Beef Today Late Spring 2014 : Page 1
Late Spring 2014 CONTENTS The Round Up The New Generation 6 Are 16 Leave you a marketer or a monogamy behind; salesman? Be both. we need to work together. 8 Develop a profit strategy and don’t look back. Capture the Cash Survey Details 18 Angus Influence Nobody’s COOL 12 Is an end to the debate in sight? Producers share their seedstock intentions. Closing the Gate 24 A glimpse of your future. PHOTO: K LAZY K RANCH DATA DRIVEN B Cattlemen utilize a revolution of new data to improve genetics, ef ciency and capture value › BY GREG HENDERSON Beauty is in the data of the beholder. That’s the message from a growing combination of commercial cow-men, seedstock producers and cattle feeders who are measuring every facet of their animals’ performance and developing new tools to guide selection and management. As a fifth-generation farmer, Justin Dammann in Clarinda, Iowa, was accustomed to utilizing data and technology to increase yields and profits for the family’s grain produc-tion. Increasing yields—or pay-weights—on the calves from the family’s 1,100 cows, however, did not produce the results he hoped for. “Our goal was to raise as many pounds as possible,” Dammann says. To increase weaning weights he used terminal sires on his average commercial cows. “The steer calves were bigger, but our heifers sold at a $100-to $150-per-head discount. The heifers were losing what we gained on the steers,” he says. Seeking solutions, Dammann consulted Nichols Farms in Bridgewater, Iowa, a diverse seedstock operation known for cutting-edge genetics and customer service. Ross Havens, Nichols’ representative, visited Dammann and his cowherd to help recommend genetic solutions. Dammann purchased 23 Angus and Angus-Simmental composite bulls, and the first year’s calf crop revealed a dramatic improvement. Reputation cattle. “My calves blew the doors off the market,” Dammann says. “The genetic change added
Cattlemen utilize a revolution of new data to improve genetics, efficiency and capture value<br /> <br /> Beauty is in the data of the beholder. That’s the message from a growing combination of commercial cowmen, seedstock producers and cattle feeders who are measuring every facet of their animals’ performance and developing new tools to guide selection and management.<br /> <br /> As a fifth-generation farmer, Justin Dammann in Clarinda, Iowa, was accustomed to utilizing data and technology to increase yields and profits for the family’s grain production. Increasing yields—or payweights— on the calves from the family’s 1,100 cows, however, did not produce the results he hoped for.<br /> <br /> “Our goal was to raise as many pounds as possible,” Dammann says. To increase weaning weights he used terminal sires on his average commercial cows.<br /> <br /> “The steer calves were bigger, but our heifers sold at a $100- to $150-per-head discount. The heifers were losing what we gained on the steers,” he says.<br /> <br /> Seeking solutions, Dammann consulted Nichols Farms in Bridgewater, Iowa, a diverse seedstock operation known for cutting-edge genetics and customer service. Ross Havens, Nichols’ representative, visited Dammann and his cowherd to help recommend genetic solutions. Dammann purchased 23 Angus and Angus-Simmental composite bulls, and the first year’s calf crop revealed a dramatic improvement.<br /> <br /> Reputation cattle. “My calves blew the doors off the market,” Dammann says. “The genetic change added value to the heifers, and now they are selling for just as much as the steers.” <br /> <br /> While Nichols genetics improved his herd, Dammann also became part of the vast network of producers who enjoy the rewards of Nichols’ reputation among feedlot buyers on sale day. Dave Nichols has more than a decade of actual sale data on calves sold at auction by his customers. The results show a $3- to $5-per-cwt. Advantage for Nichols-sired calves, and last fall, Dammann’s calves sold for a $20-per-cwt. Bump over that day’s sale average.<br /> <br /> “The $20-over-market price Justin received was an anomaly,” Nichols admits, “but our customers routinely receive that $3- to $5-per-cwt. Increase.” <br /> <br /> Nichols doesn’t like to call that a premium. “I don’t believe it’s a premium. I believe buyers pay more because they’re worth more, and the health and genetics of those calves make them worth more to feedyards,” he says.<br /> <br /> Breeding and identifying cattle that add value in the feedyard and on the rail is the concept behind the partnership formed between Leachman Cattle of Colorado and Decatur County Feed Yard in Oberlin, Kan. Their relationship seeks to couple cutting-edge technology with data-driven sire selection to produce the highest quality beef and increase profits for every sector.<br /> <br /> A self-described data junkie, Lee Leachman pours over computer screens filled with cattle performance data. EPDs, feedlot performance, carcass data—they’re all critical to Leachman’s business model.<br /> <br /> “The data doesn’t lie,” Leachman says. “Data helps improve profitability for our customers, and that’s why we sought to work with Decatur County Feed Yard, because of their ability to capture and utilize data. Through our partnership, we’re finding that the good cattle are way better than the average cattle.”<br /> <br /> Feedyard cooperation. Feedyard owner and general manager Warren Weibert says ranchers who utilize superior genetics can capture more value and increase profitability when they retain ownership of their calves through the feedyard, and he’s championed that cause for 40 years. The commitment to retained ownership led Decatur County Feed Yard to implement many cutting-edge technologies that improve cattle management and create data that guide decisions. For instance, Decatur County was one of the first feedyards to implement ultrasound scanning to measure backfat and ribeye size in cattle in 1987. That helped launch the feedyard’s focus of individual animal management to improve efficiency and carcass value.<br /> <br /> In 1998, Weibert constructed a state-of-the-art processing facility to implement electronic cattle management (ECM). A radio-frequency ID tag is applied to each animal at the feedyard, and as they move through the ECM system, a camera records hip height while an ultrasound technician measures backfat and ribeye size. Scales under the chute record the animal’s weight and a computer software program calculates its rate and cost of gain. This information identifies ideal marketing dates for each animal. As the animals exit the chute, a series of automated gates sends the animals into one of six pens, sorted by marketing group.<br /> <br /> Such management of individual animals has proven ideal to highlight the genetic value Leachman says his bulls offer. Such feedlot information has allowed Leachman to develop a unique index to measure the bottom-line value of bulls, what he calls $Profit.<br /> <br /> “$Profit assumes that the average commercial bull will have 100 progeny over its lifetime,” Leachman says. “The model assumes that you keep 30% of your heifers as replacements and that you retain ownership on the remainder of the calves through finishing and sale on a grid. Our simulation model then factors in all of the effects on both income and expense to come up with a net profit figure for each bull.”<br /> <br /> Bull-to-bull comparison. $Profit allows bull buyers to compare any two bulls Leachman Cattle of Colorado sells and calculate the difference in profit they are expected to generate for a herd. For instance, a $10,000 $Profit bull is predicted to generate $4,000 more than a $6,000 $Profit bull (the average 2008-born Angus bull). That’s $40 more per calf.<br /> <br /> Leachman’s $Profit index includes calving ease, weaning and yearling weight EPDs, fertility, carcass weight, marbling, ribeye area, percent retail product, cow mature size, cow intake and feed efficiency.<br /> <br /> Of those traits, Leachman says feed efficiency is the most important. Ten years ago Leachman Cattle of Colorado began testing yearling bulls for feed intake and conversion, using feed-monitoring bunks. During the evaluation, bulls were weighed at various intervals to determine rate of gain. They used the data to create EPDs for each bull, predicting progeny feed intake and progeny feed conversion.<br /> <br /> The real-world value of feed efficiency is evident in a comparison of two bulls of similar appearance from the same herd that were fed at Decatur County Feed Yard. Bull 1 consumed 17 lb. Of dry matter per day, while the second bull consumed 42 lb. Per day. The first bull converted pounds of feed to gain at a rate of 4:1, while the second converted at 10:1.<br /> <br /> “That trait is 40% heritable,” Leachman says. “That means a cowman can run 112 cows on the same pasture where he was running 75 cows before.” <br /> <br /> Real-world data. Jerry Kusser, Highmore, S.D., says his herd of commercial cows confirms Leachman’s concepts about $Profit and feed efficiency.<br /> <br /> “We’ve been measuring feedlot performance and carcass data for 20 years, and we thought our cattle were efficient at converting feed,” Kusser says. “But we discovered the feed conversion on the bulls we were using was too high.” <br /> <br /> That discovery was made four years ago when they used feed-efficiency traits to select Leachman Cattle of Colorado bulls and sent 396 of the calves to Decatur County Feed Yard. Kusser says feed costs for his calves averaged $164 per head less than the least-efficient group at the yard. Also, 99.5% of Kusser’s calves graded Choice, with 88.4% Certified Angus Beef and 25.1% Prime.<br /> <br /> That data convinced Kusser he needed to take a closer look at his cows, too. “It was obvious I had some inefficient cows. I estimated they could be eating as much as an extra ton of feed per cow per year.” <br /> <br /> After four years of using $Profit to select bulls and adding heifers back to his herd that are now mature cows, Kusser sees the difference. “The cows and heifers are eating less feed. When you have 1,000 head that are eating 5 lb. Or 6 lb. A day less than before, it adds up quickly.” <br /> <br /> Seedstock operations such as Nichols Farms and Leachman Cattle of Colorado are leading a revolution of genetic change for America’s cattlemen through data collection, customer service and real-world economics. The results are improved profitability for cowmen and higher quality beef for consumers.<br /> <br /> To contact Greg Henderson, email email@example.com.
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