Advantages in Cattle Marketing


It’s the age-old question in the cattle business – How can I get the most out of my calf crop? Cattle producers have two main sources of income; calf crops and cull cows. There are many ways to take advantage of market fluctuations, trends, and market location opportunities, but what are the real keys to marketing advantage? Not sure there’s one clear answer, other than find what fits your operation best.

My family owns a local cattle auction, so obviously I’m a little biased for local auctions versus regional, national, or video auctions. We’re trying our best to be competitive and progressive in our market while helping local producers to get the most for their year of hard work. We’ve added video marketing to expand our buying audience, and are continuously working with producers to find ways to improve their return. A few things to consider about the average Arkansas cattle farmer: He is a 58-year-old male with 30 head of cattle, a year-round calving season, and weans his calves on the truck. Cattle production is not his primary income and for many, any bull will do.

Our efforts include visiting area cattlemen’s association meetings and discussing options with farmers and ranchers. My dad will usually pay for a good meal of beef at the meeting and in return have a chance to share a few tips and give a plug for our family’s auction. Last month I had the opportunity to join my dad in a visit with cattlemen in Eastern Arkansas. Like I told em, most have been in the cattle business longer than I have been alive. I may have nothing new to share, but maybe can bring up a few points to consider in cattle management that will earn producers a dollar or two when it comes time to market the calf crop.

To make a long story short, the calf crop will bring more return to the farmer if he/she invests in a quality bull that compliments the cowherd, creates a more narrow calving season, and castrates male calves at an early age. But there’s much more to the plan than this.

  • Groups of uniform calves will bring a premium over singles.
  • Black, black white-face, and yellow calves will bring a premium over reds, white-nose Charolais, spotted, dairy, and Brahman influenced cattle.
  • Fill, horns, illness, and fleshy body condition are subject to discounts
  • Steers will gain a 6-8 $/cwt premium over bulls – this premium increases with weight
  • Muscle score and frame size also impact discounts
Premiums and discounts depend heavily on the readiness for the calf to enter a stocker or feeder program. Thin, castrated (males) , weaned, and vaccinated cattle will start on feed or grazing programs much quicker than fleshy, non-weaned, non-castrated (males) calves, so the buyer will be willing to pay more for these cattle. And these buyers are looking for quality genetics, cattle that will perform well in the future. Guess it all boils down to supply and demand.
The guys over at the University of Arkansas Extension have done a great job at looking into the details of cattle marketing premiums and discounts over the last decade. Check out these papers for more detailed information.
What marketing tips do you have for cattle producers in your region?
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About Ryan Goodman (988 Articles)
Ryan Goodman lives in Helena, MT and comes from an Arkansas cattle ranching family. Since growing up on a family cow/calf and stocker-calf operation, he has spent the last several years learning about farming systems across the country. A graduate of Oklahoma State, Ryan is currently working on a Master's degree from the University of Tennessee. He works continuously to share his story of ranch life through community outreach and social media, all while encouraging others in agriculture to do the same.

16 Comments on Advantages in Cattle Marketing

  1. Ryan, just wanted to add I’m on the other end of that calf selling transaction. We have a small family feedlot, and without question the #1 criteria I personally look for is this quote from you:

    “Thin, castrated (males) , weaned, and vaccinated cattle will start on feed or grazing programs much quicker than fleshy, non-weaned, non-castrated (males) calves, so the buyer will be willing to pay more for these cattle.”

    The genetics we buy are pretty miss-match. We buy lots of small group cattle b/c their cheaper. (Which makes your point about selling in larger groups through).

    But we ABSOLUTELY want a calf that will come to the feedlot weaned, step in and take off eating from a fence line bunk on day #1, and we are fully willing to pay a premium for that. Health problems in the feedlot (which inevitably happens to calves coming straight off the momma) are incredibly costly. Having producers take the time to wean calves prior to sale should earn them a very nice return and be good for the buyer as well.

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    • Thanks for the input from your side Darin! Good to hear I’m on the right track!

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  2. Thank you for bringing these points up! Our farm is like the typical Arkansas farm: 30ish cows, year-round calving and not a great weaning plan. We are working on getting a more uniform calving season and separating our herd so we can let the heifers grow off a little more and have the chance to rotate bulls. These points remind me that we are at least stepping in the right direction! Thanks Ryan!

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    • Jilian, it’s all in baby steps. Even if your looking to spread out your cash flow, consider two calving seasons each year. With two calving seasons, cows that fall behind can be rolled over to the next breeding group and only miss 6 months instead of an entire year.

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      • Cows that fall behind (open) need to be culled period! Feeding open cows is not a good cash flow.

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  3. Great post Ryan. I know you will find this hard to believe, but I have always questioned the practice of paying more per pound for the thinner calves. Sure you get a compensatory gain, but these calves are also usually the ones with the higher morbidity (and mortality) rates.

    It would be interesting for a feedlot to analyze the true value of these two different groups of cattle after figuring in the cost of the higher morbidity and death losses (And you just gave me a great idea for a post of my own)

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    • True, these calves may have a history of more health problems, but could just be on a lower nutrition plane coming into the program too. Given the right program starting, and getting up to full feed, owners will usually gain from compensatory weight increases.

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  4. Nebraska Farm Wife // September 19, 2011 at 11:00 AM // Reply

    Great Post Ryan!! Gives me a good idea for my own blog as we have started weaning this past weekend. Speaking from several years spent horse back in a feedlot riding pens to make some money to pay for college I can’t agree with the perspective that the feedlot or most buyers are willing to pay more for what I call a “lower risk” calf (weaned, vaccinated, castrated, good nutrition program). It was my worst nightmare to ride into a newly recieved pen of bawling calves with snotty noses that were spending more time looking for mom than consuming fresh feed and water. I strongly feel that a lot of cow/calf producers would change their management if they spent a little time on the other side of the fence.

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    • Oh I know the feeling well. I remember riding into a pen of calves at the feedlot on my first day riding pens, turning around and asking for more guidance.

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  5. Ryan,
    Lots of great marketing points. However, IMO this is where allot of ranchers put to much of their focus on. You asked…How can I get the most out of my calf crop? While marketing your calf crop is important. Controlling your inputs should be priority number 1 to get the most out of that calf crop. It is not always what you make, but what you didn’t have to spend. Ranchers need to produce cows that fit your environment rather than changing the environment for them. Starting with calving the right time of year according to your environment. Calving the right time of year will drastically cut your winter feed cost. For my environment calving in May has been a huge money saver and makes calving season so much more enjoyable on green grass. Also cow size makes a difference to bottom line as well. Smaller efficient cows will help get the most out of that calf crop as well. Bigger is not always better. I probably could go on, but had to put in my .02. In short your cows should work for you not you work for them. That along with marketing will get the most out of your calf crop.
    Keep up the posting Ryan I enjoy your passion in your writings.
    Cody

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    • Good points Cody, and if it was from the perspective of cow management, these would fit great. But from a calf management standpoint, putting a little more investment into your work can increase your ROI (return on investment) for all of your work. But I agree, as my dad taught me, it’s better to work smarter, not harder.

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  6. Boy did you hit that on the head Cody! In the late 70’s I saw prices similar to today ($125 cwt in 1978) and as low as $0.60 around 1996. There are a lot of things which can reduces inputs without lowering efficiency or productivity which just are not looked at by the average rancher. When you do mention them, many look at you like you are out of your mind!

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  7. Great article. You’re exactly right about uniform calves. If your group is uniform, chances are pretty good you’re going to get more for your calves. Striped, and spotted calves are generally discounted, as well.

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  8. Nebraska Farm Wife // September 20, 2011 at 12:00 PM // Reply

    Sorry – Correction to previous post it should have said that “I couln’t agree MORE with the perspective that feeders are willing to pay more…”. Brain was faster than fingers….

    I couldn’t agree with Cody more about cutting the cost and matching your system to the environment and your labor. We have changed up our nutrition program to where we wean the calves early let the cow put some weight on before winter and don’t feed her any extra hay or protein unless the snow covers the grass or cornstalks until 30 days or less before calving. It is cheaper to feed the calf for an extra 30 or 60 days than it is to feed the cow all winter. We have noticed that by getting the cow in better condition going into winter our calf weaning weights have improved (40-50 lbs/head!!!) and we have saved a lot of $$ in feed. We have also changed our calving diets and have increased our BCS going to grass (probably part of why weaning weights increased) and cut the amount of hay we fed by 15%!!!

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    • Changing up your calving season does decrease winter feed costs. Retaining ownership of those calves through the winter, and preconditioning them will also set you in the right spot to hit season market highs.

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      • Nebraska Farm Wife // September 21, 2011 at 10:51 AM //

        We sell the big end of the steers direct to the feedlot in an A&S and PVP program and we deliver in Dec. We hold the light steers and heifers till spring and sell the big end of the heifers in March as Replacement heifers. Everything is 90+ days weaned and have had a minimum of 3 rounds of shots, wormed at least once. With a mid March-April calving season our big steers hit slaughter about the Last week of June/1st week of July and are sold on the 21 month or younger for export market. We haven’t changed our calving date, just good nutrient management can cut winter feed cost also.
        Good thoughts and comments…

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