Friday, April 30, 2021
CapitalPress.com 5
Weak pandemic comparables skew cattle market perception
By CAROL RYAN DUMAS
Capital Press
USDA’s monthly cattle
on feed report was released
on Friday, prompting ana-
lysts to warn trade against
putting much weight in year-
over-year comparisons.
Comparisons to 2019 are
more relevant in getting a
sense of the market due to
unprecedented market dis-
ruption as the pandemic
gained ground in the spring
of 2020.
For example, the inven-
tory in large feedlots at 11.9
million head on April 1 was
up 5.3% from 2020 but down
5% from 2019, according to
USDA National Agricultural
Statistics Service.
In addition, marketings of
fed cattle in March at 2 mil-
lion head were up 1.5% over
2020’s number — which
were unusually high — but
up 14.8% from 2019. Place-
ments into feedlots in March
at 2 million head were up
28.3% over 2020 but down
0.8% from 2019.
Cattle on feed, placements, marketing and other disappearances
(Feedlots with 1,000 head capacity or more)
Item
2019
(1,000 head)
2020
2021
Percent change
2020/2021
Percent change
2019/2021
On feed April 1
11,953
11,297
11,897
5.3
-5
Placed on feed, March
2,014
1,557
1,997
28.3
-0.8
Fed cattle marketed, March
1,777
2,010
2,040
1.5
14.8
69
61
60
-1.6
-13.0
Other disappearance, March*
*Includes death loss, movement from feedlots to pasture, and shipments to other feedlots for further feeding.
Source: USDA-NASS
The eff ects of the pan-
demic in the feedlot sec-
tor really kicked in during
March 2020, with a spike in
marketing fed cattle and a
drop in placement of feeder
cattle, said Derrell Peel,
extension livestock market-
ing specialist with Oklahoma
State University.
“I think the feedlots saw
what was coming and mar-
keted ahead,” he said.
In the same vein, fear of
the unknown kept place-
ments down, he said.
“They could sort of see
what was happening,” he
said
The pandemic didn’t hit
the slaughter market until the
second week of April and got
progressively worse over the
next four weeks. But there
already had been news com-
ing from China of shutdowns
and port disruptions. Feed-
lots accelerated marketings
and decreased placements
in March. After that, they
decreased both, he said.
While March placements
are up substantially year
over year from 2020, they
are actually fairly bearish —
down from March 2019 and
coming in below industry
expectations, he said.
“We’re going to be deal-
ing with this (skewed com-
parison) most of the year …
because we’re going to be
dealing with goofy numbers.
We’re not going to be com-
paring to anything normal
(year over year) over the next
several months,” he said.
There are still quite a few
cattle in the pipeline, but the
industry is making progress
moving them through the
system and getting back on
track, he said.
“We’re going to do that,
but it’s going to take time. I
think we’re going to move
toward where we were at
pre-pandemic in the next two
to three months,” he said.
Fed cattle prices have
really struggled so far this
year under the large num-
ber of cattle but are expected
to be higher year over year
as the industry gets into the
third and fourth quarters —
mostly due to weak compa-
rables, he said.
Obviously, a growing
concern is the tremendous
run in feed prices, and it’s not
clear yet where they’re going
to end up, he said.
Weakness in fed cat-
tle prices and the rising cost
of gain in feedlots puts the
feeder cattle market in the
worst squeeze. Feedlots are
going to want to feed bigger
cattle to cut down on days on
feed, he said.
“There’s a lot of uncer-
tainty going forward,” he
said.
Feed prices are going to
stay relatively high. Even if
with good grain crops and
good supplies, there’s a lot
of demand out there, he said.
Ruling favors Washington sheep ranch
By DON JENKINS
Capital Press
Courtesy of Nick Blanksma
Potato planting near
Hammett, Idaho, in 2020.
Idaho
processors
to pay
slightly less
for potatoes
A federal judge has ruled a Wash-
ington sheep ranch can operate as it
has for decades, denying a motion
by environmentalists to stop graz-
ing on four allotments in the Okan-
ogan-Wenatchee National Forest.
U.S. District Judge Rosanna
Malouf Peterson in Spokane on
April 20 rejected claims that the
sheep are an immediate health haz-
ard to bighorn sheep.
Peterson wrote that bighorn
sheep are important, but so is S.
Martinez Livestock, a century-old
ranch. There is, according to Peter-
son, “intrinsic public interest in
allowing a community-oriented
business to operate.”
WildEarth Guardians and West-
ern Watersheds Project are suing
the U.S. Forest Service, claiming
the agency has disregarded the risks
that grazing sheep will infect big-
horn sheep with Mycoplasma ovi-
pheumoniae, a pathogen harmless
to domestic sheep but lethal to big-
horn sheep.
Martinez Livestock intervened
in the lawsuit, defending grazing
about 3,000 sheep on allotments
within 10 miles of the Cleman
Mountain Herd.
The environmental groups
claimed that a 2016 study by the
Forest Service showed that bighorn
sheep are in danger of coming into
contact with domestic sheep. They
sought an emergency order block-
ing grazing this year while the judge
considered claims that the Forest
Service has violated federal laws.
Peterson said it was hard to see
the urgency in a case based on a
study done in 2016.
She also observed that the study
assessed the chances that a bighorn
sheep crossed the allotment bound-
ary. It didn’t assess the chances of
diseases being transmitted, or con-
sider what the sheep rancher has
done to keep the species apart.
The judge said the bighorn
herd is increasing and questioned
whether driving sheep off federal
land would help it. The sheep would
have to graze on private land closer
to the herd, she noted.
Tillamook transforms into certifi ed B Corporation
Highlights outlined
in annual
stewardship report
By BRAD CARLSON
Capital Press
By GEORGE PLAVEN
Capital Press
Negotiations
between
growers and Idaho proces-
sors have resulted in an
average 3% reduction in
the contract price, said Dan
Hargraves, Southern Idaho
Potato Cooperative execu-
tive director.
That means prices are
down 20-40 cents per hun-
dredweight, depending on
the processor and grower, he
said.
Hargraves said the net
impact of the price reduc-
tion from 2020 to this year is
about 7% because growers’
input costs have increased.
Spring fertilizer costs are up
28%, labor is up 6.8% and
equipment and fuel prices
are up.
“Conservatively,
we
think our costs are up 4%
for crop year 2021” overall,
he said.
“And at the same time,
we’re operating at less than
full capacity, so it’s a diffi -
cult environment for these
commercial potato farms,”
he said.
Processors in the annual
contract last year paid grow-
ers a price that was about
2% higher than that of 2019
in response to growers’
higher labor and machinery
costs, but they contracted
for fewer acres.
Compared to 2019, pro-
cessors
contracted
for
10-50% fewer acres last
year, depending on proces-
sor and grower.
Compared to last year,
processors contracted for
5-38% more acres this year,
Hargraves said.
Despite the increase in
acreage from 2020 to 2021,
growers will still be running
at around 90% of their capi-
talized capacity, he said.
“I’m happy that all of Ida-
ho’s other agricultural crops
are increasing in value back
to the growers in the com-
munities, but disappointed
that potato contracts are
not keeping up with other
crops,” said Nick Blanksma,
a farmer in Hammett.
Idaho leads the nation
in potato production. More
than one-third of the state’s
crop is grown for processing.
TILLAMOOK,
Ore.
— The Tillamook County
Creamery
Association
ended a diffi cult year in
2020 on a positive note,
becoming a certifi ed B Cor-
poration for its commitment
to social welfare and causes
outside the board room.
The dairy cooperative
— makers of Tillamook
cheese, yogurt, butter and
ice cream — released its
2020 Stewardship Report
on March 31, highlight-
ing its eff orts to save water,
improve animal welfare and
assist communities battling
the coronavirus pandemic.
Tillamook was offi cially
recognized as a certifi ed B
Corporation in November,
completing a months-long
process demonstrating the
co-op’s commitment to
the greater public good.
“It means that we’re
really here for more than
just profi t,” said Paul Sny-
der, executive vice pres-
ident of stewardship for
Tillamook. “We’re here
to be a positive force in
society.”
Getting to this point
was years in the making,
Snyder said. In 2017, Til-
lamook’s board of direc-
tors adopted a Steward-
ship Charter focused on
six core values — healthy
cows, thriving farms,
enduring
ecosystems,
Mathew Millman
Tillamook’s creamery and visitor center on the Oregon Coast.
inspired
consum-
ers, fulfi lled
employ-
ees
and
enriched
communi-
Paul Snyder ties.
W i t h
the stewardship charter in
place, Snyder said the co-op
set its sights on providing
the data needed for B Cor-
poration certifi cation.
The process, which
started last year in March,
involved going through a
lengthy impact assessment,
answering more than 200
questions about Tillamook’s
governance, workers, com-
munity and environmental
performance.
“There are things in
there from what percent-
age of your managers and
above are female or BIPOC,
to do you have environmen-
tal targets, to how much
money do you give to non-
profi ts in the communities
where you operate,” Snyder
said. “Honestly, it’s like the
phone book of questions.”
Once completed, the
assessment and documen-
tation undergo an indepen-
dent audit, and companies
that earn a minimum score
become certifi ed.
As a certifi ed B Corpora-
tion, Snyder said the co-op
can voice its values to new
socially conscious consum-
ers, especially as Tillamook
continues to grow its brand
eastward.
“In this space, authen-
ticity rules,” Snyder said.
“As a co-op, (Tillamook)
has structured its business
to be a force for good in
the world, and we live this
value each day.”
COVID-19 was at the
heart of much of Tilla-
mook’s stewardship work in
2020.
In May, the co-op
announced it would pro-
vide $4 million in pan-
demic relief. The money
was used in part to expand
full wages and sick leave for
its own workers at process-
ing plants in Tillamook and
Boardman.
The co-op also seeded
$500,000 to create the
Hometown
Resilience
Fund, awarding grants to
local businesses hampered
by coronavirus restrictions
and closures.
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