Ag In UncertainTimes: Webinar 2 — Tax and Financial Risks Due to Drought and Disaster

A reminder of the  Ag in Uncertain Times webinar Friday December 7, 2012, 12:00 Eastern/11:00 Central/10:00 Mountain/9:00 Pacific  — Tax and Financial Risks Due to Drought and Disaster

The webinar is part of a series by the North Central Risk Management Education Center and co-hosted by the Agriculture and Applied  Economics Section (Extension Section)  and is being hosted by Montana State University Technology at this link – http://msuextensionconnect.org/aginuncertaintimes

 

The third webinar is set for January 22, 2013 and will address strategies for the coming production year with uncertain institutional, production, and market risks.

Kim Cassel         Dec 7 AgInUncertainTimes_FLYER

COW/CALF CORNER The Newsletter From the Oklahoma Cooperative Extension Service

Shared by Susan Kerr with EDEN deleagates:

In this Issue:

Can We Rebuild the Beef Cow Herd? Part 1

Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist

Management of Cows with Limited Forage Availability

Glenn Selk, Oklahoma State University Emeritus Extension Animal Scientist

Can We Rebuild the Beef Cow Herd? Part 1

Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist

 

That was the question posed to me by a producer in response to my recent article suggesting that two years of drought liquidation, on top of previous liquidation, has pushed the beef cattle inventory so low that we are effectively “out of cattle” in terms of our ability to maintain beef production and rebuild the cow herd.  This producer specifically noted two issues that will affect the ability of the beef industry to rebuild: the loss of forage land to non-agricultural (development and recreational) uses; and the conversion of pasture to crop production.  While these and other issues pose significant challenges to rebuilding the beef cow herd, I do believe there is ample capacity to rebuild the cow herd according to the demands of the market.  That said, the question of how and where it will done is likely to be different in the future than in the past.

 

In the short run, the drought is, of course, the major factor affecting herd liquidation.  Until forage conditions improve, the question of herd rebuilding is a moot one. And while there is no current indication of improving drought conditions, nor any guarantee that conditions will improve, it is likely that some regions, at least, will see improving conditions in the coming months.  The more regionally specific drought in 2011 caused a 1.07 million head decrease in beef cows in a single year in Texas, Oklahoma and the surrounding states.  Much of this region is still in severe drought, with some areas, such as Arkansas, in considerably worse shape in 2012 than in 2011.  There has been some improvement in drought conditions in parts of east Texas but little if any herd rebuilding has taken place yet.  Most all of this loss in beef cows can be recovered post-drought, though some parts of the region will take several years to fully recover.

 

The impact of the 2012 drought has yet to be documented until the next USDA cattle inventory report is available.  I expect to see another 400 to500 thousand head decrease in the beef cow herd, spread across several states.  I suspect this reduction represents extra heavy culling of the cow herd and fewer heifers entering herds rather than the deep herd culling or herd dispersals that occurred in 2011.  Nevertheless, this is additional herd capacity that can return rather quickly with improved forage conditions.

 

Land use issues affecting the beef industry reflect long term trends and on-going structural changes in U.S. agriculture.  Concerns about development and recreational use of forage lands are common and understandable among many cattle producers.  Certainly in some areas, the loss of pasture to small acreage development or for other non-agricultural uses is significant and noticeable.  However, about 30 percent (571 million acres) of the total U.S. land area of 1.93 billion acres is rangeland, pasture or non-cultivated cropland (mostly hay). No doubt this includes some land used for recreation despite being designated as agricultural.  Another 810 million acres (42 percent) is forest land or federal land, a significant portion of which is grazed or partially grazed by livestock. Thus, a majority of some 1.381 billion acres (72 percent) of the total land in the country is used exclusively or partially for livestock, mostly cattle, production.  This compares to 305 million acres (16 percent) used for crop production; 33 million acres (1.7 percent in the Conservation Reserve Program); 111 million acres (5.7 percent) developed; and another 5.2 percent in water surface and other rural uses.  Land used for development increased nearly 17 million acres from 1997-2007.

 

Land diversion away from agriculture is not a trivial matter but does not represent a significant barrier to potential rebuilding of the cow herd, at least not on a national basis.  The implications of this issue certainly vary in some regions and are part of a broader set of regional changes in agriculture that will affect the beef industry in the future.  The next installment of this article will discuss how and where beef cow herd rebuilding will take place.

 

Management of Cows with Limited Forage Availability

Glenn Selk, Oklahoma State University Emeritus Extension Animal Scientist

Most of the cow calf producers of the Midwest and Southwest are going into winter with very limited hay supplies and standing forage.  As they search for alternative methods to keep the cows in adequate body condition this winter, some were planning on wheat pasture that so far has not received enough rain to grow.  Therefore it has become time to look for Plan B (or C or D).  Most of the alternatives after wheat pasture are not easy or inexpensive.

 

Information that may provide guidelines for alternative winter feeding methods can be found in an Oklahoma State University Extension Fact Sheet:  ANSI-3034 called “Management of Cows with Limited Forage Availability”.  In this fact sheet you will find:

 

  • Culling suggestions (if that has not already been done);
  • Recommendations about how much hay is needed if it is to be purchased;
  • Limit-feeding grain with limited forage available
  • Suggested complete diets for cows fed in drylot
  • Limit energy concentrate feeding management tips
  • Limit feeding of hay

 

Some of the suggestions in the fact sheet require great skill and discipline on the part of the herd manager.  Also feed handling equipment, feed bunks, and well-fenced lots or sacrifice pastures are necessary for many of these alternatives.  Study the lesson extensively before undertaking some of these alternatives.  The price of many grain-based diets must be considered as well as the management challenges.  Read Oklahoma State University Extension Fact Sheet ANSI-3034 (http://pods.dasnr.okstate.edu/docushare/dsweb/Get/Document-4968/ANSI-3034web.pdf) before winter sets in.

 

Oklahoma State University, in compliance with Title VI and VII of the Civil Rights Act of 1964, Executive Order 11246 as amended, Title IX of the Education Amendments of 1972, Americans with Disabilities Act of 1990, and other federal laws and regulations, does not discriminate on the basis of race, color, national origin, sex, age, religion, disability, or status as a veteran in any of its policies, practices or procedures. This includes but is not limited to admissions, employment, financial aid, and educational services.  References within this publication to any specific commercial product, process, or service by trade name, trademark, service mark, manufacturer, or otherwise does not constitute or imply endorsement by Oklahoma Cooperative Extension Service.

 

Kim Cassel

EPA Keeps Renewable Fuels Levels in Place After Considering State Requests

November 16, 2012 the Environmental Protection Agency (EPA) announced that the agency denied the request by several states to grant a waiver of the Renewable Fuel Standard (RFS).  The agency spokesperson indicated no evidence was found to support the claim that producers in particular livestock are being hurt by high corn prices due to the 2012 drought and diversion of corn to the production of ethanol.  The EPA indicated their decision was based on analyses and modeling done in partnership with the US Department of Agriculture and the US Department of Energy.  For more information see the EPA news release.


Kim Cassel