LMD Sept 2015

Page 1

Riding Herd

“The greatest homage we can pay to truth is to use it.”

by LEE PITTS

– JAMES RUSSELL LOWELL

Hey, Stop That!

September 15, 2015 • www.aaalivestock.com

Volume 57 • No. 9

The Big Gamble C By Lee Pitts

ongratulations. You’ve spent $5,000 for bulls, culled ruthlessly and built up a herd of cows you should be proud of and the results have been impressive. U.S. ranchers are producing the same amount of beef now as we did 20 years ago with four million fewer cattle. By using EPDs, DNA, embryo transfer and a host of other tools, the purebred industry is producing more efficient cattle that produce meatier carcasses with less waste and more Prime and Choice carcasses. As a result, the beef from your cattle has found eager buyers both in this country and abroad. Now, how would you like it if you had to kill every animal in your herd? How would you feel if your life’s legacy went up in a puff of black smoke?

This Time, It’s Personal

NEWSPAPER PRIORITY HANDLING

Under the banner of free trade the USDA is gambling with your future by lifting a ban on imported beef from Northern Argentina and 14 of Brazil’s 27 states while these two countries still have foot and mouth disease! Why is the Obama administration gambling with your future? So the price of beef might go down a few pennies or so that we can call ourselves free traders only to be out-traded yet again?

Words that soak into your ears are whispered, not yelled.

Or is this all just another part of Obama’s legacy enhancement program? The Environmental Protection Agency just devastated a river they were supposed to “protect”, creating one of the biggest environmental disasters in recent history. Another government agency, USDA’s Animal and Plant Health Inspection Service, could be unleashing an even bigger disaster by allowing fresh beef to be imported into this country from two countries with FMD. We have rules on the books to

prevent such imports yet Obama simply ignores them, as he often does. But this time his actions will directly affect you. This time it’s personal.

Downsizing Due to globalization, when China sneezes the entire world catches a cold. Witness the recent stock market calamity. But that was just money, this time we’re talking about you and your animals. We’ve watched as Ebola from Western Africa terrified the world and listened as the World Health Organization told visitors

to Saudi Arabia to wash their hands after the obligatory camel ride lest they catch the MERS virus, also known as camel flu which is killing 40 percent of those contracting it. Yes, a more interconnected world is a much more dangerous one. To get some idea of the damage that can be caused by a disease, consider the living Hell the poultry industry is currently experiencing. We have just witnessed arguably the worst animal health emergency in our history as bird flu has killed nearly 50 million fowl and cost one billion dollars! The feds have spent $191 million to pay poultry farmers for birds lost to avian flu in addition to the nearly $400 million spent on cleaning up dead birds and disinfecting barns. And that doesn’t count the export markets that have been closed to American poultry products. China and South Korea have gone from continued on page two

World economic woes hit home Soft grain trade, cattle to follow BY MIRANDA REIMAN

I

f you don’t believe the global factors affecting the U.S. cattle market are numerous and complicated, you probably haven’t heard Dan Basse, president of Ag Resource Company, give an economic outlook. By 2040, Japan’s population will drop by 25.3 million people. Today, the Black Sea region exports 34 percent of the world’s wheat. Brazil’s currency, the real, has been weak for several years versus the U.S. dollar. Those realities shape Basse’s predictions of fed cattle prices soon topping out near $160/ hundredweight (cwt.) before softening to $120/ cwt. or lower and, with normal weather, $3/bushel (bu.) corn prices all the way to 2019. The seasoned market analyst spoke at the Feeding Quality Forum, Aug. 18 in La Vista, Neb., and Aug. 20 in Garden City, Kan. “There is no shortage of grain in the world, so U.S. users don’t have much to worry about,” Basse said, agreeing with USDA’s average yield prediction of 168 bu./acre. U.S. grain producers, however, need to concentrate on making margin. Despite being down 9 percent, U.S. gross farm income is going to be the fourth largest on record this year, Basse said, but net farm income will see the biggest drop since 1932.

“Everything went higher as you made more money,” he said. “The problem is now that the cycle has changed, they are slow to take their hands out of your pocket. Our balance sheets can’t keep imploding at this rate without some readjustment in the cost side.” Land, labor, nitrogen and seed have all risen dramatically. “These are the four factors that have to see readjustment if we are going to see $3 corn prices translate back to profitability for the American farmer,” Basse said. The strength of the U.S. dollar, which has trended upward since 2014, does not bode well for exports. Typically the dollar rises in 6-year cycles. “We are only at the beginning of year one-anda-half of this dollar rally,” the analyst said. “That means we are fighting against others to export our goods into the world marketplace.” Argentina, Russia and Brazil have seen poor currency exchange rates by comparison. “This is really important because never before has the world seen where the United States wasn’t a predominant exporter of grains and meat,” he said. In 2000 the Black Sea region only exported 4 percent of all wheat and corn combined. Today that’s 34 percent of the world’s wheat alone. continued on page four

T

he USDA is spending eleven million dollars over the next five years to find out why there are so many wild horses and how they can keep the population from doubling every four years like it is now. The USDA says they have 21 research projects started or in the planning stages to discover why there are so many wild ones. No doubt the manpower they’ve assigned to the problem doubles every four years too! I can save the USDA all that time and money because I used to raise rabbits. Here is my six-step plan to reduce the wild horse herd. Step #1. Years ago I visited one of the USDA’s feedlots and I noticed that the stallions were still in pens with mares and their social interaction had clearly gone past the dating stage. It appeared that the USDA was a pimp in hooking up the studs for some daytime playtime. So I offer my services to teach a sex education class to USDA employees about the birds and the bees. I would stress that these feedlots are not social clubs but are pits of sexual deviation and exploitation that all feminists should abhor. If the USDA can’t at least separate the sexes the least they could do is do what I did when I raised rabbits. I hid behind a barrel and when I saw a buck deflowering a young bunny I’d jump up and yell, “Hey, cut that out! Step #2: Years ago cowboys would tie a dummy to a saddle and put it on a wild horse. (Not to be confused with a USDA dummy.) The horses in the herd, thinking it was a person, would run themselves to near exhaustion so the cowboys could catch them easier. We could do this on a grander scale and by the time the horses figured it out they’d be too tired to have sex and both the studs and the mares would have a headache. Step #3: Bring back the horse processing plants because these are not endangered species we’re talking about. The DNA of the “wild” horses is identical to continued on page four

www.LeePittsbooks.com


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LMD Sept 2015 by Livestock Publishers - Issuu