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Taking Dead Aim At The US Cattle Business

Taking Dead Aim At The US Cattle Business. AN OVER-VIEW OF THE USA CATTLE MARKET & FUTURE THREATS. Global Animal Products, Inc. (US Office) Ken Ridenour, M.S. TOPICS. The USA Feedlot – Current Cattle Industry Beef Checkoff Program Future Threats

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Taking Dead Aim At The US Cattle Business

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  1. Taking Dead Aim At The US Cattle Business

  2. AN OVER-VIEW OF THE USA CATTLE MARKET & FUTURE THREATS Global Animal Products, Inc. (US Office) Ken Ridenour, M.S.

  3. TOPICS • The USA Feedlot – Current Cattle Industry • Beef Checkoff Program • Future Threats • Personal Opinion – Direction That The World Cattle Market Could Take In The Future

  4. TOTAL CATTLE IN THE USA97.1 million head (Jan. ’07)Average cow herd size – 35 head • 97.1 million • 3rd consecutive year of expansion • 33.3 million beef cows • Heifers held back 5.9 million • Calf crop estimated at 37.6 million head

  5. TOTAL CATTLE AND BEEF PRODUCTION IN THE USA

  6. USA FEEDLOT MARKET

  7. FEEDER CATTLE (Steers)Amarillo, Texas

  8. RATION COSTMARCH 2007

  9. ETHANOL • 110 Operating Plants • 8 of the above are expanding • 73 plants are under construction • 18.85 billion liters of ethanol were produced in 2006 • 42.987 billion liters are expected to be produced by 2009 • 49 to 57 billion liters of ethanol are expected by 2012

  10. ETHANOL • 2006 ethanol production required 2.56 million hectares of corn – 20% of the US corn harvest • An estimated 4 to 6 million more hectares of corn will be planted in the 2007 crop year • For the first time in history over 50% of the corn produced in the USA will be used for something other than animal production

  11. Beef Checkoff Program • Established as part of the 1985 Farm Bill • Totally funded by the beef producers and no Government funds are utilized • Funding is $1 USD per head on both domestic and imported beef • Fifty cents goes to the National Organization • Fifty cents goes to the State Organization

  12. Mission Of The Beef Checkoff Program • Check program is dedicated; • To improving producer profitability • Expanding consumer demands • Strengthening Beef position in the market place • Research funding for all phases of the Beef Industry

  13. Beef Checkoff Program Funding • Revenue 2006 -- $45,238,376 USD • Expenditures: • Promotion $24,800,185 • Research $6,233,497 • Consumer Information $5,637,074 • Foreign Marketing $3,997,592 • Producer Communications $2,029,143 • Industry Information $1,091,269 • Program Evaluation $226,538 • USDA Oversight $143,722 • Program Development $123,661 • Administration $1,547,899

  14. Beef Checkoff Program Conclusion • Acts as a catalyst for Change. • Doesn’t own cattle or retail outlets. • Can’t single-handedly turn around a bad market. • Designed to stimulate others to sell more beef. • Stimulate consumers to buy more beef. • Initiatives are accomplished by consumer advertising, marketing partnerships, public relations, education, research, and new product development.

  15. THREATS TO THE CATTLE INDUSTRY(BSE)

  16. B.S.E.A Closer Look At Mad Cow Disease • New vCJD is reported in 200 people world wide

  17. Science& Research

  18. Study presented at Europe’s annual human reproductive conference Study design – 100 men consumed 6 pints of beer in 1hour Observations made in 100% of subjects • All gained weight • Talked excessively without making sense • Became overly emotional • Could not drive • Failed to think rationally • Refused to apologize when wrong • Could not preform sexually • Had to sit down while urinating

  19. Conclusion of Study There has to be female hormones in beer

  20. Bio – Terrorism Foot and Mouth Disease

  21. PER CAPITA CONSUMPTION OF RED MEAT AND POULTRY (1909-2006)

  22. MATURING FEEDLOT INDUSTRY • 3 Major Packers Cargill-Excel Swift (Monfort – ConAgra) Tyson (IBP) • Vertical Integration • Contract Growing for Packers

  23. USA CATTLE INDUSTRY – LONG TERM • Suburban Sprawl • Land Price • Government Land • Environmental Impact and Regulations • Government Subsidies

  24. SUMMARY • 30% of US feedlot head capacity is held in 10 companies • Three beef packers control slaughter and marketing • Maturing market for the feedlot industry – cattle business

  25. CRYSTAL BALL PROJECTIONS • Feedlot – Cattle will decrease • More imports will be needed Australia South Africa Brazil • Consumption – Beef will follow Lamb

  26. Global Animal Products South Africa Proud To Be Associated With The South Africa Feedlot Conference Beef It’s What’s For Dinner!

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