Marketing Cull Cows

Cattle Cycle & Cull Cows Cattle Cycle –Long as 15 years ~ short as 7 –8-10 years of profitability Counter – Cyclically 1)Cost of production 2)Ability to purchase and sell at lows and highs 3)Different attitude toward risk

Livestock Marketing Information Center Data Source: USDA/NASS

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

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

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.

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

Processors Rosen Diversified 5 plants –Yankton, SD Cimpl Meats 400 /day –St. Paul MN –Long Prairie, MN1,000 / day –Omaha, NE 950 /day –Gibbon, NE1,000 /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

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

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

Livestock Marketing Information Center Data Source: USDA/NASS

Cows: Percent Lean Weight Price Lean Premium White lbs Breakers lbs Boners lbs High Dressing Lean lbs High Dressing Low Dressing Sioux Falls Cow Prices October 22, 2003 USDA, Market News

Cows: Percent Lean Weight Price Lean Premium White lbs Breakers lbs Boners lbs High Dressing Lean lbs High Dressing Low Dressing Sioux Falls Cow Prices October 20, 2004 USDA, Market News

Marketing Cull Cows Questions to be asked 1)What season of the market are you in? 2)The price difference between grades of cows? 3)Cost of feeding? 4)Select cows that will gain and obtain higher grades 5)Consider market place.

Percentage Price Increases Between Cull Cow Grades CutterUtilityCommercial Canner9%14%15% Cutter-5%6% Utility--1% Pritchard, SDSU

Percentage of Cows in Each Grade Following a Feeding Program of Shelled Corn and Corn Silage Days Fed Grades CanCutUtlCom + 064%28%8%- 5018%57%24%1% 778%21%65%6% %74%7% Can = CannerCut = Cutter Utl = UtilityCom + = Commercial or higher Pritchard, SDSU

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

Cancer Eye

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

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

Proper Condition

Quality Losses Per Head Carcass condemnation11.99 Trim dirt/ Bruises Loss of offal 4.00 Hide devalued 7.00 Injection Site Lesions.75 Yellow Fat 2.30 Poor Muscling14.50 Excessive Fat17.75 Light Carcasses 4.00 Other 1.20 Total76.00

Strategies to Improve Quality 1)Monitor herd health 2)Monitor Condition Scores 3)Decreased hide damage ~ Insects 4)Reduce Bruising 5)Reduce Injection site lesions 6)Market clean cattle 7)Euthanasia disabled cattle Market in a Timely Manner!!!

Marketing Live –Auction markets –Live basis –Risks??? Packer Direct –Delivery –Carcass basis –Risks??

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

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)

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

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.

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