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[ November/December 2005 ]

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Benefits and Costs Associated With an Animal Identification System for Cattle in the United States
Final in the series on a National Animal Identification System
By DeeVon Bailey, Ph. D.
Department of Economics and Cooperative Extension Service Utah State University Logan, Utah
dbailey@econ.usu.edu

Estimated Costs of Implementing Animal ID
Prior to December 2003, the full implementation costs (all species with interstate and intrastate movements tracked) for the USAIP were estimated to total over $500 million for the first six years of the program. The precise plan for how these costs would be shared between the public and private sectors was not defined in the USAIP, although some funding for the first year of the project had been requested from the Commodity Credit Corporation (CCC). As a result, USAIP was a plan that did not initially have a clear format for funding the full cost of its implementation. A separate cost study completed by Sparks Companies Inc. estimated the capital investment required to implement a source verification system for cattle would be approximately $140 million with an additional annual variable cost of about $108 million.

Buhr estimated the costs of implementing a farm-to-fork traceability system for a single supply chain in Europe to be between $10-$12 million. Consequently, traceability systems such as those that could be established using animal ID are not costless and, as a result, they raise questions about which firms, based on size and market, will be able to implement such protocols most profitably.

Blasi estimated the costs of implementing an RFID system at the producer level for cow/calf operators and feedlots and included the costs of transponder tags, electronic readers, computer hardware, computer software, Internet access, required upgrades and labor. Their results indicate substantial economies of size (i.e., average costs decline dramatically as the size of the operation increases) in implementing animal ID exist at the producer level. This could place small producers at a disadvantage to large producers. However, the cost differences between large and small producers estimated by Blasi may be somewhat overstated because they did not account for the possibility of pooling some of these costs (e.g., in some instances small producers might be able to share costs for computer hardware or electronic readers). However, the largest single difference in cost between large and small producers is for labor. This suggests animal ID programs will probably provide incentives for small producers to work cooperatively in placing identification devices such as eartags on cattle and in collecting and disseminating this information.

The USDA, APHIS received a transfer of $18.8 million from the Commodity Credit Corporation (CCC) during fiscal year (FY) 2004, and President Bush’s budget for FY 2005 requests $33 million for animal ID. During FY 2004, APHIS plans to spend this money to establish cooperative agreements that will assist implementing animal ID, establish a national premises allocator and repository to begin allocating premises identification numbers and identify and qualify third parties that have ID technology and products so they can be integrated into the national system. The USDA is initiating the program on a voluntary basis, although it may become mandatory over time as the system becomes fully functioning.

At this point (August 2004), the funding available to USDA will probably cover only the costs of developing the national databasing system for animal ID. This means the costs for identification devices such as eartags and data gathering devices such as hand-held computers will be borne by individual firms (producers, sale barns, order buyers, etc.) and not the U.S. government.

The initial investment of implementing traceability protocols can be expensive. However, they will potentially provide benefits from several perspectives including animal disease control and food safety. Once implemented, there may be long-run niche- marketing opportunities because of the ability animal ID systems will have to gather and certify data about production inputs and processes leading to the identification of cost efficiencies or market opportunities.

Who Will Benefit from the Implementation of Animal ID?
Results from a survey of the leaders of state cattlemens organizations indicate different perceptions exist about who will benefit from the implementation of an animal ID system and why they are expected to benefit. While over 90 percent of state cattle producer association respondents indicated support for a national cattle ID program, only 41 percent indicated they supported the USAIP when the survey was administered (January 2004). This may help to explain why the USAIP has continued to evolve as producer groups have applied political pressure to add more flexibility to the national animal ID plan.

The desire for flexibility in implementing traceability systems, such as animal ID, has been a constant theme with U.S. agribusiness firms when discussing issues relating to traceability. Farm Foundation reports U.S. agribusiness firms would prefer market solutions rather than government regulation and mandates when traceability systems are implemented, except in the case of life-threatening food safety concerns. Bailey and Slade reported average responses from a survey of leaders of state cattle producer associations for both USAIP supporters and non-supporters. While the average responses for supporters tended to be higher (more favorable about the possible benefits of the USAIP) for most questions than for non-supporters, both supporters and non-supporters ranked the maintenance of international markets as the most important reasons for implementing the USAIP. Bailey and Slade report the state veterinarians responding to a similar survey ranked consumer issues only fourth, based on the average response, as the most important reason for implementing the USAIP. This may help explain why support for the USAIP varied between state veterinarians and producer groups. State veterinarians see animal ID principally as an animal and public health issue, while state producer associations place at least an equal weight on market issues as they do health issues as reasons for implementing animal ID. Veterinarians would be expected to support the implementation of standardized programs that safeguard animal and human health because this is their area of responsibility. Conversely, leaders of cattle producer organizations would be expected to be most concerned about implementing a flexible system that can adjust to market conditions.

On average, supporters of the USAIP had a more positive perception of the USAIP from the perspective of food safety and preserving international markets than did non-supporters. In fact, the results suggest the most positive feelings non-supporters have had about the USAIP are were from the perspective of animal disease control and eradication. This may help explain why the national effort to develop an animal identification ID plan continues to build consensus for implementing animal ID by focusing on animal disease control issues.

A further statistical analysis revealed if the state cattle producer organization leaders perceived that processors (packers) would benefit more from the USAIP than for farmers and ranchers, they were less likely to support the USAIP than if they perceived no difference in benefits between producers and processors. This illustrates that some of these leaders see costs, but only limited benefits from animal ID while believing most of the benefits would be captured by downstream firms. The respondents seemed to understand the health issues (both animal and human) associated with animal ID and also the potential positive impact on international markets, all of which should offer direct or indirect benefits to producers.

Issues relating to the potential shift in liability in the marketing chain toward producers as a result of animal ID are often brought up by producers when discussing traceability issues. This might explain why some industry leaders see fewer benefits for producers as a result of implementing animal ID compared to other levels of the marketing channel. Those who perceive shifts in liability away from packers and toward farmers would likely reduce producer support for animal ID programs.

Few issues in the U.S. livestock industry in recent years have been more controversial than animal ID. Significant barriers remain to be crossed before animal ID is implemented on a national basis in the United States. For example, issues relating to how liability will be shared or limited in a system with animal ID and how costs of implementing animal ID will be allocated remain to be addressed. Questions about which technology or technologies will be used in a national animal ID system and how these technologies will interface in transferring information to a national database also need to be resolved. Despite these challenges, animal ID offers opportunities for controlling animal diseases, standardizing beef trade in world markets and expanding niche market opportunities to beef producers. Consequently, although the precise form in which animal ID will be implemented in the United States remains somewhat cloudy, a significant commitment on the part of industry and government currently exists that has not  existed in the past. This commitment should provide the ability to overcome the apparent obstacles standing in the way of implementing animal ID in the United States.

Another Year...Come and Gone With each passing year, each passing month and each passing day, the American Maine-Anjou Association (AMAA) continues to grow and thrive with its main emphasis on bettering the association itself, its membership and of course the cattle. The association has stepped up in this last year to meet the challenges the breed, along with growing a bigger and stronger association and membership. Thanks to all who have contributed to its growth. It’s you, the breeders, members, sellers and enthusiasts who make for a growing and flourishing breed of cattle, which in turn,

by Kyla Nesheim editor/director of communications

It’s hard to believe the end of the year is drawing near. With the fall show season, fall calving, fall sales and football in full force, we sometimes forget to take in and enjoy the rest of the year. If we don’t, we find ourselves mid-January asking where it all went.

A lot can happen in a year, but yet, I still ponder on how it can go by so fast. In this last year, I can’t even begin to think about, let alone count, all the shows, events, deadlines and travels I have been on. Each event and deadline I’ve been faced with has been a challenging and rewarding experience. I’ve gotten the opportunity to meet an array of “cattle folk” and junior exhibitors who make my time at these shows and at the office worthwhile.

Getting the opportunity to travel across the country to shows has given me the chance to meet many truly great and wonderful people who strive to better the breed and association as a whole. During my tenure at the AMAA, I have come to respect and cherish the times I get to spend with all the Maine-Anjou enthusiasts. The beginning of 2006 brings me on my third year at the association and I’m looking forward to what’s in store for the breed.

The junior members I know and have met in the last year bring a smile to my face. The determination and overall quality in these kids is remarkable. The kids are second to none. I have come to know a great number of the junior board and the junior members and can I say the breed is fortunate to have you.

As we wrap up the end of another year, we always continue to look ahead. Setting new goals and identifying what we can do to better the association and its members - both adult and junior - are key to our successful future. Ideas come and go, but we are always striving to improve.

Over this past year, we have witnessed a lot of change, some for better and some for worse, and we as an association and membership need to face the future head-on with an open mind. Be open to new ideas and goals. With your support, we can continue to set new, challenging goals and progress our breed and association.

Denver will kick it off the new year, and might I add, what a great way to start. Maine-Anjou activities in Denver are at the top of everyone's list. I encourage everyone to come to Denver and enjoy the pen-of-three bull and heifer shows, the popular bull and heifer sales and the open and junior shows. The breed is a force to be reckoned with in Denver. Come see for yourselves what the cattle have to offer. The best of the breed will be represented. Enthusiasm and energy shine through in Denver with the Maine-Anjou breed.

Next we will travel to our National Maine-Anjou Show held in conjunction with the Ft. Worth Stock Show and Rodeo in Ft. Worth, Texas. Don’t miss out on your opportunity to see the next National Champion bull and female crowned or your chance to see where the breed started. Ft. Worth is known for its Fullblood Maine-Anjou show. The best of the best in Fullbloods will be represented – a great opportunity to trace the breed back to the very beginning.

Thanks for a great year and best of luck in 2006!

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BOARD NOMINEES
 

REGION I Rick Carlson - Plattsburg, Mo. Wife, Rosemary; daughter, Rachael

Rick Carlson was raised on a livestock and grain farm in central Illinois. He is currently involved in a purebred Shorthorn and Maine-Anjou breeding operation where he has bred a national champion Shorthorn heifer and a reserve national champion Shorthorn heifer.

Throughout his lifetime he has served some prestigious terms. He was on the Blackhawk East and University of Illinois Livestock Judging Teams. He has served as the vice president of international business for Farmland Foods of Kansas City, Mo. There he developed marketing strategies to position Farmland beef and pork products worldwide. He also managed foreign offices in Mexico City, Geneva, Tokyo and Moscow. He has also served as the senior vice president of operations for PM Beef Group, Kansas City, Mo., where he was responsible for all fresh beef operations, sales, marketing, plant production and cattle feeding.

Rick is currently the president of Summit Food Group where he is involved in cattle feeding, marketing niche beef products domestically, and exporting beef, pork, chicken and turkey products worldwide.

Rick chose the Maine-Anjou breed because of their commercial acceptance. He believes the cattle are one of the few breeds that fit all segments of the beef business making excellent mothers, having excellent rate of gain, feedlot efficiency and cutability. He also enjoys their disposition which affects cutability and feedlot efficiency; their diversity of color - black or red - fits various environments, regions and conditions; and the people and families involved in the breed. They are dedicated to improving the breed, not only in the show ring, but in the commercial business as well.

"I believe in maintaining a strong junior program, focusing on a strong commercial base by using genetic markers to determine value and continued commercial acceptance and a strong association creating value for its membership through creative programs," says Rick.

REGION I John Dickerson - Martinsville, Ind. Wife, Diana; son, Casey; daughter, Courtney

John Dickerson was raised near both sets of his grandparents and raised livestock with each. John raised his college funds by working daily with his grandparents as well as his parents. His two grandfathers rank as the most influential people in John's life and he feels privileged to be named after both of them.

In the fall of 1992, John met Miles and Kim DeJong at the recommendation of a work associate of Diana's. The first exposure to a working Maine-Anjou operation convinced him the breed would exceed his families needs for a team hobby and business. "My work in the animal health industry requires a lot of travel, and if we are going to raise cattle, they have to have predictable temperament, positive reproductive and mothering abilities and show ring potential. Maine-Anjou cattle have fit the bill!" says John.

John will never forget the first time he heard this bit of sarcasm, "beauty is only skin deep...but goes all the way to the bone." He feels this statement may be humorous, but it applies to the industry. John feels Maine-Anjou show cattle have a powerful presence in any exhibition across the United States. Breed influenced steers are standard today. "I believe a next positive step is to take this success and transfer it further to the "center of the plate." As a member of the Maine-Anjou board, I will work to gain our breed identification to consumers as we deserve more recognition than "black hided" cattle," says John.

REGION II Larry Rademacher - Loup City, Mo. Wife, Karen; sons, Scott, Wayne and David

After growing up on his family farm where he was involved with raising both beef and dairy cattle, Larry Rademacher started his own commercial cow calf herd in 1964. He started dealing with the Maine-Anjou breed in 1986. At present Larry owns over 300 cows and bulls registered with the American Maine-Anjou Association (AMAA), with another 150 being registered this year.

Larry strongly believes Maine-Anjou cattle work for both the commercial man and in the show ring. They have good dispositions, tremendous thickness and lots of hair. For the commercial cattleman, they are outstanding feeding cattle delivering a carcass that works on the grid system, a good rate of gain, feed efficiency and excellent maternal traits.

"The future of the breed is ours for the taking," Larry says, "I believe the time is here right now. The expansion of herds is on. Our breed has to offer as much or more than any other breed. Each and everyone of us has to go out and sell our fair share."

Larry Rademacher & Sons have been awarded with both the Seedstock Producer of the Year and Breeder of the Year awards. They have also been among the top five in the Cornerstone Dam program, both breeder and owner, for the past eight years. They have been involved in the AMAA National Steer Feeding Trial every year it has been held and have come out with outstanding results.

The Rademachers will hold their 10th consecutive production sale in 2006.

REGION III Matt Elliott - Chester, Okla.

Matt Elliott grew up on a cow/calf operation and continues to operate a herd with his parents, Glen and Judy. He attended Connors State College for two years on a livestock judging scholarship. He then received his BS in Agronomy from Panhandle State and a Masters in Ag Education from Oklahoma State University. He currently works for the NRCS in Taloga, Okla.

Matt has been very involved with the breed from a young age. He served on the national junior board for three years. For fourteen years, he has showed cattle and participated in the contests at the national junior show, also helping others along the way. He has had the high gaining and selling bulls at both Panhandle and Connors state bull tests.

The main reason Matt chose the Maine-Anjou breed was for their temperament, predictability in the genetics and their maternal characteristics.

He believes the future of the breed lies in its junior population as well as its marketability to all aspects of the cattle industry. "With the ability to gain and grade we can not only market our cattle to the feedlot producers, but also to the commercial producer," says Matt. "Our breed appeals to the club calf man because of the thickness and design of the Maine cattle as well as their docile disposition. We need to continue to address the positive benefits we have to offer our juniors and keep the junior program going because they are the future of our breed.

Matt says it would be a privilege and honor to serve on the Maine-Anjou board.

REGION III Bill Thorne - Dalhart, Texas Wife, Nina; son, Billy and wife Susan; daughter Kelly Bateman and husband John; granddaughters, Katie and Jordan

Bill Thorne graduated from the University of Missouri where he was on the livestock judging team. Throughout his life, he has held some prestigious positions in the cattle industry. He was a cattle buyer for Wilson Packing Company for seven years; he then moved on the the beef department manager at Wilson Packing Company. Bill spent 13 years as the manager of XIT Feedyard, where they fed 40,000 plus head of cattle. He has now been self-employed for 18 years order buying, grazing stocker cattle, feeding cattle, raising show steers and raising Maine-Anjou cattle.

Bill likes the Maine-Anjou breed because they are superior in their muscle pattern, bone and disposition. "They have the ability to produce a high quality lean carcass very efficiently," says Bill. "They also cross well with other breeds to produce quality show steers."

"The future for this breed is good if we continue to promote and produce lean, high quality carcasses," explains Bill. "The cattle need to be solid colored, efficient gainers and have acceptable birth weights. If we can accomplish these goals, the commercial cattlemen will be more and more interested in our cattle."

AT-LARGE Don McLain Wife, Viki; daughter Shannon and husband Jason Farmer; granddaughter Payton; daughter Katie; grandson Kaleb

Don McLain grew up on a 400 acre cow commercial ranch south of Denver and began raising club calves in the mid 1970's. He then moved to Gill, Colo., in 1985 and started crossing cattle with Maine-Anjou genetics. "We were so pleased that we are presently developing into a Maine program," says Don. "We liked the results in the 1980's when we started crossing our club calf operation with Maines. We felt that Maine-Anjou cattle had the best economic traits and the look we were desiring."

Don feels there has been more positive changes made in the Maine breeders and association in the last 10 years than any other breed. "Since my involvement began, I see more contracts with commercial cattleman and new seedstock producers everyday," explains Don.

In the past three years, He has seen what the goals of the association and the breeders have done and can only imagine what the next three years will bring.

INDUSTRY NEWS

Wendland Farms and 4T Ranch top B&B Cattle Company's Test 1
Barrett Farms and Brandon Maine-Anjou Farms top Test 2

Test 1 and 2 are complete and the results are in. Test 1 consisted of bulls that were born Nov. 1, 2003 through April 31, 2004. Daniel and Danny Wendland of Wendland Farms, Taft, Texas, and Buster Terrell of 4T Ranch, Menard, Texas, took top spots in the senior and junior Maine-Anjou Test 1 group of bulls, respectively. Wendland Farms high indexing senior bull was sired by DMCC Limited Edition 4F. He completed the test with an average daily gain (ADG) of 4.88 lbs.; a 1,281 lb. 420-day adjusted yearling weight (YW); a 13.8 square inch 420-day adjusted ribeye are (REA); and an overall index of 112.3. Wendland Farms also owned the second through fourth place senior Maine-Anjou bulls with an overall index range of 109.3 to 105.5. FJH Timeline 500J sired Wendland's second and fourth place bulls. There were thirteen bulls entered in the senior Maine-Anjou Test.

Sir Jazz sired Mr. Terrell's high indexing junior bull. He completed the test with an ADG of 4.05; a 1,018 lb. 365-day adjusted YW; a 10.1 square inch 365-day adjusted REA; and an overall index of 108.6. Jerry Gibson and Jerry Mara of J&J Farms, Parker, Texas, placed second with an overall index of 108.5. FJH Primetime 48H sired this calf. J&J Farms also took third and fourth place with an overall index of 108.3 and 106.0 respectively. There were thirteen bulls entered in the junior Maine-Anjou test.

In Test 2, which consisted of bulls born April 1, 2004 through July 31, 2004, William Barrett of Barrett Farms, Tatum, Texas, and Cleveland Brandon of Brandon Maine-Anjou Farms, Wills Point, Texas, own the first place bulls in the senior and junior groups respectively. WLBJ Chairman, a FJH Executive 31C son sired Barrett Farm's high indexing senior bull. He finished the test with a 4.08 ADG; a 1,099 lb. 420-day adjusted YW; a 12.0 square inch 420-day adjusted REA; and an overall index of 125.0. Mr. Barrett also owns the second place bull sired by WLBF Ain't Skeered.

Mr. Brandon's high indexing junior bull was sired by JJN Mr. 933L, a NBH Polled Energizer son. He finished the test with a 3.33 ADG; a 1,003 lb. 365-day adjusted YW; a 12.0 square inch 365-day adjusted REA; and an overall index of 112.0. Barrett Farms also raised the second place junior bull sired by WLBF Ain't Skeered.

B&B Cattle Company is owned and operated by Brad & Jana Barrett and is located in Normangee, Texas. You may check B&B Cattle Company out on line at www.bbcattleco.com or e-mail them at: bbcattleco@valornet.com.

OPEN SHOW REPORTS
Oklahoma State Fair
September 24, 2005 - Oklahoma City, Okla.
Judge: Jeff Sargent, Texas
Grand Champion Female - BK Party Harty 4009
Exhibited by Ethan Moore, Madill

Reserve Grand Champion Female - Power's Courtney 3140N
Exhibited by Jared Bedwell, Isabella

Grand Champion Bull - Wild Turkey
Exhibited by Diamonds in the Rough Cattle Company, Oologah

Reserve Grand Champion Bull - Remington
Exhibited by Dalen Toney, Noble

Keystone International Livestock Exposition
October 7, 2005 - Harrisburg, Pa.
Judge: Howard Hoffman, N.J.
Grand Champion Female - LGSM Witchy Woman 937D
Exhibited by Sara Campbell, Sycamore

Reserve Grand Champion Female - DCF Pearl
Exhibited by Courtney Dickerson, Martinsville, Ind.

Grand Champion MaineTainer Female - BRNY 20 to Life
Exhibited by Cody Duhamel, Northford, Con.

Reserve Grand Champion MaineTainer Female - 5DM Shania
Exhibited by Dylan Giebner, Saegertown

Grand Champion Bull - We-Glow Petey Pablo
Exhibited by We-Glow Maine-Anjous, Rochester

Reserve Grand Champion Bull - Mr. Ice
Exhibited by Melissa Shafer, Thornville, Ohio

Grand Champion MaineTainer Bull - WOL Hoss 12R
Exhibited by Dennis WOlfe, Lewisburg

Reserve Grand Champion MaineTainer Bull - WOL Pioneer 58R
Exhibited by Dennis Wolfe, Lewisburg