F&R Livestock Resource, Fall 2017 Issue

F&R LivestockResource

Fall 2017 | Volume 1, Issue 1

Your direct source for livestock news and information Published by Farmers & Ranchers Livestock, Salina, Kansas

In this Issue: 1 Where You Fit

Assimilating industry signals into actual beef production presents the age-old dilemma. Reports like National Beef Quality Audits have helped bridge the gap between consumers, packers and producers.

7 Value Differentiation is Here to Stay

Saying “they’re worth more” isn’t good enough anymore. Transparency and value-added programs that require documentation have strengthened the “worth more” argument.

10 Market Makers Beef Connecting Producers

Internet cattle listing sites aren’t new. MarketMakersBeef.com is a new concept in marketing cattle with added value. Within the new website, sellers have many selection tools to document the inputs on a particular group of cattle.

13 Cattle Prices Remain Stronger Longer

Odds favor cattle prices continuing at higher year-over-year levels through the remainder of the year, despite increasing cattle numbers.

17 Trading Up

In any market, one of the most straightforward means of increasing herd productivity and revenue might be one so easily taken for granted—selecting early breeding heifers.

19 Consumers are Driving Packer Changes

Tyson Foods, one of the nation’s largest meat purveyors, expands its product line to offer consumers new choices in a diverse marketplace.

22 American Royal, K-State Olathe Concludes High ‘Steaks’ Contest “Steak is very much a part of the culture in the Midwest and Kansas City,” Marianne Swaney-Steuve said. The American Royal Steak Contest is an annual, nationwide competition that identifies the tastiest steak in the country.

Where You Fit

by Wes Ishmael

“Just tell us what you want. What’s the target?”

That request was made decades ago to a noted executive from one of the major beef packers. The requestor, visibly frustrated, was one of a group of seedstock producers. If memory serves, the central theme of the meeting was the dog-eared debate about whether carcass quality or yield pays more over the long haul.

“The target is the same as it has been for at least the past 30 years,” was the reply from the packer man, who was also visibly frustrated. “We want Choice, Yield Grade 2 cattle.”

Period.

Certainly, lots of things are different these days, everything from instrument grading, to the creation of new beef cuts and convenience products, to more precise valuation of cattle for specific value attributes, at least as part of branded and value-added programs.

In the great scheme of things, achieving the aforementioned target would please more packers than not—a level of quality that should reduce unsatisfactory eating experiences and enough carcass yield to make worthwhile providing the experience, notwithstanding the fact that the current yield grading system is plumb outdated.

Continued on page 4 ________________________________________

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Safe-Guard is a registered trademark of Merck Animal Health. Panacur is a registered trademark of Merck Animal Health. Ivomec is a registered trademark of Merial, Ltd. Cydectin is a registered trademark of Boehringer Ingelheim Vetmedica. Dectomax is a registered trademark of Zoetis. LongRange is a registered trademark of Merial, Ltd. 1 FDA Public Resistance Forum-March 2012 2 Tests from 1/1/2008 - 4/12/2016 3 NAHMS 2008 4 Dobson R., Jackson F., Levecke B., Besier B., et al. Guidelines for fecal egg count reduction tests (FECRT). World Association for the Advancement of Veterinary Parasitology (WAAVP) (2011) Proceedings: 23rd International Conference of the World Association for the Advancement of Veterinary Parasitology 2 Giralda Farms – Madison, NJ 07940 – merck-animal-health-usa.com – 800.521.5767 Copyright © 2016 Intervet, Inc. d/b/a Merck Animal Health, a subsidiary of Merck & Co., Inc. All rights reserved.

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F&R Livestock

From the Editor

Resource

Volume 1, Issue 1 Fall 2017 Published quarterly by

Farmers & Ranchers Livestock, Salina, Kansas 1500 W. Old Hwy 40 Salina, Kansas 67401 785-825-0211 • 785-826-1590 (fax) FandRLive.com

find us on Facebook

Facebook.com/FarmersAndRanchersLivestock/

Owner: Farmers & Ranchers Livestock, Mike Samples, Salina, Kansas (785) 826-7884 Editor: Deb Norton, Deb@CogentIdeasInc.com Production Coordinator: Julie Tucker Graphic Designer: Daric Wells Editorial Assistants: Dixie Russell, Dave Cumpton Contributing Editor: Wes Ishmael Contributing Artist: Ted Foulkes Sales Andrew Sylvester Farmers & Ranchers Livestock (785) 456-4352 Jay Carlson Carlson Media Group, LLC (913) 967-9085 Subscriber Questions: To be added to our mailing list, contact Julie Tucker, Julie@CogentIdeasInc.com.

F&R Livestock Resource is published quarterly with mail dates of January 15, March 1, July 1 and October 15 by Farmers & Ranchers Livestock, Salina, Kansas.

First of all, on behalf of an excited team, I want to welcome you to the inaugural issue of the F&R Livestock Resource. The idea for this new communication tool was discussed more than a year ago. Like many new ideas, the proverbial can was kicked down the road for several months, revisiting the issue and continuing to toss ideas around.

After months of planning and discussion, the first issue is now in your hands. It’s important to explain why a print publication and why now. The F&R Livestock Resource fits into an overall plan for Farmers and Ranchers Livestock (F&R) to better serve an emerging value-added market. In addition to the publication, you will soon see changes inside the F&R livestock facility.

Although F&R is the largest livestock market in Kansas, limited pen capacity at certain times of the year simply means the facility cannot accommodate all of the cattle for the week, particularly during cow sales.

As an online bidder, you will notice a significantly improved internet bidding platform. If you’re a regular onsite F&R customer, you will see

F&R

Livestock Resource

large, flat screen televisions and data monitors in an effort to better display information that ultimately can add value. F&R now has the capability to sell cattle in the country and display video of the cattle online and onsite. F&R will work aggressively to position itself as one of the Midwest’s premier livestock markets for value-added cattle.

The F&R Livestock Resource is an opportunity for registered seedstock suppliers, commercial beef producers, equipment dealers and health and nutrition companies to advertise. The publication reaches 10,000 producers and decision makers. The editorial is timely, educational and industry relevant.

Advertisers will have digital opportunities onsite as well as the website.

Editorial content is intended to be educational, objective and informative.

Exploring science and technology and the value of implementing tools and technology into management schemes today is important. Many commercial beef producers are recognizing tools and technology serve as valuable risk management as well.

A few of the best journalists in the agriculture industry will be invited to contribute to F&R Livestock Resource. It’s important to lead with the best and that’s why the first issue features the editorial contributions of Wes Ishmael. At the risk of dating both of us, I remember one of Wes’ first jobs out of college.

One of the true strengths of Wes’ journalism is his ability to dig into complex topics, ask the right questions and complete a story with industry relevance, accuracy and enough simplicity that anyone can “get it!”

Another fun feature included in each issue is the cowboy cartoon of Ted Foulkes. Raised in the city (the really big city of Los Angeles), Ted migrated east and now calls Missouri home. He’s a member of Cowboy Cartoonists International and is a contributing artist for Leanin’ Tree greeting cards. Regardless of the cattle market, politics and other life stressors, taking just a minute to look at a little humor often makes the rest of the day just a bit easier.

Again, welcome to the first issue of F&R Livestock Resource. We look forward to growing the publication, providing the Midwest with another viable advertising resource and keeping readers informed.

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Some would say the same for Quality Grade.

Despite such a broad and static target for so long, still too many cattle end up too far from the bulls-eye.

Consider the most recent checkoff-funded National Beef Quality Audit (NBQA). Of the $49.06/carcass in lost quality opportunity, 81 percent stems from Quality Grade ($15.75), Yield Grade ($12.91) or carcass weight ($10.88). The latter two are worse than in the previous NBQA in 2011. These lost opportunities are derived from compliance with consensus target consists established by packers, retailers and restaurateurs. In other words, ideally, what is the ideal mix of Quality Grade, Yield Grade and such across the industry?

For Quality Grade, the target was 5 percent Prime, 70 percent Choice (equally divided between Low Choice and the upper two-thirds of Choice) and 25 percent Select. For Yield Grade (YG), the targets were 10 percent YG1, 45 percent YG2, 40 percent YG3, 5 percent YG4. For carcass weight: 20 percent at 600-800 lbs.; 30 percent at 801-900 lbs.; 50 percent at 901-1,000 lbs.

“While the industry is improving the quality of beef being produced, quality is being accompanied by an increase in size and fatness,” according

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to the 2016 NBQA. “The mean USDA Yield Grade in 2016 was 3.1, increasing slightly compared to the mean yield grade of 2.9 in 2011. More significantly, however, the frequencies of YG 3, 4 and 5 in 2016 increased compared to 2011. The largest percentage of carcasses (29.9 percent) was Choice YG 3. During the same time period, the percentage of carcasses grading Choice or Prime increased 10 percent to 71 percent.

Besides the significant increase in Choice and Prime carcasses, the NBQA notes that positives include a

high mobility score for cattle entering packing plants and the fact that the number of blemishes, condemnations and other attributes that impact animal value remain small, according to a synopsis by the Beef Board.

The NBQA has been conducted every five years for the past 25 years.

It and subsequent industry goals and tactics from each is one reason why injection site blemishes are no longer the major problem they once were, why average Quality Grade increased and excess fat declined.

Incidentally, the value of lost oppor-

tunities in quality issues was $63.27/ carcass in 1991. It declined to $47.30 in 2011 before edging higher to the most recent $49.06. Keep in mind that comparing dollar values between audits is a dicey business since market conditions affecting value vary widely between audits. Instead the dollar values provide a relative gauge of progress over time. Individually, each audit also provides a glimpse of the dollars at stake.

Based on approximately 24.2 million steers and heifers slaughtered last year, about $1.2 billion worth of lost

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opportunity, due only to the specific quality attributes highlighted by the audit: Quality Grade, Yield Grade, carcass weight, hides and branding, offal/carcass condemnation.

“Among areas for possible improvement, are the fact that there was more bruising (although bruising was less severe) and the fact that more than 30 percent of livers harvested did not pass inspection and were condemned,” according to the report.

Although not stated this way, from the following, you could be forgiven for believing that improvement would come simply from beef packers placing a higher priority on consumer eating satisfaction with beef.

“The eating satisfaction quality factor, which was primarily defined as

‘customer satisfaction’ by all sectors, was ranked second by all marketing sectors except packers, who ranked lean, fat and bone second,” according to the report. “Compared to the 2011 audit, a greater percentage of companies were willing to pay a premium for guaranteed quality attributes. However, overall these companies were willing to pay lower average premiums than the companies interviewed in 2011. While not a single packer listed eating satisfaction as a ‘must-have,’ 55 percent said they would be willing to pay an average premium of 10 percent if it could be guaranteed.”

Good grief.

Perhaps packers didn’t rank eating satisfaction because they believe it’s

…the NBQA offers the industry an invaluable report card of sorts, documenting how well the beef product served direct customers and their customers during a specific window of time.

a given. If that’s the case, then they should eat more random samples of what they harvest and process because spectacular eating failures routinely still exist, from steaks to ground beef.

Yes, it’s difficult to guarantee eating satisfaction. For one thing, no single

product will satisfy everyone. And, if carcasses fail, whatever satisfaction test is applied, who’s to blame and who’s to foot the bill? Like a judge picking a steer to win the show that the crowd considers too this or too that, when those are the only types in the show, packers deal the proverbial cards they’re dealt.

Testing tied to such assurances is expensive, too—things like conducting Warner-Bratzler shear force tests on core sample from carcasses. Some companies go further than that in guaranteeing eating satisfaction on specific premium branded products.

But, when beef is far and away the highest priced animal protein available to consumers in volume, surely consumers should expect to enjoy eating any beef that is the result of federal inspection and grading.

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Fall 2017

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As mentioned, the NBQA offers the industry an invaluable report card of sorts, documenting how well the beef product served direct customers and their customers during a specific window of time.

This gauge also offers individual producers a compass. For instance, based on the consensus of the recent audit, the target is 55 percent YG 1-2 cattle (95 percent YG 1-3), with 75 percent that grade Choice or higher and hang carcasses that weigh 6001,000 pounds.

Did someone say the target was Choice 2?

Calves that produce feeder cattle, which produce fed cattle that leave carcasses falling outside those parameters are worth less to buyers because they have less value to customers.

For someone selling calves at weaning or soon after, even for those selling feeder cattle, subsequent management can alter carcass quality, carcass weight, yield and the incidence of offal and carcass condemnations.

But they’ll never have a chance to hit the broad target without enough muscling and inherent marbling ability to start with.

Dan Kniffen, owner of Windy Butte Ranch and an assistant professor at Penn State University shares some insight about the importance of the NBQA to individual producers and to the industry, collectively, in a video that can be found with the NBQA at BQA.org/National-Beef-Quality-Audit.

“It gives us the facts and figures to talk to the American consumer, and now the global consumer,” Kniffen explains. He emphasizes the NBQA provides science-based information the industry can use to truthfully tell the story of beef quality and wholesomeness to consumers.

Value Differentiation is Here to Stay Buyers will pay more for cattle that are worth more, but you have to prove it.

by Wes Ishmael

Adding value to a set of calves is nothing new, everything from castrating and dehorning, to straightening out and upgrading fly-weights assembled from multiple sources, to pooling calves of similar kind with the neighbor to build a load lot.

Adding quantifiable value to each of those calves, though, is a relatively recent phenomenon.

Perhaps beginning with the creation of Certified Angus Beef® (CAB) in 1978, more consumers expressed willingness to pay a higher price for beef products that come with added promises. In the case of CAB, the promise was based on carcass characteristics and grade.

Yes, there were branded beef programs before CAB, some spectacular

failures in the early 1970s come to mind. Arguably, though, it was the advent of a beef brand moving beyond niche status, discovering and creating added demand along the way that cemented the concept.

Taking the same trip down the management side, consider the market for verified preconditioned calves. You can argue whether or not the premium over time has made it worth the producer assuming added risk. You can’t argue with the fact that buyers will typically pay a premium for preconditioning, as long as it’s verified.

Also, as long as calves are sold in such a way that buyers can access a volume of them at the same time.

These days, other value-added management opportunities include

Randall Spare, DVM, Ashland Veterinary Center

things like all-natural, the non-hormone treated cattle designation for the European market and grass-fed.

Arguably, the next frontier of adding value revolved around genetics, not breeds—verified specific genetics that promise a specific level of performance and access to particular value-based premiums.

“Value creation and value capture opportunities in this business have never been better,” said Tom Brink, founder of Top Dollar Angus, presenting results of a study at Gardiner Angus Ranch. “If you are producing superior cattle with excellent genetics, and they go on through the supply chain and hang a good carcass, there has never been a better time to capture the value.”

Brink is now CEO of the Red Angus Association of America. Keep in mind, he made those comments in 2014 when any head of cattle drawing a breath brought record-high, unprecedented prices.

“You can add value to an animal, but it must be quantifiable,” says Randall Spare, DVM and co-founder of Market Makers Beef (see “Connecting Producers and Buyers of Added Value”). “You can add value biologically or through management, but it must have economic value in order to retrieve it in the marketplace.”

Added-Value Foundations Hard as it may be to believe this day and age, most cattle feeders know a lot about only a small minority of the cattle they purchase. As such, they typically buy on the average, paying an average price based on average expectations of health, feedlot performance and carcass potential.

You say the calves are vaccinated, for example. Without verification, they will vaccinate the calves again. You tell them your cows are tops and the bulls rank among the highest in the breed for carcass traits. Without documentation of the genetics and past peer performance, those calves must be purchased on the average, plus or minus what their eye and experience tell the buyer.

Of course, getting paid average prices is exactly what cattle feeders were trying to get away from more than two decades ago, when they lobbied beef packers for formula pricing and grid pricing. Until then, only a flea could squeeze between the weekly price difference paid across packers and feedlots.

It helped that the industry’s first National Beef Quality Audit (NBQA) (1991) and the Strategic Alliances Field Study (SAFS) that followed F&R Livestock Resource page 7

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(1993) were fresh in mind. The SAFS sought to identify whether any of the lost dollars identified in the NBQA could be recovered if industry segments worked together, sharing information, rather than against one another protecting their own information.

Although industry alliances and branded beef products existed prior to the SAFS, it’s hard to deny this study gave root to the concept industry-wide.

For instance, Dr. Spare explains, “U.S. Premium Beef started because they knew there was added value in their cattle. They wanted to be able to measure that value and be paid for it.

That’s transparency.”

Incidentally, by working together, producers, feeders and packers were able to recover almost 27 percent of the $279.82 per head of lost value identified in that first NBQA. More importantly, that demonstration provided impetus for the many value-based alliances to follow. Some were successful, some still continue, and others failed. All sought to add and retrieve more dollars by virtue of having more than one industry sector involved.

Keep in mind that the NBQA and SAFS (both funded by the beef check-off) came amid a 20-year decline in domestic consumer beef demand. Every year, for two decades, beef lost another 1 percent in demand.

It was a period of peak commod-

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page 8

Fall 2017

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ity beef production and marketing.

Commodity is defined here as the proverbial widget: all considered to be of roughly the same value and priced accordingly.

Today, upwards of 75 percent of all fed cattle are traded outside of the spot cash market, although the base price for many formulas and grids still relies on price discovery in the spot cash market. But, that’s a whole ’nother conversation.

So, a major portion of those cattle have the opportunity to be valued beyond commodity.

By and large, though, calf and feeder cattle markets remain based on averages, whether the medium is physical, internet auction or direct trade. But, Spare believes the opportunity to document calf value and to retrieve an added portion of the added value is growing rapidly. “Buyers are becoming more sophisticated,” he says.

At the very least, buyers are more aware of information available to describe cattle and how that information equates to expected performance. At the same time, more producers are making more information available because they understand there is economic benefit.

Today, calves eligible for CAB typically command a quantifiable premium compared to ineligible ones. A growing volume of calves are being marketed with verified genetic information through the likes of Top Dollar Angus and the Reputation Feeder Cattle® program.

In every case, value differentiation is the intersection between adding value and being rewarded for the extra effort and risk. That means value-added sellers must be willing to share information.

Snubbed to a different post, adding and retrieving maximum value is achieved in the glaring light of transparency. You have to provide verified, economically measurable data in order to retrieve added value. You can’t hide behind averages and unknowns.

Dr. Spare believes commodity cattle will be discounted even more in the future. For that matter, he points out that during the market collapse last fall, there was next to no market access for unweaned calves. It wasn’t a matter of those types being worth significantly less, it was a matter of no one wanting them at any price.

Value-based marketing, or value-added, whatever term you choose, is driven as much by the mindset involved as the particular mechanism.

“Will the next producer be able to succeed with the product I’m selling?,” Dr. Spare asks. “That’s the question we need to answer.”

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Connecting Producers and Buyers of Added Value Market Makers Beef provides a new opportunity for cattle producers to market their cattle with quantifiable information buyers want.

by Wes Ishmael

“Once people have known value in their livestock, the next step is providing a marketing avenue so they can capture that value, whether they’re marketing calves, feeder cattle, fed cattle or breeding females,” says Randall Spare, DVM and president of Ashland Veterinary Center, Inc. at Ashland, Kansas.

“Everything you produce, everything you do that’s attached to your name, goes into building and maintaining your own unique brand, good and bad,” explains Debbie Norton, a partner of Cogent Ideas Inc., a veteran agricultural marketing firm based at Topeka, Kansas.

Both of those are reasons that Dr. Spare, Norton and Julie Tucker, also Cogent Ideas Inc. partner, developed Market Makers Beef (MarketMakersBeef.com), an internet-based listing service for value-added cattle.

Understand that value-added in this case is not some nebulous notion.

Head to the Market Makers website (MarketMakersBeef.com) and you’ll quickly see that sellers can describe what they have to offer via numerous quantifiable measures. Everything from specific health and nutrition attributes, to specific genetics, including easy access to expected progeny differences of the sires and other genetic evaluation measures.

They’ve had all of their shots.

Look at the bone in these heifers, and from a reputation herd.

Those kinds of descriptions no longer differentiate value, Dr. Spare says.

For that matter, he explains even terms like VAC 45 and VAC 34 mean less to buyers these days because of how they’ve been misunderstood and used to sell calves in the past.

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page 10

Fall 2017

In basic terms, Dr. Spare explains adding value to cattle means adding economic value that can be measured (see “Value Differentiation is Here to Stay”).

One Value Example Dr. Spare offers a real-world illustration—a set of steers retained and fed by one of his clients. From past experience, Dr. Spare and the client knew what the steers were capable of because of the specific genetics and specific health and nutritional management.

Those steers went on feed at 900 pounds. They brought back $175 more per head than market price, via a specific fed cattle marketing grid.

“Sixty-seven steers brought back $11,000 more than market price,” Dr. Spare says. “That’s like selling 10 more calves without the added cost of producing 10 more calves.”

This isn’t a guarantee, nor is it an anomaly. Dr. Spare’s point is, that these kinds of added returns beyond market value are routinely available for those producing or procuring cattle with more value, when marketed in a way to retrieve the added value.

In the example above, the folks knew what the cattle were capable of in terms of feedlot gain, feed efficiency and health. They knew the kind of carcasses the cattle would hang—55 percent Prime and 100 percent Choice and higher as it turned out. They also knew they had access to a market that would pay for those quality attributes, specifically.

Armed with such knowledge, this particular producer could have sold the calves at any weight, able to demonstrate how much more they were worth.

“It’s a consistent result when using a disciplined breeding program. Those steers come from a herd in southwest Kansas with a 95 percent conception rate in a 60-day breeding season. The

steers did perform exactly as genomically predicted,” Dr. Spare explains.

There’s always risk with anything living and breathing, of course. But quantifiable documentation of those calves’ history and potential make them the surest thing possible, and that has value. In this particular herd, genomic testing has been used as a benchmarking tool when retaining heifers for four years.

Foundation to Adding Value “My goal as a veterinarian is not only to help clients with herd health, but to help them add value to their livestock,” Dr. Spare says. “Our job today as veterinarians, at our clinic, at least, has moved from being a production specialist to helping our clients capture all of the value they’ve put into the cattle.”

For Dr. Spare, adding value to client cattle boils down to four areas, what he terms the four legs that the cow herd relies upon for overall strength and opportunity: genetics, health, nutrition and temperament.

“You have to keep those four legs in the front of the mind, but then you look for the low-hanging fruit,” Dr. Spare says. “Is my herd reproductively efficient? If it’s not, you first look at nutrition and adjust for the environment. Or, maybe you’re providing enough nutrition for the cows, but managing them in such a way that the calves don’t have adequate access to their mothers. If you’re still struggling, look at temperament. We know that calves out of wild cows receive fewer immunoglobulins via passive transfer in the colostrum. We know that calves with low colostrum intake are three times more likely to become sick at least once in their lives… . Watch the data to make sure there is no low-hanging fruit that’s being missed.”

When you create the value, document the value and access markets

to retrieve the value, benefits are manifold.

For instance, the client who produced the steers mentioned earlier knows they can repeat this every year.

Now, folks are inquiring about his cows and heifers.

Rather than sell heifers as market animals alongside their steer mates, but at a discount to them, Dr. Spare points out there is opportunity to breed them, in herds with the kind of cows that commercial producers covet.

“What was a discard can become a product that we can take advantage of, but we can only do that with known, quantifiable genetics,” Dr. Spare explains.

Just For Fun by Ted Foulkes

Economic Shrink Another benefit Dr. Spare believes Market Makers Beef can provide buyers and sellers is the reduction of what he terms economic shrink. Think of it like this. Every time an animal trades hands, there is a transaction cost, be it directly, via commissions and freight, or indirectly, through the tissue and muscle shrink associated with gathering and transportation.

“If you retain ownership in your calves, you probably retain $70 per head of economic shrink,” Dr. Spare reckons. “We can decrease economic shrink, and when we do, it helps improve the economic efficiency of the cow herd.”

Understand, Dr. Spare isn’t advocating that producers bypass the sale barn or any other marketing channel. He’s simply recognizing a potential area where fewer dollars can be spent and how information can help retain more of those dollars.

For instance, a seller might list a set of calves on Market Makers Beef and the date those cattle will be sold at a particular sale barn. Armed with the information available via Market Makers Beef, bidders and ultimate buyers of those calves at the auction will be more likely to retain those calves for the reasons they were purchased, rather than finding out some non-descript calves didn’t work, so they move them again.

Hobbled to a different horse, more information creates a win-win opportunity for both buyers and sellers to grow the economic pie.

Here’s How Market Makers Beef Works Market Makers Beef is a straightforward proposition. For $150 per month, you list an offering of cattle. It’s the same price, whether that offering is one head or 100,000 head; whether or not the cattle ultimately sell via the listing. Period. If you want to list the same offering for another month, it’s treated as a separate offering.

How the cattle are sold and terms of the sale are up to the seller and buyer.

“Getting cattle sold through Market Makers Beef should be only part of someone’s consideration,” Norton says. “There is tremendous value in letting a universe of buyers, who are interested in cattle with added value, know about not only a specific set of calves or package of heifers you have for sale currently, but helping them discover your program.”

In some ways, Market Makers Beef also serves as a platform for producers to market their cattle, who are typically uncomfortable with the idea of marketing, versus selling them.

Tucker emphasizes Market Makers Beef is a dynamic website that is promoted.

“Even established brands, products and services must stay in front of customers and potential customers consistently,” Tucker says. “With something new like Market Makers Beef (not just a new service but a new concept) we will promote extensively in a variety of ways. When you utilize Market Markers Beef, you’re assured the industry knows about the service.”

“Our goal is to provide a single

source where people can go to list their cattle,” Dr. Spare explains.

There is currently no place where cattle are listed on the internet where you can access all of the information about the cattle for sale,

which includes their genetic value.

With Market Makers Beef, we want to help producers connect the dots and take advantage of the value they’re already putting into their cows.”

In some ways, Market Makers Beef also serves as a platform for producers to market their cattle, who are typically uncomfortable with the idea of marketing, versus selling them.

F&R Livestock Resource page 11

ed first-quarter price for next year is $110-$120.

Cattle Prices Remain Stronger Longer There’s no current fundamental reason to expect a price collapse like last year.

Beef Demand Remains Stronger than Anticipated

by Wes Ishmael

Odds favor cattle prices continuing at higher year-over-year levels through the remainder of the year, despite increasing cattle numbers borne by national cow herd expansion. As it is, prices are already higher than many anticipated heading into the fourth quarter.

“This year has shaped up more positively than most of us thought it would,” says Glynn Tonsor, agricultural economist at Kansas State University.

In fact, in mid-September, Dr. Tonsor was projecting a positive return for cow-calf producers, albeit much less than in 2013-2015. That was based on a 550-pound steer (basis Salina) at a projected market price from mid-October to early November of $152$153/cwt.

“For someone who has annual cow costs of $800, the breakeven sale price at that weight is about $144,” Dr. Tonsor explains. “So, it suggests a small but positive return. Eight or nine months ago, few if any of us, would have projected a positive return.”

Likewise, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, expects calf prices to remain higher year over year through the fourth quarter, with a seasonal low in October.

“Strong stocker demand for fall and winter grazing may limit seasonal price pressure this fall,” Dr. Peel explained in his mid-September market comments.

“Heavyweight feeder cattle prices typically decline seasonally through the end of the year but are also expected to remain above year-ago levels. While prices may weaken seasonally, I don’t expect a repeat of last year’s October crash in cattle prices.”

Further out, analysts with the Livestock Marketing Information Center (LMIC) expect increasing cattle numbers to pressure prices.

“The fundamentals of the cattle and beef supply for the next two years will be the size of the U.S. calf crops,” LMIC analysts explained in a mid-September “Livestock Monitor.”

“As reported by USDA’s National Agricultural Statistics Service, the size of U.S. calf crops have increased each of the last three years and in 2017 looks to be the largest since 2008. Based on the cow herd, both the 2018 and 2019 calf crops are expected to be even big-

“For someone who has annual cow costs of $800, the breakeven sale price at that weight is about $144. So, it suggests a small but positive return. Eight or nine months ago, few if any of us, would have projected a positive return.” —Glynn Tonsor

ger. All else equal, that is a challenging environment to keep raising prices.”

Cattle Feeders Built Market Support Chalk up plenty of the market support since last fall’s market collapse to cattle feeders getting ahead of the marketing curve last winter. Aggressive feedlot marketing equated to lighter year-over-year carcass weights this year and less increased beef production relative to the increasing number of cattle.

“We’re seeing the remnants of what cattle feeders were setting up during the last half of last year, pulling cattle forward,” Dr. Peel explained during the summer. “Slaughter levels continue higher year-over year, but the market continued to offer feeders incentive to market cattle on a timely basis, given the wide discount between front-month live cattle futures and the cash market. As fed cattle prices increased, so did the marketing incentive. All of that helped depress carcass weights and dilute expected beef production.”

For perspective, heading into September, Dr. Peel said steer and heifer carcass weights for the year were averaging about 14 pounds less than the previous year.

Positive returns also provided incentive for cattle feeders to keep the pens turning. Improving feedlot returns resulted, at least partly, from lower breakevens wrought by lower costs for replacement cattle, as well

as lower feed costs. Feed costs should continue on the low side, too.

The season-average corn price (farm) projected by the World Agricultural Supply and Demand Estimates (WASDE) in September was projected at $2.80-$3.60/bu.

Those same WASDE projections pegged the fourth-quarter fed steer price at $107-$113/cwt. The project-

At the same time, domestic demand remains stronger than suggested by some of the most-utilized yardsticks.

“If you look at grocery store scanner data (prices actually paid at retail) demand was higher four of the first six months of this year,” Dr. Tonsor says.

Conversely, common beef demand indexes built with aggregate data suggest softer demand so far this year compared to last. Dr. Tonsor explains aggregate data accounts for the volume of beef disappearance from both retail and food service, utilizing product label prices, in the case of retail, rather than actual price paid.

Moreover, international demand for U.S. beef continued at a blistering pace through July. The per head slaughter value of U.S. beef exports was $273.52, according to the U.S. Meat Export Federation. For the first seven months of this year, exports were running 11 percent more year over year in terms of volume (711,364 metric tons) and 15 percent more in terms of value ($3.97 billion).

Keep in mind that what is termed a frozen beef safeguard was triggered

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in Japan (one of the biggest customers for U.S. beef) in late July. It significantly increases the duty on frozen beef imports to 50 percent from the U.S. and other suppliers who don’t have a trade agreement with Japan.

On the other hand, U.S. beef exports have access to China for the first time in 14 years. July was the first full month for exports there: 137 metric tons valued at $1.3 million.

Combined, Dr. Tonsor says, “The positive demand story is central to higher than anticipated cattle prices.”

Current Marketing Strategies Both Dr. Tonsor and Dr. Peel point out that lousy wheat prices and the potential for an extended wheat grazing

season this year could help underpin calf prices and also create options for cow-calf producers.

“Early planted wheat, along with other forages, may add 30 or more days to the front end of winter grazing,” Dr. Peel explains. “At the same time, expectations for 2018 wheat prices are dismal enough that some producers are beginning fall grazing with an intent or high likelihood of grazing out wheat next spring. A full graze-out adds another 75 or so days to the winter dual-purpose grazing period. Together, these conditions

suggest the possibility of 220 or more days of grazing compared to a more typical 120 day winter grazing period.”

Such a lengthy grazing period suggests that stocker operators have the chance for taking two turns of cattle through wheat pasture rather than one.

“Two sets of stockers allow producers to consider a wider range of purchase weights and perhaps avoid demand bunched around lightweight stockers,” Dr. Peel says. “It is common in the fall to see prices for typical stocker sizes (400-525 pounds) to be

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Fall 2017

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“…someone with access to wheat pasture and with the necessary equity, it probably makes sense to retain calves rather than sell them in October.” —Glynn Tonsor high relative to heavier stockers (550650 pounds). Current prices for stocker cattle suggest that a wide range of purchase weights (400-650 pounds) all offer roughly the same value of gain and similar potential for returns.”

Using BeefBasis.com (a free website with information including local basis data and buy-sell calculators), Dr. Tonsor ran the numbers for that 550-pound steer calf mentioned earlier. Grown for 200 pounds and marketed at the end of January, the projected value of gain at the time was $85/cwt.

With that in mind, Dr. Tonsor says, “For someone with access to wheat pasture and with the necessary equity, it probably makes sense to retain calves rather than sell them in October.”

Obviously, there are never guarantees. Dr. Tonsor notes that producers who kept growing calves were handsomely rewarded last year, helped along by prices bouncing back from the fall collapse. The year before, producers were severally penalized by the same approach.

Beyond the Fourth Quarter Dr. Tonsor emphasizes that the market must also be considered from a cyclical perspective.

Not that many months ago, many economists figured national herd expansion was about spent. Now, Dr. Tonsor believes, depending on an operation’s costs, there may be enough economic incentive for minimal continued expansion.

In September, Rabobank issued a long-term outlook (projections through 2025). Analysts there expect the nation’s beef cow herd to grow another 1.6 percent to 2.2 percent by 2018 or 2019.

Whenever it ends, the evolution to flatter cattle cycles—narrower spreads between the highs and lows—will likely continue.

“One reason to expect flatter cattle cycles going forward is simply the fact that we’re producing more beef per cow,” Dr. Tonsor explains.

“Given that the ultimate size of the industry is driven by signals on how much beef consumers demand, and what type of beef, this increased efficiency leads to fewer cows being needed.”

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ecognizing the difference between optimum and maximum is key to sustainability in the long term. Our cattle are very deliberately designed to make sure they contribute to your bottom line. The bedrock is fertility & functionality under real-world conditions. Calve easy, breed back, stay trouble-free on rugged range, and bring in a good calf. Both herds have been recognized for this vision, having won the BIF Commercial Producer of the Year in 2008 (KCC) and 2010 (DRI).

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nce the foundation is there, we expect calves to perform in the feedlot and produce a premium product. Our quality has been recognized nationally with the RAAA Gridmaster® award & by Certified Angus Beef®.

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Trading Up in Herd Revenue

by Wes Ishmael

In any market, one of the most straightforward means of increasing herd productivity and revenue might be one oo easily taken for granted— selecting heifers that breed early in the breeding season.

“Heifers that become pregnant early in their first breeding season remain in the herd longer and are more productive,” Cliff Lamb, head of the animal science department at Texas A&M University, explained at this year’s Cattlemen’s College. “The number one reason we cull animals early in the herd is because they fail to breed during the breeding season,” In fact, using data from the U.S. Meat Animal Research Center— some 25,000 heifers—Dr. Lamb explained heifers that became pregnant within the first 21 days of their first breeding season weaned the equivalent of three-quarters of another calf during their production lifetime, compared to heifers that didn’t conceive until after 21 days.

“Age at puberty is a major factor that influences reproductive success of beef heifers,” Dr. Lamb explains in, “Prebreeding Management for Successful Development of Beef Replacement Heifers.” “Ideally, heifers should reach puberty approximately 60 days before the beginning of their first breeding season, increasing their chances of becoming pregnant and allowing them to conceive earlier in the season. The timing of first conception is also important to the overall productivity of a heifer.” He adds that mature cows that calve at the beginning of the calving season also wean heavier calves.

Weight and age are two primary drivers of age at puberty in heifers; adequate nutrition is key.

“It is important to consider that Bos taurus (European) beef heifers generally reach puberty at 55–60 percent of their expected mature body weight. With that in mind, the use of a target average daily gain is a common and effective way to prepare heifers for breeding,” Dr. Lamb says.

“It is recommended that Bos indicus (Brahman) influenced heifers achieve 60–65 pecent of their mature body weight before the breeding season starts. A nutritional program should be capable of providing sufficient energy and protein to heifers so they can attain this final target weight before the beginning of the breeding season.”

Proving It During his tenure as assistant director of the University of Florida’s North Florida Research and Education Center at Marianna, Dr. Lamb and fellow researchers verified the real-world benefits of getting heifers bred earlier in the season.

Dr. Lamb inherited management of the research herd nine years ago.

This is a 300-head cow-calf operation.

About half the mamas are Angus or

Sim-Angus, the other half are Brangus or Braford. Management was loose and the calving season long.

“We decided that from a production

standpoint, the number one thing we needed to select for was pregnancy,” Dr. Lamb says. He adds that reproduction has four times the economic

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F&R Livestock Resource page 17

impact on herd economics than any other trait.

Specifically, Dr. Lamb and his crew developed a set of non-negotiable rules for cows to enter and remain in the herd. Every female must: • Calve by the time she’s two years old.

• Calve every year.

• Calve without assistance—that includes replacement heifers and any amount of assistance. (Dr. Lamb explains that data indicates pregnancy

“The number one reason we cull animals early in the herd is because they fail to breed during the breeding season.”

—Cliff Lamb

39th Annual Production Sale

Saturday, November 18 ▪ 10a.m. ▪ at the farm

Every year, on the Saturday before Thanksgiving, the newest generation of Sydenstricker Genetics is offered to the buying public. Sydenstricker Genetics has a long history of combining genetic diversity with balanced trait superiority to produce breeding stock that will go out and work in the real world.

We are diligent in performance testing, and believe in supplying our customers all the information .... all the time. All performance information is included in the sale book or on update sheets available on our website and on sale day.

SydGen Atlas 6549 09/15/16 18644329 $W 66.85 $B 164.58 This outstanding son of Atlas out of a full sister to CC & 7 will be one of the standouts of the bull offering.

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Selling: 1 Proven Herd Bull 101 Fall Yearling Bulls 58 Spring Bull Calves 61 Fall Pairs 42 Spring Bred Cows 49 Spring Bred Heifers 81 Fall Yearling Heifers 44 Spring Heifer Calves Complete catalog available online; mailed with November Angus Journal; or on request from the Farm Office Check out our website for complete weights, calving, and other updates as they become available

20th Annual SydGen Influence Commercial Heifer Sale 7:00 p.m.—Callaway Livestock Center, Kingdom City, MO Selling 150 head of top commercial bred heifers. All heifers have met a stringent set of qualifications, and all will be sired by, or bred to SydGen Herd Sires.

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2001 Beef Improvement Federation Seedstock Producer of the Year 1997 Certified Angus Beef ® Seedstock “Commitment to Excellence” Award page 18

Fall 2017

rates are 10 percent less in cows that require assistance of any kind.)

• Provide sufficient resources for her calf to reach its genetic potential.

• Raise a calf genetically capable of performing to expectations. (If a heifer has a calf that doesn’t perform, the heifer is culled.)

• Maintain the body condition score for their conditions. (That keeps them away from having to manage more than one group of heifers and cows in terms of nutrition.)

• Be calm.

From a management standpoint, they follow these rules: • Only heifers that become pregnant within the first 25 days of the breeding season are considered as replacements.

• The breeding season will be tightened as much as possible.

• Every female is exposed to synchronization and artificial insemination.

(Rather than think of synchronization as way to get semen in the cow or heifer, Dr. Lamb encourages producers to think of it as reproductive technology that stimulates cycling.)

With heifer selection and these rules in mind, Dr. Lamb emphasizes their first criteria is breeding within the first 25 days. Rather than select heifers and then hope enough of them get bred on time, they synchronize and breed 90 heifers. Typically, 70-80 heifers will breed on time. That leaves them 10-20 to cull based on other criteria in order to arrive at the 60 needed replacements.

The results are stunning.

A higher percentage of cows and heifers calve within the first 30 days each succeeding year. Calves from the 2014 season were worth $169 per head (price constant basis) more than those produced six years earlier, much of it due simply to a higher percentage of calves being born earlier in the season.

Consumers are Driving Packer Changes

by Wes Ishmael

Ultimately, consumers determine what enters and exits the harvest facilities of the nation’s largest meat packers. Consumer demand determines which meats they’ll consume in terms of quantity and price, or if they’ll consume meat at all.

Consider that last October, Tyson Foods, one of the largest beef and meat packers in the nation, took a 5 percent stake in a company called Beyond Meat, which is a plant-based protein producer. Think here in terms of a company aiming to make products that feel and taste like ground beef, for instance, made from plant products and no actual meat.

“We’re enthusiastic about this investment, which gives us exposure to a fast-growing segment of the protein market,” said Monica McGurk, Tyson Foods’ executive vice president of strategy and new ventures & pPresident of foodservice. “It meets our desire to offer consumers choices and to consider how we can serve an ever-growing and diverse global population, while remaining focused on our core prepared foods and animal protein businesses.”

According to the Beyond Meat website, current products include the Beyond Burger, “the world’s first plant-based burger that looks, cooks and tastes like fresh ground beef… .” There’s also the Beast Burger, Beyond Chicken Strips and Beyond Beef Crumbles, all claiming ingredients that are GMO-free.

A couple of months after purchasing the stake in Beyond Meat, Tyson made $150 million available to launch Tyson New Ventures LLC. At the time, the company described it as, “a venture capital fund focused on investing in companies developing breakthrough technologies, business models and products to sustainably feed a growing world population.”

“This fund is about broadening our exposure to innovative, new forms of protein and ways of producing food, while remaining focused on our core fresh meats, poultry and

“We’re enthusiastic about this investment [in Beyond Meat], which gives us exposure to a fast-growing segment of the protein market.” —Monica McGurk

Practical.

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F&R Livestock Resource page 19

prepared foods businesses, which are also experiencing tremendous consumer demand and growth,” McGurk said.

You can likely think of a number of reasons why one of the nation’s largest meat purveyors might be interested in non-meat protein.

Everything from catering to fringe consumers like vegans and the anti-everything crowd, to developing protein that’s more affordable, if in fact that is the case.

Antibiotic Use is a Current Lynchpin Far as that goes, there’s plenty of angst among some mainstream consumers, those who want meat.

They continue to want to know more about the product that ends up on

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HYATT REGENCY & CENTURY II | WICHITA

their dinner plate, everything from how the livestock was raised to how it was harvested.

“We’re currently in the midst of a shift in the marketplace where the culture and conversation around conventional food, particularly online, is changing as consumers navigate which foods to adopt, moderate or abandon,” says Charlie Arnot, CEO of the Center for Food Integrity (CFI). He said that in January, announcing a new research approach—digital ethnography—to “identify influential consumer groups and the motivations that not only dictate food trends, but drive conversations that impact the decisions of others as they make choices at the grocery store or form opinions about

“Our decision to eliminate 20 percent of the antibiotics used in our beef cattle, which are also used for human health, took into consideration customer and consumer desires to help ensure the long-term medical effectiveness of antibiotics for both people and animals,” Keating said.

the products, processes, people and brands that define today’s food system.”

For the past 10 years, CFI has conducted annual consumer trust research to better understand public opinion and how to engage with consumers to earn trust. The use of antibiotics in food production continues to be a primary issue driving consumer distrust in animal agricul-

SCHEDULE AT A GLANCE

Wednesday, November 29 4:00 p.m.-6:15 p.m. ~ Trade Show Open 5:00 p.m.-6:15 p.m. ~ Trade Show Welcome Reception 6:30 p.m. ~ Cattlemen’s Banquet, Keynote Speaker Craig Karges

Thursday, November 30 7:00 a.m.-8:00 p.m. ~ Trade Show Open 7:00 a.m.-8:30 a.m. ~ Coffee & Donuts 7:00 a.m.-8:30 a.m. ~ Early-Riser Breakfast

Regist e

r onlin e at

www.kl

8:30 a.m.-10:00 a.m. ~ KLA Beef Industry University

a.org

10:00 a.m.-11:30 a.m. ~ Committee Meetings: Animal Health & ID; Tax 11:30 a.m.-1:30 p.m. ~ Lunch in the Trade Show 1:00 p.m.-2:30 p.m. ~ Committee Meetings: Natural Resources; Consumer Trends 2:30 p.m.-4:30 p.m. ~ Council Meetings: Stockgrowers; Cattle Feeders 4:30 p.m.-6:00 p.m. ~ Trade Show Reception 9:00 p.m.-11:00 p.m. ~ Cattlemen’s Barn Party with Rusty Rierson

Friday, December 1 6:30 a.m.-7:45 a.m. ~ Coffee with Colleagues 7:45 a.m.-10:00 a.m. ~ Membership Breakfast, Business Meeting and Market Outlook by Randy Blach

ture, according to CFI research.

Meat and food companies like Tyson are responding.

Since 2011, Tyson stopped using human antibiotics in its 35 hatcheries and reduced use in its broiler chickens by more than 80 percent.

Related, insofar as their efforts to reduce the use of medically important antibiotics, Cargill (another of the nation’s largest packers) is also making changes.

In August last year, Cargill ended the use of gentamicin (an antibiotic used in both human and animal healthcare) for disease prevention in turkeys harvested for its two largest brands. The company emphasized turkeys will continue to receive antibiotics for control and treatment of disease.

Later that month, Cargill introduced the Honest Turkey™ product line, which comes from turkeys that were never treated with antibiotics.

You and I could wax philosophic about choosing to describe one product line as honest, thereby suggesting all other product lines are dishonest, but the company left little doubt as to the direction it’s heading.

“Eliminating antibiotic use for disease prevention purposes is the next logical step after ending the use of antibiotics for growth promotion purposes, which we began in 2014,” said Jan Hood, head of marketing for the Cargill turkey business.

“Based on consumer research and their desire for transparency in food production, we developed the Honest Turkey™ product line, which communicates the turkeys are raised without antibiotics.”

“When needed, we believe the judicious use of antibiotics in animal agriculture helps assure a safe food supply,” said John Niemann, president of Cargill’s Wichita-based turkey business. “At Cargill, we remain committed to exploring factbased technologies as alternatives to antibiotics, and to the reduced use of shared-class antibiotics when the efficacy of a given technology has been proven effective and economical.”

Era Shifting As for cattle and beef, you might recall that Cargill sold its two Texas-based yards at Bovina and Dalhart to Friona Industries in July last year.

page 20

Fall 2017

health of animals raised for food, which contributes to the production of safer food,” Keating explained.

“We have an obligation to ensure that sick animals do not suffer, and that we prevent them from becoming ill and we will use ongoing research efforts as the basis for any future additional reductions in antibiotic use. We’ve listened to consumers and our customers, we’ve taken this first step and we believe there are more steps coming in the not-too-distant future.”

At the time, Cargill also announced it would increase to 90 percent by 2018 the Beef Quality Assurance certified feedyards that supply it cattle.

The company’s last two yards in Leoti, Kansas, and Yuma, Colorado, were sold in April (pending completion of a definitive agreement and regulatory review) to Omaha-based Green Plains Inc. (GPI), a vertically integrated ethanol producer with existing feedyards at Kismet, Kansas, and Hereford, Texas. The Cargill yards being acquired by GPI have a one-time capacity of approximately 155,000 head.

Thus ends what was once known as Caprock Cattle Feeders.

“Selling our two remaining feedyards aligns with our protein growth focus by allowing us to redeploy working capital away from cattle feeding operations to other investments,” says John Keating, president of Cargill’s Wichita-based protein business operations and supply chain. “By partnering with Green Plains in a multiyear supply agreement, the Yuma and Leoti yards will continue to supply cattle to our beef processing facilities at Fort Morgan, Colorado, and Dodge City… .”

In March last year, before selling its feedyards, Cargill announced a 20 percent reduction in shared-class antibiotics (those used for human and animal health) used at its yards, as well as five additional feedyards owned by alliance partners that provide Cargill with cattle. That’s about 1.2 million head of cattle annually.

“Our decision to eliminate 20 percent of the antibiotics used in our beef cattle, which are also used for human health, took into consideration customer and consumer desires to help ensure the long-term medical effectiveness of antibiotics for both people and animals,” Keating said.

Keating emphasized animal welfare while reducing antibiotic use.

“We need to balance those desires with our commitment to ensure the

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F&R Livestock Resource page 21

American Royal, K-State Olathe Concludes High ‘Steaks’ Contest for U.S. Beef Producers Over the summer, the American Royal Association and the Kansas State University Olathe campus turned up the heat on U.S. beef producers in a competition to find America’s best tasting steaks.

The American Royal Steak Contest is an annual, nationwide competition that identifies the tastiest steak in the country. Through the contest results,

cattle producers are able to determine what breeds, feeding methods and other factors consistently produce the best steak for American consumers.

The contest is in its sixth year.

“The American Royal Steak Contest is a great opportunity for top beef producers to have their product judged purely on its quality,” said Lynn Parman, president and CEO of the

American Royal. “This year we were excited to see the contest continue to attract some of the best steak producers from around the country.”

Grand and reserve grand champions of the contest were recently announced, along with breakdown profiles of the flavor, tenderness, juiciness and flavor finish of each steak.

The contest began in late July when

K-State Olathe received dozens of steaks from beef producers across the U.S. Steaks were divided into two categories: grain fed and grass fed. Each steak was prepared in an identical manner in K-State Olathe’s research kitchens.

Once cooked, a panel of experts consisting of restaurateurs, food bloggers, beef representatives and members of the Kansas and Missouri Beef Councils, judged each steak in a blind taste test at the campus. Points were assigned for flavor, juiciness and texture.

Marianne Swaney-Stueve, research assistant professor of human nutrition and manager of the Sensory and Consumer Research Center at K-State Olathe, and Bryan Severns, director of food programs and services, oversaw the preparation and evaluation processes.

“Steak is very much a part of the culture in the Midwest and Kansas City,” Swaney-Stueve said. “At the Sensory and Consumer Research Center, we work with industry and help them understand consumer preferences about their products. This competition provides valuable information to beef producers about how their steaks perform on key attributes that resonate with consumers.”

K-State Olathe and the American Royal Association have a longstanding partnership with the annual steak contest.

Woven through the history of Kansas City since 1899, the American Royal provides opportunities for youth and adults from around the country to compete in our livestock show, ProRodeo, horse shows and the World Series of Barbecue®. These events allow the American Royal, a 501 (c) (3) not-forprofit organization, to give more than $1 million annually for youth scholarships and support agriculture education programs. In 2016, more than 90,000 attendees attended American Royal events, generating more than $60 million of economic impact. To learn more about the American Royal, visit AmericanRoyal.com.

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page 22

Fall 2017

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page 24

Fall 2017

The World According to Hooter McCormick Bull Selection 101 There’s not much scarier than ignorance armed with confidence.

Hooter McCormick couldn’t help but think so, sitting beside Uncas Binglemeyer at yet another bull sale.

He watched in fascination as Uncas— manic gleam in his eyes and a red pencil clenched between his teeth—ran fingers at lightening speed across the keys of an ancient calculator.

Mind you, Hooter wasn’t using the term of ignorance in a mean way. It simply meant that despite facts, Uncas chose to believe how he chose, no matter the logic. And he did so with the confidence of a card shark at a poker game for the blind. It had always been that way.

Uncas and Hooter became friends decades earlier on a West Texas 4-H judging team. Uncas could see cattle just fine, better than most. But, he absolutely disagreed with traditional thinking about the relative value of various phenotypic attributes.

His unorthodox views of cattle and their management carried over into his adult life and cow herd. “It’s a commercial operation, but I’ve been known to dabble on the seedstock side,” Uncas would explain.

When someone had the audacity to suggest that he might get more return with a defined calving season, Uncas always replied, “I never believed in sticking all my chicks in one bucket.

Besides, it helps average out market seasonality.”

When someone made the mistake of arguing that cattle gained value with lot size and uniformity, Uncas would answer, “Something for everyone, that’s what I say, and give more folks a chance to own them.”

It was the subject of records that lit Uncas like a roman candle strapped to a rocket. You’d be hard-pressed to find anyone who kept more records than he did, albeit of a unique variety.

Rather than weights, Uncas recorded the phases of the moon and barometric pressure for the day each calf was born, or the day he guessed it was. Come cutting and branding time (which could occur up to yearling age at the Binglemeyer place) Uncas was keen on recording pastern diameters and cannon bone lengths, using a measuring device he constructed himself.

He used that data in combination with the five-area weighted average calf price for the previous month, the five-year average basis at Apache Flats

Humor

Editor’s Note: Creative folks have a different way of expressing themselves. Artists often express creativity like our friend, Ted Foulkes, through cowboy cartoons. Creative journalists sometimes use storytelling. Some may wonder if Hooter McCormick is, in fact, Wes Ishmael’s alter ego! We’ll leave that as an unanswered question. However, Hooter’s ability to entertain and remind us not to take ourselves so seriously has been a welcome respite for decades. We look forward to reading more of Hooter McCormick’s misadventures. and other assorted statistical detritus to calculate an index of sorts for each cow in his herd.

Uncas tried to explain his system to Hooter one time. He’d thumb through the dusty ledger containing his cow

inventory, then shuffle through a mountain of green-bar computer paper, gleefully pointing out presumed connections.

“See there!” Uncas shouted, punching the ledger for emphasis. “The

numbers say this cow here should have been open last year and she was… it’s consistent, too. She hasn’t had a calf since 2008.”

The same selection system produced a bull named Sir-Loin-A-Lot,

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F&R Livestock Resource page 25

(Sir for short) whom Uncas believed was the lynchpin to the next genetic revolution in beef cattle.

Sir was a narrow, pencil-gutted behemoth carrying enough sheath to leave a track in short grass. He was comprised of an eighth Angus, an eighth Hereford, a sixteenth Simmental, a sixteenth Maine-Anjou, a sixteenth Watusi and an eighth Nellore.

The other seven-sixteenths being the Binglemeyer Composite, a concoction that Uncas held more secret than the whereabouts of Jimmy Hoffa. Apparently, shoddy semen management robbed the industry of Sir’s promise.

The Next Stem-Winder Uncas asked Hooter to come along for his current bull buying odyssey;

Hooter had no idea why, since Uncas would disregard any opinion except his own.

So, Hooter watched Uncas’ fingers flying over the calculator, pausing only occasionally to bid once on any single bull. Over the course of a week and several sales, Hooter had yet to figure out what it was that caused Uncas to bid.

“It’s a little-known fact,” Uncas confided at the first stop, “but if you take the length between a bull’s scrotum and navel, and divide by his adjusted yearling weight, then multiply by 100 you will have a very accurate predictor of the percentage of twins a bull will sire in his lifetime.”

Hooter could only suppose the pursuit of such conjecture had something to do with Uncas tramping through

the pens at each sale and flashing a laser pointer in the eyes of every bull he was interested in, much to the dismay of both bulls and onlookers.

“Plus,” Uncas continued, “I’ve proven to myself conclusively that the width of a bull’s poll and the size of his nostrils are directly correlated to his disposition, the wider and larger the calmer.”

After Uncas shined his laser into the wrong bull’s eyes, then escaped over the fence with surprising finesse, Hooter wondered aloud, “Where do you reckon he fits on the nostril bell curve?”

Ever since they began the trip, Hooter had been trying to pry from Uncas some semblance of what he was looking for: what he wanted the bull to bring to the cow herd, whether he

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page 26

Fall 2017

was changing how he marketed calves, whether daughters would be retained, that kind of thing.

To each question, Uncas would reply with a knowing smile, “Yes, but what comes after that?”

If Uncas expected an answer, he’d forgotten that Hooter could win a staring contest with a fence post when he wanted.

Finally, at the last stop, auction at full cry, Uncas posed the question again and still got no reply. He couldn’t help himself, “Next, what comes next Hooter? Pounds and performance have been done to death.

Reproductive performance is nothing new. Convenience traits are in the eye of the beholder. Serving capacity, carcass traits, all those things, the train has already left. Know what I’m saying?”

“No, Uncas, I have no idea what you’re saying, but I’m guessing your fixing to tell me,” said Hooter.

“I’ll tell you what comes next,” Uncas whispered. “Hide quality.” He was becoming more animated than Hooter had seen him in the last week. He even shut off his calculator.

“Hide quality?”

“It’s been right in front of us all this time,” said Uncas with the serenity of a pig wallowing in fresh mud. He sketched his thought in the air, dotting it with his pencil for emphasis. “Fractionally speaking, hide quality is where it’s at; not just volume and consistency, mind you, but thickness as well.”

Even Hooter couldn’t have guessed the destination of Uncas’ twisted calculating.

“Pound for pound and ounce for ounce, the relative value of the hide will grow exponentially, I’m telling you. I’ve done my research,” said Uncas with a final flourish of the hand.

“Sold!” boomed the auctioneer.

“Laser boy there in the top row got him.”

“But… ” “Which way’s he go?” asked the ring man.

“But… ” stuttered Uncas, “I didn’t mean… ” “Fine bull you’ve got there, sir. No finer in all the sale. Number or name, please?” pressed the ring man.

“Uncas, Uncas Binglemeyer,” interjected Hooter. “No address necessary, he’ll be paying cash.”

“But… ” stammered Uncas.

Hooter clapped him on the shoulder. “That’s a right good selection.

Middle of the road all the way. You can go any direction you want.”

“But… ” “Look at it this way, Uncas. His navel-to-scrotal placement ratio might not be what you’d hoped, but there’s lots of room on that hide for your brand.”

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