Marketing Cull Cows

1. Marketing Cull Cows

2. Cattle Cycle & Cull Cows • Cattle Cycle • Long as 15 years ~ short as 7 • 8-10 years of profitability • Counter – Cyclically • Cost of production • Ability to purchase and sell at lows and highs • Different attitude toward risk

4. Livestock Marketing Information Center Data Source: USDA/NASS

7. Cattle Cycle & Cull Cows Rules of Thumb • What do these numbers Mean? • Cow slaughter less than 13% of Inventory indicates herd buildup • Greater than 15% indicates decline • Heifer Slaughter less than 37% of Cow herd considered growth

8. Importance of Understanding Cow Slaughter • 15-20% of a producers revenue comes from the sale of cull cows and bulls • Cow slaughter generates 70-75% of domestic non fed beef • A high percentage of ground beef comes form cows • Ground beef accounts for 44% of all beef consumed

9. Importance of Understanding Cow Slaughter • Approximately one half of all cows slaughtered are dairy cows • About 1/3 of of domestic non-fed beef production comes from dairy cows.

10. Economic Importance • Approximately 7million pounds of Non-Fed Beef. • 50% slaughter cows • 9% from bulls • 13% from non fed steers and heifers • 28% from imported • Equates to 20% of total beef production

11. Processors • Rosen Diversified 5 plants • Yankton, SD Cimpl Meats 400 /day • St. Paul MN • Long Prairie, MN 1,000 / day • Omaha, NE 950 /day • Gibbon, NE 1,000 /day • Swift 2 plants • Omaha, NE and Idaho • Iowa Producers • Tama Ia. Plant 30% cows 500 / day • Privately held Plants • Lovett Pack, NE; Host of ones in WI

13. Marketing Cull Cows • Questions • When are most cull cows sold • When is the greatest demand for cull cow meat

15. Marketing Cull Cows • Questions • When are most cull cows sold • When is the greatest demand for cull cow meat • Most sold from October – December • Pregnancy checked off grass, old poor performance • Greatest demand for Ground Beef Summer Months ~ can be frozen for storage

16. Livestock Marketing Information Center Data Source: USDA/NASS

20. Sioux Falls Cow Prices October 22, 2003 Cows: Percent Lean Weight Price Lean Premium White 65-75 1404-1534 lbs 56.00-59.50 Breakers 75-80 1305-1710 lbs 50.50-55.50 Boners 80-85 1162-1479 lbs 45.00-50.00 High Dressing 52.00 Lean 85-90 975-1490 lbs 44.00-48.50 High Dressing 50.00 Low Dressing 42.50-43.00 USDA, Market News

21. Sioux Falls Cow Prices October 20, 2004 Cows: Percent Lean Weight Price Lean Premium White 65-75 1404-1534 lbs 58.00-66.00 Breakers 75-80 1305-1710 lbs 54.00-56.00 Boners 80-85 1162-1479 lbs 52.00-54.00 High Dressing 58.00 Lean 85-90 975-1490 lbs 49.00-52.00 High Dressing 56.00 Low Dressing 45.00-46.00 USDA, Market News

22. Marketing Cull Cows Questions to be asked • What season of the market are you in? • The price difference between grades of cows? • Cost of feeding? • Select cows that will gain and obtain higher grades • Consider market place.

23. Percentage Price Increases Between Cull Cow Grades Pritchard, SDSU

24. Percentage of Cows in Each Grade Following a Feeding Program of Shelled Corn and Corn Silage Pritchard, SDSU

25. Marketing Cull Cows Iowa State Data - Feed 60 – 90 days to obtain White Fat • Average daily gain 3.8 lbs • Feed costs were 52.23/cwt • Conversions were 10 to 1

27. Cancer Eye

28. Bruising

29. Bruising • Tim Loss (26.8 mil lbs) $23.0 mil • Loss of Primal $52.0 mil • Avg loss per head $11.75 / hd • Producer controlled $ 4.00 / hd

34. Downer Cows • Only 1% But…. Causes problems when animal right activist get a hold of pictures

35. Proper Condition

36. Proper Condition

39. Quality Losses Per Head Carcass condemnation 11.99 Trim dirt/ Bruises 12.00 Loss of offal 4.00 Hide devalued 7.00 Injection Site Lesions .75 Yellow Fat 2.30 Poor Muscling 14.50 Excessive Fat 17.75 Light Carcasses 4.00 Other 1.20 Total 76.00

40. Strategies to Improve Quality • Monitor herd health • Monitor Condition Scores • Decreased hide damage ~ Insects • Reduce Bruising • Reduce Injection site lesions • Market clean cattle • Euthanasia disabled cattle Market in a Timely Manner!!!

41. Marketing • Live • Auction markets • Live basis • Risks??? • Packer Direct • Delivery • Carcass basis • Risks??

42. Marketing • Live • Auction markets • Live basis • Risks??? NO Risk • Packer Direct • Delivery • Carcass basis • Risks?? Great Risk ~ condemned carcasses trim ect

43. Marketing • Where to sell • Local Auction Markets • Ask how many cow buyers and who they represent • How to sell • Do Auctions use sorting • How many do the sell (large groups or Small)

44. Marketing Maximizing Price • Time of year • Dressing percent • Condition • Quality, Fatness, Structural soundness and Age

45. Importance of Understanding Cow Slaughter • 15-20% of a producers revenue comes from the sale of cull cows and bulls • Cow slaughter generates 70-75% of domestic non fed beef • A high percentage of ground beef comes form cows • Ground beef accounts for 44% of all beef consumed • Approximately one half of all cows slaughtered are dairy cows • About 1/3 of domestic non-fed beef production comes from dairy cows.

46. Marketing Cull Cows • Questions • When are most cull cows sold • When is the greatest demand for cull cow meat • Most sold from October – December • Pregnancy checked off grass, old poor performance • Greatest demand for Ground Beef Summer Months ~ can be frozen for storage