by IBBA Member Relations Specialist Tullina Wilson
Retaining ownership of cattle through the harvest phase can be scary for a cow-calf producer. There is additional risk taken when owning calves beyond the weaning endpoint into the feedlot phase and finally to the packing plant. These risks include potential sickness, death loss, poor growth, inadequate carcass performance, and others. Cattlemen that have done a good job of selecting and purchasing their bull battery are more apt to take this risk, because they have confidence in the product the seedstock producer has created for them.
Additional opportunities exist from owning cattle throughout the feeding and harvesting phase than by marketing them at weaning time. This affords the opportunity to be paid for the quality of the final product; hence, a true value-based marketing advantage. Being paid for the value of the carcass instead of the pounds of weaned calf have allowed producers to focus on carcass genetics when selecting potential herd sires from their seedstock supplier. Selling on a grid in this manner allows cattlemen to receive yield and quality grade premiums when the hanging carcass meets the required criteria.
Although most cattlemen market their calves at weaning, retained ownership can provide opportunities to add value to your cattle. Many prognosticators are suggesting the market signals may be right for some level of retained ownership this year. Much of this optimism is due to the decreased feed costs that ultimately reduce the overall cost of gain throughout the feeding period. Continued low interest rates on your money may have a positive impact as well.
For the Neals, the cattle business is a family affair. Raising commercial cattle on their family operations is Michael and Lisa Neal, Jarrod and Sally Neal, and Craig and Brenda Neal. The Neals own and operate Craig Neal & Sons, Bayou State Cattle, and C & B Cattle Co. Michael and Lisa, also, own and operate Midsouth Cattle Co., a registered Brangus operation. The Neal family is no stranger to the cattle industry. The Neal family has raised cattle in southern Louisiana for several generations.
Taking pride in their cattle, the final product is a direct reflection of the care and attention given to their herd. In the spring of 2016, a lot of 102 steers made the journey from southern Louisiana to southwestern Kansas to be fed and harvested for data collection. The calves were a product of registered Brangus bulls mated to commercial dams. The steers followed a strict vaccine protocol, which had them receiving vaccinations twice prior to weaning and once more at weaning.
The steers were placed on ryegrass pastures during the winter and had access to lick tubs and minerals year-round. After weaning, the steers were backgrounded and fed to have an average daily gain of three pounds or so. The Brangus-sired steers had an average final live weight of 1,368 pounds and an average carcass weight of 901 pounds, which provides an average dressing percentage of 65.86 percent. Sixty-nine percent of the carcasses graded choice or better with 85 percent receiving a yield grade of three or better.
Cattlemen like the Neals know that a great bull selection program, in combination with a good animal health protocol and adequate nutrition program, can reduce the overall risk of a retained ownership beef enterprise. Risk management tools such as futures, contracts and options are available, as well as to further minimize potential feeding risks.
Selling on a grid means you will be paid a base price on total carcass weight with premiums and/or discounts for USDA quality and yield grades. Additional premiums may be garnered through various source and age verification programs being marketed internationally (e.g. Japan and China). Becoming familiar with the processes involved in a successful retained ownership program will help cow-calf producers gain the confidence to add value to their cattle as the Neal family has done.
The Neal family has worked diligently the past ten years to produce enough quality replacement heifers to maintain and grow their herd. All current producing dams were born and raised onsite with no outside females being utilized. Their herd sires are selected based on balanced expected progeny differences (EPDs) with more emphasis placed on ribeye area, scrotal circumference, and milk EPDs. The Neal family attributes much of their positive carcass results to the quality herd sires carefully selected to influence their herd.
The Neal family continually strives to improve their operation, working to select the best Brangus genetics available for their production needs.
Midsouth Cattle Co. and the Neal family, are hosting their first sale this September in St. Francisville, Louisiana, where they will offer over 300 commercial-bred heifers and 60 Brangus and Ultrablack bulls.