“There's a treasure trove of information here, some of it benchmarking what we've long believed about the stocker industry, and other data offering new perspectives,” says Dale Balsi, Kansas State University (KSU) Extension beef stocker specialist.
Blasi coordinated the involvement of 12 land-grant universities in preparing and analyzing the recently completed National Stocker Survey (NSS). It's the first time that the demographics, management practices and needs of the nation's beef stocker and backgrounding industry have been assessed so broadly and deeply.
Among the data affirming previous beliefs about the stocker industry, Blasi cites the fact that pure stocker operators are more likely than other operation types to: run cattle year-round rather than seasonally; run higher-risk cattle and be more tolerant of health risk; use forward contracting as part of their marketing; and use a veterinarian only in an emergency, though veterinarians are also who these stocker operators trust the most for stocker-management information.
As for surprises, Blasi mentions the fact that a significant majority of stocker operators say they buy cattle at or above average market price. That runs counter to long-held dogma that stocker operators primarily buy and straighten out other producers' mistakes. Instead, stockers of all operation types and lengths of tenure say buying high-quality cattle is a chief tool for managing market risk.
Blasi was also surprised that almost half of the operations say they utilize at least some limit-feeding in their operations. Though the high number could stem in part from the wide array of definitions for the practice, it suggests limit-feeding and the intense management necessitated by it are becoming entrenched in the business. “Recent history — high feed prices climbing higher — might have something to do with the number of producers exploiting the practice,” Blasi says.
Defining pure stockers
Pure stockers are defined as those who run stocker and/or background cattle exclusively without involvement in any other phase of the cattle business. The NSS also defined three other stocker operation types: Cow-calf producers who also stocker and background their own and/or purchased cattle; whole-cycle operations involved in cow-calf, stocker and cattle feeding; and feedlot operations that also run stockers or background cattle.
“That was also one of the surprises,” Blasi says. “We've always known that a number of cow-calf producers retain their calves to grow to heavier weights. The NSS data underscores the fact that a sizeable portion of cow-calf producers involved in the stocker business also buy a significant number of calves to stocker and background, in addition to those from their own herds.”
In fact, NSS data indicates cow-calf producers comprise the largest segment of stocker producers (64.6%). Conversely, 17.2% of the nation's stocker operations are pure stocker operations. Those in the whole-cycle group represent 10.6%. Cattle-feeding operations that also have a stocker enterprise represent 4.8%.
“This data offers more insight to the stocker industry than we've ever had,” Blasi emphasizes. “It will help those in the industry identify opportunities. For those of us serving that industry, this information will help us utilize our resources most effectively in serving the industry.”
The NSS also gauged the pulse of stocker operators in terms of what they deem the most significant barriers to their competitiveness in the next five years. Perhaps unsurprisingly, across all operation types, the primary barriers are: feed input costs, other input costs, potential return on investment, land purchase prices, land lease prices and availability of land to purchase and lease.
Along with KSU, other industry partners include: Auburn University, Iowa State University, Mississippi State University, North Carolina State University, Oklahoma State University, South Dakota State University, Texas A&M University, University of Florida, University of Missouri, University of Nevada and Western Kentucky University. Elanco Animal Health sponsored the NSS.
“The stocker industry has always been a vital part of the U.S. beef industry that allows us to remain more competitive with other consumer protein sources than we otherwise could,” Blasi says. “As feed costs and cost of gain increase, it becomes even more essential that we understand and serve that segment of the industry.”
Compared to other operation types, pure stocker operators are less likely to:
- Farm row crops.
- Run cattle intended for value-added marketing.
- Require certified verification via Quality Systems Assessment or Process Verified Programs.
- Test for BVD persistent infection pre-shipment.
- Use non-surgical castration.
- Feed a complete receiving ration.
- Utilize retained ownership to manage market risk.