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Drought concerns shape feed, beef outlook

Laura Handke for Progressive Cattleman Published on 24 September 2018
Missouri corn crop

With much of the Midwest still suffering from moderate to extreme drought conditions, beef and crop producers are keeping a close eye on both foreign and domestic markets, hoping to maximize profit margins on the commodities they have to sell.

“There is so much going on in international markets right now it is hard to focus on any one key driver,” says U.S. Meat Export Federation (USMEF) economist Erin Borror.

“But both domestically and internationally,” she says, “drought is what we are watching.”

With 1.3 million head of cattle currently on feed in Australia, USMEF is watching Australian cattle numbers closely. Because of a prolonged drought period, Australia hasn’t been able to rebuild cow numbers since 2013. Canada’s prairie provinces and northern Europe have also been plagued by drought.

Borror says female slaughter has been high in all of these markets, and those animals aren’t being replaced.

What is increasing is global demand.

In the short term, Australia is a major competitor for Japanese markets, but with dwindling Australian cattle numbers, the concerns will be the available supply coming out of the country on a long-term basis and the repercussions herd rebuilding will have on the market when the drought breaks.

“Right now, the concern is U.S. pasture conditions and hay, and with those resources drying up, how to stay competitive in the global market to take advantage of tight global supplies,” says Borror.

To stay competitive in a global market, among numerous challenges, U.S. cow numbers will need to remain stable. With much of the Midwest’s cattle country in a drought, securing the quality and quantity of feed needed to keep herds current is an added obstacle many producers will face through 2019.

Maximizing resources

With drought-stricken pastures and an estimated 30 percent hay shortage, utilizing every available resource has become a reality for cattlemen in Missouri and Kansas this season.

Eric Bailey, University of Missouri’s state beef Extension specialist, says with much of the Missouri corn crop falling short during the 2018 growing season, paired with record-high hay prices in the state, utilizing the failed corn crop to offset a majority of hay consumption may be a producer’s best management option.

“The one big difference between the 2012 drought and the 2018 drought is: Corn was seven-plus dollars a bushel in 2012. It’s half that now. I have been recommending producers offset these high hay prices with some of our commodity crops, and corn is at the top of the list.

“When corn is cheaper per ton than hay is and it’s got twice the energy hay does, that’s what producers should be looking at,” says Bailey.

Scrambling throughout the 2018 growing season, producers were faced with making decisions for their failed crops, burnt-up pastures and dry watering sources.

For those Missouri corn acres estimated to yield 30 acres or less, Bailey says many producers looked to silage and baleage as options for their crop.

“About two-thirds of my questions have been about traditional chopped silage, and the other one-third are about whole-plant corn being chopped and put into baleage,” he says.

“Kansas’ drought-affected corn acres are faced with the same dilemma,” says Jaymelynn Farney, Kansas State University assistant professor and beef Extension specialist.

“For acres with a yield above 50 bushels per acre, we recommended harvesting as grain and, for acres below 25 bushels an acre, we recommended harvesting for forage. The tricky decision was what to do with the acres that fell between those ranges,” she says.

In terms of quality, both baleage and silage are effective preservation options. Both methods’ success is dependent upon the exclusion of oxygen and generation of fermentation to kill microbes.

Bailey says the problem he sees, from a quality standpoint, is: Baleage doesn’t pack well when the whole plant is chopped and baled, and those considerations should be accounted for when purchasing or planning to feed a corn crop utilized as baleage.

“Unless the baler used a recutter, and the particle size was reduced, it’s really hard to get a good pack on baleage,” he says. As with silage, the tightness of the pack is key to minimizing oxygen and hastening the fermentation process, resulting in a higher-quality feed.

The other difference that has influenced a producer’s decision to put up baleage or silage this year was the percent moisture each method required.

For traditional corn silage, 65 percent moisture is ideal, while baleage can utilize a drier crop and still produce a quality feedstuff at 50 percent moisture. With several areas of drought-impacted acres reaching 35 percent dry matter early in the season, many producers found their options limited by the time their salvage decisions were made.

Economic feasibility

“In terms of energy, the value of drought-damaged silage can range from 75 to 95 percent of silage produced in normal growing conditions,” says Farney. “The range accommodates for the hybrid type as well as the fiber composition of the corn.”

Knowing the nutritional value of the silage or baleage you plan to feed out, or purchase and feed out, is important to both herd management and economic feasibility.

Bailey says testing is important when utilizing a drought-affected crop because of the increased nitrates that accumulate in the plant material.

“One of the things producers don’t fully appreciate is the amount of nitrogen that comes from the ground, through the fertilizer, into an actual ear of corn. Corn (grain) is 9.25 percent crude protein, so the kernels are a significant sink of nitrogen. When a crop fails to make an ear, the number one diagnostic is that the nitrate risk is going to be high,” he says.

Knowing the quality, digestibility and risk of a ration ingredient helps a producer better calculate the costs of a feed, both from a feedout and purchase to feedout standpoint.

Research from the University of Iowa cautions purchasers that purchased silage should not exceed the feeding value of corn grain. Depending on the grain content, the recommended pricing per ton falls somewhere between eight and nine times the value of a bushel of corn with an added $5 to $10 per ton added for harvesting, transporting and storing.  end mark

PHOTO: The Missouri corn crop should be viewed as an option for producers in that region, to offset the high costs of hay going into fall. Staff photo.

Laura Handke is a freelance writer based in Kansas.