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Adding value to the calf crop

Posted Dec. 1, 2008

To many producers, adding value means implementing management practices to maximize the price received for their calves on sale day. Some practices simply avoid discounts: dehorning; castration; breeding-in adequate frame and muscling; and managing away from extremes of body condition at sale time. Other practices open the door for the possibility of premiums on sale day: superior bull and cow genetics; a controlled breeding season so that calves can sell in larger, more uniform lots relative to size, age and breed-type; preconditioning; and a complete health program. Then there are what might be called one-time practices that can significantly impact your check: minimizing presale shrink and optimizing fill in the sale ring. Collectively and individually, these practices add to an animal's total value as it moves through the production chain.

In the few seconds your calves are in the ring, buyers visually appraise your offering, determine their value and place a bid. Mostly, their bid is based on their perception of how your calves will perform in the next phase of production. To enhance the buyer's appraisal of the product's value, it is becoming more common for producers to document their value-added management practices and to communicate this information to buyers at sale time.

Selling at or soon after weaning is a perfectly valid marketing endpoint; however, the value-added attributes you've infused into your product continue to pay dividends all the way to the end product - quality beef for the consumer. A good example is preconditioning. Research shows that preconditioned calves entering the feedlot will have lower morbidity and mortality, gain faster with greater feed efficiency and finish with fewer days on feed and a lower total cost of gain. One study showed a $55 per head advantage for preconditioned calves by the end of the feeding period.

A buyer may share part of that future value with you in the form of a premium, but it will never equal the full value of the management and expertise represented in your calves. It follows then that the longer you own your product, the more of the true value of your management you will realize. If you are producing a high quality, value-added calf crop, it's worth the effort to evaluate ways to own your product longer.