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The National Livestock Weekly March 15, 2004 • Vol. 83, No. 22 “The Industry’s Largest Weekly Circulation” www.wlj.net • E-mail: [email protected] • [email protected] • [email protected] A Crow Publication Packers granted access to Mexico — Swift certified was closed since the U.S. discovery the ability to export boneless boxed from either USDA’s Food Safety companies approved has been on 2 days after border’s of its first confirmed case of bovine beef from cattle 30 months of age and Inspection Service (FSIS) or the the Mexico side, rather than USDA spongiform encephalopathy (BSE) or younger. Veal from calves un- company. slowing the process. reopening. December 23. der nine months of age is also sub- According to Chuck Lambert, “It’s a two-sided process. We get — Analysts expect As of press time last week, there ject to the new border rules. chief economist with USDA, there the actual applications from the were reports some U.S. beef had en- Swift & Company’s Greeley, CO, would likely be several beef man- companies and sign off on them 60-70% of normal tered Mexico, however, the amount plant was the first to receive BEV ufacturers approved for export to from our side,” the USDA trade trade by April 1. of that product was not known. The certification March 5, with Excel Mexico by last Friday, after WLJ source said. “But, then it’s up to By Steven D. Vetter processors certified to ship beef Corporation’s Plainview, TX, plant press time. Mexico to also sign off on all appli- across the border did not return approved March 8. Swift had its “There has been a lot of activity cations approved by us, and in sev- WLJ Editor calls specifying the amounts or Cactus, TX, plant approved by both for export certification,” he said. eral instances they have had some It didn’t take long for the first cou- dates of entry. USDA and the Mexican govern- “It’s just taken some time to get all questions that have delayed plant ple of U.S. processing companies to Through last Thursday, three ment last Wednesday, March 10. the requests processed and all the approval.” be approved for exporting beef to plants, representing two compa- There were reports indicating I’s dotted and T’s crossed for some It was expected a large majority Mexico, once the U.S.’ neighbor to nies, were approved under the US- beef from Swift & Company crossed of these companies.” of companies planning to apply for the south announced March 3 it DABeef Export Verification (BEV) the border March 7, however, con- Another USDAtrade spokesman BEV certification to Mexico would was reopening the border, which program to Mexico, allowing them firmation of that was not available said some of the delay in getting have the application completed by the end of the second week in March, with approval from Mexi- The normal spring run of heavy feeder co completed by the end of the Congress cattle coming off of month. wheat and cool-sea- By the time April starts, it is ex- son-grass pasture, pected the U.S. will be exporting 60- reviews particularly in the 70 percent of its normal volume to southern Plains and Mexico, according to both govern- Southwest, isn’t ex- ment and independent analysts. ID plan pected to be as large With the exception of 2002, when By Sarah L. Roen as in the past several it was the largest importer of U.S. years. In addition, WLJ Associate Editor several sources said beef, Mexico is the second largest Both the House and Senate wheat is maturing See Mexico on page 11 Agriculture Committees heard faster than normal, testimony recently on USDA’s which has forced a planned implementation of a majority of those cat- national animal identification tle to already be Canada program. Of particular interest sold, meaning the to both panels were the issues remaining spring supply of heavy- expands of the plan being mandatory or weight feedlot place- voluntary, security and confi- ments will be further dentiality, cost and funding, and shortened. See relat- feeder which technology should be ed story on Page 10. used. — Photo by Steven D. Vetter rules “We think USDA is, — Market impact so far, unlikely in near going Cash feds reach $90, $142 term. down the — Ramped up cutout up $5 to $144 at midweek. Packers were reportedly coming By Steven D. Vetter right slaughter volume, Both supply and demand are to the table for more cattle than WLJ Editor working to bring this market up. were originally expected, due to the Canadian ag officials last track...” lighter weights cited. USDA’s last Cattle-on-Feed (CoF) unexpected decision by Mexico to re- week announced they were Cattle markets were much report showed January placements open its borders to U.S. beef. As of opening the border to U.S. feed- stronger across all classes last week, down 16 percent from a year ago. last week, there were reports that er cattle year-round, however According to USDA officials, with cash fed cattle leading the The number of cattle that have U.S. product was crossing into Mex- U.S. cattle market analysts they expect to start out with a way and feeder calves and year- been on feed for more than 120 ico, and U.S. processors would be don’t expect a significant im- voluntary individual animal ID lings feeling the trickle-down ef- days was also up. However, there looking to buy cattle to meet de- pact from the decision for sev- program, and move towards a fect.. are more calf feds in the mix, which mand from Mexican consumers. eral years. U.S. reactions to mandatory program in the fu- Fed cattle traded $2-5 higher is putting cattle feeders in a very Carcass weights are starting to the decision ranged between ture. There was some indica- with the top cattle bringing $90 current position, for now, according fall below seasonable levels put- bullish from a North American tion movement towards a live, $142 dressed. Fed cattle trade to analysts. ting some pressure on beef produc- trade standpoint to bearish be- mandatory system would be ex- volume was very strong with over The nearby supply of fed cattle tion. The latest packer margin in- cause political maneuvering pedited if the level of voluntary 221,000 head trading on the spot is expected to grow into April and dex was a positive $6.05 per head was appeased. participation was considered cash market and a total trade vol- May. Bob Wilson, Hedgers- on an average purchase price of Last Wednesday, Bob Speller, edge.com, said he expects to see “inadequate.” ume of 393,000 head at the close of $85.12. Canada’s Minister of Agricul- fed cattle prices to top out in the Initially, Dr. Jim Butler, Wednesday’s trade. Despite Choice being a larger ture, announced his country, The overall price range of cattle next few weeks. The supply data deputy undersecretary for mar- part of the boxed beef trade, com- starting April 1, will allow feed- last week was mostly $87-88 live, going into summer is growing keting and regulatory programs pared to normal, live finishing and er cattle from the 39 states with for USDA, told the House com- $140 dressed. The cash fed cattle quickly. Their data projects April a “low- or medium-risk” of market gained an average of $9 as having the largest supply of carcass weights continue to be be- mittee the agency does want the low seasonal levels. Most analysts anaplasmosis or bluetongue to program to be voluntary. over the last week of February and cattle on feed for more than 120 enter Canada and go to a feed- days. They also expect to see a say that is because of the abnormal- “I sense all sectors of the live- first two weeks of March. lot setting without being tested After cash trade started last fairly normal fed market decline ly high level of calf-feds being mar- stock industry are willing to step keted now. or treated for the diseases. Feed- forward,” said Butler. “Ultimate- Wednesday, the futures market fol- from the winter high to the sum- “There is a lot of research out See Canada on page 11 ly, we (USDA) don’t know how lowed with a limit up day of $3 on mer low. That drop is normally 15- there showing that lighter, more many will come forth from a vol- the March and April live cattle con- 17 percent. untary perspective, and how tracts. The futures are taking their Cattle slaughter has been immature calves can reach the many might need to come forth lead from the cash market at this stronger with 615,000 head Choice grade at a weight that is after rules are promulgated to point. The discounted deferred live processed the week ending march 100 pounds lighter, if not more, make this system mandatory.” cattle contracts are continuing to 5. In addition, through last Thurs- compared to cattle placed at a heav- According to testimony at the motivate cattle feeders to move cat- day, processors had run 488,000 ier weight,” said Jim Robb, Live- tle. head through slaughter chains, stock Marketing Information Cen- See ID on page 9 Boxed beef trade also saw a sharp 3,000 head more than the same pe- ter (LMIC). increase with the light Choice riod the previous week. See Markets on page 27 INSIDE WLJ BSE UPDATE — Industry and WY WOLVES — A Wyoming NFU COVERAGB — The Nation- GRAZING REG.