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Consider tried-and-true practices

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Watch each Friday for Doug Ferguson's Market Intel blog on Beef Producer and BEEF magazine.
Sell/buy has proven itself over time offering profit potential in today’s beef market.

This week some questions and comments from my daughter made me pause and reflect. First, she saw a guy making round bales using twine and she asked what kind of wrap that was. I gave her more of a lesson on the evolution of balers and twine, wire and wrap than she cared for.

She also started middle school this week and all her class information is on her phone. I made a comment that when I was her age the only thing on a phone was the important numbers mom taped to the front of it. This confused my baby girl, and she then got a lesson in rotary dial phones and land lines. I doubt she’ll be asking many more questions for the sake of she didn’t want to know that much about it.

These topics made me stop and think about the changes I have seen in my lifetime. I have often thought of what my great grandfather saw in his. He went from a team of horses to man on the moon.

Consider the pace of change

Then as my mind wandered while I was in the hay field this week, I imagined a man who was about 35 years old in 1922. And suppose we froze this man like in some sci-fi movie, and we thawed him out today. I then imagined him standing at the edge of a field and someone telling him to get in that tractor and plant this quarter, and to text in a few hours when he is getting close to done.

What would confuse him more? The tractor with all the technology of precision farming, or the fact that someone thinks a quarter could be completed in a few hours? I bet he ignores the part about texting.

Then I imagined we took this same man to a cattle auction. The old timers were well versed in sell/buy marketing. This man who was frozen in time could easily function there.

We hear all the time how things are changing, and most things are. Thing is something doesn’t get replaced until something better comes along. Some people have tried to replace sell/buy marketing with other methods. These other methods have failed.

We know they have failed because we now have a generation that thinks this is a labor of love, feeding cattle is a breakeven deal and cows and calves are only profitable 3 years out of 10. When I was in school anything below a 70% was a failing grade, so based off these statistics we have created a generation of highly educated dysfunctional incompetents. I say this because we have more people with college degrees than ever corkscrewing multi-generational operations into the ground, when it was a guy who barely had an eighth grade education that got the whole thing rolling to begin with.

Beef marketing paradigms matter

Right there highlights why I spend as much time as I do talk about paradigms. It is the paradigm that gets the result not the level of education. Let’s be honest, most of these people have these credentials so they have something to fall back on. That right there sounds like a plan to fail. We know what their paradigm is. If cattlemen today had the same paradigm and skills as our 1922 throwback, I am sure we’d all be much more successful. Have you noticed a saying that has been circulating around for the last few years “what is old, is new again.” Sell/buy marketing is the oldest form of marketing there is, and it has survived this long for a reason: it works

Some of you may be really upset that I am suggesting someone from 100 years ago could do better. Look at it this way, when our throwback was raising livestock, he didn’t even have penicillin, and today we have magnificent drugs and vaccines yet pull rates and death loss have gone up. We even have a term “mass med” that this guy would question.

To close the loop on my thought this week I understand that humans love to copy. Some of us embrace change and other resist it fiercely. Let’s just be sure that if we copy we copy highly successful people and if we implement changes let’s be darn sure the changes are for the better.

Cattle market review

This week when we look at the markets there is a quote from an Oklahoma cattle buyer that sums things up well “it sounds like October”. While I understand it is painful to be forced to sell calves earlier just to stretch grass, the prices do not reflect that of a desperate drought sell off. It is clear there are multiple buyers located somewhere that have feed.

Another cattle buyer told me this week he is seeing an unusually high percentage of heifer calves moving in the area. When we couple that with the volume of cow slaughter, we can break character on this blog and make a prediction: something very different is going to happen than what we are accustomed to. I really let the cat out of the bag with that one I know. Point is this is something worth paying attention to. Relationships are going to change, and it could really help us to prosper, or hurt us if we aren’t paying attention.

This week Value of Gain (VOG) was all over the place with no consistency. One sale would have a VOG of well over $2 between four and five weight steers, while the next sale only had a VOG of 40 cents. To a sell/buy marketer this volatility only means one thing: great trades are possible if you’re shopping. Another thing that really stood out was geographical spreads. The last thing of note is the ever increasing abundance of leap frog trades that are possible.

This week feeder bulls were 5-15 back and unweaned cattle were 6-20 back. The bigger the bawler the bigger the discount. All that performance bred in actually cost money, instead of making money.

We have plenty of room for our upcoming Deadwood, S.D., marketing school. If you would like to learn these old, and proven marketing skills get registered soon. This school will also feature a pasture tour with Clay Conry, host of the Working Cows Podcast.

Heading to Husker Harvest Days? You can catch Doug Ferguson live each day at 12:15 has he offers ways to put more money in your wallet with sell/buy marketing. And it’s your chance to talk with him each day. Husker Harvest Days runs Sept. 13 – 15 near Grand Island, Neb. Make plans to attend.

The opinions of Doug Ferguson are not necessarily those of beefmagazine.com or Farm Progress.

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