Adding Value to Your Customers’ Herds
Seedstock producers can enhance the value of their customers’ cattle through several opportunities.
OVERLAND PARK, Kan. (Nov. 4, 2015) — “Seedstock producers create opportunity for themselves by creating opportunity for their customers,” notes Ginette Gottswiller, American Angus Association director of commercial programs. To illustrate this point, she was joined by seedstock breeder Art Butler, Spring Cove Ranch, and commercial breeder Dave Rutan, Morgan Ranches.
“It is important as the market gets saturated with black cattle to verify that your customers’ cattle are Angus-sired," said Art Butler of Spring Cover Ranch.
The trio spoke as part of Angus University Wednesday afternoon at the Angus Means Business National Convention & Trade Show in Overland Park, Kan., Nov. 3-5, 2015.
To begin, Gottswiller explained three Association value-added programs designed to help market Angus-sired commercial calves. AngusSource® is a USDA Process-Verified Program (PVP) that verifies source, group age and genetics. Gateway is a second-tier program in the USDA PVP that only verifies source and group age. AngusSource Genetic provides genetic verification, but it is not a PVP.
Butler shared that he started incorporating AngusSource in his relationship with his commercial customers when the program began in 2003. Spring Cove Ranch paid for their commercial customers’ AngusSource tags. Butler also hosted an AngusSource informational meeting at their ranch for his progressive customers. Before AngusSource, Spring Cove contacted potential buyers for calves out of Spring Cove bulls. However, with AngusSource, he gets help doing that.
AngusSource sends an email each Sunday and Tuesday to a list of about 600 buyers who want to know where AngusSource and AngusSource Genetic calves are selling. This email includes the number and type of head, location of sale, any special type of programs the calves fit [like natural or nonhormone treated cattle (NHTC)], and average dollar weaning value ($W) and dollar beef value ($B) indexes.
In 2015, Gottswiller reported that 17,000 head of AngusSource and AngusSource Genetic calves, weighing an average of 650 pounds (lb.), were reported as sold. The highest steer premium was $58 per hundredweight (cwt.), and the highest heifer premium was $48.50 per cwt. The average overall premium on all groups reported was $5.16. For calves enrolled in additional value-added programs like NHTC or global animal partnership (GAP) level 4 brought $8.05 per cwt. on average.
The total amount of AngusSource premiums from 2008-2015 was $181,901.95.
“The premiums don’t follow the cash market or video markets. The AngusSource program is not a ‘jump-in, jump-out’ kind of program. It takes commitment, but the premiums are there,” Gottswiller explained.
Butler adds, “It’s important to represent good cattle and to represent them correctly.”
Rutan admits he was skeptical at first, but he has since embraced the program after seeing the benefits early on. He says the program is user-friendly, and the bookkeeping is not difficult.
Dave Rutan of Morgan Ranches said the premiums earned with AngusSource®justified spending more on the bulls he was buying.
Rutan says the premiums justified spending more on bulls, which, in turn, earned higher premiums on better cattle. He increased his bull budget by $1,000, and the following calf crop’s weaning weights jumped by 100 lb. He adds that there were no feed or supplement changes; the change was due to genetics. Verifying his genetics used garnered more dollars at sale time.
Butler adds, “It is important as the market gets saturated with black cattle to verify that your customers’ cattle are Angus-sired. Good verified cattle bring more than commodity cattle.”
For more information on enrolling in AngusSource, AngusSource Genetic or Gateway, call the Commercial Services Department at 816-383-5100.
Angus University was sponsored by Merck Animal Health.