COW/CALF
CORNER
The
Newsletter
From
the Oklahoma Cooperative Extension Service
October
17, 2016
In
this Issue:
World beef markets
and trade expected to grow in 2017
Derrell S. Peel,
Oklahoma State University Extension Livestock Marketing Specialist
Know the USDA cull
cow grades before you send them to market
Glenn Selk,
Oklahoma State University Emeritus Extension Animal Scientist
World beef markets
and trade expected to grow in 2017
Derrell S. Peel,
Oklahoma State University Extension Livestock Marketing Specialist
The
latest global meat trade estimates from the USDA Foreign Agricultural Service
indicate that beef production and consumption among major beef countries is
growing in 2016 and is projected to grow additionally in 2017. Aside from
the U.S., the world’s largest beef producing and consuming country where both
production and consumption are increasing, beef production is expanding in
several major beef producing countries. Brazil, which saw decreased beef
production in 2015 and 2016, is projected to increase production in 2017.
Beef production is also expected to increase in China, India and Argentina with
the European Union (EU) holding about steady. Australia is an exception,
with drought forced liquidation in 2014 and 2015 leading to a projected 19
percent beef production decrease in 2016 and continued smaller production in 2017.
In
addition to the U.S., beef consumption among major beef consuming nations is
projected to expand in 2017 in China and Brazil, with a modest year over year
decrease in the EU. In the remaining top ten beef consuming nations, beef
consumption in 2017 is projected to expand in Argentina, India, Mexico,
Pakistan and Turkey. Russia is expected to post another decrease
following reduced beef consumption in 2015 and 2016. Beef consumption in
Japan, which is currently the number eleven beef consuming nation, is projected
to hold steady in 2017.
Beef
exports among major exporting countries are projected to increase year over
year in 2017. In 2016, sharply lower beef exports from Australia and New
Zealand are projected to more than offset increased exports from Brazil, India
and the U.S. resulting is a slight year over year decrease in total exports
from 2015 levels. Australia and New Zealand are expected see continued
reductions in beef exports in 2017 with growth continuing in the three other
largest beef exporting countries. Beef exports also expected to continue
growing in other top ten exporting countries in 2016 and 2017 including
increased exports projected for Canada, Paraguay, Uruguay (steady in 2017), the
EU and Mexico along with Argentina, currently the number eleven beef exporting
country.
Despite
sharply lower U.S. beef imports in 2016 and additional reductions projected for
2017, total beef imports among major importing countries are expected to
increase year over year in 2016 and 2017. Rapid growth in beef imports in
China is the most dramatic change in global beef markets. China, which
was not a global beef market player at all just a few years ago, has risen to
be the second largest beef importing country in 2016 with additional growth
projected in 2017. At the current pace of growth, China could surpass the
U.S. as the largest beef importing country in the next two or three
years. Beef imports in South Korea have also increased sharply in 2015
and 2016 with modest increases projected to continue in 2017. Japan is
also projected to continue modest year over year increases in beef imports in
2017. Russia, which has seen beef imports fall by more than half since 2013, is
projected to stabilize beef imports in 2016 and 2017 at the lowest level in
more than 15 years. Beef imports in most other significant beef importing
countries are projected to be steady to higher in 2017. These countries
include the EU, Hong Kong, Egypt, Canada, Chile and Malaysia.
Know the USDA cull
cow grades before you send them to market
Glenn Selk,
Oklahoma State University Emeritus Extension Animal Scientist
Some
culling of beef cows occurs in most herds every year. The Beef Audits have
generally shown that cull cows, bulls, and cull dairy cows make up about 20% of
the beef available for consumption in the United States. About half of this
group (or 10% of the beef supply) comes from cull beef cows.
Whether
we are culling because of drought or to improve the productivity of the herd,
it is important to understand the values placed on cull cows intended for
slaughter.
The
USDA market news service reports on four classes of cull cows (not destined to
be replacements). The four classes are divided primarily on fatness. The
highest conditioned cull cows are reported as "Breakers". They
usually are quite fleshy and generally have excellent dressing percentages. Body
condition score 7 and above are required to be "Breakers".
The
next class is a more moderate conditioned group of cows called "Boners"
or "Boning Utility". These cows usually would fall in the body
condition score grades of 5 to 7. Many well-nourished commercial beef cows
would be graded "Boners".
The
last two grades of cows as reported by the market news service are the "Leans"
and "Lights". These cows are very thin (Body condition scores 1 -
4). They are in general expected to be lower in dressing percentage than the
fleshier cows and are more easily bruised while being transported than are cows
in better body condition. "Lights" are thin cows that are very small
and would have very low hot carcass weights.
Leans
and Lights are nearly always lower in price per pound than are the Boners and
the Breakers. "Lights" often bring the lowest price per pound because
the amount of saleable product is small, even though the overhead costs of
slaughtering and processing are about the same as larger, fleshier cows.
Also thin cows are more susceptible to bruising while in transit to
market and to the harvest plant. Therefore, more trim loss is likely to
occur with thin cull cows than with those in better body condition.
Producers
that sell cull cows should pay close attention to the market news reports about
the price differentials of the cows in these classes. Cull cows that can be fed
enough to gain body condition to improve from the Lean class to Boner class can
gain weight and gain in value per pound at the same time. Seldom, if ever, does
this situation exist elsewhere in the beef business. Therefore during the fall
and early winter, market your cull cows while still in good enough condition to
fall in the Boner grade. If cows are being culled while very thin, consider
short term dry lot feeding to take them up in weight and up in grade. This
usually can be done in about 50 to 70 days with excellent feed efficiency.
Rarely does it pay to feed enough to move the cows to "Breaker"
class. There is very little, if any, price per pound advantage of Breakers over
Boners and cows lose feed efficiency if fed to that degree of fatness.
Dressing
percentage within each of the four grades will also play a major role in the
price per pound of cull cows. High dressing percentage cows often may
bring 6 to 10 dollars or more per hundredweight than low dressing cows within
the same grade. The current cow and bull market for Oklahoma City
National can be found at this web link. https://www.ams.usda.gov/mnreports/ko_ls151.txt
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