Made In America
Live Exports of U.S. Cattle a Growing Trend
Daniel Mushrush is looking down the road to help build the family's bull and heifer business -- way down the road and across the ocean.
Mushrush Red Angus, of Strong City, Kan., is one of many purebred beef operations exploring the market potential for sales of U.S. bulls and females around the world. They are joining the growing ranks of cattle operations sending bulls and breeding females to places like Russia, Georgia, Kazakhstan and Turkey.
In the case of Russia, there are multiple reasons the arrangement should work. To start with, demand is strong. Trade constraints have limited domestic consumption in the country to around 37 pounds per capita compared to 57 pounds per capita in the U.S. The Russian government has set a goal of being "beef independent" by 2018, which has opened the door of opportunity for breeders. The Russian government is subsidizing its beef industry with $1 billion for the direct purchase of breeding stock. Officials are aiming for a 10-million-head beef herd by 2020, nearly a tenfold increase from current levels.
Despite the potential, U.S. sales to Russia could be sidetracked by political decisions. Russia's ban on Western food imports, in retaliation for trade sanctions imposed on Moscow over the Ukraine crisis, does not include live animals. The ban does, however, cast a shadow over possible transactions.
LIVE EXPORTS GROWING
Worldwide exports of U.S. breeding beef females are golden, rocketing from 546 head in 2008 to approximately 54,000 head in 2012, according to the U.S. Department of Commerce. Beef bull exports topped 1,000 head in 2012. Among those cattle stepping into a new world recently were 15 Red Angus yearlings from Mushrush's operation. The cattleman said an exporter handled getting the yearlings to Russia in 2012, with his own obligation ending after they were delivered to western Kansas for quarantine. The quarantine period for cattle bound for Russia is a minimum of 21 days. Prices, which Mushrush chose not to reveal, are negotiated between buyer and seller, just as they would be in the U.S.
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Breeding animals in Russia must have extensive documentation. To garner a government subsidy there, they must be registered. Vaccination requirements include infectious bovine rhinotracheitis (IBR) and bovine viral diarrhea (BVD). Animals must be free of certain contagious diseases, including leukosis and brucellosis, and, for bulls, trichomoniasis and campylobacteriosis. Although some cattle travel by plane, the vast majority are shipped by boat. It all adds up to an extra cost of at least $2,000 per head, which is negotiated into the sales price.
J.J. Jones, marketing and trade director for the Kansas Department of Agriculture, as well as chairman of the U.S. Livestock Genetic Export Board, said several states are pursuing breeding stock export markets, most notably North and South Dakota, and Montana. In addition, Southern purebred breeders are working to develop markets in areas where Brahman-influenced bulls and females are in demand, especially Southeast Asia and South America.
Russian buyers, on the other hand, typically represent large operations and are primarily focused on Angus and Hereford cattle. "The smallest Russian herd we've dealt with is 50 head, and the largest is 250,000 head," Jones said. "The majority of the interested Russian buyers have 1,000 to 15,000 cows, but they all want to get bigger."
Jones described himself as a "matchmaker, a resource" in the export market. He said America's annual livestock genetic export value is approaching $1 billion. Much of that is in the form of semen and embryos, and a lot is based in the dairy side.
DOMESTIC PUSH PREVAILS
For now, the need to rebuild U.S. herds has pushed prices of stock to the point where international sales have cooled.
"When demand for good bulls and females is so high right here at home, it doesn't make economic sense for us to jump through all the hoops and added expense to pursue something like the Russian market right now," Mushrush said. But he's keeping the door open. The Kansan has visited Russia as part of a cattlemen's trade delegation and hosted several prospective buyers from Russia, Kazakhstan and the Ukraine.
Mark Brunner wants to be in the right position to take advantage of future sales opportunities abroad, too. He runs Cow Camp Ranch, at Lost Springs, Kan. He has traveled to Russia and hosted foreign visitors at the family's Simmental and SimAngus operation and commercial feedyard. He's particularly interested in the market for embryos but said at this point, Russia's low cow numbers mean there isn't an abundance of recipients available. There are other factors that impact the market, as well, including quantity versus quality.
"A lot of buyers are looking for sheer numbers rather than elite genetics," he said. "They're definitely enthusiastic, but the level of sophistication of the cattlemen seems variable. For the market to develop, they will have to raise their level of management."
Mushrush added: "The expertise American cattlemen possess would make a huge difference over there. A simple vaccination schedule we wouldn't think twice about could save one of these Russian outfits millions of dollars."
And the Kansans are sharing their expertise as part of the trade-development picture, Jones said. He believes the best beef practices researched and developed in this country can be part of the foundation for new market opportunities with overseas buyers.
"The better managers our international customers become, the more valued our livestock genetics become," he explained. "And as American cattlemen know, the value of high-quality genetics is fully expressed by good nutrition, good health and good management."
(VM/CZ)
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