Peel Says It's Crunch Time for Beef Demand 

Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist, writes in the latest Cow/Calf Corner newsletter

Beef demand has been a pleasant surprise so far this year. Wholesale and retail beef prices have increased fast enough to maintain decent margins for beef packers and allow feedlots profitability for the first three quarters of the year. Retail beef prices are up year over year an average of nearly 11 percent for the year to date through August, with August monthly prices up nearly 17 percent from one year earlier. Boxed beef prices are up an average 21-22 percent for Choice and Select so far this year, with August up 32-34 percent year over year. Retail prices do not currently reflect all of the wholesale price increase and the coming months will be even more important for beef demand as retail adjustments continue.


Moreover, while boxed beef prices have declined in September, the pressure for higher prices is not over. Total cattle slaughter has been down over seven percent since the beginning of August with heifer slaughter down nearly 11 percent and cow slaughter down nearly 17 percent. Each of these continue to push the year to date totals lower with heifer slaughter down 8.8 percent and cow slaughter down 14.6 percent so far this year. Steer slaughter has been down 1.9 percent since the beginning of August, a slightly smaller decline than the year to date total decrease of 2.9 percent. More steers in the total slaughter mix (steers represent two percent more of total slaughter than last year) combined with heavier steer carcass weights, up 15-20 pounds year over year in recent weeks, have mitigated declining beef production somewhat in recent weeks. Beef production in August and September was down 5.5 percent, less of a decrease than the year to date total which is down 6.1 percent.   Limited beef supplies will continue to challenge beef demand.

Competing meats may play a bigger role in late 2014 and into 2015.  Click Here to read how pork and poultry could potentially impact beef demand.  
 

Corn and sorghum harvest was in full swing across Oklahoma this past week. Harvest has been active, but excessive dew in the northeast part of the state was halting progress.  The US Department of Agriculture reports in the latest crop progress report corn harvest gained 15 points to 58 percent complete. Sorghum harvest reached 33 percent complete at the end of last week. Peanuts mature reached 59 percent complete. Eighty-six percent of the cotton bolls were opening. The fourth cutting of alfalfa hay reached 80 percent complete. A small portion of soybeans have been harvested, while 38 percent are dropping leaves. Wheat and canola planting is running neck and neck with 57 percent of the wheat planted and 59 percent of the canola planted. Ten percent of the wheat crop was starting to emerge.  Click Here for the full Oklahoma report.

Corn harvest was slow going in Texas this past week with areas receiving one to eight inches of rain. Corn and sorghum harvest each gained one point to reach 68 percent harvested. Cotton harvest was getting underway in the Blacklands and North East Texas with harvest reaching 17 percent done. Soybean harvest reached 38 percent complete and peanut harvest was getting underway with two percent of the crop harvested. Winter wheat seeding was active with 41 percent of the crop planted and 13 percent emerged.  Click Here for the full Texas report.

Rain showers across central and northern Kansas slowed corn harvest and wheat seeding. Corn harvest was 35 percent complete, well behind the five year average of 44. Sorghum harvest was getting started with harvest five percent complete and soybean harvest was two percent done. The fourth cutting of hay was 70 percent complete. Cotton bolls opening was at 42 percent. Winter wheat planting was 31 percent complete with 13 percent emerged.  Click Here for the full Kansas report.

Corn Harvest Continues As More States Mark Progress

Corn growers in more states have seen harvest progress drive on this fall, with all but one of the 18 states tracked by the U.S. Department of Agriculture now reporting progress. Twelve percent of the corn crop has been harvested as of Sunday, still below the five-year average of 23 percent.

"While we've seen a lot of great weather across much of the Corn Belt, farmers are still taking their time to make sure the crop is mature enough to bring in," said NCGA President Martin Barbre, a corn grower in southern Illinois. "With our second record crop in a row, corn farmers know they have a lot more work to do this harvest and want to ensure the quality remains high as the corn dries to an acceptable level."

States reporting harvest progress for the first time this season include Colorado, Iowa, Michigan, Minnesota, South Dakota and Wisconsin; only North Dakota reported no harvest.

The US Department of Agriculture reported that 60 percent of the crop was now rated mature, compared to an average of 70 percent this time of year. The overall condition of the corn crop remained the same as last week, with 74 percent rated good or excellent, compared to only 55 percent in 2013.

Click here for the complete USDA National Crop Progress Report.

Tolle Says Farm Bill Offers Farmers Options with ARC, PLC, SCO

This past week, we saw lots of details released about the Commodity Title of the 2014 Farm Law. With the new farm law,  farmers will no longer receive direct payments that have been a part of federal farm safety net since "Freedom to Farm" was enacted in 1996. Oklahoma FSA Executive Director Francie Tolle said farmers will have two Risk Management programs to select from with the Price Loss Coverage (PLC) option and the Agricultural Risk Coverage (ARC) program.


"The PLC program is based on price," Tolle said. "It's a lot like a counter-cyclical program, so if the price dips below the support level- there will be a payment."


With the ARC program, farmers have two options within that program with a county option and an individual option. Tolle said ARC is based on revenue that will take into account yield as well as price. 


On Monday, September 29th, the US Department of Agriculture began to allow landowners to reallocate their base acres or update yield history. This is a big decision that farmers will need to contemplate. Tolle said the last time farmers were able to make changes to their base acres or yield was back in 2002.     

In making that decision, Tolle said farmers will want to consider what they are planting now and in the future.  You can hear our in depth conversation with Tolle by clicking here and can also read more about the tools that are being made available to farmers in making those decisions.

Oklahoma Local Foods Challenge Set for October

The Oklahoma Dept. of Agriculture, Food and Forestry announced a Local Foods Challenge for Oklahoma schools during the month of October. Schools are invited to use more Oklahoma products during the month and share their own local food recipes and menus. Selected recipes and menus will be featured on the Oklahoma Farm to School website.


"Oklahoma agriculture is rich with a variety of specialty crops such as watermelon, carrots, beans, peas, squash, sweet potatoes and beets," Oklahoma Secretary of Agriculture Jim Reese said. "Beef, dairy and wheat are also frequently used in school menus. The Local Foods Challenge encourages students to learn more about local agriculture and where their food comes from in addition to enjoying nutritious local food choices on their plates."


Participating schools must include a contact name, phone number and e-mail address along with a copy of the school menu and recipes highlighting local foods. Send menus and supporting recipes featuring local foods to Oklahoma Farm to School Program Administrator Katie Strack at katie.strack@ag.ok.gov with "F2S Month Challenge" in the subject line. Information must be submitted no later than Friday, Oct. 24.


In addition to being listed on the Oklahoma Farm to School website, participants will be recognized by ODAFF and the National Farm to School Network. The month-long state celebration includes National Farm to School Month and National School Lunch Week on Oct. 13-17. 

Managing Cattle in Confinement to Save Herd During Drought

Cow-calf producers who are dealing with minimal range land, due to drought and competition for grazing land, may want to  consider managing the herd in confinement. K-State beef specialist Jaymelynn Farney recently published two extension publications that discuss this option. Farney provides an example of how big of an area a herd may need.


"It all depends on whether you are putting a dry cow in, pairs in, whether you receive a lot of moisture, whether its rather dry," Farney said. "So as you would probably guess, dry cows on well-drained hard packed facilities need less area than pairs in muddy wet conditions. We do have a range listed from about 200 square feet for dry cows in a optimal lot conditional with drainage to up to 800 square feet for pairs in a not well draining, very muddy type of pen situation." 


Producers can consider feeding the herd in confinement, even if there is no actual permanent drylot available on site. Farney said if producers have a pasture that needs some recovery time, then it might be worth it to make a small part of that pasture and dedicating it to a drylot situation. 

You can hear Farney's description of your options by clicking or tapping here to learn more about cow confinement- plus we have links to her publications on the concept. 

On this 30th of September- Last Call for Crop Insurance Signup for Wheat- Plus Getting on the List for LFP

We have written, talked about on the radio and discussed in our TV segments about "Sequestration Day" coming on the Livestock Forage Program which is the largest of the Livestock Disaster Programs that were reinstated by the 2014 Farm Law.   

LFP has paid out over $2.5 billion nationally- with over $560 million of that going to Oklahoma ranchers for primarily help from three years of persistent drought.  

State FSA Director Francie Tolle told us at the end of this past week that we are only about half way done in getting everyone through the application process- with many folks yet to show up and apply.   

As a result, those who wait to get on the FSA list for applying  until tomorrow now face a 7.3 percent cut of whatever payment they are qualified to receive because of the Budget Control Act- which results in what folks are calling sequestration.  

You can avoid that potential cut in the payment by calling your local FSA office today before the close of business and having your name placed on their "register" of producers who intend to sign up for the disaster help program.  You may not be able to get in and sign up for several months- but a phone call today keeps your eventual check from being reduced by 7.3%.   

It's your call.

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September 30th also means deadline day for signing up for Crop Insurance for your winter wheat crop that will be harvested in 2015.   

There are lots of options you can decide upon when it comes to Crop Insurance this year- and that includes the so called "SCO" coverage- that stands for Supplemental Coverage Option and it is a part of the farm safety net connected with the Price Loss Coverage in the Commodity Title of the 2014 Farm Law.   

Signing up today for SCO does not mean you have to pay for it- you can cancel it all the way out to mid December without a penalty.  It is basically a way to "buy up" coverage from whatever level of insurance protection you decide upon with your regular policy.   

Again- check with your local Crop Insurance agent- make sure your "i"s are dotted and your "t"s are crossed on your policy for the 2015 crop- this needs to be done by the close of business today.