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Animal Health News & Notes for April 13, 2007 4/13/2007

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Brakke Consulting's
Animal Health News & Notes for April 13, 2007

Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon, DVM, MBA

earnings news
other news
Eli Lilly
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> Swift & Co. reported a net loss of ($48.6 million) in the quarter ended February 25. Beef sales for the quarter fell 16% to $1.16 billion, though revenue from the company's pork and Australian operations increased. Overall sales fell 6.9%, to $2.09 billion.  Swift indicated its sales have been hurt by ongoing restrictions from trading partners. (Meating Place)
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> Eli Lilly and Company announced it has received approval from the FDA to market Reconcile (fluoxetine hydrochloride), the first selective serotonin reuptake inhibitor (SSRI) class of antidepressants approved by the FDA for treatment of canine separation anxiety in conjunction with a behavior modification program. Reconcile is a once-daily, chewable, flavored tablet for use in conjunction with behavior modification training to treat canine separation anxiety. Reconcile is available in 8, 16, 32 or 64 mg tablets. (company press release)
> CANADA - BSE BIRTH COHORT SENT TO US   One of the birth cohorts of a Canadian bull diagnosed with BSE in January was exported to the US in 2002, according to USDA's Animal and Plant Health Inspection Service. The animal, a heifer, was sent to a Nebraska feedlot, and then was slaughtered at a Nebraska facility. APHIS indicated the animal presented a negligible risk since scientific data indicate that two BSE-positive animals rarely originate from the same herd. (Meating Place)
> US - PET FOOD ILLNESS   Over the last several weeks, Banfield, The Pet Hospital, has provided the FDA with medical information collected from its centralized medical records database of pets that may have been affected by the Menu Foods recall.  According to Banfield, the database shows that out of 237,844 dogs and cats examined at Banfield during the last three weeks, six pets (five cats and one dog) or 0.003% have died as a result of eating a recalled food. These numbers don't include the 16 pet deaths FDA had already confirmed.  In the last three weeks, Banfield doctors have examined 1,605 pets with a history of eating a recalled food, which is less than 1% of the pets examined in all of its hospitals. Very few of these pets are ill. (Feedstuffs online)
> US - NEW SWINE AILMENT  A cluster of ailments linked to the circovirus has recently emerged in the US swine industry. Known collectively as porcine circovirus associated diseases, or PCVAD, they have the potential to seriously impact pork production with death losses as high as 40%, according to the Vice President of Science and Technology for the National Pork Board. Perhaps even more troubling is that it's still not clear why or even how the circovirus is contributing to a new spate of hog diseases.  (ThePigSite)
> US - LEGISLATION BANNING GESTATION CRATES   Elected officials in Maryland have introduced in both of the state's legislative houses bills aiming to ban the use of gestation crates that all but immobilize expecting sows. The bills would prohibit a person from confining a hog during pregnancy in a manner that prevents the animal from lying down and fully extending its limbs or turning around freely. Maryland's movement follows that of Oregon and California, whose legislatures are also discussing the matter. Florida and Arizona have already outlawed gestation crates in the past couple of years. (Meating Place)
> US - ETHANOL'S EFFECT ON PROTEIN PRODUCTION  An analyst from Doan Advisory Services has predicted that US pork producers will be impacted most by intense business and structural pressure from the booming ethanol industry in coming years. Ethanol processors will pull more corn into their operations as they push more ethanol feed coproducts into the markets. Doane expects USA distillers dried grains production to rise from about 10 million tons this year to 28 million tons in 2011. Beef and dairy industries will be able to use the low-cost feed products, but poultry and pork producers, with limited capability to use DDGS in their feeds, will suffer from high corn price pressure. (Watt Feed e-news)
> US - POULTRY LITTER POWER SOURCE  A new power plant in Carnesville, Georgia, will produce electricity powered in part by chicken litter.  A project of Green Power EMC, a consortium of Electric Membership Corporation divisions from around the state, the conversion plant should be on line by this fall, utilizing litter from the many poultry farms in north Georgia.  The plant should produce 20 megawatts of electricity when running at full capacity, enough power for about 15,000 homes. (Meating Place)
It’s obvious by the lack of news for the industry that many of you had a restful time during the Easter Holidays.  We hope to have more news for you next week. 
During the past week I’ve been intrigued by the various opinions on the “ethanol boom” and the impact it will have on meat production.  The expectations and forecasts are all over the board depending on the source and perspective.  At the very least it’s going to offer some cover for those firms not achieving 2007 sales forecasts for the first few months of the year. 
We’re of the opinion that it will have a negative impact on the food animal production in 2007, but to what degree depends on how high the price of corn goes and how long it stays at that level.  Who will take the negative hit?  Most likely the producers involved in the cash market.  Others in the supply chain will have their margins shaved and they’ll pass along some of their increased costs to the consumers.  As one expert indicated, we might be seeing a whole new level of pricing in animal protein in the near future. 
Have a great weekend!!!
Ron Brakke
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