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Articles from 2000 In February


B3R Country Meats Puts Dollars In Producer's Pockets

Squeezing more jingle out of the cattle business isn't for everyone. But, for those who want to pump up the bottom line there are still plenty of opportunities that cost little more than an open mind, a sharp pencil and some brain sweat.

Just ask Bob Bachman, vice president and manager of Agri-Ventures Corp., Graham, TX. Frustrated by the average-based marketing system, Bachman started sending cattle through B3R Country Meats at Childress, TX. He wanted to find out more about his cattle, while shooting for extra returns based on carcass merit.

Last year, some of those cattle earned over $100/head premium and a few lost over $100/head. Overall, however, he pocketed another $21.11 average/head, just for carcass premiums. B3R also pays premiums for dressing percentage and for the non-implanted cattle their product requires. Total premiums paid last year averaged $61/head.

"When producers see how much the top third of the cattle make, there is a lot of incentive to get rid of the bottom third and to move the entire group toward the performance of the top third," says Neal Odom. He's manager of McLean Feedyard, McLean, TX, currently the exclusive feeder for B3R.

Indeed. With about 300 head in each cut - steers and heifers combined - Bachman's top third averaged $32.70/head for carcass premium last year, compared to $8.73/head for the bottom third.

And, those premiums pale in comparison to identifying the most efficient cattle in the feedlot and pasture.

"There is the potential to increase the income at least another $110-170 per head," says Odom. He's alluding to the added promise of everything from reducing health risk entering the feedlot to chopping an extra cycle off of a long calving season.

Moreover, Bachman says the individual feedlot and carcass data that B3R provides free, in tandem with his individual cow records, give him firmer control of genetic selection.

"It helps confirm my ideas on how to mesh the traits of the cows together because an ideal carcass animal is not necessarily an ideal brood cow," he explains. In fact, economic incentives are strong enough that he has used DNA to identify which bulls sired the top and bottom ends ofhis cattle.

Going Full Circle "We're trying to get it to where the cow herd is working for the rancher and not the other way around," says Mary Lou Bradley, B3R president. She founded the company in 1986 with two simple goals: Help ranchers make a living and provide consumers with the same kind of tender beef she and her family always ate at home.

That's not lip service, either. As the fourth generation at the Bradley 3 Ranch near Memphis, TX, Bradley was looking for a way she and other folks like her could avoid being the last generation on the family ranch.

"There is no silver bullet to any of this. It's a matter of understanding all the dynamics," says Bradley. Rather than build a system that focuses solely on paying carcass premiums, B3R builds long-term partnerships with producers, sharing information back and forth that can help everyone in the system make more money. This full-circle approach, she explains, means dissecting the interrelated genetic, environmental, nutritional and economic opportunities that exist in every operation.

B3R and its production partners are just as likely to share grazing management tips and early weaning techniques among the innovative network - anything that impacts the end product and bottom line - as they are to visit about premiums on the last set of cattle.

"The vision is to find those people who have a goal not only to raise good cattle, but to know they have good cattle by gathering information; people who truly want to improve their herds," says Bradley. "Some come seeking help and some come to teach us."

Currently, B3R works with 150 ranchers in 18 states. Not bad for an operation that was harvesting seven head per week in 1986. Some time back, B3R passed up 90 head per week.

"Growth this year is the largest in our history, and that's not counting new customers," says James Henderson, B3R manager. "People buy it the first time because they want a product that hasn't received any antibiotics or growth hormones. They buy it the second, third and fourth time because it tastes good."

Peek into the company coolers and you'll find consistency is also a customer hallmark. Up and down each rail, the uniformity of carcass size, fat, ribeye and marbling is remarkable.

B3R is after Choice and better, high yielding cattle that will reach acceptable harvest weights at 18 months or younger without ever receiving antibiotics or growth hormones. Cattle must be preconditioned and weaned for 45 days before entering the feedyard.

Along the way, producers follow defined management protocol and sign production certificates for every set of cattle. This provides the foundation for the company's quality assurance trace-back system that B3R uses to enhance consumer confidence.

But B3R doesn't control production as much as build a system of consistency.

"The thing I see is that so many branded beef programs want to control the production end in order to control the consistency of the product. Our philosophy has been to provide the incentives to produce what our customers want, and to teach producers how to do it, rather than control the production," says Henderson.

"So we teach ranchers to look at each cow as an individual investment, then when one cow is returning $1,000 and another is returning $500, the decision making gets real easy," he adds.

Moreover, decision-making is made easier since B3R targets rarely change. Unlike most value-added systems, B3R's pricing grid remains relatively constant so that consumers get what they want consistently and producers have the time and incentive to push more cattle toward the bulls-eye.

Getting Started "Participating in the B3R program is not something where you can just pick up the phone and decide you're going to send cattle next week," says Odom. In fact, cattle entering the program must have a reservation number at the feedlot. And, reserving space means taking the time to get acquainted.

For one thing, Bradley explains, "The more we know about your cattle and the more you know about us, the more predictability we all have."

Keep in mind that while some B3R partners buy cattle to feed from time to time, either outright or in partnership, the bulk of B3R's supply comes via retained ownership. So first-timers represent as much risk to B3R as their value-added system does to folks who don't know how their cattle perform.

"Because we're such a niche market, we don't have the diversity of larger programs. If cattle come here that are out of our norm, it's a wreck... An outlier is an outlier. It costs everybody money," says Bradley.

Unlike branded programs with broader specifications, B3R can't skim feedlot pens to pick up supply slack. They must know cattle will qualify for their narrow acceptance window when they go on feed.

Likewise, Bradley says, "You can make a lot of money feeding cattle and you can lose a lot of money. We don't encourage people to come to this program if they've never fed cattle before."

With that in mind, anyone interested in B3R will usually find their first inquiry going like this: Have you fed cattle before? If you have, how do they perform in the feedlot and on the rail? How long is your calving season? Do you implant your cattle? What are your goals? Why do you want to be a part of this program?

If interested producers have never fed cattle before, Bradley recommends they at least send some through a ranch-to-rail program.

"These programs are designed to educate you on a small enough scale that it can't bankrupt you," says Bradley.

Once a partnership is forged, however, participation is fairly simple. Bachman, for example, never did make antibiotics a part of his preconditioning program. And, he quit implanting his cattle several years ago, believing it added to the variation of his carcass quality. Besides, he points out B3R pays a premium to offset performance lost by not implanting.

On the other end, the only added fee is $5/head charged by the feedlot to cover added costs of managing cattle for the program. These costs include residue testing cattle upon receiving and shipment.

"It's a comprehensive program," emphasizes Odom. "It really fits people who have a long-range commitment. Someone who just does it one year and gets out will get some useful information, but there is a learning curve to all of this. The real benefit to the program comes in the long-term."

For more information about B3R Country Meats, call 940/937-8870.

Tools of the Trade

In a world where categories are demographed, sub-demographed, psychographed and niched to death, you'd think selecting the best risk management tools would get easier. That's not necessarily so.

"Risk management is a broad topic and it's becoming broader," says Ted Schroeder, agricultural economics professor at Kansas State University. "It used to be that we talked about price risk management and production risk management, but both have grown into multifaceted issues with a variety of evolving tools to help manage risk."

Schroeder says keeping up to speed on basic risk management practices is no small task itself. And, he adds, there are new risk management tools right around the corner that will offer more alternatives than we previously imagined.

Basics No matter how many risk management tools crop up, they all start with the basics. There are four basic sources of risk when it comes to feeding cattle, Jose Pena, a Texas A&M Extension economist in Uvalde, TX, says. They are: 1) price, 2) death, 3) performance and 4) weather. Making sure your customers understand them will help them make realistic risk management decisions.

"What you do with all these factors is 'safe side' your risk and in your analysis, have a best estimate of what each factor might be and how it will affect you or your customer's desired goals," Pena says. "For example, with price risk management, you determine an 'in' price and 'out' price. Then, based on experience and quantitative information, determine what effects each of the risk factors will affect what you need to make a profit.

"Things that will have an effect on determining out prices include rate of gain, cost of gain, average death loss, genetics and the type of market where the cattle will be sold."

Manage What You Control Along the same lines, Schroeder says it's important to understand there is no single, best strategy for managing price risk, or any risk for that matter.

"The whole idea of economic risk management is to reduce the risk of returns going in the opposite direction you desire," he says. "It's best to manage things that can be controlled. That starts with genetics, information management, cattle management and basic production practices."

Once these are in place, Schroeder says to determine markets where you can best match the value of the cattle being marketed.

That's one area where alliances come in. Schroeder says while alliances don't offer profit guarantees, they can significantly increase the amount of information producers have about cattle performance and quality. Generally, risk can only be reduced by giving up potential returns. However, increased information helps producers better target cattle management and marketing. This potentially reduces risk, while increasing profit.

Customers Must Understand It won't matter how good your risk management skills may be unless customers understand the recommended practices, their responsibility and your responsibility, Pena says.

"Be willing to satisfy all variables with good communications," he says. "For example, tell customers you've got enough grain forward contracted for a specific time period so the cost of gain estimate will be as accurate as it can be. Make sure they understand how you've arrived at your loss estimates. A feedyard manager's bedside manner will go a long way to establish credibility, especially to customers new at using risk management tools."

Local Extension service offices offer risk management publications that cover the topic from the most basic contracts to the most advanced.

The Future Making sure customers know the basics will help when new risk management tools are launched.

Schroeder says new tools for those with strong needs to reduce risk, such as highly-leveraged operations, are on the way. Referred to as complete cost revenue management insurance, the practices will allow cattle owners to better secure production and price variables.

As with all risk management alternatives, this insurance will be more desirable and useful for certain circumstances than others. The key is to understand the risk management opportunities being offered and to be realistic about the amount of risk you face and can afford.

Despite the advent of new tools, producers and feeders will still be subject to global price movements, he says. That reality simply increases the need for a solid risk management plan.

More information to help get customers started using risk management is available from Extension services, independent brokers and these Web sites:

Kansas State University:

http://www.oznet.ksu.edu/library/

Oklahoma State University:

http://agweb.okstate.edu/pearl/agecon http://ansi.okstate.edu/EXTEN/BEEF/

Texas A&M University:

http://animalscience-extension.tamu.edu/frameset.html

Texas Cattle Feeders Association:

http://www.tcfa.org/

It is critical for customers to understand the tools used for managing risk. A continual review of terms can be helpful to those who use risk management infrequently. The following checklist offers sample marketing terms defined by Texas A&M University and Kansas State University.

Cash Market Basis - the difference between a cash price and a futures price of a commodity on a given futures exchange. Calculated as: Basis = cash price minus futures price.

Basis contract - an agreement between a producer and feedlot that specifies the cash price upon future delivery as a fixed amount above or below the futures price, fixing the basis.

Deferred payment - a delayed payment on the sale of a commodity from the producer to the buyer, with the price to be determined later.

Forward contract - a contract for the cash sale of grain at a sp ecified price for future delivery.

Minimum price contract - a contract that establishes a minimum, or floor, sale price and allows the seller to capture a higher price if prices rise.

Futures Market Carry spread - when the nearest futures month is trading at lower prices than a distant futures month.

Carrying charge - a futures market condition in which distant futures contracts are trading at higher levels than nearby contracts and above cash price offers. Often indicate a surplus.

Clearing house - an agency of the futures exchange responsible for matching purchases and sales.

Delivery - the settlement of a futures contr act by receipt of the actual commodity.

Delivery month - the specified month in which delivery can be made under the futures contract.

Making Trades Market order - instructs the broker to immediately execute an order at the current price in the pit.

Limited order - an order that has a time or price restriction to its execution. Stop-loss order - an attempt to limit risk by placing a liquidation order if the price moves to a specified level.

Options Call option - gives the buyer the right, but not the obligation, to purchase an underlying futures contract at the strike price on or before the expiration date of the option.

Exercising options - initiated by the buyer of an option when he takes ownership of the underlying futures contract at a specified price. The seller is obligated to take the transaction.

Expiration date - the day when the option holder loses the right to exercise the option.

Offset - the liquidation of an options contract position.

Put option - gives the buyer the right, not the obligation, to sell the underlying futures contract at the strike price on or before the expiration date.

Strike price - the price at which the option holder may ee underlying futures contract.

Designing Breeding Systems That Work

One of the key principles in Stephen Covey's book "Seven Habits of Highly Effective People" is to start with the goal in mind. This management approach is aptly applied to the development of a breeding system.

Determination of the breeding program goal(s) involves a careful evaluation of the production resources at the farm or ranch as well as the demands of the market channel(s) through which cattle are sold. Beef cattle producers must address a number of considerations as they design a mating system appropriate to their individual enterprise. The following factors should be considered:

* What is the most appropriate grazing system for the enterprise? What are the issues associated with duration, frequency and timing of the grazing system that may limit or be in conflict with the mating system alternatives?

* What proportion of total farm income is derived from the cow/calf enterprise and what times of the year do other enterprises compete for a producer's time?

* What is the cost and availability of labor?

* How much complexity can be effectively handled by management?

* How important is simplicity?

* What is the availability of bulls from desired breeds or composites?

* What is the feasibility and cost effectiveness of utilizing artificial insemination?

* What is the marketing plan for the enterprise?

Producers have a variety of mating system alternatives from which to choose. The most simple approach is straight breeding throughout the herd. The primary advantage is, of course, convenience.

But, the producer gives up the opportunity to make effective use of two powerful genetic tools - heterosis and breed complementarity. Effective crossbreeding systems take advantage of both of these genetic tools.

Heterosis is the performance advantage of crossbred progeny as compared to the average of the parental breeds involved in the cross for a particular trait. In essence, the value of heterosis is manifested in the ability of a crossbred animal to better deal with stress.

Heterosis is expressed individually in crossbred progeny, maternally via the use of crossbred females and paternally through the use of crossbred or composite bulls. Reproductive performance, calf survival and cow longevity are traits where the benefits of heterosis are greatest. Moderate positive effects are also obtained in the growth traits (Table 1).

The concept of breed complementarity is founded on the premise that no single breed excels in all economically important traits. As such, the careful matching of breed strengths and weaknesses can yield progeny with the optimal combination of traits. However, implementation of an effective crossing system requires thorough planning, may increase the intensity of management and must account for the resource limitations of a particular farm or ranch.

The goal at the ranch is to assure that the cowherd is well matched to the environment with particular attention to the forage resource. It's important to recognize that crossbreeding is not a "silver bullet" for cattle breeders. In fact, crossbreeding efforts may fail to produce favorable outcomes.

The late Bob DeBaca suggested that the primary reasons for failures in crossbreeding were:

* Over-use of individual beef cattle breeds that have too much in them - too much growth, milk, birth weight or mature size.

* The mating system was either too complicated or wasn't implemented in a systematic manner.

* Seedstock producers failed to develop the expertise and service orientation to assist their clients in development of effective crossbreeding systems.

* The use of poor quality bulls in a crossing system will not yield desired results. Selection of bulls must be based on an objective set of criteria that allows the identification of superior sires.

Producers should keep two general targets in mind when developing a mating system - what are the requirements for profitability at the cowherd level (typically involves cost controls), and what are the requirements of the market place?

One of the most significant challenges facing commercial producers is that of overcoming the genetic antagonisms between maternal and carcass traits that were described in the article "Can Both Be Achieved?" on page 6. As such, producers should critically evaluate the environmental and market risks as well as the resource limitations associated with their enterprises.

The selection of breeds and sires within those breeds should be made with a goal of matching the genetic potential of the cowherd to the available resources. For example, a cow-calf enterprise in the semi-arid West is likely to have vastly different forage availability than a herd in northern Missouri.

Montana State University's Don Kress, and Mike MacNeil at USDA's Fort Keogh Livestock and Range Research Laboratory in Miles City, MT, illustrate the process of matching biological type to environmental conditions in Figure 1. Ranges in annual precipitation are utilized to delineate acceptable levels of milk and mature size.

When rainfall is limited (<12 in.), the options in cow size and level of lactation are limited to cows with mature weight less than 1,100 lbs. and milk production less than 15 lbs./day.At the upper end of the precipitation scale, larger cows capable of higher milk production may be acceptable.

In essence, as forage availability becomes more limited, the risk of reproductive failure due to mismatched biological type increases. Additionally, if producers are participating in marketing systems that require conformance to a specific set of post-mortem targets, then it becomes more important for producers to match their selection strategy and mating system to those criteria.

The benefits and requirements/drawbacks associated with a variety of crossbreeding systems are outlined in Table 2. The use of either two- or three-breed rotation systems (Figure 2) yields a relatively high level of heterosis for pounds of calf weaned per cow exposed to mating.

The most notable challenges associated with these systems include the need for multiple breeding pastures and a narrower range of breeds from which to choose due to the fact that daughters from each rotation are maintained as replacements. Furthermore, the male calves from these systems tend to be moderate in growth rate and carcass cutability. Thus, marketing flexibility may be reduced.

The use of disciplined terminal crossbreeding systems (Figure 3) is under-utilized. The inclusion of a terminal sire cross in a herd using a rotational system overcomes the shortcomings associated with the rotational system alternatives. All progeny from the terminal cross are marketed with none being retained as breeding females.

Note that in Table 3, the degree of conformance to the generally accepted carcass targets (70% YG 1 and 2, and 70% Choice or better) is highest in composite populations that are composed of 50% British breed and 50% Continental breed influence. This ratio can also be optimized in about 75% of the progeny produced by terminal sires in terminal crossing systems involving either rotational cross or composite maternal populations.

In terminal crossing systems involving British maternal populations and Continental terminal sires, steer progeny from British breeds are well suited to market targets emphasizing quality grade. Meanwhile, steers and heifers from the terminal sire breeds are more optimal for targets emphasizing the combination of yield grade and quality grade (=70% each). In many regions of the country, especially where the need for Bos indicus influence is important, the terminal cross may well be a British breed bull.

The selection of the proper breeding system is essential to hitting both the cowherd and market animal objectives and will contribute significantly to the overall sustainability and profitability of the farm or ranch.

Raising Replacement Heifers

Spann Ranches currently operates two separate cowherds: a Hereford herd that we breed to select Angus bulls for our own black-white face (BWF) replacement heifers, and a much larger BWF cowherd that we breed in a textbook terminal cross fashion to Limousin bulls and whose replacements come strictly from our Hereford herd.

While we could purchase replacement heifers that on paper might look cheaper and more profitable, the reality is that finding a source that can consistently deliver top-quality bred heifers to our specifications in volume is a very tall order.

Our replacement heifers are required to breed natural service in a 40-day breeding season. They're individually pelvic measured and must meet a minimum pelvic area to be retained.

Our purchased bulls must have birth weight, weaning weight and yearling weight Expected Progeny Differences (EPDs) in the top 10% of their breed. We use the bulls as yearlings and expect the heifers to bear those bulls' calves their first year.

We cull year-round for disposition, structural soundness and frame. Additionally, once a replacement heifer is selected as a replacement, she has to continue to earn the right to stay in the herd.Our philosophy is that she has one beside her or in her, or she doesn't belong to us.

With the advent of better feedback from the feedlot and packing sectors, we've begun supplementing, but not replacing, our own demanding reproductive performance standards with meaningful criteria reflecting feedlot performance and carcass values.

Our herd production goals are all Yield Grade 1 and 2, 70% Choice, slaughtered at 14 months of age, feed efficiency of at least 5.5:1 on a dry matter basis, and 4.0 average daily gain or better. The real bottom line, however, is maximum herd profit obtained on an individual basis with high repeatability. That means no "out" cattle of any kind.

Our system of developing our own replacement heifers and maintaining our cowherd in a commercial setting is expensive and labor intensive. It demands a commitment to quality and management at a very high level and is not for everyone.

The payoff has come in a number of areas: much lower calving difficulties with relatively large birth weights, higher overall herd health and lower annual death loss. In addition, we have consistency in both the cowherd and resulting calf crops, heifers that will rebreed while raising a 500-lb. first calf, and feedlot performance and carcass values that enhance retained ownership profits, thereby lowering the risk. Ultimately, it enhances our long-term profitability.

Y2K calving has begun

December was a busy month. We raced against time to get Michael and Carolyn's new house finished before Christmas so they could get moved in before we start calving. It was a photo finish as the carpenters got the inside done the week before Christmas. Lynn got the pump hooked up and working, and the carpet layers finished Dec. 23.

Our son and his family slept there that night. They celebrated Christmas in their new home. Andrea, Jim and little Emily spent Christmas day with us. Em, not quite two years old, enjoyed helping all of us open our presents - when she wasn't busy playing with her new little plastic horses or galloping her new stick horse around the living room.

We've been a little slow getting everything ready for calving. The cows, however, won't wait. At least we got the big barn emptied and bedded with straw before the first calves arrived.

The first ones were not due until January 8 but we moved all the heifers into the maternity ward two days before Christmas to be safe. We also brought the cows to the big holding field Dec. 26, sorting out a few of the earliest calvers on the way by. We have breeding dates on almost all the cows, which really helps when sorting the herd.

We started our night shifts - Jim and Andrea checking the cows until about 2 or 3 a.m. and then I get up and watch them the rest of the night (and get Lynn up to help me if I need to get a cow in or have a problem delivery). It will get a little easier once Michael and Carolyn can help fill in.

The first two calves to arrive were from heifers (calving 7 and 8 days early); one arrived late evening January 2 and the other a few hours later at 2 a.m. Both were born swiftly and easily without help, and nursed quickly.

But the mother of the little bull calf doesn't have much milk. I thawed some colostrum and gave him an extra 11/2 quarts. He's three days old now, and still not getting enough to eat; we are giving him supplemental bottles.

This is an unusual problem, since our crossbred heifers usually milk very well. This big heifer, however, was sired by a Canadian Angus bull we didn't keep very long, since he was a bit wild and also growing much too big. He was also a hard keeper - as a yearling he couldn't keep weight on like our own young bulls we raise on pasture.

We generally try to look at the mother of any bull we buy, since a bull's daughters tend to inherit a lot of her characteristics such as udder shape and milking ability. But we didn't have an opportunity to find out anything about this bull's mother. I'm glad we only kept one daughter from him!

Last night, one of Michael and Carolyn's cows calved - twin heifers. It's the first set of twins they've had in their herd in four years of calving, so they were pretty excited. With help, both calves nursed the cow all right, and she is mothering them both.

Artificial Insemination Can Get You There

The past 60 years have seen many advances in the field of reproductive biotechnology, including artificial insemination (AI), embryo transfer, sexed semen and cloning.

One of the oldest reproductive technologies available to beef producers - and perhaps the most valuable tool for meeting production and economic goals - is AI.

However, less than 10% of U.S. beef producers currently use AI. In contrast, the use of AI has played a key role in the 256% increase in milk production per lactation in the dairy industry. And, the swine and poultry industries have made similar improvements in feed efficiency and product consistency.

Why are beef producers so reluctant to use AI? A recent Colorado State University survey of Colorado beef producers found they thought AI was too costly, too labor intensive and too time consuming. Others felt they didn't have adequate facilities, didn't know enough about the procedure or were concerned about lowered conception rates.

Granted, AI is more time consuming and labor intensive than simply turning the bull into the cowherd. But, AI allows producers to take advantage of superior genetics for growth, carcass and maternal traits to produce functional females that fit a given environment and produce slaughter offspring with the desired growth and carcass merit fitting the targeted market.

One example where AI can be used to increase production efficiency goals is a system using a rota-terminal crossbreeding scheme (F1 female crossed with a terminal sire breed. This would allow producers to use AI in the youngest cows. This takes advantage of superior, high-accuracy genetics for maternal traits to produce F1 female replacements while turning out a terminal sire on the remainder of the herd to produce calves meeting market specifications for growth and carcass attributes.

Commercially available sexed semen can make the above breeding scheme even more efficient. Producers could obtain a higher percentage of heifer calves from the AI program and eliminate many of the "by-product" F1 steers that fail to fit market specifications for growth and carcass merit.

Sexed semen would potentially allow producers to make use of superior growth and carcass genetics to produce male slaughter progeny from mature cows while taking advantage of maternal and calving ease genetics to produce female offspring out of younger cows in the herd. Those currently using AI will be the first to benefit from sexed semen when it's available to commercial beef producers.

AI is more costly, but it is not as costly as one might think. Estimated AI costs are about $5.55 more per pregnancy when compared to natural service. Remember in comparing costs that AI allows for the use of proven sires of known superior genetics and decreases the genetic risk associated with unproven, young sires.

Everybody knows a chain is only as strong as its weakest link. The same is true about AI. This chain is made up of four important links - cow fertility, semen handling and quality, AI technician and heat detection. If we do a good job in each of these areas, we should have a successful AI program resulting in pregnancy rates as good as those associated with natural service. Failure in one area can have disastrous effects.

AI requires a considerable investment in time and resources, but allows access to the most accurate and genetically superior sires available. The use of trait leaders will increase the speed of genetic progress and reduce the probability of genetic errors.

In the end, AI has the potential to empower the beef industry to produce the level of product quality and consistency demanded by consumers.

* Cow Fertility

Moderate to good body condition.

Effective vaccination program.

On gaining ration during breeding season.

* Semen Handling And Quality

Avoid unnecessary and extended exposure increased temperatures and UV light by:

-Assuring thaw water temperatures between 95 degrees and 98 degrees F.

-Thawing times of no less than 30 seconds and no more than 15 minutes.

-Drying straw thoroughly.

-Warming AI gun prior to use.

* AI Technician

Practice to become confident in your skills.

Hire skilled technician with proven pregnancy rates.

* Heat Detection

Check for a minimum of 30 minutes twice daily.

Estrous synchronization and heat detection aids may be useful.

The seedstock industry is the source of genetic improvement for the entire beef industry. The use of AI allows seedstock producers to rapidly and cost effectively propagate superior genetics. Seedstock producers who use AI will continue to have a decided advantage over those who don't in providing their customer with genetics that enhance their profitability in the pasture and on the rail.

Here's why AI use is growing:

* Estrous synchronization - more successful and user-friendly methods being further developed and used.

* Value-based marketing - pays premiums to commercial producers; therefore, it pays seedstock bull suppliers to raise superior cattle.

* Vertical coordination/integration - leads to more economies of size and an ability to adopt and use AI and other advancements as they become increasingly profitable to use.

* Sexed semen - increase calving ease in heifers by breeding for heifer calves, increase rate of genetic improvement, more efficiently produce maternal and terminal lines.

Like any other business, a commercial cow/calf operation needs goals focused on profitability and quality of life with a flexible plan to achieve those goals. Using AI and other technology can help facilitate this process.

In fact, when dealing with genetic advancement, without these tools it may take too long and cost too much to improve our cowherds to produce calves that consistently hit market specifications and have cows that are functional in our differing environments.

Technological advances have made carcass data collection affordable and more easily attainable. Producers can find alliances, auction yards or buyers that will help with this process. Once you know what the cowherd genetics are producing, one can then make decisions on how to best hit market and cowherd targets.

AI is an old technology but it's used by a small number of producers. Seedstock producers make rapid genetic advances through AI by matching EPD values and applying them to a large enough population to verify accuracy.

For the commercial producer, many studies have proven the benefit of AI use to complement a natural sire breeding program. AI offers the use of high-quality sires at low cost with knownand measurable traits.

>From a practical standpoint, a commercial cow/calf producer can use AI >where there are available facilities, easy access to the cowherd and a >willingness to commit to the program. At the very least, one should be >familiar with AI and select bulls from programs that utilize AI for >genetic supply and advancement. Once embarking on an AI program, the >producer should consider keeping the genetically superior heifer calves as >replacements.

The economic signals today focus on marbling. The markets are paying high premiums for Choice and Prime cattle. The recent concentration on maximizing growth and muscling, making cattle bigger and leaner has sacrificed the ability to marble.

Bigger cows can only adapt to a high-input environment. The good news is that moderate-sized cows selected for reproductive and maternal efficiency are more adaptable and often have more marbling.

AI sires are available that have accurate information on carcass, growth and maternal characteristics. It's important to balance increased marbling ability with other characteristics and not lose sight of the "big" picture.

For the last 32 years, we have used AI on a closed herd and measured that herd's performance. We select the better AI-sired calves for bulls to breed on our commercial cows and retain ownership on those calves to the rail. This gives us carcass information that along with the measured growth performance allows us to make genetic decisions that respond to the marketplace. Although most of our genetic selection occurs with the grandsire of the marketable calf, we are still able to make rapid changes and advancements.

Because not all breeds have carcass trait information, we've used other measurable traits to indicate the ability to marble when crossbreeding for hybrid vigor. The sooner more breeds generate accurate carcass data, the better job producers can do breeding cattle that meet specifications.

Profitability for the future hinges on an industry that is consumer focused. Market specifications with premiums and discounts will increasingly be the signals that producers use to make improvements.

Look for new advancements for measuring tenderness and be ready to implement them into a breeding program. AI use and technology are low-cost, effective tools to move the industry product in the right direction.

A Role For Composites

The 1990s have been a time when our industry has been looking for the "silver bullet" to cure all that ails us. And, programs are starting to add value to our product by paying us "what they are worth."

One question worth asking is "worth to whom?" Who actually does and who should establish the true value of the product we produce? For the cattle producer, establishing and receiving a true consumer-driven value will prove to be the challenge for the coming decade.

The rise of grid and formula programs has paid added value over the current market. How much value was actually added to the calf at the time it left the ranch is hard to say, and it can be debated whether it has added anything at all.

The fact is we must still be consistent in our attempt to lower production costs while increasing the demand for and value of the finished product. Weighing input costs vs. any premiums received is key in establishing whether or not we have met the target and/or were cost effective in doing so.

There are a great many antagonisms within our industry. Attempting to produce carcass animals that are highly desirable under our current system can sometimes lead to lower fertility, higher maintenance requirements and lower milk production in cowherds where females are retained as replacements.

All this lowers the productivity and, more importantly, profitability of the cowherd. In meeting certain targets with our cowherds, it's important we do not actually decrease our profitability.

The formation of a composite breeding herd program at Schroeder Cattle Co., began in 1978. The goal was to use the best in scientific research, genetic selection and breeding. The aim was to develop highly fertile animals that would gain quickly and efficiently, and produce desirable carcasses at a low cost of production.

Breeds with the desired composite characteristics were defined, and individuals within those breeds were chosen to meet these goals. Discipline had to be strict to avoid selection of outlying individuals that would not allow us to meet our goals.

The formation of a four-breed composite allowed us to utilize heterosis from generation to generation and become more efficient. We obtained our market target of producing carcasses within the top parameters of the industry by blending breeds known to produce such traits. Our composite allowed us to produce a desirable product for all areas of the production chain, faster and at a lower cost than more traditional programs.

To date, progeny from our composite program have been tested in all areas from conception to the rail. Replacement females are selected from within the gene pool while steer mates are tested for carcass traits.

Due to heterosis, the composite has proven to produce females with excellent fertility and longevity. Less maintenance is required for these females to obtain a level of production above that of their non-composite counterparts.

Steer mates are fed to finish and their carcass and feedlot performance evaluated. Over the past 12years, the steers have averaged 74% Choice and 79% Yield Grade 2 or better, slaughtered at 12-14 months of age.

It's essential to not give up cowherd productivity to single-trait selection for carcass traits that may have little payback to offset added production and maintenance costs within the cowherd. We feel that desirable carcasses can be obtained from cost-efficient cows with a properly planned and developed breeding program. The key is knowing your costs of production and the most efficient means of reaching your objective.

Composite cattle will continue to be used more extensively in progressive programs. A silver bullet? Probably not. But, certainly it's an option that many producers will look at to load their gun in the future.

As cattlemen design breeding programs, the resulting level of heterosis becomes a primary objective. But, how much heterosis do we need?

I think it's really quite simple. Plan your breeding program to capture as much hybrid vigor as you can, while considering the economic implications of those decisions. In other words, I can design a complicated breeding system that results in consistently high levels of heterosis. But ask yourself the following questions:

* Are the animals marketable?

* How does it impact my grazing system?

* What about labor resources?

* How many breeding pastures?

* How many seedstock sources do I need to identify?

* How much labor is required to manage the system?

* Is my herd large enough to manage a rotational cross or terminal system?

* Do I want to raise or purchase replacements?

As a student, I learned a variety of complex crossbreeding systems that allowed producers to capture heterosis as well as take advantage of breed complementarity. Yet, as I travel through the U.S., I rarely see them implemented. More typically, you see the "Heinz 57" herds - I call them members of the "breed of the month club."

But complicated breeding programs are extremely difficult to implement. Simplicity is essential, especially in range country or with small herds.

I became interested in using composites as an alternative to complicated crossbreeding systems primarily because of their ability to fit into a controlled grazing system with minimal labor, coupled with breed complementarity. Composites fit the "low input" philosophy that I think is essential to profitability in the cow/calf sector.

The level of heterosis achieved with composites is not as high as the traditional planned crossbreeding system, however, the tradeoff must be predicated on solid economic planning.

Chasing a high level of heterosis as a single goal is not advisable. It makes no more sense than single-trait selection for any trait. Optimal levels of heterosis are dictated by management, labor, natural resources and marketability of the end product.

The Heat Is On

How successful is your AI program? Getting the results you'd hoped for? If not, success may be just around the corner.

The most limiting factor in a successful AI program lies in the accuracy of heat detection. Pregnancy rate is usually the measure of a successful AI program. Pregnancy rates, however, are determined by a combination of accurate heat detection, inseminator efficiency, female fertility and semen fertility, with heat detection being the most important.

"The most fertile semen and the best inseminator in the world can't overcome the problems of inseminating cows at the wrong time," says Tom Geary, a researcher with USDA's Agricultural Research Service at Fort Keogh in Miles City, MT.

Visual heat detection is the most widely used method of detecting estrus in beef cows. But, Geary says most producers need to make some adjustments to their heat detection protocol in order to increase accuracy and efficiency.

"There are several reasons why we miss heats with visual detection alone," says Geary. "The main one is we don't spend enough time observing cows for signs of estrus."

To avoid inseminating cows at the wrong time, an estrous synchronization program can be very effective. Estrous synchronization can shorten estrus detection from a 21-day window to a five-day window. Not only does synchronization reduce the number of days spent visually appraising estrus, it also increases the accuracy of heat detection.

According to Geary's research and calculations, using estrous synchronization increases the chanceof detecting each cow in heat by 10%. The reason is simple. If estrus is exhibited over 21 days, there will be only one or two cows in heat at the same time, and they have a hard time finding others that will mount them. If the estrus is exhibited over only five days, the number of cows in heat at one time increases, thus more mounts are observed.

Several estrous synchronization programs are available for beef females. They include MGA/PGF, Syncro-Mate-B, one or two-injections of PGF, and Select Synch. Each protocol has its advantages and disadvantages, so choosing a program depends on your animals, goals, facilities and resources.

Time Of Observation Is Critical Geary also believes that producers miss more naturally occurring heats than synchronized heats because of the time of day observations are typically done. The old standard for heat detection was 30 minutes of observation in the morning and evening. But, new research shows while only 3% of synchronized cows were found to display heat during darkness, some 28% of natural estrus cows displayed heat during darkness.

"If every cow or heifer would remain in heat for 8-12 hours during which time they would actively engage in mounting activity, then perhaps this limited amount of heat detection would be sufficient," says Geary. But, cattle don't always perform by the book, so Geary suggests adding an additional observation period between noon and 6 p.m. This extra observation period will increase the percentage of cows and heifers observed in estrus, thus giving a better idea of when insemination should occur.

Geary also suggests producers make a larger commitment to heat detection. Research suggests that "intense heat detection" can be as accurate as electronic heat detection aids, such as HeatWatch. Intense heat detection requires a time investment of two hours each morning and evening, as well as one hour around noon. The extra time will pay off though. Geary found that "HeatWatch and intense visual observation were equally efficient in detecting heat among cows."

HeatWatch efficiently identifies 89-100% of beef cows and heifers within a herd that are in heat. Among those females, 88-100% are accurately identified, and, in fact, in heat. Visual detection of estrus (using the standard 30-60 minutes each morning and evening) is just as accurate, but less efficient.

This means cows visually identified as being in heat probably are, but some that are in fact in heat are missed. Visual detection missed 22-31% of synchronized heats and up to 80% of unsynchronized heats.

Another management technique that may help observe heat in more submissive cows is to continue observations for signs of estrus for at least 30 minutes after removing cows that were observed to be in heat. "When there are several cows in heat," says Geary, "the more submissive cows often go unnoticed."

More accurate identification of the start of estrus increased conception rate and pregnancy rates. Conception rates were 62% using a 30-minute, twice daily observation program, while rates jumped to 82% when intense heat detection was used. Pregnancy rates doubled from 35% to 71% by using a more intense heat detection program.

Looking For The Signs Although the only definite sign of estrus is "standing to be mounted," there are other signs that may help observers pinpoint the animals to watch for estrus. The secondary signs of estrus include trying to ride, following, standing and putting her head on the back or rump of another female. Some cows also bawl, become restless, pace along a fence, and walk more in search of a bull. Clear mucus is sometimes seen on the buttocks or stringing from the vulva.

There are also tools on the market to help aid in visual detection of estrus. Remember, however, that aids should only be used to supplement visual observations. A list of the visual aids and their application can be found in Table 1.

Teaser animals may be beneficial to producers in helping to detect estrus visually. Choices include a penile-blocked bull, vasectomized bulls, penis-deviated bulls, caudal epididymectomized bulls and androgenized females.

Your particular operation, estrus management plan and resources should be factored into whichever choice of teaser animal is used. Above, Table 2 details the differences among teaser animals.

Detecting estrus isn't enough to make an AI program a success. It is important to inseminate in a timely manner while ovulation is occurring. Ovulation occurs 26-32 hours after estrus starts, so researchers suggest that producers inseminate 12 hours after estrus observation.

Geary says data suggests higher pregnancy rates will result if cows are bred a little earlier rather than after this 12-hour rule. He says if a cow is still in heat 12 hours after she was first observed in heat, it is better to breed her then rather than wait an additional 12 hours.

"Why are we willing to spend $15-20 to buy the best semen, and sometimes $3-10 on the best synchronization system, but as little as possible for heat detection?" Geary asks. "The answer is that we think we are saving money. But are we really saving money, or are we compromising our success?"

In reality, saving a few dollars on the front end really doesn't pay at the back end.

Prudent use of antibiotics

Pathogen resistance and antibiotic use are important global issues. While antibiotic use in animals is just one part of the larger issue of growing resistance of human pathogens to antibiotics, it does impact cattle producers directly.

In an ongoing effort to enhance antibiotic use, as well as overall healthfulness of livestock, veterinary groups have developed and adopted prudent antibiotic use guidelines. Much of this information will be familiar to cattlemen, as they are contained in the national and state quality assurance programs that some cattlemen have been following for over a decade.

Each of the 1 million U.S. cattle operations must use antibiotics responsibly or all stand to lose these important tools. Let's look at the 13 points in the American Association of Bovine Practitioners' Prudent Drug Usage Guidelines.

13 Prudent Use Points The Guidelines' preamble reminds us that preventive immune system management is key to the production of safe and wholesome beef. This includes use of vaccines, parasiticides, stress reduction and proper nutritional management.

With proper and timely management practices, we can reduce the incidence of disease and thus reduce the need for antibiotics. But, even with a sound disease prevention plan, antibiotics remain a necessary tool to humanely and effectively manage infectious diseases in cattle.

* Point #1 talks about the veterinarian and cattle producer teaming up to design management, immunization, housing and nutritional programs that will reduce disease incidence and the need for antibiotics.

* Point #2 reminds us that prescription antibiotics should be used only within a valid veterinarian-client-patient relationship. It also stresses that anytime you use an antibiotic in a manner other than exactly as listed on the label instructions (extra-label use), a veterinarian needs to be involved.

* Point #3 is about making sure we have an idea of what we are treating - a diagnosis. Many diseases share clinical signs, making diagnosis tricky. Your veterinarian can provide training in these matters, as wellas direct diagnostic support. Additionally, they can periodically monitor changes in microbial susceptibility that should influence antibiotic selections.

* Point #4 discusses the complexity of choosing antibiotics and developing a plan to use them. This involves combining information from package inserts, diagnostic lab and additional data in the literature, along with consideration of how the drug works, moves through the animal and is broken down. Your veterinarian can help you in these choices.

* Point #5 reminds us to use antibiotics at a dosage and duration appropriate for the condition being treated. The instructions provide directions, and deviation from these directions constitutes extra-label use.

* Point #6 suggests we avoid treatment of chronic cases where there's little chance for response. Working with your veterinarian to develop written treatment protocols can help you determine when to quit treatment.

* Point #7 states that, when appropriate, local therapy (e.g., intramammary, intrauterine, topical) is preferred over systemic therapy.

* Point #8 discourages combination antibiotic therapy unless there is information to show an increase in efficacy or suppression of resistance development for the target organism. Many of us are guilty of thinking that if one drug is good, two or three will be better. Oftentimes, this does not improve treatment response, but raises treatment costs, muddles our ability to determine which drug is getting the job done, and exposes bacteria to more antibiotics. Some drugs actually counteract other drugs when used together.

* Point #9 states that antibiotic use on groups should be a selective rather than standard practice. This is sound advice from an economic, as well as a prudent use standpoint.

* Point #10 stresses that veterinarians are legally required to rule out the effectiveness of label and extra-label use of approved antibiotics before using unapproved products, including their own concoctions. Producers should question the legality and rationale of such formulations, if they're offered.

* Don't stockpile antibiotics. Quantities of antibiotics prescribed or dispensed to you should be of appropriate size, as outlined in point #11.

* Veterinarians are required by law to participate in continuing education programs to maintain their licenses. Point #12 suggests that some of this work should address emergence and/or development of antibiotic resistance and prudent drug usage.

* Point #13 urges veterinarians to play an active role in training cattlemen on diagnosis of common diseases, indications for antibiotic use, dosage, withdrawal times, route of administration, injection site precautions, storage, handling and record keeping.

Clearly, cattlemen can do much to ensure antibiotic use in livestock is optimally effective and withstands outside scrutiny by those concerned that our use of antibiotics might be contributing to resistance in human pathogens. Developing and maintaining a productive working relationship with a veterinarian is a key. Having written herd health management and treatment programs can benefit you in several ways.

So what's the bottom-line? Scanning back over the 13 guides, you'll note that prudent drug use equates to good animal husbandry, sound business practices and using drugs legally. This is nothing new for responsible cattlemen. If you want to learn more about beef quality assurance, visit www.bqa.org.