x153;I am not here to compete with the existing

meat-packing plants, because we wonâ&#x20AC;&#x2122;t be producing commodity beef,â&#x20AC;? said Vesta.

The original $40-million Rancherâ&#x20AC;&#x2122;s Beef plant, backed by 50 investors, was launched in 2005 as a producer-owned facility that was designed to segregate supplies for demanding markets such as Japan. It closed 14 months later. The plant and 140-acre site, valued at $75 million, was sold to Sunterra in late 2007 for an undisclosed amount. The price of the latest sale was not revealed. c

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 NEWS AB OUT YOU

By Deb Wilson

PurelyPurebred

Suggestions are always welcome. My phone number is 403-325-1695

 Cattlemen’s Young Leaders: — Austen Anderson, Swan River, Man. Mentor: Heather Travis.

Heather holds degrees in corporate communications from Seneca College, and sociology from Queen’s University. She joined the Beef Information Centre in 2007 and has spent every day since sharing her love of Canadian beef. Heather does this both through media relations and by spearheading Canadian beef ’s extensive social media engagement activities. Her work online has led Canada Beef to be recognized as a leader in this space and has ensured more Canadians than ever are hearing all the good news there is to share about Canadian beef. Prior to joining Canada Beef Inc. (formerly BIC), Heather developed and implemented public relations and marketing programs for beef and other food

— Debra Murphy, Altario, Alta.

Mentor: Tim Wiens.

As president of O & T Farms, Ltd., Tim believes in the value of continuous learning and improvement, which is the strength of the O & T team. A fellow of Quantum Shift at the Ivey School of Business, he is active in industry organizations and the community. He currently chairs the Saskatchewan Trade and Export Partnership (STEP) and is a former member of the executive committee. He believes the company’s groundbreaking nutrition in omega-3 energy in animal protein will enhance human health.

Debra Murphy is a farmer, aspiring writer and amateur photographer in east-central Alberta. After graduating from the University of Alberta with a B.Sc. in agriculture in Debra Murphy 2010, Debra participated in a six-month volunteer exchange to Nova Scotia and Indonesia. Since then she has been actively involved as a co-manager of the family farm, freelancer, secretary for the Gooseberry Lake Rodeo Committee, three-time participant in The Enbridge Ride to Conquer Cancer and was accepted to attend the 2013 International Youth Ag Summit in Calgary in August.

— Becky Page, Didsbury, Alta.

Mentor: Corinne Gibson.

Corinne ranches in the rolling hills of southwest Saskatchewan. Along with her husband Clayton and three children, Callie, Cade and Coy, she owns and operates Six Mile Ranch Ltd. near Fir Mountain. The ranch currently runs a 700-head cow herd of registered Red and Black Angus cows along with a commercial Angus herd. Corinne spent her whole life in the cattle industry and was an active 4-H member throughout her youth. After attending the University of Regina she married Clayton and they took over the reins of Six Mile Ranch from his grandparents, Ken and Roberta Frazer. Six Mile Ranch holds a bull sale in April, a purebred female sale in October and a commercial bred female sale in December. She has served as vice-president of the Canadian Red Angus Promotion Society, and was the first

product lines at retail, as well as high-end sporting goods and apparel.

Austen Anderson is a fifth-generation cattle producer from Swan River, Man. He and his family run Anderson Cattle Com p a ny In c . , a purebred Red and Austen Anderson Black Angus operation specializing in producing two-year-old bulls. They have a production sale every year on the last Saturday in March at their ranch. Austen recently graduated from the University of Regina with a bachelor’s degree in education. His future plans include returning to Swan River to be more involved with his family’s operation and to teach in the local high school.

because all calves don’t make it to the bunk.

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there’s a CRYSTALYX® barrel for that.

58

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PURELY PUREBRED

female president of the Saskatchewan Angus Association. She currently sits on the board of the Canadian Angus Association and was recently elected president elect for next year.

Becky Page grew up on a cow-calf and grain operation near Grenfell, Sask. Growing up, she was always involved in the family farm, and enjoyed learning about and Becky Page working with cattle from a young age. In high school, she developed a passion for purebred cattle and that industry by working for local purebred producers. After receiving an agriculture production diploma from Olds College, Becky moved to her husband’s family farm near Didsbury, Alta., where they raise purebred Herefords, Red Angus, and commercial Red Baldy cattle.

In her career to date she has worked for Davis Rairdan International, Square D Herefords, and for the last three years, Alta Genetics Inc. She now plans to expand the family’s cattle operation. Becky is hoping

that CYL will help open some doors for marketing, networking, and learning more about the political side of the industry.

— Kelcy Elford, Caronport, Sask.

Mentor: Garnet Altwasser.

Garnet manages a personal portfolio of ranching properties, cattle feeding, land development, futures trading and equity investments. His earlier career centred on the founding and growth of Lakeside Farm Industries Ltd., in Brooks, Alta. During his 30 years as president and CEO of Lakeside, the company opened a beef-processing division with one-third of the national slaughter capacity, commercial feed mills, six fertilizer farm supply centres, hog and broiler production and a multi-species livestock research centre. Upon the sale of Lakeside to IBP and the subsequent purchase by Tyson Food, he served both as a vice-president of IBP and of Tyson Food.

After graduating from the University of Saskatchewan with a B.Sc. in agriculture in 1962 Garnet worked for Canada Packers until 1966 when he and his wife Faye moved to Brooks where they founded Newell Feed and Supply, one of the founding businesses

of Lakeside. Garnet and Faye continue to live in the Brooks area. He has also served as director of the Alberta Division of the Canadian Feed Manufacturer Association, director of Alberta Cattle Feeders Association, president of Brooks Chamber of Commerce, member of Southern Alberta Advisory Committee to Transalta Utilities, chairman of Veterinary Infectious Diseases Organization and the Canadian Meat Council. He was awarded “The Distinguished Agrologist Award” from the Alberta Institute of Agrologists and in 1994 recognized as the Prairie Region 1994 entrepreneur of the year in the agriculture and food category. He is currently a director of ATB Financial.

Kelcy Elford and his wife Katherin, along with their two young children live southwest of Moose Jaw in the Missouri Coutea hills and operate a cow-calf operation. Kelcy grew up on a ranch south of McCord, Sask., and has always had a love for agriculture. In 1999, he and his brother purchased their first “piece of Continued on page 60

“Maximizing Profit”

Join us at SBIC 2014 to learn how!

Beef & Forage Symposium | Industry Trade Show Breed and Industry Association Meetings

Conference

January 22 – 24, 2014

Saskatoon Inn and Conference Centre Saskatoon, Saskatchewan

SASKATCHEWAN’S PREMIER BEEF EVENT

For more information and to register visit: www.saskbeefconference.com

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Continued from page 59

grass,” with financial help from their father, and a herd of cows. As the years went by and their lives changed, Kelcy and Katherin decided to ranch on their own. They are Kelcy Elford proud to have come through some of the worst economic times in Canadian cattle history when a lot of young producers left the industry, he fears, not to return. He believes there is optimism beginning to return in this industry. He also believes this lifestyle is a great place to raise a family. Kelcy hopes we can all see many good years ahead. “We are the future of agriculture and the future is bright,” he says.  An Alberta ranching family is proving anyone can step up and support a Canadian athlete’s journey to the international podium. The Barnert family, owners and operators of Pin to Point Gelbvieh in the heart of the foothills, are the first to step up and respond to the Canadian Luge Association’s recently announced FOR SALE campaign. In true Alberta fashion, the new official beef supplier of the Canadian Luge Team announced it is contributing the equivalent of one cow in the form of nearly 600 pounds of high-end Alberta beef, to be divided amongst each of Canada’s six luge athletes (Sam Edney, Alex Gough, Kimberly McRae, Arianne Jones, Tristan Walker and Justin Snith) who placed in the top 10 at the 2012 World Championships.

“Our family heard about the team’s recent sponsorship struggles, and we thought ensuring the athletes have access to highquality beef could be a small way to contribute to the campaign and their performance goals,” said Mark Barnert, who made the announcement while hosting the team and media for a good old-fashion western cookout in the middle of his 50-strong Gelbvieh seedstock that were roaming the picturesque ranch south of Calgary.

“Not only do we believe in the benefits that high-performance sport has on communities across Canada, but there are many synergies between what we do, and the goals of these athletes. Elite athletes are focused on achieving excellence, and we too are committed to developing a high-quality, grass-fed stock program

60

that delivers high-performance beef to our clients. We are thrilled to help out, and I challenge other organizations across Canada to take a step back and think about how they may also be able to connect themselves to this inspiring group of Canadian role models.”  On Oct. 25 the Canadian Angus Association closed up shop at its old office and opened for business at its new building in Balzac, northwest of the Calgary airport, on Oct. 29. All of us here at Canadian Cattlemen magazine wish them the best of luck in their new digs. Everyone is invited to their open house Dec. 11. See you there.

in the countryside worldwide, it is estimated that 2.5 billion of these women and men are farmers. “The designation of a year recognizing the vital role of family farms highlights the importance and extensive reach of agriculture,” says Adele Buettner, executive director of the Farm Animal Council of Saskatchewan (FACS).

“Well-managed farm operations with good management practices, whether at the corporate or small-scale level, make major contributions to food production, both locally and globally.”

 Canada Beef, along with Canada’s beef producers, is celebrating the announcement of a Comprehensive Economic and Trade Agreement (CETA) with the European Union (EU), which was finalized and announced October 18, giving the Canadian beef industry broader trade access in European export markets.The European market holds great opportunity for Canadian beef and veal, with the potential for 64,950 tonnes of duty-free market access for Canadian beef and veal worth over $600 million.

 What could be better than a conference on “Advancing Women” which I think will be an amazing event for women in any path? Some of the speakers confirmed to date are: Mary Morrissey, an international known motivational speaker, bestselling author, and founder of Life Mastery Institute in Simi Valley, California; Jason Ryan Dorsey, Center for Generational Kinetics in Austin, Texas; Courtenay Wolfe, president and CEO of Salida Capital, Toronto; Fran Burr, AVP marketing and crop inputs with Cargill in Winnipeg; Senator the Honourable JoAnne Buth; Alison Sunstrum, vice-president, GrowSafe Systems Ltd., Airdrie, Alta.; Gwen Paddock, national manager, RBC Royal Bank, Guelph, Ont. Google the speakers listed as some have videos of their work on their websites. For details visit the Advancing Women section of the IMCI website at www.imcievents.ca. If you wish to be put on a mailing list for this conference, send me your email address. I believe this will be a powerful event for all women and am looking forward to it.

 The United Nations has declared 2014 the International Year of Family Farming (IYFF). With 98 per cent of Canada’s farms being family owned, the announcement is a very welcome gesture for those involved in agriculture, including the Farm Animal Councils of Saskatchewan, Ontario, Alberta and British Columbia.

This worldwide celebration aims to be a tool to stimulate policies for the sustainable development of farm families and agriculture.

Family farms play a key role in enhancing food security. The World Bank estimates that a one per cent increase in GDP in the agriculture sector will be twice as effective in alleviating poverty and hunger compared to increases in any other sector. Of the three billion people living

 Join Farm Animal Care of Saskatchewan (FACS) in Saskatoon on Dec. 4 for two half-day social media workshops facilitated by Crystal Munro of Creating Excellence. The morning session covers the basics of YouTube, Facebook, Twitter, LinkedIn and Pinterest. Those who already have a basic understanding of social media can expand their knowledge in the afternoon session. Plan to learn even more by staying for the Fence Lines to Corporate Board Rooms Conference the following day when FACS will present several speakers to help identify opportunities within the changing animal agriculture industry.

The conference starts 9 a.m. Dec. 5 at the Travelodge Hotel, Saskatoon. For more information check www.facs.sk.ca/events or call 306-249-3227. c

 The Canadian Simmental Association has all kinds of interesting information online for cattle enthusiasts: Beef Innovations 2013 videos, CSA Fall 2013 Genetic Evaluation, Simmental Innovations E-Newsletter and you can view the video on how CSA is leading the industry with genomic research initiatives.

C at t l e m e n · n o v e m b e r 2 0 1 3

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 Market Su mma ry

By Debbie McMillin

TheMarkets Fed Cattle Limited movement has been seen in the cash market in recent weeks as many cattle were forward contracted through this period leaving fewer on the showlist for the cash trade. Fortunately the smaller supply of cash cattle was not affected by the sluggish demand and slower chain speeds during this reporting period. Fed cattle traded in a steady pattern since falling back from this year’s high of $122.70.

In the past 18 weeks fed cattle ranged from $117 to $120 with the bulk around $119.

At mid-October fed steers averaged $118.7 per cwt, $12.45 better than a year ago. The basis widened from the start of October to -13.24/cwt at mid-month, which is almost $2 wider than the five-year average for this time of year.

The Canfax Cattle on Feed report for October 1 showed 722,814 in feedlots, an increase of eight per cent from a year ago.

One contributing factor is the increase in placements in the past two months. September placements were up 12 per cent on the year. Fed-cattle exports to the middle of September totalled almost 260,000 head, the latest data available following the shutdown of U.S. government services.

Domestic steer slaughter is down three per cent at 1,066,589 head and heifers are off by 12 per cent at 598,790 head.

Feeder Cattle High deferred fed-cattle futures and reduced grain prices are supporting the feeder market this fall. Yearling volumes have tapered off since the central Alberta market posted a high of $147.08 in August. But after several weeks of trading just below that level the market posted a new average high of $148.50 for 850 steers in central Alberta, more that $20 above the same week last year.

At the same time the largest basis levels in recent years are being reported thanks

www.canadiancattlemen.ca

to the approaching enforcement of the country-of-origin rules. U.S. yearling markets are posting new record highs on the futures and the cash while calves continue to trade under the record levels set in 2012. Alberta calves have started to resist the seasonal index trend with a contra-seasonal rise through September and October. Mid-October 550-pound calves were trading at $164.83 per cwt, $11.33 higher than last year.

Recent export data were not available at press time due to the USDA shutdown but the mid-September data showed feeder exports running 81 per cent ahead of last year at that point in time.

Non-Fed Cattle Cow volumes picked up in recent weeks as ranchers started to wean and sell calves.

By mid-October cow slaughter was running at volumes not seen since May, and despite the reduced size of the cow herd marketings were pegged to be large in 2013. To mid-October cow slaughter on the year was up two per cent at 317,921 head. Exports to mid-September were also running 80 per cent ahead of last year at 199,383 head. Thanks to the relatively strong demand for grinding and trim cuts, prices remained surprisingly strong given these numbers. D1,2 cow prices in Alberta averaged $78 in mid-October, about $4 off our summer highs but $14 per cwt better than last year at this time. Slaughter bulls slipped a bit but held a mid-October average of $86.20 per cwt. Most of the bulls are still heading south with only 3,689 slaughtered in Canada by mid-October and 50,261 head moving to the U.S, which is an increase of 61 per cent or 190,000 head over 2012. c Debbie McMillin is a market analyst who ranches at Hanna, Alta.

More markets 

 DE B ’S OUTLOOK Fed Cattle Over the next few weeks North American fed supplies should tighten giving already current feedlots more leverage at a time when seasonal demand generally increases. Towards the end of the year higher-priced middle meats take centre stage with retail and food-service clients and help boost fed prices. The U.S. is expecting smaller net fed-cattle supplies, which should create an export floor and support local demand.

Bottom line: for the remainder of 2013 a favourable Canadian dollar, smaller market-ready supplies, strengthening demand and strong live cattle futures should provide a higher-trending fed-cattle market.

Feeder Cattle There are so many factors to watch during the fall feeder run. Potential downside risks include the uncertainty around U.S. labelling rules, although the current weak basis suggests some of that has already been taken into account. Moving forward volumes will increase in the next several weeks however, a cheaper cost of gain and bullish live cattle deferred futures should make it possible for buyers to hedge some margin at current levels. Look for a strong fall run with a solid floor on goodquality feeder calves.

Non-Fed Cattle Seasonally prices are pressured at this time of year but the downside is less than usual this fall. Prices may struggle as volumes continue to increase in the coming weeks however, the strong demand for grinding cuts both here and in the U.S. will continue to put a floor under this market.

C a t t l e m e n · n o v e m b e r 2 0 1 3 61

M A R K ETS

Break-even Prices on A-Grade Steers

Market Prices

140

190

ALBERTA

130

170

120

160

110

150

100 90 155 145

Steer Calves (500-600 lb.)

180

140 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

ONTARIO

135

130

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

95

D1,2 Cows

85 75

125

65

115

55

105 95 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Canfax weighted average price on A-Grade steers

Break-even price for steers on date sold

2013 2012

2014 2013

October 2013 prices* Alberta Yearling steers (850 lb.) . . . . . . . . . . . . . . . . . . $142.99/cwt Barley . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.13/bu.

Barley silage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51.63/ton Cost of gain (feed) . . . . . . . . . . . . . . . . . . . . . . . . . 63.49/cwt Cost of gain (all costs) . . . . . . . . . . . . . . . . . . . . . 91.60/cwt Fed steers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118.35/cwt Break-even (March 2014) . . . . . . . . . . . . . . . . . 122.80/cwt Ontario Yearling steers (850 lb.) . . . . . . . . . . . . . . . . . . . $151.83/cwt Corn silage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41.76/ton Grain corn . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.97/bu.

Cost of gain (feed) . . . . . . . . . . . . . . . . . . . . . . . . . 76.32/cwt Cost of gain (all costs) . . . . . . . . . . . . . . . . . . . . . 101.98/cwt Fed steers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119.40/cwt Break-even (April 2014) . . . . . . . . . . . . . . . . . . . . 131.20/cwt *Mid-month to mid-month prices Breakevens East: end wt 1,450, 183 days West end wt 1,325 lb., 125 days

45

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Ontario

Alberta

2013 2012

2013 2012

Ontario prices based on a 50/50 east/west mix

Market Summary (to October 5) 2013

2012

Total Canadian federally inspected slaughter. . . . . . . . . . . . . . 1,986,989. . . . . . . . . 2,098,813 Average steer carcass weight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 874 lb.. . . . . . . . . . . . 876 lb.

Total U.S. slaughter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N/A. . . . . . . . . . . . . . . N/A

Trade Summary Exports 2013 2012 Fed cattle to U.S. (to September 21) . . . . . . . . . . . . . . . . . . . . . . . . . . . . N/A.. . . . . . . . . . . . . . .N/A Feeder cattle and calves to U.S. (to September 21). . . . . . . . . . . . . . N/A.. . . . . . . . . . . . . . .N/A Dressed beef to U.S. (to August). . . . . . . . . . . . . . . . . . . . . . 285.70 mil.lbs.. . . . .338.52 mil.lbs Total dressed beef (to August). . . . . . . . . . . . . . . . . . . . . . . 402.42 mil.lbs.. . . . . 451.25 mil.lbs 2013 IMPORTS 2012 Slaughter cattle from U.S. (to August) . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . . . . . . . . . . . . . . . 0 *Dressed beef from U.S. (to August) . . . . . . . . . . . . . . . . . 253.67 mil.lbs. . . . . 230.32 mil.lbs *Dressed beef from Australia (to August) . . . . . . . . . . . . . . 22.67 mil.lbs. . . . . . . .18.14 mil.lbs *Dressed beef from New Zealand (to August) . . . . . . . . . . 27.02 mil.lbs. . . . . . . 34.97 mil.lbs *Dressed beef from Uruguay (to August) . . . . . . . . . . . . . . 23.45 mil.lbs. . . . . . . . 17.21 mil.lbs Canadian Grades (to October 19, 2013) % of A grades +59% 54-58% AAA 20.9 21.8 AA 27.9 9.0 A 1.9 0.1 Prime 0.2 0.5 Total 31.4 50.9

EAST WEST

Total graded 475,849 1,592,500

Yield â&#x20AC;&#x201C; 53% Total 12.2 54.9 2.5 39.4 0.0 2.0 0.9 1.6 15.6 Total A grade 97.9%

Total ungraded 21,852 162

% carcass basis 80.0% 87.4% Only federally inspected plants

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 market ta l k

By Gerald Klassen

Feeder Cattle Market Slowly Rising

W

estern Canadian feeder cattle prices have been slowly rising throughout the fall period. However, local prices have been lagging the U.S. market as values in the Midwest for replacement cattle have traded near all-time record highs. Many cow-calf producers have been looking at this price discrepancy and waiting to make sales. Barley prices are trading near three-year lows but the feeder market hasn’t factored in the full price drop of the barley market. This is largely due to the current feeding margins in the feedlot sector and the equity erosion over the past year. The stronger live cattle futures in the deferred marketing positions would suggest higher fed-cattle prices next March and April.

In past years, there has been optimism and hope in the feeder complex as feedlots pencilled out margins based on current barley prices and forward contracts for fed cattle. Given the fact that feeding cattle is a competitive market (meaning there is no profitable margin in the long run) feedlot managers would bid up the feeders accordingly. However, this year is a bit different. Feeding margins on current pen closeouts are slightly in the red as Alberta fed-cattle prices hover at $118 per cwt, approximately $3 per cwt below break-even.

It appears feedlot managers are basing their calculations on current market conditions rather than deferred live cattle futures. In the past, the Alberta basis levels on fed cattle have been quite volatile so the gain in the futures market is not always realized in the cash trade. Secondly, I’m surprised by the number of operations that have closed, are empty or running minimal numbers. The demand for feeder cattle in Western Canada is down sharply in comparison to past years and the current income constraints on feeding margins have limited the optimism to overbid on feeder cattle. I’ve received many inquiries in regards to feeder cattle prices over the next threeto four-month period so I thought this would be a good time to discuss the market conditions.

The price of feeder cattle is determined by cost of feed grains and the potential fed-cattle price when the animal is fat. In the previous issue, I discussed the barley outlook making the case that the 2013-14 Canadian barley could reach 2.1 million mt, which is slightly above the 10-year average. Larger stocks would keep barley prices under pressure throughout the crop year and strong competition from U.S. corn would also limit the upside. Barley in the Lethbridge area is trading at $180 per mt delivered while prices in non-major feeding regions are lower. We are seeing more feed barley move off the West Coast as the market functions to encourage demand. Barley prices are projected to trade at these levels over the winter.

The fed-cattle market projection for the January-through-April period is more uncertain because demand can be quite variable. The supply equation becomes more certain as the market realizes the number of cattle on feed multiplied by carcass weight projections. In Canada, total beef output in the first quarter of 2014 is projected at 214,000 mt, down eight per cent from 2013 first-quarter production

www.canadiancattlemen.ca

u.s. quarterly beef production (million pounds)

Quarter

2010

2011

2012

Estimated 2013

Estimated 2104

1

6,251

6,411

6,283

6,172

5,870

2

6,547

6,559

6,475

6,517

6,135

3

6,768

6,737

6,584

6,640

6,250

4

6,741

6,492

6,571

6,270

5,895

TOTAL

26,307

26,199

25,913

25,599

24,150

of 233,000 mt. Second-quarter beef production for 2014 is projected at 231,000 mt, down five per cent from the 243,000 mt produced during the same period of 2013.

U.S. beef production will experience a sharp year-over-year decline in the first and second quarters of 2014 by approximately 5.5 per cent. Overall, exports are expected to be about the same during this time frame therefore each U.S. consumer will eat one less pound of beef in the first quarter and 1.2 less pounds in the second quarter. This does not necessarily mean that prices have to rise to ration demand.

American consumer confidence has been shattered since the U.S. government shutdown which caused overall spending to slow down. This is very detrimental to beef demand. I’ve mentioned before a one per cent decrease in consumer spending results in a similar decline in beef demand. Secondly, there is a strong seasonal tendency for consumers to spend less in the first two months of the year. I’m not expecting a year-over-year increase in food spending in the first quarter of 2014 while a marginal increase is projected in the second quarter. Disposable income has not increased at the same rate as retail beef prices.

Consumers are having to spend about three per cent more on food to keep up with other inflationary factors. Retail beef prices are now levelling off while wholesale values are also in a consolidation pattern. This trend will likely continue over the next few months because there are no major factors to increase the income level for the average American and each consumer is less optimistic about their economic future.

Using current feeder cattle prices and barley at $180 per mt, break-even prices during February through April are in the range of $122 to $125 per cwt based on all costs. At this time, I don’t think fed-cattle prices will be above $125 for a solid quarter. In the past, the fed market tended to trade at higher levels for a short period.

Therefore, western Canadian feeder cattle prices have likely run their course. We may see a bit of a seasonal rally in March, in line with the fed cattle but I wouldn’t count on significant upside from current levels given the current market environment. c Gerald Klassen analyzes markets in Winnipeg and also maintains an interest in the family feedlot in southern Alberta. He can be reached at gklassen7@hotmail.com.

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 GOINGS ON

Sales&Events Events

4

November

10-16 Canadian Western Agribition, Evraz Place, Regina, Sask.

13-14 Sweetheart Classic Gelbvieh Futurity, Evraz Place, Regina, Sask.

14 Canadian Western Agribition Shorthorn Sale, Evraz Place, Regina, Sask.

15 Canadian Western Agribition Shorthorn Show, Evraz Place, Regina, Sask.

21 Best of Canadian Agrimarketing Awards, Chateau Frontenac, Quebec City, Que. 26-27 Canfax Forum, Deerfoot Inn, Calgary, Alta.

29- Canadian People’s Choice Gelbvieh Dec. 1 Bull Futurity and Wishlist Weekend, Westerner, Red Deer, Alta.

December 2-4

ACS — Social Media Workshops, F Travelodge Hotel, Saskatoon, Sask., facs@sasktel.net or 306-249-3227 9-11 Canada’s Forage and Grassland Association Conference and AGM, Pomeroy Inn, Olds, Alta.

11 Canadian Angus Association — Grand Opening of Angus Central, Balzac, Alta.

January 2014

9-11 O ntario Beef Industry Conference, London, Ont. 22-24 Saskatchewan Beef Industry Conference, Saskatoon Inn, Saskatoon, Sask.

25 Lazy S Ranch Bull Power 2014 Sale, at the ranch, Mayerthorpe, Alta., www.lazysranch.ca

February 4-5

lberta Beef Producers Annual General A Meeting, Sheraton Cavalier, Calgary, Alta.

4-7

anitoba Beef Producers 35th Annual General M Meeting,Victoria Inn, Brandon, Man. U.S. Cattle Industry Convention and NCBA Tradeshow, Nashville, Tennessee

June

18-21 Beef Improvement Federation Convention, Lincoln, Nebraska

July

24-26 Canadian Junior Limousin Conference, Saskatoon, Sask.

25-27 2014 Canadian Simmental Association AGM, Elkhorn Resort, Riding Mountain National Park, Man.

Sales November

29- 30 Crowfoot Cattle Co. Complete Red and Black Angus Dispersal, at the ranch, Strathmore, Alta., www.crowfootcattle.com

January 2014 25

 ADVERTISE R IN D EX Ability Pump & Equipment Advanced Agri Direct Airdrie Trailer Sales Allen Leigh Security & Communications Ltd. Beefbooster

By Livestock Canadian Angus Assoc.

Canadian Beef Sires Canadian Charolais Assoc.

Canadian Forage & Grassland Canadian Gelbvieh Assoc.

Canadian Hereford Assoc.

Canadian Shorthorn Assoc.

Canadian Simmental Assoc.

Case-IH Cattlex Farms Ltd. Crowfoot Cattle Company Cudlobe Direct Livestock Marketing Double D Custom Hats Farm Animal Council of Sask. Inc. Farm Credit Canada

19-21 Alberta Beef Industry Conference, Sheraton Hotel, Red Deer, Alta.

Page 55 28 56 56 41 53 IFC 60 a-b OBC 20 55 54 16 54 12, 13 51 27 35 51 56 52 29

Page General Motors IBC Government of Alberta Workforce 50 Greener Pastures 53 Hawk Valley Ranch 57 Hi Hog Farm & Ranch Equipment 57 Hill 70 Quantock Ranch 9 54 International Stock Foods Kubota Canada 23 Lakeland Group/Northstar 16 a-p MC Quantock Livestock 5 Mel Stewart Holdings 57 15, 31, 49 Merck Animal Health Merial 11, 34 New Holland 32, 33 Novartis Animal Health Canada 21 Peak Dot Ranch 43 Plain Jans 54 Ridley Block Ops/Crystalyx 58 Salers Assoc. of Canada 54 Saskatchewan Beef Industry 59 6 The Cattle Range Tru-test Inc. 54 Zoetis Animal Health 7, 19, 25, 37

C Quantock “Canada’s Bulls” Bull Sale M — 450 Bulls, Lloydminster Exhibition, Lloydminster, Sask.

February 1

ill 70 Quantock “Barn Burnin Bull H Sale,” at the ranch, Lloydminster, Sask.

8 Soderglen Ranches Ltd. 2014 Select Bull Sale, at the ranch, Airdrie, Alberta.

March 1

4

avidson Gelbvieh and Lonesome Dove D Ranch 25th Anniversary Bull Sale, Bull Yards, Ponteix, Sask.

Belvin Angus Bull Sale, at the farm, Innisfail, Alta. c

 Event listings are a free service to industry.  Sale listings are for our advertisers.

Your contact is Deborah Wilson at 403-325-1695 or deb.wilson@fbcpublishing.com

CANADIAN CATTLEMEN NEEDS YOUR

Calving tips & tales

Friends and neighbours, we are once again looking for your best calving tips and tales for Cattlemen’s January 2014 Calving Special. We’re looking for good ideas, practical advice, or humorous tales and photos to share with fellow readers. A reward will be sent for Tips & Tales printed in this special.

Send your calving tips to Calving Tips & Tales (and your address) to Canadian Cattlemen 1666 Dublin Ave., Winnipeg, MB R3H 0H1 Email: gren@fbcpublishing.com Fax: 1-866-399-5710

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 ENTER BEFORE NOV. 29, 2013 C at t l e m e n · n o v e m b e r 2 0 1 3

YOUR REWARD: A limited edition Canadian Cattlemen cap

www.canadiancattlemen.ca

A TRUCK AS STRONG AS THE MAN WHO DRIVES IT.

ALL-NEW CHEVY SILVERADO THE MOST EFFICIENT V8 AVAILABLE IN A pICkup (8.7L/100 kM HWY*).

EVEN MOrE EFFICIENT THAN FOrDâ&#x20AC;&#x2122;S F-150 ECOBOOST V6 (HWY). STrONg. FOr ALL THE rOADS AHEAD.

*2014 Silverado 1500 5.3L EcoTec3 V8 engine equipped with a 6-speed automatic transmission has a fuel-consumption rating of 13.0L/100 km city and 8.7L/100 km hwy (2WD) and 13.3L/100 km city and 9.0L/100 km hwy (4WD). Fuel consumption based on gM testing in accordance with approved Transport Canada test methods. Your actual fuel consumption may vary. Comparison based on wardsauto.com 2013 Large pickup segment and latest competitive data available. Excludes other gM vehicles.

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