In my list last month of “five essentials” for successful ranch management, I listed “emphasis on marketing” last, but that wasn’t because I consider it the least important. Let me give an example.
I’ve often noticed that when cull or sale animals are identified or sorted off in many operations, they become “chores,” and the tendency is to sell them as quickly as possible.
This situation makes me reminisce on my first college marketing course and the emphasis placed on the factors of time, form and place. Recognizing as a manager that a fairly large chunk of our income comes from the sales of cull animals, my focus has been to sell each animal – even from very large herds – to its highest and best use and for the best possible price.
While place addresses the best location and/or medium for presenting animals for sale, the factors of time and form often work together. For instance, if I choose to sell my calf crop as yearlings rather than calves, I’ve changed the form and the time.
I can be more subtle and simply change from selling a calf straight off the cow to selling a pre-weaned, preconditioned calf, and I have still changed both form and time. In some cases, those pre-weaned calves might be backgrounded until mid-winter and then sold to, or placed in, a finishing feedlot. The handling is different but, in each example, I am looking for the best value-added possibility, while also recognizing that some alternatives may subtract value.
Deciding how and when (time, form and place) to sell steer calves is probably the most important decision and gets much of our marketing attention. However, heifer calves (especially those remaining after replacements are held back) and culls tend to be overlooked opportunities. At the ranches I’ve managed, we’d used the word “cull” for so long that it was difficult to eliminate it from our vocabulary in favor of “market” or “sale” animals.
Marketing, genetics, nutrition, reproduction and health are all tied together, and it’s a great advantage when one understands how the interactions work. Some years ago, during a severe drought, part of our stock-reduction plan was to expose our yearling heifers for only 24-30 days at a fairly high heifer-to-bull ratio. This would allow us to pregnancy-check earlier and sell more open yearling heifers a month or so earlier than normal.
Our crew liked the short calving season so well that breeding a lot of heifers for a short time became standard practice. Now, the question becomes, can I or a buyer breed the open heifers to calve in the fall, and will this create more value than simply selling to, or owning through, the feedlot?
In our case, except for heavy steer calves, selling yearlings was a better option in most years than selling calves. Plus, it provided more flexibility in drought planning.
Market (cull) cows offer similar options. With a very short heifer-calving season, we found that most of the cows bred early and calved very rapidly. After 30 days of calving, we sorted those that hadn’t calved and bred them to calve a month later. They were sold as replacement cows (not heifers) to someone calving a month later than us.
Think of it – the buyer never had to breed or calve a heifer. He could also terminal-cross using bulls that emphasize growth and carcass. This resulted in a very simple operation where the cows-to-man ratio could be very high.
Contrary to most recommendations, we didn’t pull our bulls from our cows until we pregnancy-checked the females. Our veterinarian would put any detectable pregnancy less than 45 days in with the open cows. We checked those cows again about two months later and were able to sell well over half of them as pregnant summer-calving cows.
In the meantime, the bulls had been put back with the cows, enabling us to sell even more of them as fall calvers. I’ve chosen to call this “value-retention,” which is selling the cow as a producing female rather than as an open slaughter animal.
Breeding a lot of heifers for a very short season, and then selling all cows not calving in a short season, will cause an increase in herd turnover. Follow the logic. If a yearling is more profitable than a calf, the only additional cost I have in developing replacements is the cost of the bull. The open heifers then become a very valuable commodity to sell or feed.
Selling the cows that don’t calve early in the calving season results in increased calf uniformity and easier nutritional supplementation because most of the cows are in the same phase of gestation or lactation. Cows may be sorted for age but don’t need to be sorted for body condition. Those that drop out have made your herd better and more efficient. In the meantime, selling a pregnant cow can result in a significant price advantage over an open cow.
Some may ask, “Yes, but have you sold someone a fertility problem?” With the heritability of fertility being quite low, I say, “probably not.” We sold many cows to repeat buyers and found they had good results with rebreeding.
Another option to consider is early-weaning calves from short-term cows that appear to be in their last year. The cows can then be sold before the fall cow market suffers its usual reduction in price. If some of the cows are pregnant, there are sometimes buyers in a better feed environment who will pay cull-cow price by weight, plus a $50-100 markup.
Price setting and delivery can also be separated in time with the use of futures, options and forward contracts. If you want to take prices that are available in June for cattle to be delivered in August or September, there are several ways to do that.
In all of our marketing efforts, we should be asking, “Is there a better time, form or place?”
One final thought: Using some of the options presented here can increase risks for sexually transmitted diseases, so good bull management and biosecurity measures are a must.