Marketing: Endless Opportunities

by Karoline Rose

Payday: the day when all your hard work for the year leaves the driveway on a cattle truck, and you hold a check in hand. As a cattle procurement officer and a cow-calf operator, I am on both sides of the payday coin. I know this is how many of us operate year after year, but is it consistently the best option? Is selling cattle directly off the ranch the best option for you and your operation? Are there value-added options you need to consider? Are you doing everything possible to make your calves worth top-dollar? Or would retaining ownership give you more return, more knowledge to improve your operation, and the ability to more effectively manage risk?

I want to preface this article by saying that cattle marketing is not black or white. It’s full of gray areas. What works for you and your family might not work for your neighbor and vice versa. As a cattle procurement officer, my job is to serve producers and provide avenues to market cattle. There are many different avenues to market calves year after year, but the biggest mistake one can make is be narrow-minded and not consider all the available marketing avenues and to get stuck in a routine doing the same thing every year without looking at your options.

Factors and options that often play a huge role in your decision to sell off the cow, to wean, or to retain ownership through the feedlot include the following:

 

TIMING

Fulton J. Sheen said it best: “Patience is power. Patience is not an absence of action; rather it is ‘timing,’ it waits on the right time to act, for the right principles and in the right way.”

It’s impossible to know what the cattle market is going to do from minute to minute, much less from month to month. Even so, timing plays a huge role in your decision to sell. The typical option of weaning cattle and sending them to the feedlot often happens five to seven months after calving, with fall shipping being typical. Most people aim for the April market for their fat cattle, creating a highly competitive time to market cattle. Production practices such as changing your calving date by a month or two lowers the competition because fewer cattle will be ready then. For instance, if you consider calving in May and selling in December, you have the option to send them to the feed yard, grass in the warmer states or a backgrounding lot. Adapting to certain practices expands your options as a producer, and with some patience, you are positioned to capitalize on markets that others miss.

 

DATA

We are in an ever-increasing numbers industry and the commodity board has more volatility than ever. It’s your job as a rancher to be attentive to timing, the markets, and value-added programs. Data plays a more important role now more than ever. We live in a very competitive industry and buyers and feeders are looking for operations who work to set themselves apart from their neighbors. Don’t hesitate to request feed and carcass data from your buyer. Ask them for direct feedback on your calves. Not only will gathering data help you improve your operation’s productivity but that data can also be used to market your best year.

 

STAND OUT

There are several ways to add value to your calves outside typical value-added programs. For example, if you opt to market your cattle through a local auction barn, type-up the details on your calves. Show up early and hand those details to the buyers. This will give you an edge compared to your neighbors. More information is always helpful to local buyers. To further emphasize, if you tell them the day you gave shots, it’s much more meaningful than the auctioneer simply saying the calves have had all their vaccinations. Specificity can sometimes be the aspect that makes the biggest difference.

 

SOCIAL MEDIA AND MARKETING

Social media is another way to add unique value to your calves, especially on the female side. For example, a simple video on Facebook of your replacement heifer calves, bred heifers or bred cows can be seen by 20,000 instead of the traditional five to 10 local buyers. When done right, social media has the ability to add value by simply increasing interest in the cattle, making it a more competitive market.

 

FILM

Presentation is everything. Giving a potential buyer the opportunity to actually have a look into your operation by seeing your “mama cows,” calves, and grass conditions is second only to on-site visits. Grab a good video camera and document your calves; you’ll be glad you did.

 

RETAINED OWNERSHIP

Retaining ownership through the feed yard is another option. This option is often not considered due to elevated risk and sometimes limited availability, but as a producer this option must be considered. It might not be an option you use every year, but it can provide you with valuable knowledge that can help you market your cattle better the next year. The beauty of retaining ownership is that it puts the options and power in your hand. You are able to hedge your cattle for risk management, understand how much your cattle actually shrink on the way to the yard, and see the value your cattle have while understanding average daily gain and cost of gain, as well as understanding carcass data. When you opt to retain ownership, you also give yourself the opportunity to put yourself in the shoes of your buyers and feeders. Retained ownership shows you the changes needed in your operation and highlights the areas in which you excel. One of the benefits of retaining ownership is the ability to have your cattle fall into a carcass merit program based on breed or quality. These programs hold extreme value when understanding designing a program because the carcass quality data is priceless when marketing. When you market cattle through a carcass program you are rewarded for quality and if the right data is kept on the ranch you can see which cows and sires are producing the calves that are bringing a premium on the rail, which gives you the ability to be more profitable.

 

CONSISTENCY

Consistency is key. If you band 99 percent of your calves and miss 1 percent, that will cause a feeder to be hesitant to bid the next year. If one of your calves missed their pre-weaning shots, that’s not good enough. I don’t encourage you to demand perfection, but be consistent in your program, your marketing effort and your quality. The most sought-after calves come from ranchers who strive to do everything right, every time. They create a security for the buyer and feeder. If your buyer knows that you are consistent and every year you get better and better, your calves will be desirable. Now, don’t get consistency confused with routines that don’t change. Being consistent allows you to be flexible, work your timing and market your cattle in the best way possible because it means from top to bottom your calves are treated the same. They have the same shots, the same treatment, the same data and more. Be consistent while being flexible.

 

Cattle marketing is quickly changing. Bids on calves are only good for an hour instead of for weeks like they were 20 years ago. There is more competition, but at the same time that competition enables you the opportunity to set yourself apart and truly showcase your cattle and operation. As you analyze your marketing plan for this year, think outside the box. What can you do that makes your cattle different than your neighbors’? That could be throwing a high-quality video of your heifers on Facebook or retaining ownership of your calves until slaughter. The options are ever evolving and endless.