Choice, YG 1's Now Pay More Than CAB

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MikeC

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Premium Excitement
While past numbers tell one story, Ken Conway, president of GeneNet, is even more excited about the interest his alliance has generated in 2002 and the improvements GeneNet has made to its formula.
“Since last fall, most grids have reduced Prime and Certified Angus Beef (CAB) premiums,” he explains. Consequently, the yield grade base has been moved up to where a lot of grids are giving less yield premiums and are now discounting USDA Yield Grade (YG) 3s by $1/cwt.

GeneNet is still paying an $8/cwt. premium for Prime, $4.50 for CAB, $3.50 for Armour Premium (AP)(non-black-hided), $5 for USDA Choice YG 1s and $3 for Choice YG 2s.

“And our base price is a Choice YG 3,” says Conway. “We have now doubled our minimum USDA Choice/Select spread to be $6/cwt. instead of $3.” He notes that producers can bid the price or use the weighted average to determine the base price.

GeneNet provides the following data collection options:

Group data/tag transfer (no individual eartags): Number and percentage breakdown of group average in all carcass categories then compared to all cattle killed in system.
Normal data/tag transfer (individual eartags): Each tag tied to a hot-carcass weight, quality grade, yield grade, if it went CAB, AP or a calculated yield grade.
Complete data (individual eartags): Each tag tied to a hot-carcass weight, marbling score, quality grade, ribeye area, backfat thickness, percent of kidney, pelvic and heart fat, CAB, AP or a calculated yield grade.
 

Brandonm22

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Let me see if I can translate all of this into real money.....

Say we have 5 800 lb carcasses in this grid

Prime brings $54 more than the base
Choice Yield Grade One brings $40 more than the base
CAB brings $36 more than the base
Armour Premium brings $28 more than the base
Choice YG 2s bring $24 over the base
If the base is a low Choice Yield Grade 3; then
a Select Yield Grade 3 is worth $48 less than the base price.

IF I did not flub up the math here, then on this grading scale 50 YG 3 steers that grade CAB are worth ~$4200 more than 50 YG 3 steers that grade Select.
 
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