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Articles from 2016 In June


This is not just another article on time management

This is not just another article on time management

I have always heard that time is the great equalizer – everyone has 24 hours in the day; how we elect to use it is what separates us. However, this is not intended as a management article, where I give you helpful hints on how to better manage your time. 

Not that I haven’t spent a lot of time and money trying to learn. I have purchased multiple planners, even computer programs and have read multiple books on time management. I have picked up some good tips along the way, and I like to think I’m better at managing my time then I once was.  

But I’ve still got a long ways to go. I’ve never had the guts to do it, but I would be a tremendous time manager if I just put a bullet in my TV or blocked ESPN and Fox News. I probably could learn a lesson from my Grandpa; he was in bed by 8 and up at 4 the vast majority of time. As a young kid, I thought it was crazy to see an adult go to sleep that early. He told me, “I’ve stayed up past 8 lots of times, and always got in trouble.” 

It wasn’t till I was older and a little more worldly and heard some of the stories that I understood what kind of trouble my grandpa was getting into. As Ben Franklin said, “early to bed, early to rise, makes you healthy, wealthy and wise.” 

However, the one thing all the experts forget to tell you is that for most of your life, you just get busier and somehow time just seems to go faster. And while they talk about balance, relaxation, productivity, efficiency and the like, there is no clear roadmap or set of rules that you can follow to get you to where you can slow time down. 

I have never been a big believer in regrets, and I don’t spend much time wishing I had done something else with my time. I just try to evaluate so I can do better going forward. 

There are some things I have learned, though. We all have to make a living, deadlines are real and usually for a reason, and while planning is invaluable, you’d better plan on some flexibility because life has a way of adjusting your plans. Cows that haven’t been out all year will create a hole in the fence the night your son graduates (I earned a $150 speeding ticket that day). 

Balance is achieved via focused effort. But that’s hard to do. I don’t have consistent date nights, I can’t always sit down with my teenagers and talk about the day, I don’t work out at 8:15 every night or have a quiet time at 6:30 in the morning. Life happens and balance is about adjustments, which means that nearly every day seems to be focused on one or two areas. With that said, it has always been simpler investing in projects than people. Looking back, people offer the highest return. 

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For example, I’ve spent what seems like tens of thousands of hours and miles hauling to horse and cattle shows, but it was something we did as a family. Your kids grow up – those times will never return.

But, while your kids and your spouse deserve your time, the laws of compound interest and sustained effort relative to our business and careers are immutable and unforgiving. In the end, few of us will be Bill Gates, Mother Theresa, Michael Jordan or Ronald Reagan. But we all make a difference. When we make an impact in our own little sphere, the sphere has a way of widening.

Here’s hoping that this summer finds you finishing that windbreak project, putting up hay and harvesting the record corn crop, but also finds you sharing a lemonade and funnel cake with your spouse at the county fair; or staying up all night helping your child prepare for the big speech contest; or maybe finding yourself growing closer to God; and saying yes to someone when every fiber in your being is telling you to just say no. It hasn’t been a particularly auspicious start for me, but my time management mantra for the next several months boils down to this simply being a summer well spent.

The opinions of Troy Marshall are not necessarily those of beefmagazine.com and the Penton Agriculture Group.

 

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Meat Market Update | Choice middle meats drop in value

Ed Czerwien, USDA Market News reporter in Amarillo, Texas, provides us with the latest outlook on boxed beef prices and the weekly cattle trade.

The Daily Choice Rib primal has dropped almost $50 in the past two weeks and the Choice loin has followed a similar path. This is part of a normal seasonal decline of the Choice middle meats during this part of the grilling season. However, when combined with plummeting out-front prices for these items, the Choice cutout continues to drop lower.

Find more cattle price news here or bookmark our commodity price page for the minute-by-minute updates.

Has cloning research produced the ideal beef carcass?

Has cloning research produced the ideal beef carcass?

Throughout the history of the modern beef business, the holy grail of genetic improvement has been to produce the “curve-bender” bull. Cattle producers have invested a lifetime, perhaps several lifetimes, in finding the perfect genetic combination that will not just nudge the quality of beef forward, but catapult it.

Researchers at West Texas A&M University (WTAMU) in Canyon, Texas, in a public-private partnership, have accomplished that feat in one generation and just a few years.

The initial results of WTAMU’s research involving cloned cattle demonstrate that it is possible to improve both carcass quality and yield simultaneously, which means higher value beef can be produced without wasteful trim fat. That’s a breakthrough because conventional wisdom holds that the quality of beef suffers as the yield—the amount of boneless, closely trimmed retail cuts—increases and vice versa.

seedstock 100

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“This outcome indicates that the antagonistic relationship between beef carcass quality and yield can be overcome by crossing rarely occurring animals,” says Ty Lawrence, professor of meat science and lead researcher on the project.

In 2012, WTAMU successfully cloned a bull, which they named Alpha, from the carcass of a steer that graded Prime, Yield Grade 1—the best combination of quality grade and yield grade in the USDA beef evaluation system. Such a rating is only achieved by about 0.03% of all beef carcasses. Three heifers—Gammas 1, 2 and 3—were cloned from another Prime, Yield Grade 1 carcass.

While not clones themselves, the 13 calves of Alpha and the Gammas were the first bovine offspring ever produced from two cloned carcasses. Last month, seven of them were harvested. The seven steer carcasses were evaluated by a third-party USDA beef-grading supervisor and graded significantly above the industry average. One of the seven achieved the Prime grade, three graded High Choice, and three were Average Choice. The industry average is Low Choice. Industry-wide, less than 5% of all beef—fewer than one in 20 carcasses—grades Prime.

All seven of WTAMU’s steers produced a Yield Grade of 1 or 2. The industry average is a 3. Compared with the average animal reported in the 2011 National Beef Quality Audit, the offspring of Alpha and the Gammas have 16% less trim fat, 9% more ribeye and 45% more marbling.

“By finding, cloning, and crossing these rare genetics, we have demonstrated the ability to create exactly what the market desires: high quality taste fat without unnecessary waste fat,” Lawrence said.

These findings have been five years in the making and the ongoing project has included numerous partners. WTAMU teamed up with ViaGen, a private company based in Cedar Park, Texas, to develop the initial clones for the purposes of breeding them.

Collaborating with their industry partners, animal scientists from WTAMU were careful to raise the offspring of the clones in the same way that cattle would normally be produced for commercial meat production.

“The calves were raised by their mothers while grazing our native pastures, in the herd with our other commercial cattle,” said David Lust, a research team member and associate professor of animal science. “They were weaned at a normal time and then fed at the WTAMU Research Feedlot for 185 days on a typical feedlot diet. They have been treated just like commercial cattle throughout the industry.”

 The research team is encouraged that the data thus far points toward a new way to improve beef production efficiency.

 “I think the biggest innovations will be the intersection of technology and biology,” said Gregg Veneklasen, a research team member and veterinarian at Timber Creek Veterinary Clinic. “West Texas A&M University will be at the forefront of this cutting edge technology, and our students will be the ones who benefit.”

Following these initial results, the team plans to conduct a commercial-scale trial with future Alpha-Gamma calves that are cattle bred, born, raised, fed and harvested outside the controlled University research environment. Additional trials will also proceed with Alpha alone—they want to know how he compares to top sires of multiple breeds selected through traditional ways. They also plan to continue to find and clone exceptional carcasses. 

 “This project is an example of a public-private partnership that produced great results,” said Dean Hawkins, research team member and dean of the College of Agriculture and Natural Sciences. “West Texas A&M University is thankful to Blake Russell and the team at ViaGen, Dr. Gregg Veneklasen at Timber Creek Veterinary Clinic, Jason Abraham at Mendota Ranch and many others who propelled this idea to fruition.”

“We anticipate this to be the beginning of a long relationship of positive research outcomes,” he said.

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3 key principles for summer grazing management

3 key principles for summer grazing management

As June draws to a close, we’ll soon be entering the traditionally driest, hottest days of summer. With the July heat, summer pastures can suffer; however, there are a few critical management practices that can help producers extend the grazing season and promote plant growth, even during these hot and dry days. 

Rory Lewandowski, Ohio State University (OSU) Extension educator, shared three key management principles in a recent OSU Beef Cattle Letter. Here are his thoughts on keeping pastures productive during the hot summer months:

1. Take half, leave half

“The take half, leave half principle must be followed during the summer months,” writes Lewandowski. “The leaf area that remains after a grazing pass provides a photosynthetic base for plant regrowth, shades the soil to keep the soil temperature cooler, and it helps to reduce soil moisture loss.

“In addition, research has shown that leaving half of the leaf area on the plant produces a minimal impact upon the plant root system, enabling that plant to continue to absorb nutrients and moisture and recover quicker. Taking off 60% or more of the plant leaf area will cause a significant decrease in the plant root system that will slow down and impede the regrowth of the plant. Do not cheat on this principle during hot, dry spells.”

2. Provide a rest period

“The second principle that must be adhered to is to provide a rest period that is sufficient to allow plants to grow back to a practical grazing height,” says Lewandowski. “Obviously, the two principles work hand in hand. The height at which grazing should begin is somewhere in the 8 to 10 inch range for grasses such as orchardgrass, fescue and festuloliums. For bluegrass and perennial ryegrass pastures, 6-8 inches may be used.

“In practice, this means that grazing rotations must slow down during hot, dry periods because grass growth and recovery is slower as compared to spring conditions. When pastures are growing fast, rotate fast. When pastures are growing slowly, rotate slowly. Unfortunately, it is easy to do the opposite and I have seen a number of pasture managers get caught in faster rotations during the summer with the end result that pastures become overgrazed leading to even slower recovery and less pasture production.”

So what’s the best way to increase grazing days on each paddock? Lewandowski says it’s important to have a sufficient number of pasture paddocks. He offers a formula to figure out how to increase the number of days before rotating from one pasture to another.

3. A formula to determine the number of paddocks needed

“The number of paddocks needed can be determined by this formula: Days of rest needed divided by days of grazing + 1,” he says. “For example, let’s say that in the spring of the year, it takes 15 days for grass to regrow from 4 inches back to 8 to 10 inches in height. If my livestock stay in each paddock for 5 days, I need 15/5 =3+1 or 4 paddocks.

“Now let’s say that as it gets warmer and drier it takes 35 days for that same pasture to regrow to an 8-10 inch height after being grazed down to 4 inches. I now need 35/5= 7+1 or 8 paddocks to provide enough rest period. If I have fewer paddocks I am either going to graze down the preceding paddock below 4 inches while waiting for the next paddock to regrow to the 8 to 10 inch height or I will enter the next paddock at a lower height and have less forage available.”


While we can’t control how hot or dry July gets, we can strategically manage the grass we have to extend the grazing season into the fall. Consider these tips to help keep summer paddocks productive and growing.

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

 

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Is supply or demand driving the fed cattle market?

Is supply or demand driving the fed cattle market?

The primary focus in recent weeks has been the Choice -Select spread and the ensuing inferences for the beef industry. That began with highlighting the surge of rib/loin values versus end-meat prices. It appears that consumers are voting with their dollars: they want high-end, high-quality beef.    

The inherent pushback with that observation, though, invokes questions around supply. Accordingly, last week’s graph featured the beef industry’s annual production of Prime and Choice product. Last year, the beef industry produced record tonnage of Prime and Choice beef. That occurred despite the beef industry producing only 23.8 billion pounds in 2015, including production from non-fed cows and bulls – the lowest total since 1993. As such, supply shortfalls are not driving the market.

This week’s illustration emphasizes wholesale beef price trends from a somewhat different perspective. The graph features the wholesale value differences (four-week moving averages) between Prime, Branded and commodity Choice versus Select. Not surprisingly, the price spreads of late have seen an upward trend in all three categories: e.g. the Prime premium is nearly $40 per cwt while the Branded premium averaging $25 per cwt. All the while, that’s occurring amidst bigger volume and a much more tenuous market environment for beef - both domestically and internationally – versus 2013 and 2014.   

comprensive cutout

Finally, Industry At A Glance highlighted earlier in the year some recent struggles on the ground beef side and what that means for the beef industry going forward. Most notably, “…[the beef industry] may begin to witness greater pricing diversion across the beef categories going forward in 2016.”

It appears that consumers are increasingly opting in at the top end of the beef market. How do you read this trend occurring within the beef complex? Will the demand at the higher end of the market have staying power? If so, what are the long run implications? How might this change the industry going forward? Leave your thoughts in the comments section below.  

Nevil Speer is based in Bowling Green, Ky., and serves as vice president of U.S. operations for AgriClear, Inc. – a wholly-owned subsidiary of TMX Group Limited. The views and opinions of the author expressed herein do not necessarily state or reflect those of the TMX Group Limited and Natural Gas Exchange Inc.

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Brexit vote impact uncertain for U.S. beef

Getty ImagesCameron Spencer
<p>International beef trade is vital for U.S. cattle producers.</p>

Immediate fallout from Great Britain’s closely contested vote to exit the European Union (EU)—global financial markets plummeting amid currency realignment—underscore the concerns that prompted the vote. Those concerns include things like waning economic and cultural sovereignty and the fact that a single decision made by one country in one part of the world could create such chaos for everyone else.

It’s too simple to think of it as anti-globalization, per se. The EU began in 1993 with the signing of the Maastricht Treaty, but threads of its history stretch back to soon after World War II. Pacts and organizations that preceded the EU were primarily trade and economic agreements—collaborations to develop and share energy resources, agreements to reduce import tariffs between member countries and what not.

Somewhere along the way, all of that morphed into a federation government regulating the economic, social and foreign policies of member countries. In simple terms, it would be like NAFTA partners—the U.S., Canada and Mexico—allowing a committee to decide what they could and couldn’t do as nations in other matters besides how they trade with one another.

Aside from added uncertainty, the most immediate impact affecting U.S. beef is the stronger dollar, making it more expensive for international customers to import beef from the U.S.

“The U.S. dollar strengthened, not only against the British pound, but also against most other currencies,” explains Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “The Japanese yen also strengthened sharply as global markets turned to the safe havens of the dollar and the yen.”

Brexit Vote
Photo by illustration by Christopher Furlong/Getty Images

It is likely that a good deal of the uncertainty surrounding the U.K. departure from the European Union will subside, Peel says, but the timetable is unknown and some impacts will persist for extended periods or permanently.  “Meantime, U.S. beef and other meat markets are hampered by the additional headwinds of a stronger dollar slowing exports and supporting imports.” 

The process of the exit itself seems rife with unknowns, including exactly how and when. Odds favor a chaotic and lengthy process measured in years. For that matter, there will be plenty of speculation on the sustainability of the EU itself. Lots more uncertainty, in other words.

The U.S. exported $6.3 billion of beef and variety meat in 2015, according to the U.S. Meat Export Federation (USMEF). The EU only represented about 4% (approximately $250 million), thanks in large part to the restrictive tariffs and non-tariff trade barriers imposed by the EU. But the U.S. continues to work for increased trade there through the ongoing negotiations surrounding the Transatlantic Trade and Investment Partnership (TTIP).

“Imports of U.S. beef under the European Union’s duty-free, high-quality beef quota were challenged this year by a weak euro and increasing pressure on the quota’s capacity due to larger imports of Australian and Uruguayan beef,” according to the USMEF Annual Report 2015.

“The indirect effects will matter the most,” says Philip Abbott, professor of agricultural economics at Purdue University, who researches international trade and agriculture. “The effects on agricultural trade will be through the exchange rate mechanism and through any negative business cycle effects involving global demand. How big those are depend on whether this is a temporary or longer-term situation and how long the very recent changes in exchange rates and interest rates persist.”

Abbott points out that a strong dollar makes U.S. exports more expensive to the rest of the world and that a widely held belief in the agricultural industry is that trade and a weak dollar are good for U.S. agriculture.

Mike Boehlje, Purdue University distinguished professor of agricultural economics, adds that the Brexit vote drew more attention to the issue of globalization versus nationalization—essentially, open or closed markets.

He explains that supporters of the referendum to withdraw contend that the influence and sovereignty of Britain has suffered under the EU’s trade and economic regulations and its policies on immigration and the free movement of people within the 28 European countries in the bloc. Similar issues have come up in the current U.S. presidential election campaigns.

“Generally, agriculture is much more dependent on international trade than other parts of the economy,” Boehlje says. “Globalization is important to U.S. agriculture to keep markets open to access.”

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8 resources to combat negative assumptions about grain-fed beef

I recently read an opinion column written by Jared Stone for the LA Times titled, “If we're going to eat cattle, let them eat grass.” The op-ed shared the benefits of grass-fed beef on the environment and the perceived harm that feedlots cause to the planet.

Stone shares how his family purchased a whole beef carcass from an animal that was raised on an olive orchard. The bulk beef purchase lasted his family five years, and overall, he was a satisfied customer who went on to write a book about his purchase titled, “Year of the Cow: How 420 Pounds of Beef Built a Better Life for One American Family.”

Of course, I’m happy Stone found beef that suited his family’s needs. Whether it’s grass-fed, grain-fed, organic, natural or any other branded beef program, the great thing about the U.S. beef production chain is we have a lot of choices to offer our consumers.

However, what I didn’t appreciate about Stone’s column was the misinformation he shared about grain-fed beef and how he created a villain out of modern-day feedlots that are able to produce more beef using fewer resources.

Granted, while Stone admits that the drought in California where he resides creates some challenges to raising grass-fed beef, he concludes that if we simply stop raising crops to feed livestock, we will miraculously fix the state’s water issues.

This op-ed begs for some rancher comments to balance out the conversation, with many readers sourcing documentaries like “Food Inc.” and “Cowspiracy” as reasons why we shouldn’t eat beef at all.

Since this topic has been covered many times in BEEF over the years, I’ve compiled eight resources (from our archives and from other reputable sources) as references to help negate the claims made in this op-ed piece:

1. Reality vs. myth of animal feeding and the environment

2. “Telling the grass-fed beef story” from Penn State Extension

3. “Water rights & wrongs” from American Cowboy

4. 5 ways cattle help the environment

5. Is grass-fed beef better for the environment?

6. Conventional beef production best for the environment

7. “Raising beef is more sustainable than you think” from Facts About Beef

8. Sustainable beef? U.S. has most environmentally friendly livestock industry in the world

If you have a free minute, use these resources to help you compile a response to the LA Times op-ed, or feel free to share today’s blog on social media to explain how conventional beef production is a sustainable model.

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

 

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Meat must stay on the military menu

As Independence Day approaches, my heart is with the men and women who serve this great nation and make such great personal sacrifices to protect our freedoms. While we enjoy our steaks and burgers on the grill this upcoming Monday, July 4th, I’m also thankful that our military men and women will continue to be offered animal proteins instead of having to practice Meatless Mondays, thanks to Congress’ willingness to stand up to activists with an agenda against animal agriculture. 

In May, Congress reviewed bill H.R. 5293, which provides FY2017 appropriations to the Department of Defense (DOD) for military activities. These appropriations would also include meal provisions, and activists were pushing to take meat off the menus for our troops on Mondays.

According to AgView.net, “The U.S. Coast Guard Academy has cut meat consumption among cadets by 10% over the last three years, drawing concern about an expansion of anti-meat efforts throughout the Armed Services.”

Of course, it’s no secret that activists have been focusing on reducing and eliminating Americans’ meat consumption over the years. Most recently, the industry had to fight to keep beef on the table in discussions over the 2015 Dietary Guidelines for Americans. These dietary recommendations would have impacted school lunch programs, guidelines for nursing homes and daycares, food stamp programs, and even the nutritional information taught in medical schools.

The bias against meat isn’t based on sound science or solid nutritional research; instead, the Meatless Monday agenda is being pushed by misinformation regarding meat production and the environment, misconceived notions about ranchers and animal welfare, and falsehoods about meat and a healthful diet.

It was only a matter of time before activists set their sights on the military. However, thanks to an amendment to H.R. 5293 made by Congressman Adrian Smith (R-Neb.), meat will continue to be an option every day for our U.S. troops. The amendment prohibits the DOD from excluding animal proteins from its food provisions offered to the men and women serving our country.

Of his amendment, Smith released a statement, “Ideologically-motivated activists are working to take meat off the menu in institutions across the country, and they have included the U.S. military on their list of targets. These restrictions would negatively impact the nutrition and morale of the men and women who protect our nation.

“Meat contains vitamins and nutrients not readily available in a plant-based diet. My amendment is not a mandate or a prohibition, it simply ensures there is a meat option available to our troops each day.

“I am not willing to allow activist groups to tell members of our military, who risk their lives to keep us safe, they cannot enjoy a hamburger or steak on certain days of the week simply to advance an agenda against animal agriculture.”

The amendment passed in the House, and I applaud Smith’s willingness to protect our troops from radical activist agendas and ensure that they are properly nourished to do their jobs well and stay healthy while they are serving our nation. We need to support efforts like this to keep meat on the table and make sure we are at the table to discuss why beef is such a critical part of a healthy diet. It would be appalling to force our military to practice Meatless Mondays based on biased information.

Now that the bill has been received in the Senate, I hope our nation’s Senators will also have the common sense to make sure meat stays on the military menu. I encourage everyone to write to their Senators to make sure they are aware of this issue as this bill is discussed on the Senate floor.

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

 

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Marketing beef cattle

“So far this year, the U.S. cattle feeding sector is not following the last year’s path, which set the stage for the cattle price collapse during the last few months of 2015,” analysts with the Livestock Marketing Information Center (LMIC) explained in early June.

They’re referring to the long-day, overdone fed cattle and slower harvest rates that created a tonnage bubble, crashing prices as packers took a heavier hand in managing inventory. Obviously, that wasn’t the intent of cattle feeders who were doing all that was possible to dilute losses.

Currently, increased harvest rates, decreased carcass weights and the declining percentage of Choice-grade cattle suggest cattle feeder marketing is more current.

“Cattle feeders are not delaying marketing of slaughter-ready cattle like they did last year,” LMIC analysts say. “The economic incentives, like very high feeder animal compared to the fed animal price that led to delayed marketing of slaughter cattle, are not in place this year. The results are fed animals being marketed at a much higher rate than a year ago. Important consequences of the increased feedlot marketing rate have been year-over-year declines in steer dressed weights and increased steer slaughter levels.”

Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, said in late May, “Though feedlot inventories are now above year-earlier levels and climbing, the industry is in better shape: leaner and more agile going into larger cattle supplies for the remainder of the year.”

In the middle of June, LMIC forecasts the fourth-quarter price for feeder steers (700 to 800 pounds) as $146 to $150 per cwt. The forecast for fed steers at the middle of June was $123 to $126.

Likewise, the June World and Agricultural Supply and Demand Estimates raised the top end of the price range for fed steers in the fourth quarter by $4 to $119 to $129, compared to the May forecast. Projections for next year were unchanged at $118 to $128.

Although beef production continues to increase, pressuring prices cyclically, all of this gets at part of similar, recent conversations along the lines of: “How do we manage price risk with price inversion this fall?”

Yikes.

Entertaining the thought that fed cattle prices could be higher than feeder and calf prices underscores the level of current market angst.

For the record, anything is possible, and cattle feeders will work hard to buy back as much margin as possible. But, checking around with several trusted agricultural economists, there is no fundamental suggestion of looming price inversion.

It’s the second part of the question that’s more vexing — how to manage price risk amid gut-wrenching volatility, as feeder cattle futures continue to offer a false reflection of reality, and price discovery seems less clear than the bottom of a deep well.

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Everybody’s resources and goals are different, but a few time-proven basics emerge as at least parts of the strategy:

• Know your costs and look for ways to carve gains on the input side of the equation.

• Preserve and add value — castrating, dehorning, lot size and the like can prevent discounts. Adding weight and days ahead of marketing through preconditioning continues to offer opportunity, plus the chance for same-weight premiums — at least on the lighter end of calves and if marketed in a way to capture the premium. There’s added risk, too.

• Determine a rational selling price, relative to known costs that reach a specific financial goal, or allow getting close to that goal.

“Breaking even is financial failure,” said noted agricultural economist Jim McGrann recently. “Equity loss from retained ownership cannot be recovered breaking even. A business is not financially sustainable [profitable] if net price merely covers total costs — particularly incomplete costs often reported in the cattle sector.”

The luxury of waiting to take a price continues to come at a higher price than setting, seeking and accepting a price based on specific financial goals.

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Do your cows stack up?

Do your cows stack up?

Benchmarking is the management process of comparing your herd’s production and economic numbers to the average of a set of benchmark herds to identify your herd’s strengths and weaknesses. Benchmarking helps direct your management efforts toward critical production and economic factors.

First, identify your herd’s strengths — that is, where your herd beats the benchmark averages. Pat yourself on the back and say “well done.” Capitalize on your herd’s strengths. I have never found a herd that did not have some production strengths that could be capitalized on.

Second, identify your herd’s weaknesses — that is, where the benchmark averages beat your herd’s numbers. Examine your herd’s weaknesses one by one to see if you can do something to improve. As you remove weaknesses from your herd, herd profit tends to go up.

Depending on your situation, it may take a whole year to remove or change one major weakness, but benchmarking should help you focus your limited management time. Your next year’s benchmarks will help you measure your progress.


Download these charts in .PDF format.
Put your herd to the test. Download these free printable charts to do your own herd comparison.

The problem with benchmarking is that you need some benchmarks to compare to. The two major sets of benchmarks available are Standardized Performance Analysis (SPA) benchmarks from Texas A&M University, covering Texas, Oklahoma and New Mexico. The second is Finpack (farm financial planning and analysis software) benchmarks called Finbin from the University of Minnesota covering several Northern, Midwest, and Western states. Both sets of benchmarks are available through a Google search. North Dakota’s Farm Business Management (ND-FBM) benchmarks presented here are part of Finpack’s expanded multistate set of benchmarks. 

Herd performance benchmarks

I like to start a herd’s benchmarking analysis with herd performance data like those listed in Figure 1. For example, weaning percentage is based on the number of live calves born per total females exposed in last year’s breeding season (not this past breeding season). Agricultural financial guidelines are also available under the title “Farm Financial Guidelines” published by the Farm Financial Standard Council, also available with a Google search.

nenchmark 2015 herd data

This year’s (2015) 82 Northern Plains beef cow herds averaged 157 cows per herd, of which 93.5% of the bred females calved. Five percent of live calves that were born died, giving a final weaned percentage of 88.5%. A “Your herd” column is presented so that you can benchmark your herd in Figure 1. Did your herd beat these benchmarks or did the benchmarks beat you?

The average weaning weight was 556 pounds for both the steer and heifer calves. This generated a “lbs. weaned/female exposed” of 491 pounds This is one of the more important benchmarks that I look at. It tells a lot about the overall performance of the herd.

Several critical production factors enter into the “lbs. weaned/female exposed.” If this benchmark number is high for your herd, you move on. If this number is low, you need to dig deeper into the production numbers below this number.

For example, areas such as pregnancy rate, calf death loss, pregnancy loss, low weaning weights and low weaning percentages can be the production problem or problems. Calving distribution can also impact “lbs. weaned/female exposed.”

North Dakota’s CHAPS (Cow Herd Appraisal Performance System) provides additional production benchmarks, including calving distribution. A Google search for “CHAPS 2000 benchmark numbers” should find them.

Gross income benchmarks

ND-FBM approaches gross income with a “gross margin,” as in the top section of Figure 2. It calculates calf sales and cull animal sales plus beef calves transferred out, and adjusts that total by subtracting animals purchased into the herd (like bull purchases and purchased replacement heifers), animals transferred in (like raised replacement heifers) plus herd inventory change to arrive at a total “gross margin.” In this case, the benchmark gross margin equals $895 per cow.

total gross income

I like to take out the “purchased” and “transferred in” and treat them as part of the production costs. So by adding these two items back in, I get an “adjusted total gross income” of $1,266 per cow (see bottom of Figure 2). The net income bottom line is the same for both income procedures. I just prefer the latter system of accounting.

Economic summary

Figure 3 presents the economic benchmarks for these Northern Plains herds. The first economic benchmark I like to focus on is the “feed cost per cow,” which is benchmarked at $361 per cow. This is both the summer grazing cost and winter feed bill.

Your situation will vary considerably on winter and summer feed costs, depending on where you live, but your total annual feed cost may well not vary much from this annual figure. How is your herd on this benchmark? Did you beat the benchmark or did the benchmark beat you?

net economic returns of cows

The vet and medicine benchmark is $30 per cow. Total livestock fees consist of livestock supplies, livestock fuel and oil, livestock repairs, custom hire, livestock leases, marketing, and operating interest (beef cow herd proportion). The benchmark for this total is $111 per cow.

Total direct costs include feed costs ($361) and livestock costs ($111), for a total cost of $501 per cow. Overhead costs consist of hired labor, farm insurance, utilities, interest, machinery and building depreciation, and miscellaneous costs, for a total overhead cost of $108 per cow. Replacement heifer costs and replacement bulls totaled $371 per cow (record high). Add all of these benchmark costs together and the benchmarked total economic cost is $980 per cow.

Benchmark gross income per cow is $1,266 and the total economic cost is $980, giving a benchmark “net economic return” of $286 per cow in the Jan. 1, 2015 inventory.

earned net cow return

One question I am often asked when benchmarking a given herd’s economic performance is, how does this compare to other years? Figure 4 addresses this question. Figure 4 is a chart of the average earned net income per cow for Northern Plains beef cow herds for the last 16 years. We will never forget that 2014 and 2015 had the second-highest earned net returns per cow ever recorded.

Harlan Hughes is a North Dakota State University professor emeritus. He lives in Kuna, Idaho. Reach him at 701-238-9607 or harlan.hughes@gte.net.

 

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