Biosecurity

Vulnerability and Strategy evaluationContinued

Total WelfareTotal Welfare for CB analysis

TSW=CS+PS

Demand Supply

P*

Q

P2

P1

Q*

E

PS

CS

Appraisal Based on Changes in Net Income

• Examining situations where economic agents are operating with varying biosecurity attributes where all other factors either do not vary or can be controlled

• Estimating a relationship between net income and the biosecurity attribute

• Calculating the change in net income induced by the change in biosecurity attributes

• Utilizing quantitative relationship between biosecurity change and net income .

Assumes prices don’t change so demand is perfectly elastic

Appraisal Based on Changes in Net Income

Assumes prices don’t change so demand is perfectly elastic

Processing

Markets

Feed Mixing

Other Resources

AUM Grazing

Labor

Pasture Land

Natl. Inputs

Forestland

Water

Livestock Production

CropProduction

Export

DomesticDemand

Import

Biofuel/GHGDemand

ForestProduction

Cropland

Initial Accomplishments (V)Applying Sector modeling

Land

Water

Labor

Grazing

Nat Inputs

Aggregate Supply and Demand

Feed Demand

Processing Demand

Processing Supply

Sector Model Economic Structure

Domestic Demand

Export Demand

Import Supply

Household Demand

Model Economic Structure

Primary CommoditiesCotton Corn Soybeans SorghumSOFT HRWW DURW HRSWRice Oats Barley PotatoesSilage Hay Alfalfa SugarcaneSugarbeet Tomatofrsh Tomatoproc Orangefrsh Orangeproc Grpfrtfrsh Grpfrtproc SwitchGras HybrPoplar WillowCornres SorgRes RiceRes WheatResOatsRes BarleyRes

Sheep CowCalf BeefFeed DairyHogFarrow FeedPig PigFinish OthLvstkStockSCav StockHCav StockSYea StockHYeaVealCalf Turkeys Broilers EggsBeefcows BioManure

Secondary Commodities

OrangeJuic GrpfrtJuic SoybeanMeal SoybeanOilHFCS Beverages Confection BakingCanning RefSugar GlutenMeal GlutenFeedDDG CornStarch CornOil CornSyrupDextrose FrozenPot DriedPot ChipPotFedBeef NonFedBeef Pork ChickenTurkey WoolClean FluidMilkwhol FluidMilkLowFatSkimMilk Cream EvapCondM NonFatDryMButter AmCheese OtCheese CottageCheIceCream Bagasse Lignin LigninHardwd LigninSoftwdEdTallow NonEdTallow YellowGrease

CropEthanol CellEthanol Biodiesel BiodieselWOMktGasBlend SubGasBlend Tbtus

Corn Belt

Great Plains

Lake States

NortheastPacific Southwest

Pacific Northwest

South Central

SoutheastSouth West

WestEast

Rocky Mountains

FASOM Agricultural Regions

Foreign Regions in FASOM

10 1213

1425

26

17

29

30

67

5

3

2

1

28

15

15

20

22

21

19

8

2723

1116

26

FASOM has supply and demand curves for corn, 4 types of wheat, soybeans, rice and sorghum across the above regions and within 11 major US regions where the region trades the commodity. FASOM also maintains transportation costs between all regions. The model determines exports to the point where prices are in equilibrium considering transport across all markets.

Modeled Beef Cattle Flow

Cow/Calf•Beef Steer Calves•Beef Heifer Calves•Cull Cows

Replacement Breeding Stock

Steer Yearling Stockers

Steer CalvesSteer Calf Stockers

Heifer Yearling Stockers

Feedlot Beef

Yearlings

First Grazing

Program

Second Grazing Program

Heifer Calves Heifer Calf

Stockers

Feedlot Beef

Calves

First Grazing

Program

Second Grazing Program

Feedlot Beef Slaughter

Cull Cows

Non-Fed Beef Slaughter

Bulls

Modeled Dairy Cattle Flow

Dairy•Milk•Dairy Steer Calves•Dairy Heifer Calves•Cull Dairy Cows

Replacement Breeding Stock

Raw Fluid Milk

Dairy Steer Calves*

*Dairy Steer Calves merge in with the Steer Calves in the Beef Cattle Flow

Steer Yearling Stockers

Steer Calves

Steer Calf Stockers

First Grazing

Program

Second Grazing Program

Feedlot Beef Yearlings

Feedlot Beef Calves

Feedlot Beef SlaughterDairy Cull

Cows

Non-Fed Beef Slaughter

Dairy Heifer Calves

Bulls

Rift Valley FeverAn emerging disease and agro-bio-terror

threat

• Mosquito-borne viral disease of livestock and humans

• Transmission modulated by weather• Demonstrated ability to travel• Unknown outside Africa and Arabian Peninsula

Appearance in US expected to impact agriculture sector severely

• Cost of cattle illness and death• Potential bans on US livestock

Limited analytic tools to support decision-making or operational planning

• French vector model• USDA/NASA risk assessment method

Epidemic/Economic Modeling

Biology and Epidemiology

Economics

Disease Vectors

EnvironmentModeling Infection

Estim

ate

s

Animal ProductionAnalysisCosts & Impacts

Subject MatterExperts

Items changed in FASOM/ASM for Rift Study

For both beef and dairy on a geographic basisCalving rateAdult beef production (Deaths and culling)Culled cattle (those who lost calves)Replacement needs (lost adults and lost replacements)Milk production (Deaths and cows that lost calves)

In model other indirect effectsFeed usageCalf movementReleased feed usage expanded elsewhere (exports, biofuels)

Regional locus of feedingProductionCommodity pricesDairy and beef products

High Plains FMD Epidemic/Economic Modeling

• 64 scenarios over various outbreak and disease mitigation scenarios– Early detection vs. late detection – Ring vs. targeted vaccination– Adequate vs. inadequate vaccine availability– Regular vs. enhanced surveillance– Slaughter options: ring slaughter, slaughter of

infected, and slaughter of dangerous contacts

AusSpread

• Output– Duration of epidemic in weeks– Expected number of infected herds– Expected number of dangerous contacts– Expected slaughter– Expected vaccination

Integration into FASOM

• Unlike Rift, FMD affects more than cattle• Adjustment of sheep and swine budgets as

well• Estimate percentage impacts and adjust

budgets by these percentages• Spatially lock infected region at the

production level

Specific Adjustments

• Cow/Calf• Dairy• Milk• Sheep• Wool• Feeder Pig Production• Hog Farrow to Finish

Example: Dairy• Dairy budgets are on a per cow basis• A single dairy cow produces, on average a certain

amount of milk and a certain amount of dairy calves each year as well as cull cows

• To do this she needs a certain amount of inputs • The conversion of FMD effects into percentage

allows the modeler to adjust these outputs across an entire region

• the model automatically shifts input to alternative uses

Baseline Specification

Average Units / Description

base.Silage -6.600 US tons for dairy production

base.Hay -5.060 US tons for dairy production

base.Milk 193.906 100 lbs of raw milk

base.CullDairyCows 1.657 100 lbs of cull dairy calves

base.DairyCalves 2.057 100 lbs of dairy calves

base.biomanure 4.940 tons manure available for bioprocesses

base.SoybeanMeal 0.860 tons soybean meal

base.DairyCon0 108.529 100 lbs grain blend for dairy cattle

base.Pasture 1.750 Acres of pasture land

base.Labor 31.587 Hours

base.othercosts 1272.391 Dollars

base.Profit 1435.851 Dollar difference between revenues and costs

base.Head 1.000 Budget is for one animal

Code in FASOM*adjust budgets for slaughterlivestockbud("TxHiPlains",ANIMAL,livetech,eftech,"DairyCalves") $(livestockbud("TxHiPlains",ANIMAL,livetech,eftech,"DairyCalves") and avgeffectsonherd("dairy",newscenarioname,"TxHiPlains",herdcomponent)) =(livestockbud("TxHiPlains",ANIMAL,livetech,eftech,"DairyCalves")

-2.057*(avgeffectsonherd("dairy",newscenarioname,"TxHiPlains","infected")+ avgeffectsonherd("dairy",newscenarioname,"TxHiPlains","immune")+

avgeffectsonherd("dairy",newscenarioname,"TxHiPlains","dead")));

*handle milk loss livestockbud("TxHiPlains",ANIMAL,livetech,eftech,"milk") $(livestockbud("TxHiPlains",ANIMAL,livetech,eftech,"milk") and avgeffectsonherd("dairy",newscenarioname,"TxHiPlains",herdcomponent)) =(livestockbud("TxHiPlains",ANIMAL,livetech,eftech,"milk")* (1-(avgeffectsonherd("dairy",newscenarioname,"TxHiPlains","latent")+ avgeffectsonherd("dairy",newscenarioname,"TxHiPlains","infected")+ avgeffectsonherd("dairy",newscenarioname,"TxHiPlains","immune")+ avgeffectsonherd("dairy",newscenarioname,"TxHiPlains“,“dead”)));

Initial Accomplishments (VI)Estimated Economic Impacts of an FMD outbreak

Welfare for Agriculture

Base millions

Economic Impacts

Large Feedlot Grazing Operation Backyard

(1) Early Detection

(57) Late

Detection

(15) Early Detection

(7) Late Detection

(40) Early Detection

(16) Late Detection

US Consumers$1,587,043 -$218 -$354 -$64 $163 $172 -$21,106

US Processors$2,681 $13 $0.0142 $13 -$15 -$44 $46

US Producers$54,951 -$22,384 -$44,849 -$1,514 -$3,498 -$4,213 -$7,108,210

US Total

$1,644,676 -$22,590 -$45,203 -$1,565 -$3,350 -$4,085 -$7,129,270

Foreign Consumers$188,107 -$87 -$89 -$65 -$37 -$62 -$1,691

Foreign Producers$15,039 $21 $19 $10 -$15 -$10 $1,329

Rest Total$203,146 -$66 -$70 -$54 -$53 -$72 -$362

Total Globally$1,847,823 -$22,656 -$45,274 -$1,620 -$3,404 -$4,158 -$7,129,632

Costs for Disease Management and Carcass Disposal

• Disease Management– Vaccination (per head and per farm)– Testing (per farm)– Surveillance (per farm/ per visit)

• Carcass Disposal– Appraisal (per farm)– Euthanasia (per head)– Disposal (per farm)– Cleaning and Disinfecting (per farm)

Average Costs Across Scenarios

• Disease Management– $5,912,086.82

• Carcass Disposal– $39,998,352.68

Average Across Scenarios: $45,910,439.5

Price Changes from Pre-Event Base• Drops in

– Cotton, soybeans, wheat, barley, silage , hay and sugarcane (less than 1%) – Feeder Pig prices dropped about 15% across scenarios– Feeder calves, stocker calves dropped 2-7%– Not much change in cattle yearlings

• Prices Increased for– Fresh vegetables and raw milk (less than 1%)– Broilers, pork and fed beef (small 0.1 – 2%)– Generally no change in lamb

• Certain late detection, backyard index cases were exceptions. – Very large drops and increases (15-40%)– Rarely, dairy calves and steer calves dropped almost 100%.