How To Become Successful In Registered Cattle

R. Curt Lacy, Extension Economist-Livestock
Carole Hicks Knight, UGA Cooperative Extension
John C. Mckissick, Professor Emeritus-Livestock Economics & Marketing

• Selling Versus Marketing
• Know Your Price
• Plan for the Market
• Feeder Dogie Marketing Alternatives
• Which Cattle to Produce
• Where to Marketplace
• Cull the Right Marketing Method
• When to Market
• Keeping Up with the Market
• References

Most cattle produced in Georgia come from moo-cow-calf farms and ranches. With cow-dogie operations, as with other farm enterprises, making a profit is the only thing that volition keep you in business. How much profit you make depends largely on your ability to marketplace your calves.

Selling Versus Marketing

Profitable cattle marketing involves more just getting the highest price. It involves producing the type of calf the marketplace desires, marketing that calf through the best outlet and at the all-time time. Unfortunately, most cow-calf producers simply sell their calves. They produce calves that are the easiest to enhance, sell at the virtually convenient market outlet and sell at the near convenient fourth dimension. Every bit a result, they are price-takers.

Marketing ways making choices almost how or what product to produce, where to market information technology and when to price. As a outcome, marketers accept some control over the toll they receive.

The get-go stride in becoming an effective cattle marketer is to recognize all your alternatives and evaluate each in calorie-free of potential cost and returns, selecting the about profitable rather than the most convenient alternative.

This publication addresses several issues associated with marketing calves -- most notably, toll considerations, marketplace structure, the type of dogie to produce, marketplace outlets and seasonal price considerations.

Know Your Cost

The first footstep in whatever successful marketing plan is to know the unit cost of production (UCOP). In fact, for many small or medium-size cow herds, the cost of production is a larger profit determinant than the marketing method. Regardless of the size of the herd, for moo-cow-dogie producers this means knowing the price per pound of dogie sold. The all-time way to make this determination is to begin with a upkeep similar to the one shown in Table 1.

Tabular array 1. Example summary budget for a cow-calf enterprise in Georgia.
ITEM	$/Cwt.	$/Cow
Variable Price	$137.14	$609.06
Less: Value of cull cows, bulls and heifers	($26.88)	$119.forty
Cyberspace VARIABLE Toll	$110.25	$489.66
Annual Livestock Fixed Costs	$xi.43	$l.76
Almanac Buildings & Facilities Fixed Costs	$7.16	$31.82
Annual Equipment Fixed Costs	$21.02	$93.37
Almanac State Fixed Costs Excluding Taxes	$0.00	$0.00
Annual Existent Estate Taxes	$1.37	$6.eleven
Full COSTS	$149.87	$665.61
Source: 2012 UGA beef cow-calf budgets

Note that while the cost per cow is shown, the accent is placed on $/Cwt. The cost per hundredweight sold is used because it captures non simply total herd costs just too calf crop percentage and weaning weights.

In the example budgets shown, there are 2 numbers highlighted -- the first 1 being variable cost in $/Cwt. Variable costs (VC) are also called Direct, "Out of Pocket" or Operating Costs and include items such as feed, seed fertilizer, fuel and labor. These are the costs that must be covered each year because they are the measure out of profitability. It is likewise critical to cover variable costs because any returns higher up variable costs (ROVC) become toward paying overhead or fixed costs.

Returns to a higher place full costs (ROTC) is the measure of the long-term economical sustainability of an enterprise. Full costs (TC) include not only VC just too fixed costs (FC) such as depreciation, cost of uppercase, direction, taxes, etc. FC are those costs that occur regardless of the number of head produced. Some people also refer to FC as overhead or indirect costs. Regardless of the terms used, the total cost (TC) per hundredweight is the price a cow-calf producer must average in the long run if they want to remain in concern.

Knowing the VC and TC per hundredweight allows producers to set up target prices and evaluate their costs in relation to the marketplace. While atmospheric condition and input costs can be volatile in the short term, which will bear on cost per hundredweight year-to-year, producers who consistently have break-even prices in a higher place marketplace prices will need to notice ways to lower their costs in order to stay in the business.

Plan for the Market

The old saying goes that if you don't know where you're going, any road will have you lot there. But if marketing your cattle at a profit is where you want to become, then planning for the market will help get y'all there. Planning requires information. A good way to start becoming a amend cattle marketer is existence sure you empathise the cattle marketing system and how your cattle prices are determined. Then you need to recognize all the market alternatives available to y'all. Finally, you need to know where to get the information to assistance you decide on a marketing plan.

The Georgia Feeder Cattle Market

Figure i. Seasonal prices of feeder steers and bulls in Georgia auction markets. 2007-2011. Information source: USDA-AMS, Weekly Auction Report, TV_LS145 (various weeks).

In Georgia, as in the Southeast, feeder calves are produced and sold as feeder calves after weaning. Virtually seventy percent of all Southeastern calves are weaned and sold during the autumn. This is the major reason behind the normal seasonal price swings shown in Figure one: prices are normally lower during the fall and college during the tardily winter and early leap.

At that place are around 17,000 cattle producers in Georgia with an average herd size of fewer than 50 head. With so many pocket-size producers, information technology is natural that most Georgia feeder calves are sold through local auction markets.

Calves weighing betwixt 300 and 500 pounds volition unremarkably move into some blazon of forage-based stockering programs, where another 300 to 400 pounds will be added. As heavyweight feeders, between 600 and 800 pounds, they and then will typically movement straight into feedlots.

Figure ii. Cattle on feed in yards with more than 1,000 head (January ane, 2012). Source: Information provided by USDA-NASS, "Cattle" Study. Chart developed by the Livestock Marketing Information Center (LMIC).

Normally, seventy to 75 percent of all U.S. beef comes from cattle fed in feedlots. Feedlots have get fewer but larger in size. The top iii feedlot states (Texas, Nebraska and Kansas) now market near 60 percentage of the cattle fed in the United states of america. Figure 2 illustrates the concentration of the cattle feeding industry in the United States every bit of January 1, 2012.

While at that place are definite segments to the beefiness product organization, the important bespeak to call back is that the consumer eventually makes the last pricing decision. The retailer wants a certain type of product because the consumer wants it. This is relayed back to the packer, who relays information technology to the feedlot, who relays information technology to the feeder cattle producer. The "relay" for all these messages is the price. Unfortunately, considering of all the messengers in the market, the signals sometimes become mixed or muted. However, if we pay close enough attention, we can recognize them. By understanding how the beefiness cattle markets work, feeder cattle producers will be better able to recognize changes that may make a higher profit.

Feeder cattle prices are derived from their next market. The calves' value is based on what they are expected to be sold for, either out of the feedlot or out of a backgrounding operation, less the cost of gain. Every bit the expected price of finished animals goes upward or the price of proceeds goes down, feeder calf prices will increase. The weight to be added is factored in with the expected price of finished cattle. A 1,200-pound finished steer weighs 2.40 times equally much as a 500-pound feeder calf and 1.60 times equally much equally a 750-pound yearling. Therefore, a $1-per-hundredweight increase in the expected selling price of a finished steer would cause a heir-apparent to bid $two.40 per hundredweight more for a 500-pound feeder calf or $1.60 more than for a 750-pound steer.

The cost of finishing the dogie volition also affect the price of the feeder. The price of putting a pound of gain on a calf depends on feed toll, non-feed costs such equally involvement, and the efficiency of the calf itself.

A feeder buying a 500-pound calf and finishing it to 1,200 pounds is putting on 700 pounds of gain, or ane.forty times the original weight. Finishers buying 750-pound yearlings and finishing to 1,200 pounds are putting on 0.64 times the original weight. Each $1 change in the price of gain will raise or lower the price finishers can pay past $1.40 for a 500-pound calf and $0.64 for a 750-pound feeder. Table 2 shows the break-fifty-fifty buy prices that could exist paid for a 550-pound steer given alternative fed-cattle prices and price of gain. Of course, feeder calves produced in Georgia are likely to be transported to the feedlot states. Thus, a feedlot will besides take to discount the feeder price in Georgia by the price of transporting the calves to the feedlot.

Table two. Prices that can be paid for a 550-pound feeder steer at alternative fed-cattle selling prices and cost of proceeds.
	Sales Cost of Finished Cattle ($/Cwt.)
Cost of Gain ($/Cwt.)	$ 105.00	$ 115.00	$ 125.00	$ 135.00
$ 70.00	$ 149.55	$ 172.27	$ 195.00	$ 217.73
$ fourscore.00	$ 136.82	$ 159.55	$ 182.27	$ 205.00
$ ninety.00	$ 124.09	$ 146.82	$ 169.55	$ 192.27
$ 100.00	$ 111.36	$ 134.09	$ 156.82	$ 179.55
$ 110.00	$ 98.64	$ 121.36	$ 144.09	$ 166.82
$ 120.00	$ 85.91	$ 108.64	$ 131.36	$ 154.09

CHANGES IN BEEF AND Alive CATTLE MARKETING
For years most live cattle (as well called slaughter or fat cattle) were marketed on a pen-average basis. That is, feed yards were paid 1 price for all of the cattle in the pen. However, over fourth dimension that has changed. Now close to sixty% of all slaughter cattle are sold on a carcass ground where each carcass is individually weighed and graded for quality (marbling) and yield (percentage of retail meat). Since at that place are different prices for different yield and quality grades, each carcass ends up with an private or customized toll. The net effect is that price transmissions from the packer back to the moo-cow-calf producer are much clearer at present than in the past.

Effigy iii. Factors that bear on feeder cattle prices.

While it is the cost and return from finished cattle that give feeders their value, information technology is the overall supply and demand for beef that determines fed-cattle prices. Effigy 3 illustrates the factors that affect fed-cattle prices. It is of import to note that in that location are many things that affect the cost of cattle and beefiness that moo-cow-calf producers cannot control. Still, by being aware of these factors, cattlemen can take some idea of expected prices and programme accordingly.

The variables are shown by different size squares depicting the relative importance of each. For example, fed steer and heifer slaughter contributes the almost to beef supplies, followed by commercial cow slaughter, non-fed steer and heifer slaughter, beefiness imports and exports, and bull and stag slaughter.

On the demand side, per capita disposable income, full population and competing meats (poultry and pork) are all important factors. Other factors, such as the value of past-products and the price of slaughter, processing and marketing (subcontract-to-retail margin), volition also impact farm prices.

Feeder Calf Marketing Alternatives

Webster?s Dictionary defines "marketing" every bit the procedure or technique of promoting, selling and distributing a product or service. It is important to keep in mind what your product is. Ultimately, a feeder calf producer's product is beefiness. Georgia feeder dogie producers have iii major marketing decisions: what to produce, where to market their product and when to price their calves. While some or possibly all of these decisions are set for the producer, alternatives most likely exist. The selection of these alternatives will take a dramatic impact on the profitability of the cattle operation.

Which Cattle to Produce

The cow-calf producer influences the marketability of his cattle the twenty-four hours he selects his convenance stock. While it is true that about any type of cattle tin can be sold at a price, the Georgia cattle producer should be raising the most assisting cattle. There are many factors that decide the value of a feeder calf. Some of these factors tin exist influenced through an functioning?s breeding and genetics programme and others through skillful direction practices. These factors include:

• Breed
• Color
• Frame
• Muscling
• Condition/Flesh
• Weight
• Sexual practice
• Background
• Horns
• Fill up
• Personal Preference
• Vaccinations

Breed

The breed of the calf can influence prices independent of grade. Certain breeds or breed-types bring a higher toll because of perceptions by the order heir-apparent as to how these breeds will perform in the feedlot. While these perceptions may or may not be correct, they do exist. One way to get around breed perceptions is to accept advantage of brood association-sponsored marketing programs. Crossbred calves have traditionally been in higher demand than purebred calves considering of the reward of hybrid vigor. However, in recent years, that trend has been challenged. Calves with a high percent of dairy or Brahman influence are typically discounted through the sale barn.

Color

Calf colour can as well impact the conclusion of value because it can be a clue into the calf'southward breeding. According to a written report washed in Arkansas in 2005, there was a $13.07/Cwt. spread between selling prices of calves of various colors.

Tabular array 3. Toll adjustments for various breeds.
Dogie Color	Average Selling Toll (Value/Cwt.)	Deviation From Overall Average (Value/Cwt.)
yellow-white face up	$120.44	$two.34
yellow	$120.29	$ii.nineteen
black-white face	$120.03	$i.93
black	$119.24	$one.xiv
gray	$117.66	-$0.44
gray-white confront	$116.79	-$1.31
white	$116.01	-$2.09
red-white face	$114.58	-$three.52
carmine	$113.92	-$iv.18
spotted or striped	$107.37	-$ten.73
Source: Improving the Value of Feeder Cattle, FSA 3056. Arkansas Cooperative Extension.

Frame

The Usa Section of Agriculture has official grades for feeder cattle based on frame size, thickness and thriftiness (overall wellness). Frame size refers to the animal'south skeletal size ? its height and body length ? in relation to its historic period. Frame size is related to the weight at which, nether normal feeding and direction, an animal will produce a carcass of a given grade. Large-frame animals require a longer time in the feedlot to accomplish a given grade and will weigh more than than a pocket-size-frame animal would weigh at the aforementioned grade. Animals are assigned to 3 frame sizes - Large, Medium and Small. Table 4 describes the expected minimum live weights at which these calves would produce U.Due south. Choice carcasses.

Table 4. Correlation between frame size and finished slaughter weight.
Frame Size	Steers	Heifers
Large	1250	1150
Medium	1100-1250	1000-1150
Small	< 1100	< chiliad
Source: USDA Agricultural Marketing Service, Livestock and Seed Programme. United states of america Grades of Feeder Cattle. Effective date Oct ane, 2000.

Muscling

Muscling is evaluated by looking at the thickness of the animal. Thickness in feeder cattle refers to development of the muscle system in relation to skeletal size and is the amount of muscling present in proportion to bone and fat. Thicker-muscled animals will have more than lean meat. The four thickness or muscling grades are No. ane, No. 2, No. 3 and No. four.

Muscling No. 1

No. 1. Feeder cattle that possess minimum qualifications for this course usually display predominate beef breeding. They must be thrifty and moderately thick throughout. They are moderately thick and total in the forearm and gaskin, showing a rounded appearance through the back and loin with moderate width between the legs, both front and rear. Cattle testify this thickness with a slightly thin roofing of fat; all the same, cattle eligible for this class may comport varying degrees of fat.

Muscling No. two

No. 2. Feeder cattle that possess minimum qualifications for this grade usually show a high proportion for beef convenance and slight dairy breeding may be detected. They must be thrifty and tend to exist slightly thick throughout. They tend to be slightly thick and total in the forearm and gaskin, showing a rounded advent through the back and loin with slight width between the legs, both front end and rear. Cattle show this thickness with a slightly thin covering of fat; however, cattle eligible for this grade may conduct varying degrees of fat.

Muscling No. three

No. iii. Feeder cattle that possess minimum qualifications for this grade are thrifty and sparse through the forequarter and the middle function of the rounds. The forearm and gaskin are thin and the back and loin accept a sunken appearance. The legs are gear up close together, both front and rear. Cattle evidence this narrowness with a lightly thin covering of fat; however, cattle eligible for this grade may comport varying degrees of fat.

No. iv. Feeder cattle included in this grade are thrifty animals that have less thickness than the minimum requirements specified for the No. 3 grade.

Inferior. This grade includes those feeder cattle that are not expected to perform normally in their present state and those that are "double-muscled." Cattle in this course may have any combination of thickness and frame size.

Thriftiness refers to the credible health of an beast and its ability to grow and fatten commonly. In these standards, unthrifty animals are those that are not expected to perform ordinarily in their present state due to such factors as disease, parasitism, severe emaciation or any status that must be corrected before they could exist expected to perform commonly. Unthrifty feeder cattle may accept any combination of thickness and frame size.

Several market place studies accept been conducted in the mid-Southward and Plains regions since 2000. While the exact numbers for each of these studies varies, the clear message is that that smaller-frame, lighter muscled calves are discounted compared to medium-large frame, heavily muscled animals. An example from a study conducted in Arkansas is shown below in Table 5.

Table 5. Impacts of selected feeder cattle traits on sales price in Arkansas, 2010.
Trait	Disbelieve ($/Cwt.)
No. 1 Muscling	Base of operations
No. 2 Muscling	-$8.94
No. 3 Muscling	-$32.41
No. 4 Muscling	-$57.18
Large Frame	Base
Medium Frame	0.14
Small Frame	-$22.10
Source: Improving the Value of Feeder Cattle, FSA 3056. Arkansas Cooperative Extension.

Preconditioning

Preconditioning programs involve a series of management practices on the subcontract to improve the health and nutrition of calves. Preconditioning adds value to calves for buyers. When preconditioned calves are marketed in a system that recognizes the value that has been added, cow-calf producers benefit from the college prices.

Preconditioning is not a new idea, merely has received considerable attention in contempo years with involvement in value-added programs for cow-calf producers, beef quality balls programs and strategic alliances in the beef industry. There are various preconditioning programs with dissimilar names and management requirements. Nigh programs require a 45-twenty-four hour period post-weaning phase with a sound nutritional program, specified animal wellness procedures, dehorning, castration of bull calves and bunk feeding. The purpose of preconditioning programs is to reduce stress from shipping calves at weaning, improve the immune system, and heave performance in postweaning production phases (i.east., stocker production and cattle feeding) and in carcass performance (i.due east., college grading carcasses with fewer defects).

One common question is whether or not preconditioning programs add sufficient value to feeder calves to commencement the added cost. Common preconditioning programs cost cow-dogie owners about $60/head, depending on the toll of the ration, wellness of calves and length of the preconditioning program. Every bit a result, cattlemen will demand to receive in excess of $threescore (or their price) per head to brand pre-conditioning pay. It is important to remember that the additional revenue tin can come up from reduced shrink and/or a higher cost. The principal point is that those producers considering preconditioning should not focus just on receiving a higher price.

No matter the type of cattle produced, dehorned, well-managed, clean, healthy-looking calves will always bring peak-dollar prices. A Kansas State Academy study of more than 140,000 head of feeder calves sold at auctions showed that cattle that were non in good wellness, had physical impairments or were muddy received large discounts. Muddy calves or calves with expressionless hair typically were discounted 2 per centum, dried animals seven to ix percent and ill animals more than 25 percent. Castrated calves may non bring premiums at sale markets since buyers don't have time to confirm each dogie as he comes through the ring, but they will bring premiums through other market methods that permit for seller identification. Specific health practices may also bring premium prices when the market allows for the recognition of such practices.

The add-on of these management practices to a producer's operation means there is a need for acceptable facilities to perform them. The ability to safely and efficiently pen and restrain calves to perform preconditioning tasks is vital to achieving their maximum value.

Where to Market

Effigy 4. Effect of lot size on sales price. Source: "Factors Affecting Feeder Cattle Prices in Kansas and Missouri." Kansas State Academy Extension 2010.

Georgia cattle producers have several market outlets. No i system fits every producer?s needs, then in that location will go on to be many alternatives. The market place outlets available to you lot will depend on the number and uniformity of cattle you have to sell at one time. This generally is the central ingredient in gaining higher prices through unlike marketing methods. Figure 4 shows the toll premiums that larger compatible groups of similar cattle could be expected to bring. This chart is based on survey data collected from Kansas sale markets.

The correct way to interpret this chart would be to compare the values reflected by the line to a base price for a single-head auction. For example, if a single-caput lot were expected to bring $125/Cwt., a semi-trailer load would be expected to bring 5 per centum, or $6.25, more. As the number of head in the lot increases to more than than 100 caput, the increment begins to decline, only it is still larger than the base.

Essentially, the ability to form truckload lots (around 48,000 pounds) of uniform cattle volition more often than not effect in even college prices and open up marketing methods across the single-head sale.

No matter your size herd, you can capture some of these benefits by having a divers, short breeding season then your calves volition be uniform in weight. Uniformity in cattle colour and course volition be a production of your breeding herd. Lack of uniformity in cattle color tin become a problem if non properly planned in the crossbreeding system.

Choose the Right Marketing Method

Some of Georgia'south cattle market alternatives, along with their advantages and disadvantages, are described in this section.

Auction Markets

Auctions are the traditional way of selling livestock. Most sale markets agree their sales on a detail day of the week.

Auction Market Advantages:

• The auction market tin provide competitive bidding.
• About markets are open up 48-l weeks out of the year.
• It is convenient.
• Information technology is open up to all sellers and buyers.
• There is prompt greenbacks payment.
• All types of livestock can be marketed.
• It provides a place where cattle prices are determined and known to all.
• It is supervised by the federal government.
• Information technology requires admittedly no market cognition by the producer.
• It requires no minimum number of cattle.

Sale Market Disadvantages:

• The seller has little control of prices.
• Information technology encourages multi-handling, speculative-type trading.
• Overhead price is high.
• Excessive stress and shrinkage of livestock may occur.
• In that location is a lack of volume and uniformity of animals at many markets.
• No permanent system exists for identifying livestock and producers later a sale.
• Producers may observe information technology hard to establish a reputation for selling high-quality, well-performing livestock.
• The form and toll information can be hard to interpret.
• Prices are uncertain.
• Disease spread is more than likely.
• The number of buyers may be pocket-sized, reducing competitiveness of bidding.

Even when marketing through auctions, prices for cattle are non uniform. Even so, you can have some influence on the toll you go by communicating with your sale operator. Notice out before you evangelize your cattle what the operator expects in buyers and cattle numbers to be sold during various marketing times. Permit the operator know ahead of time what yous will be bringing to market place. If you have a grouping of uniform calves to sell, ask about the possibility of selling equally a group.

Graded and Pooled Sales

Graded and pooled selling is the combination of small lots of livestock into larger, uniform lots of animals. This can be done informally by people "pooling" their animals earlier selling or through more than formal arrangements. For example, area livestock producers may organize to develop a graded and pooled sale.

Pooled Auction Advantages:

• Can put large, economic lots of livestock together.
• Cost savings for buyers are passed along to sellers.
• Large numbers of livestock attract more buying competition.

Pooled Sale Disadvantages:

• Grading, sorting, weighing and penning before auction tin be time-consuming and expensive.
• Individual producers lose their identity.
• Many marketing facilities may not be designed for efficient processing for this organization.
• It's hard to get a large number of producers to agree on all terms of sale.

Tele-Auctions

A tele-auction is the use of a telephone conference telephone call to allow separation of livestock, buyers and the auction process. Producers with truckload lots of cattle can be sold direct from the subcontract. Producers with fractional truckloads tin be matched with other producers "on paper" and sold together. The tele-sale could also be used with a pooled organisation for smaller producers.

Georgia producers have a long history of using feeder cattle tele-auctions. In fact, Georgia cattlemen have been using tele-auctions since 1977. Since that time, advances in technology have made it possible to utilize videos in the marketing of cattle. Fifty-fifty and then, many marketing agencies notwithstanding use the telephone when taking bids for cattle.

Tele-Auction Advantages:

• Potentially increases contest.
• Directly buyer-to-seller transportation reduces stress, shrinkage and death loss.
• Reduces heir-apparent and marketing cost.

Tele-Auction Disadvantages:

• Requires prior producer commitment.
• Reduces marketing flexibility.
• Requires fractional or total truckload lots.

Video Auctions

Video auctions are very similar to tele-auctions except that videos of the cattle are made for advance viewing or for viewing past satellite telecast while the cattle are sold. Other than that bespeak, many of the considerations for tele-auctions likewise utilise to video auctions.

Digital recordings are often used in combination with tele-auctions. Video auctions were one time exclusively sponsored past national companies; even so, in contempo years many local auction markets also every bit some regional marketing agencies accept gone to marketing load-lots of cattle using video auctions. Regardless of the size of the marketing bureau, video or tele-auctions let buyers to select from hundreds or thousands of cattle coming from a wide geographic area in a short period of time, which reduces transportation costs and wellness risks.

Video Auction Advantages:

• Largest number of potential buyers of all market methods.
• Potential for reduced buyer cost passed along to seller.
• Straight buyer-to-seller transportation.
• Commitment schedules are very flexible. For instance, cattle can be sold in July for delivery in October.

Video Auction Disadvantages:

• Marketing toll can exist generally higher than tele-auction.
• Requires producer to accept on-farm truckload (and preferably more) of uniform cattle.

Private Treaty

Straight SELLING TO CONSUMERS:
Many producers look to amend their bottom line by marketing
directly to consumers. Direct-marketing can be a style to add
value and increase profits. It also involves additional product
risk, expense and management.

While a total discussion of directly marketing is beyond the scope of
this publication, producers interested in this possibility should
consider not only the electric current value of the animals, but also
the additional production costs and chances for death loss. They
should also accept a very good handle on their target market place
and know what this market will pay and compare that price to
the overall breakeven price.

Individual treaty selling of livestock was widely used in the early on 1920s when many country buyers operated throughout the country. As auctions became more prevalent, producers shifted to auction selling. Private treaty selling is a airtight-sale method; information technology is a private negotiation between seller and buyer. The price and terms of sale are unremarkably known just by the seller and buyer.

Sellers and producers of breeding stock have used this method for centuries and continue to use information technology. Producers with large herds often use this method. Private treaty selling of cattle is increasing because many buyers prefer to have their calves conditioned to their specifications and prefer to buy from sellers whose production practices come across their needs and demands.

Private Treaty Advantages:

• Seller controls the marketing process.
• Costs less than other marketing methods.
• Producer can establish a reputation.
• Animals are subcontract fresh with no stress.
• Disease spread is minimal.
• Producer can condition animals to buyer specifications.

Private Treaty Disadvantages:

• Requires splendid marketing knowledge by seller.
• There is no supervision by the federal government.
• Producer assumes take chances of payment collection.
• May be little or no heir-apparent competition.

Retained Ownership

Retained buying involves property cattle longer than would normally be the example or to the next ane or two stages of production. In other words, if you lot are a cow-calf producer, y'all retain buying of your cattle through the stocker stage, and if y'all are a stocker operator, you retain ownership in the feedlot stage of product. There is too the option to retain ownership all the way from birth to harvest. There are many factors that should be considered before retaining ownership of calves. Each gene should be evaluated past each producer for each state of affairs. Adding of break-even costs nether dissimilar retained buying alternatives will help the producer guess profit potential.

Retained Ownership Advantages:

• Receive a return for value-added management and use of superior genetics.
• Receive data (carcass and feeding performance) dorsum to be utilized.

Retained Ownership Disadvantages:

• Increased take chances associated with market place conditions, cattle performance and production.
• Postponement of revenue.
• Additional fourth dimension, labor and interest costs.
• Requires some knowledge of performance capabilities of calves.

Branded Beef Programs

Branded beefiness programs guarantee a consumer a gear up of standards (e.m., lean, natural, organic, breed-specific, grain-fed, grass-fed, tender, etc.). In general, branded beef programs can be broken into three categories: brood-specific branded programs choose cattle from a specific brood or breed type; visitor-specific programs choose beef from all breeds merely include other criteria in terms of form, marbling, size, types of feed used and/or restrictions on the apply of pesticides, antibiotics and hormones; and shop-branded beefiness, which is exactly as the name describes. Some grocery store chains are now branding their own beef products. Most programs can be farther classified into 1 of three groups: light/lean beefiness, organic and/or natural beef, and high-palatability beef.

Branded Beef Advantages:

• Branded beef companies will pay premium for specific cattle.
• Producers are rewarded for direction practices and/or herd genetics.
• Increased ability for the producer to establish a reputation.

Branded Beef Disadvantages:

• Requires producer to switch from "selling" to "marketing" cattle.
• Good record keeping system must be established.
• May crave additional input costs to meet program requirements.
• Potential performance and morbidity (losses from health problems) from producing natural/organic cattle.

When to Market place

In addition to providing the right product at the right place, assisting marketers too marketplace at the right time. Prices for cattle are influenced by supply and demand, which fluctuate throughout the twelvemonth. These fluctuations are usually somewhat predictable; therefore, acute stockmen tin can use these tendencies to develop a profitable marketing plan.

Figure v. Seasonal price indices for steers and bulls in Georgia auction markets.

Figure five shows the relative prices for 500-600 and 700-800 pound steers and bulls in Georgia sale markets. The lines on the chart reflect cost indices or relative prices throughout the twelvemonth. By using 100 percent equally the average for the year, interested cattlemen can brand some inferences about the style prices typically behave. For example, from 2007-2011, prices for 500-600 pound steers and bulls sold in March were 6 percent higher than the yearly boilerplate. On the other hand, prices for the aforementioned calves in Nov were 8 percent beneath the annual average.

It is important to note that the indices change for different weight classes. For instance, prices for 500-600 pound calves tend to meridian in the leap and and so decline the remainder of the year. Conversely, prices for 700-800 pound feeders tend to gradually increment throughout the year and summit in July and August. In both instances, prices tend to be lowest in the fall.

Consider not only the highest (or lowest) prices, but besides the cost of production. For instance, fifty-fifty though 500- 600 pound calf prices peak in the spring, it may be more cost effective to actually sell the calves later in the summer. The implication is that cattlemen should do their homework on not only when prices are the highest and everyman, but as well on what the associated cost of product is.

The actual price received by most dogie producers for their calves volition be adamant when they sell their cattle at a specific market. This need non be the case for producers who take near-truckload lots of cattle to sell at i time. These producers tin ready a price before they will really sell their cattle by using the feeder cattle futures market. Past using the feeder cattle options market, producers too can set a minimum cost they will take for their cattle before the bodily sell date. Both the feeder cattle futures and choice contracts are traded on the Chicago Mercantile exchange. By trading a 50,000-pound contract, a cattle producer in Georgia can prepare the price for as much as a yr in advance of the time he or she actually sells cattle.

Producers who will be selling close to the 50,000-pound contract size at one time may want to investigate these pricing alternatives if they need to reduce the hazard of unfavorable price changes. Producers keeping cattle through stockering, and especially those feeding cattle, are encouraged to consider forward pricing alternatives as they are most susceptible to short-term price changes.

Feeder Cattle Marketplace Alternatives Summary

Most Georgia cattle producers take several alternatives for when, where and how they market place their cattle. Consider each of these alternatives separately in light of its advantages and disadvantages.

No i combination of alternatives can be considered a superior cattle marketing program for all farms. What works for one producer may non necessarily work for another. Even so, there can be no incertitude that proper attention to a marketing plan tin pay great dividends.

Keeping Upwardly with the Market

Successfully implementing a cattle marketing program will require the producer to keep tabs on the market place, specially when a market determination is at paw.

The following is a list of toll and important supply reports that may be useful.

Price Reports by Telephone

Georgia and national cattle market prices, updated daily, Federal Land Market News, Thomasville, Ga. 229-226-1641.

Published Toll Reports

Most price reports are now available online or via east-post subscription. However, the Georgia Section of Agronomics's Livestock Market News office in Thomasville, Ga., nevertheless delivers the daily and weekly sale reports via a recorded bulletin. This information is available by calling 229-226-1641.

Many reports can exist accessed through the Southeast Cattle Advisor website at www.secattleadvisor.com. Specific market reports can be obtained via e-mail subscription through USDA'southward Agriculture Market News at http://usda.mannlib.cornell.edu/MannUsda/homepage.do

Weekly, monthly or annual production information such as cattle inventory numbers, cattle slaughter and beef production tin can be obtained at the USDA National Agricultural Statistics Service (NASS) website at www.nass.usda.gov

References

Schulz, Lee, D. Dhuyvetter, K. Harborth, and Waggoneer. "Factors Affecting Feeder Cattle Prices in Kansas and Missouri." Kansas State University Department of Agricultural Economics, 2010. Available online at www.agmanager.info.

Troxel, Tom, et al. "Improving the Value of Feeder Cattle." Arkansas Cooperative Extension, FSA 3056 (2011). University of Georgia. "2012 Beef Cow-dogie Budgets." Agricultural and Practical Economics Department. Available online at www.secattleadvisor.com.

U.Due south. Section of Agriculture-Agronomical Market place Service (AMS). "Georgia Weekly Auction Report, TV_ LS145" (various weeks).

U.S. Department of Agriculture, Livestock and Seed Program. "U.s.a. Grades of Feeder Cattle." Constructive date October 1, 2000.

U.Southward. Department of Agronomics, National Agricultural Statistics Service (USDA-NASS). "Cattle Report 2012." Washington DC, January 2012.

For more information on beef cattle marketing and economic science, visit the Southeast Cattle Advisor website at www.secattleadvisor.com

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Status and Revision History
Published on Jun 01, 2001
In Review for Major Revisions on May 15, 2009
Published on Dec 08, 2010
Published with Major Revisions on Jul thirty, 2012
Published with Full Review on Jan xxx, 2017

How To Become Successful In Registered Cattle,

Source: https://extension.uga.edu/publications/detail.html?number=B1078&title=Profitable%20Cattle%20Marketing%20for%20the%20Cow-Calf%20Producer

Posted by: michelthres1987.blogspot.com

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