Your angle for marketing cattle in the near future

[LFF]

Lets talk about where the cattle industry is going. I'm interested is your input about what you believe will be the most profitable way to sell cattle. I want to limit the discussion by elimating seedstock and show cattle because that is a different ballgame. I also want to use the approach that cattle are made to eat grass , not supplemented usless needed due to weather , and assume that they are only fed out at the feed yard on grain.

Here are two views that appear to be preached on this board. I believe that commercial and purebred cattle can fit either of the two views that I've listed.

1) Produce the most pounds possible. Don't be concerned with the genetics and carcass traits because the sale barn will not give you anything extra for them. If buyers do somehow pay extra for good carcass value , you will have to spend more to produce them than you recieve. Buyers make purchases based purely from their visual prospective.


2) Produce cattle to target a branded beef product. Examples include Laura's Lean , Certified Angus Beef , Certified Hereford Beef , and other market specified programs. Use as many tools as you can to improve your calf crop's percentage that meet your program. Examples EDP's , ultrasound , bloodlines , receiving carcass data , and vacaniation programs that the brands program requires.

3) some other state your thoughs.

 

[Cattle Rack Rancher]

Well, when I got back into cattle a few years ago, I was planning on getting into the grass fed beef market. So, I stacked my herd up with good Highland and Galloway cattle that finish well on grass. It didn't take me very long to realize that it was a 'Push' marketing strategy where to get the extra money for those grass fed genetics, you basically had to pound the pavement looking for customers interested in buying grass fed beef. I already have a full time job with lots of overtime and I could see that instead of getting extra for those grass fed genetics, that I usually ended up just selling most of the calves at the salebarn and I was getting docked for those funny looking hairy cattle. The few that I was able to finish and sell at a premium weren't making up the difference. So, new plan. Last year I went out and bought the best registered Angus bull I could find for my herd and now I plan on getting in on the Angus green tag program and hopefully getting a few extra cents a pound doing that. I've been slowly converting my genetics over the last three years or so and now have 70% Angusx cows and still a few Highlands just for my own freezer and a few other people's. Do I know that the Angus thing is probably just a short term trend? Yes, I do. But success in marketing is all about producing what the market wants and if the market is looking for Angus beef, then that's what I'll produce at least until the next trend comes along.

 

[BRG]

I think this next down cycle will be different than any other cycly we have ever seen. After visiting and reading with/about some of the major feedyards in the US. I believe that cattle that do not have an age and source verification and/or a feedlot history( feed efficiency, grade/yield) will be docked at some pretty extreme amounts. These major feedlots have said that they want to only buy source and age verifiied calves have said so for a couple reasons, 1. To target other marketing options. 2. So they can have all cattle I.D.'d so they know whose genetics they were, where they came from, and who supplied the seedstock to them. That way they can target or stay away from these cattle again next year, or look for other cattle from their seed stock producer. The carcass is very important, but it has been stated that feed efficiency in the lot is worth 4 times the quality grade. So they need cattle that will put the pounds on for them. I think if we don't all take charge and either build a history around our cattle, or buy from a seedstock producer who does it for you. We will be in trouble. When I say a seedstock producer who does it for you, I mean breeders like Lindscov-Theil, who tries to get your feeders placed into feedlots and then gets the data back from them for your use. I might be wrong, but my ranch is a Red Angus Seedstock supplier and we are gearing up just for this. We also guarantee our customers that we will bid on your calves. After we get them bought, we then take all feedlot info and give it to the customer, feedlots, sale barns and buyers. I think the seed stock side of the industry will be changing as fast or faster than the commersial side. I feel that if seedstock suppliers like myself, does not supply more customer service and quality, the commercial rancher will then go to someone who does.

I may be wrong, but this is where I think the cattle industry is heading.

 

[dun]

I think this next down cycle will be different than any other cycly we have ever seen. After visiting and reading with/about some of the major feedyards in the US. I believe that cattle that do not have an age and source verification and/or a feedlot history( feed efficiency, grade/yield) will be docked at some pretty extreme amounts. These major feedlots have said that they want to only buy source and age verifiied calves have said so for a couple reasons, 1. To target other marketing options. 2. So they can have all cattle I.D.'d so they know whose genetics they were, where they came from, and who supplied the seedstock to them. That way they can target or stay away from these cattle again next year, or look for other cattle from their seed stock producer. The carcass is very important, but it has been stated that feed efficiency in the lot is worth 4 times the quality grade. So they need cattle that will put the pounds on for them. I think if we don't all take charge and either build a history around our cattle, or buy from a seedstock producer who does it for you. We will be in trouble. When I say a seedstock producer who does it for you, I mean breeders like Lindscov-Theil, who tries to get your feeders placed into feedlots and then gets the data back from them for your use. I might be wrong, but my ranch is a Red Angus Seedstock supplier and we are gearing up just for this. We also guarantee our customers that we will bid on your calves. After we get them bought, we then take all feedlot info and give it to the customer, feedlots, sale barns and buyers. I think the seed stock side of the industry will be changing as fast or faster than the commersial side. I feel that if seedstock suppliers like myself, does not supply more customer service and quality, the commercial rancher will then go to someone who does.

I may be wrong, but this is where I think the cattle industry is heading.

Couldn't agree more about the seedstock producers needing to be more proactive in the marketing of their client/customers calves.
We've already seen the affect's of source/age verified calves when we sold calves in january and even more so with the hiefrs that we retained ownership on in the feedlot. It wasn;t much of a premium then, a couple of bucks a hundred, but that will become the standard. Anything that isn;t age/source verified will start to take a real beating at the sale barn in the next year or two.

dun

 

[ENNOT]

I think BRG brings up a very good point. We raise registered Angus along with several commercial cows. We have not given in to the National ID System, but we do verify age on the tags when calves are born, and also keep all the pedigree, shot records and other miscellaneous info on a computer database system. I was just at a program put on by ABS, and they are starting a program that will buy,feed, and supply info back to the producer, from sires in their lineup.

I think that source and age verification will be the key. No matter if it is for the feedlot or a grass fed program. We had sold to a feedlot in Nebraska for several years, but last year we sold to a local grass fed program. They paid us $1.15 for 720 lb avg calves and are pleased with how they are doing. So we'll probably explore selling to them again.

To sum it up, I think you need to work with programs that are available for your situation. You need to keep more than one option in your pocket so you can negotiate your selling price to your benefit, not the buyers.

 

[MikeC]

I think the cattlemen of the future will feed more of their animals and sell on the grid. It's a way to get more pieces of the pie and to find out what kind of calves they are raising.

 

[purecountry]

I see alot more networking, alliances, value-added chains. Some members will work together to provide the land, grass, and genetics for the production side, and others will work on the marketing and finances.

The key to all of it in the NEAR future, will be customer service, and a healthy, quality product.

It is one thing to identify age, identify carcass data, performance or efficiency, but it is another thing entirely to identify the most nutrient dense beef. I believe we should be doing it, and I think it's coming soon. We will always be strong on the production side of this industry, we need to get better - and quick - at marketing and finances. When we can market our product as being the most healthy and safest beef they will eat anywhere, the consumer will stand up and pay attention.

Until we go to those lengths of 'Quality Assurance' as ALL other industries do, the consumer is just walking through the meat section looking at JUST BEEF. If your dam box of Cheerios can have nutritional info on the side - which is sort of selective, but it's an example - why shouldn't our beef do the same?

 

[Frankie]

I expect that in the next few years we'll go commercial, so I'll chime in here.

When we do, we'll retain ownership in our calves through the feedlot phase. The nation's cowherd is growing. Sooner or later, supply is going to exceed demand. At that point, I think higher quality cattle will simply have more value than lower quality. But above all, age, source, genetically identified cattle, will be worth more.

 

[Jovid]

Consumers want tender beef

They are finding out that CAB doesn't mean tender.

I think you will see more certified tender beef and the consumer will pay extra for it.

In order to get the premium you will have to raise cattle that are genetically tender.

 

[Frankie]

Consumers want tender beef

They are finding out that CAB doesn't mean tender.

I think you will see more certified tender beef and the consumer will pay extra for it.

In order to get the premium you will have to raise cattle that are genetically tender.

No, you can get a CAB premium if your cattle meet the CAB specs. and that doesn't include any tenderness requirements.

 

[Jovid]

Consumers want tender beef

They are finding out that CAB doesn't mean tender.

I think you will see more certified tender beef and the consumer will pay extra for it.

In order to get the premium you will have to raise cattle that are genetically tender.

No, you can get a CAB premium if your cattle meet the CAB specs. and that doesn't include any tenderness requirements.

You just confirmed what I said. CAB doesn't mean tender.

Yes you can get a premium for CAB we all know that. It may not be that way in the future.

What I am saying is that the consumer wants tender beef and they will pay a premium for it also.

 

[Rod]

Not to get off the subject, and i do agree with the above posts, but my bigger profit margins have been off of selling good seedstock. I've been buying large groups of purebred angus plus or brangus heifers from dispersal sales and letting them pair out and flipping them. I've found it to be a quicker turn around than my cow calf operation.

 

[Frankie]

You just confirmed what I said. CAB doesn't mean tender.

Yes you can get a premium for CAB we all know that. It may not be that way in the future.

What I am saying is that the consumer wants tender beef and they will pay a premium for it also.

I never said it did mean tender. There's nothing in the CAB specs that says it's tender.

I think the CAB premium will be available to more people for a longer time than the "tender" premium.

I saw a presentation several years ago that showed a high percentage of people said they would pay for tender beef. But a significant number of people said, no, they wouldn't pay more for tender beef. Why should they? They didn't pay more for a cake that rose, beer that was fizzy, or, most important, chicken that was tender. So why should they have to pay more for tender beef?

I think all beef should be tender. Since we know that higher marbled beef is more likely to be tender, the quickest, easiest way to get tender beef is to use a bull with a high marbling EPD.

Or you can wait until they get all the genes that make up tenderness identified, test your bulls and cows, cull hard, and wait for someone to offer a premium for your work.

 

[greenwillowherefords]

I agree with Mike C.

 

[mtnman]

If I told you my angle, it wouldn't be "mine".

mtnman

 

[Jovid]

Since we know that higher marbled beef is more likely to be tender,

I guess I missed that one in my research. I don't remember seeing anything that says marbling makes beef tender.

 

[Frankie]

Since we know that higher marbled beef is more likely to be tender,

I guess I missed that one in my research. I don't remember seeing anything that says marbling makes beef tender.

Nobody said marbling makes beef tender. But marbled beef is more likely to be tender than Select.

 

[la4angus]

Since we know that higher marbled beef is more likely to be tender,

I guess I missed that one in my research. I don't remember seeing anything that says marbling makes beef tender.

Nobody said marbling makes beef tender. But marbled beef is more likely to be tender than Select.

Frankie you are correct about this.

 

[KMacGinley]

I expect that in the next few years we'll go commercial, so I'll chime in here.

When we do, we'll retain ownership in our calves through the feedlot phase. The nation's cowherd is growing. Sooner or later, supply is going to exceed demand. At that point, I think higher quality cattle will simply have more value than lower quality. But above all, age, source, genetically identified cattle, will be worth more.

A lot of people have been predicting the end of the high prices and a crash for the last several years, but what they leave out of their calculations is the fact that the Nation's population is also growing while the ability of this country to produce much higher quanities of beef is being marginalized by urbanization and the selling of Ranchettes in the west.

Where I live there were many small and not so small beef herds 15 years ago, now there are only a few.

Most farmers east of the Missisippi want only to work a couple months in the spring and a couple of months in the fall and spend a couple of hours a day gossiping at the coffee shop. Livestock farming is too much work for them.

Unless this country completely loses its mind and lets Central and South America flood us with beef, I don't see a huge price hit for the forseeable future.

In regard to selling age and source verified cattle... are they going to pay more for them? Since they are verified, will I get a cut if they cut out better? Will the feedlot send me a print out, since they will now know who I am so that I can get a higher price for my genetically superior cattle next year? Probably won't hold my breath.

 

[MoGal]

Two weeks ago the West Plains livestock auction report said that they had a set of age/source verified that exceeded any of those sold that day. So yes, I think it is possible to get more money.

Those of you who pat yourselves on the back for not giving your calves worming/immunizations and saving that $5 per head may be the ones crying though when packers severely dock you for it (because your calves are the sickly ones in the feedlot).