3 marketing options for the fall calf run

3 marketing options for the fall calf run

The feeder cattle and calf markets continue to decline, and as a result, producers may be rethinking their marketing strategies for the 2016 fall season.

In this week’s poll at beefmagazine,com, we ask, “Have you changed your fall marketing plans?” The votes are just getting underway, but the majority of readers who have participated in the poll say, “Yes, we’re trying to better negotiate this fall’s lower prices.” Another 30% say, “No, we’ll market the same as always,” and the remaining 11% haven't decided yet.

Vote in the poll here.

I recently read an article from Heather Gessner, South Dakota State University (SDSU) Extension livestock business management field specialist, titled, “Calf sales 2016.” In the article, she lists things to consider before changing marketing plans. Here are three marketing options for cow-calf producers to think about:

1. Sell at weaning

Gessner writes, “For those with limited feed, facilities or capacity to manage calves post-weaning this may be the best choice. These producers eliminate risks associated with post-weaning performance or death losses, but they also give up any opportunity to capture the opportunity for price improvement and for adding value to home-grown feeds.”

2. Pre-conditioning

In our seedstock operation, we select our replacement heifers and the bulls we will sell in the spring, and what's left typically goes through the sale barn. We’re scheduled to take our calves to auction on Thursday, but we aren't too hopeful about how big of a check we’ll bring home. As Gessner puts it, “2016 may be a year to forget.”

Of pre-conditioning, she writes, “Pre-conditioning allows calves to begin eating a concentrate or other grower diet and ensures the producer has completed all vaccination protocols. Most programs call for calves to be weaned for 45 days before being sold. There may be an opportunity for price improvement for pre-conditioning calves as they should have a lower risk for sickness compared to calves that were weaned at sale time.

“Producers considering this option must evaluate the feed, labor and management availability compared to the expected gain or improved market price received. There is an increased management requirement and additional risks of sickness and death loss during the first few weeks on feed. Unexpected problems during the weaning and starting phase can result in increased expense that may be difficult to recover at sale time.”

3. Backgrounding

Gessner says, “Depending on location, the method used to background calves can be very different. The protocols, expenses, feed resources and labor requirements for each method vary, so producers should accurately assess this option before implementing it as part of your operation. Many are familiar with backgrounding calves on grass over the winter on range ground and then selling these calves in early spring, or holding them through the summer and selling them as 'long yearlings.' Others will background in a feedlot system where the animals are fed a total mixed ration until they reach the goal end weight. Each of these feeding options has pros and cons to them and those need to be evaluated by the producer.”

The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Penton Agriculture.

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