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LESSONS Hard Learned

The best way to improve averages is to keep getting rid of the bottom 10, 15, 20%.

Used to be, if you wanted to make significant genetic improvement in your herd, you needed to focus on identifying and culling the bottom 20% of your cows based on the profitability (read weaning weight) of their calves. “The best way to improve averages is to keep getting rid of the bottom 10, 15, 20%,” opines James Henderson, the newest third of the highly successful Bradley 3 Ranch (B3R) at Memphis, TX.

But, adds Mary Lou Bradley-Henderson, James' wife, ranch partner and one-time employer, as well as daughter of industry icon Minnie Lou Bradley, the industry is on the cusp of changing that.

“With all our new technology, we're seeing more cattle in people's herds that are absolutely outstanding,” she says. “They're so advanced, they have all the meat qualities and they're so efficient I think we're just now beginning to understand how to identify them.”

We all want to identify the bottom end, she says, “but if you're talking about how ranchers are going to survive in the future, it seems like there are a lot of cattle that are very futuristic that we're not identifying.”

For the cow-calf producer willing and able to step into this new world of opportunity, the outlook is bright, they say. And they know of what they speak, for Minnie Lou and Mary Lou, along with then-B3R plant manager James Henderson, pioneered many of the “new” trends currently grabbing headlines in the business.

How it started

Mary Lou describes herself, back in 1986 when the Bradleys established the B3R packing plant in Childress, TX, as “another typical angry rancher.” Prices were low, profitability was scarce and cash flow tough to come by.

But shortly after joining the dark side and becoming a packer, she had a dilemma — she no longer knew who to be angry at.

“When you've walked in those shoes of having a seedstock operation, gone through the management of how to feed them and then you slaughter them, it's an eye-opening experience. Because until then, you can always blame somebody else. Once there's nobody else to blame, it's eye opening.”

B3R hung its hat on natural beef, which back in the late '80s and early '90s was looked upon with more than a little suspicion by most ranchers. B3R bought cattle on a value-based grid instead of the cash market, and sold a branded product with a consumer guarantee of quality. Participating ranchers had to individually ID each calf, and participating feedyards had to modify their practices to accommodate the changes in management. The learning curve was steep and the road had more than a few rough spots.

In 2002, they sold the plant to Coleman Natural Meats, taking their accumulated and hard-won knowledge back to their long-standing purebred Angus ranch. But make no mistake, their perspective is different and they're putting that to work to help the industry produce calves that will hit the mark at every stop along the marketing continuum.

What they learned

“At the end of the day, as a packer, I can turn that animal into protein,” Mary Lou says. “But I can't really change it. I can affect it a little bit, but I can't change it.”

So one of the first changes came early in their tenure as packers, and it happened on their own ranch.

“Our cattle were a certain way until the mid-80s,” Mary Lou says. But then they started processing them and attempting to sell the meat to a highly discerning consumer. “We were the seedstock and those cattle changed. They're (now) real long and thick because that's what we needed. That was ultimately what paid its way.”

A genetic reaction to marketplace realities. But the calves sired by Bradley 3 bulls still had to be fed. So what's more important in moving the needle toward consumer acceptability — genetics or management?

“We went round and round about how one affects the other,” she says. The outcome, after individually analyzing thousands and thousands of cattle and returning that analysis back to the feedyard and the rancher, is they're almost equally important. “You can have the best management and not have the genetic makeup, or you can have great genetics and mess it up by management and never get the benefit. But if you have the two together, you can get there.”

And getting there, defined as producing an eating experience that will encourage a consumer to buy it again, means genetics and management must be tightly linked. “When we first opened the plant,” Minnie Lou says, “it was my job to call a guy and tell him how the carcasses were. I'd have rather told him his kid was sorry than that his calves weren't up to par because he took that really personally. His cows weren't as good as he thought.”

Once the rancher got over that shock, James says, “he was ready to sell them all and start over. And you had to say, ‘Stop, wait a minute. You can't afford to do that.’”

But you can take some steps to improve your cows. “Even if it's just getting individual weaning weights on those calves and tying it back to a cow, that's a place to start. If you just load them up in a trailer and haul them to the sale barn and get a group weight on those calves, that doesn't tell you much about the performance of that cow.”

James says the key is to analyze multiple traits. “That's one thing we learned in the meat business — how much true variation in value there was in a calf crop, let alone across breeds and management techniques.”

In fact, there was so much variation that James says the plant learned early on that it didn't want to buy a ranch's entire calf crop. “That was one of the key things I learned in analyzing literally hundreds of thousands of cattle and 35-40 traits. There were certainly higher-value cattle in there, but you couldn't afford to pay higher value for the whole calf crop.”

The lesson learned is that to optimize the value potential of every calf in your herd, know its market potential. “We paid for everything on an individual animal basis, so if you sent me cattle that were of less value, you got paid less for them,” he says. Those cattle that couldn't compete on the rail would have returned more money at the sale barn where the cash market averages out value differences, he says. “It was those kinds of things that helped us to understand how that value variance makes a huge difference.”

Analyzing traits

So which traits to analyze? From a cow-calf perspective, James says, you still have to start at the ranch.

“Nothing makes a commercial cowman more money than a live calf and fertility,” he says. “Then, once you've got a live calf from a cow that can stay in the herd for a long time, how do you improve? How do you begin to hone in on things such as growth, energy or feed efficiency in the cow and then down to the quality parameters we have to have for the consumer to buy our product? All of that has to be in a package for a cow-calf man to make money.”

To that end, James encourages commercial producers to decide which traits are important to them, and then develop a genetic plan. “We see so many cow herds that have what I call ‘one for everybody.’ They'll have numerous different kinds of bulls and multi-colored cows and all kinds of variation within that cow herd.” You can work with your bull supplier, he says, to develop that plan and get started in emphasizing the traits that will pay you the most.

That's easier to do now that more comprehensive EPDs are becoming available for traits that go beyond simple performance. But true genetic analysis for a wide range of traits is still hard to get for most.

That's changing, James says. Cattlemen have talked for a number of years about tracking and tracing and looking at multiple traits. But outside of niche programs, the industry doesn't have the infrastructure in place to do it, “We're now, slowly, developing that infrastructure.”

Two big pieces still need to fall into place, he says, before widespread genetic information will be available to a large part of the commercial industry. “One of those is to understand all the markers that affect the things we've talked about from a genetic standpoint. We're still a ways from having that infrastructure in place where you can come to us and say, ‘here's the genetics I need, can you build those for me?’ But it's coming, and we're going to see that happen very quickly.”

The other piece is much more mechanical, he says, in that the industry has never had a way to track cattle in the packing plant and get that information back to producers. “And that's going to have to be accomplished in the next few years. We're going to have to get the structure inside a packinghouse where we can collect a radio-frequency ID tag, attach it to a carcass and get carcass data back.”

Once the industry breaks those two hurdles, the rest of the infrastructure is in place, he says, and the industry will have the widespread ability to make some real genetic progress.

In the meantime, however, there's still room for improvement. “One factor we use here is whether a cow weans in excess of 50% of her body weight. If she doesn't, she doesn't have a home,” James says. “And production and productivity will continue to increase because it still has room to. Standardized Performance Analysis data will tell you that we're still weaning about 82-83% of calves to cow exposed. That's a long way from really being good at what we do.”

Premiums vs. value

And then there's the breeding season. Even in a 60-day breeding season, Minnie Lou says, there's a big difference in dollars. “If you figure about 2 lbs./day from the time that calf's dropped until he's weaned. In a 60-day period, the last calf is going to be at least 120 lbs. lighter. That's close to $180. There's not a premium program out there that will pay that.”

James agrees, but cautions that chasing premiums may be like trying to rope the wind. “I don't think there is such a thing as a premium in this business,” he says. “I think there are differences in value in cattle and those are reflected by different programs. What you get paid for your cattle, is the value that's established for those cattle. And I think the concept of premiums and discounts in this business doesn't tell us where we need to be concentrating. If we look at those as being values, we can decide how much effort we want to put into reaping those rewards.”

James says we're going to see a much broader spectrum of values across the industry. In fact, it's already being seen in the sale-barn cash market, where properly managed cattle with the right genetics that are age- and source-verified are returning more value compared with calves that were weaned in the trailer on their way to the auction.

Indeed, James says, we're at a crossroads in the industry, “probably like we've not ever seen in our lifetime. There are a lot of factors coming together at one time that will decide the future.”

Question is, whose future will it be? That, he says, is up to you.