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Marketing Cull Cows
Cattle Cycle & Cull Cows
• Cattle Cycle– Long as 15 years ~ short as 7– 8-10 years of profitability
• Counter – Cyclically1) Cost of production
2) Ability to purchase and sell at lows and highs
3) Different attitude toward risk
JANUARY 1 COW INVENTORYU.S., Annual
5
10
15
20
25
30
35
40
45
50
1975 1978 1981 1984 1987 1990 1993 1996 1999 2002
Mil. Head
Beef
Dairy
-0.4 Percent
2004 = 32.9 Million Head
-1.7 Percent2004 = 9 Million Head
JANUARY 1 TOTAL COW INVENTORYU.S., Annual
40
42
44
46
48
50
52
54
56
58
60
1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008
Mil. Head
C-N-02A07/23/04
Livestock Marketing Information Center
Data Source: USDA/NASS
Weekly F.I. Cow Slaughter
70
80
90
100
110
120
130
140
150
160
01/10 02/28 04/17 06/05 07/24 09/11 10/30 12/18
Week Ending
Thousa
nd H
ead
2003 2004 5 Yr Avg
Source: USDA & K-State Research & Extension
KSU Dept. of Ag Econwww.agmanager.info
U S TOTAL COW INVENTORYvs FI COW SLAUGHTER
Annual
32
36
40
44
48
52
56
60
1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003
Mil. Head
4
5
6
7
8
9
10
11
Mil. Head
Total CowInventory
FI CowSlaughter
C-S-273/8/2004
Cattle Cycle & Cull Cows
Rules of Thumb
• What do these numbers Mean?– Cow slaughter less than 13% of Inventory
indicates herd buildup– Greater than 15% indicates decline
– Heifer Slaughter less than 37% of Cow herd considered growth
Importance of Understanding Cow Slaughter
• 15-20% of a producers revenue comes from the sale of cull cows and bulls
• Cow slaughter generates 70-75% of domestic non fed beef
• A high percentage of ground beef comes form cows– Ground beef accounts for 44% of all beef consumed
Importance of Understanding Cow Slaughter
• Approximately one half of all cows slaughtered are dairy cows
• About 1/3 of of domestic non-fed beef production comes from dairy cows.
Economic Importance
• Approximately 7million pounds of Non-Fed Beef.– 50% slaughter cows– 9% from bulls– 13% from non fed steers and heifers– 28% from imported
• Equates to 20% of total
beef production
Processors
• Rosen Diversified 5 plants– Yankton, SD Cimpl Meats 400 /day
– St. Paul MN
– Long Prairie, MN 1,000 / day
– Omaha, NE 950 /day
– Gibbon, NE 1,000 /day
• Swift 2 plants– Omaha, NE and Idaho
• Iowa Producers– Tama Ia. Plant 30% cows 500 / day
• Privately held Plants– Lovett Pack, NE; Host of ones in WI
Marketing Cull Cows
• Questions– When are most cull cows sold– When is the greatest demand for cull cow meat
Marketing Cull Cows
• Questions– When are most cull cows sold– When is the greatest demand for cull cow meat
• Most sold from October – December– Pregnancy checked off grass, old poor performance
• Greatest demand for Ground BeefSummer Months ~ can be frozen for storage
AVERAGE DRESSED WEIGHT -- COWSFederally Inspected, Monthly
540
550
560
570
580
590
600
610
620
JAN MAR MAY JUL SEP NOV
Pounds
Avg.1997-2001
2002
2003
C-S-24F10/24/03
Livestock Marketing Information Center
Data Source: USDA/NASS
Cows: Percent Lean Weight Price
Lean Premium White 65-75 1404-1534 lbs 56.00-59.50
Breakers 75-80 1305-1710 lbs 50.50-55.50
Boners 80-85 1162-1479 lbs 45.00-50.00 High Dressing 52.00
Lean 85-90 975-1490 lbs 44.00-48.50 High Dressing 50.00 Low Dressing 42.50-43.00
Sioux Falls Cow Prices October 22, 2003
USDA, Market News
Cows: Percent Lean Weight Price
Lean Premium White 65-75 1404-1534 lbs 58.00-66.00
Breakers 75-80 1305-1710 lbs 54.00-56.00
Boners 80-85 1162-1479 lbs 52.00-54.00 High Dressing 58.00
Lean 85-90 975-1490 lbs 49.00-52.00 High Dressing 56.00 Low Dressing 45.00-46.00
Sioux Falls Cow Prices October 20, 2004
USDA, Market News
Marketing Cull Cows
Questions to be asked
1) What season of the market are you in?
2) The price difference between grades of cows?
3) Cost of feeding?
4) Select cows that will gain and obtain higher grades
5) Consider market place.
Percentage Price Increases Between Cull Cow Grades
Cutter Utility Commercial
Canner 9% 14% 15%
Cutter - 5% 6%
Utility - - 1%
Pritchard, SDSU
Percentage of Cows in Each Grade Following a Feeding Program of Shelled Corn and Corn Silage
Days
Fed
Grades
Can Cut Utl Com +
0 64% 28% 8% -
50 18% 57% 24% 1%
77 8% 21% 65% 6%
105 - 19% 74% 7%Can = Canner Cut = Cutter
Utl = Utility Com + = Commercial or higherPritchard, SDSU
Marketing Cull Cows
Iowa State Data
- Feed 60 – 90 days to obtain White Fat
- Average daily gain 3.8 lbs
- Feed costs were 52.23/cwt
- Conversions were 10 to 1
Cancer Eye
Bruising
Bruising
• Tim Loss (26.8 mil lbs) $23.0 mil
• Loss of Primal $52.0 mil
• Avg loss per head $11.75 / hd
• Producer controlled $ 4.00 / hd
Downer Cows
• Only 1% But….
Causes problems when animal right activist get a hold of pictures
Proper Condition
Proper Condition
Quality Losses Per Head
Carcass condemnation 11.99Trim dirt/ Bruises 12.00Loss of offal 4.00Hide devalued 7.00Injection Site Lesions .75Yellow Fat 2.30Poor Muscling 14.50Excessive Fat 17.75Light Carcasses 4.00Other 1.20Total 76.00
Strategies to Improve Quality
1) Monitor herd health2) Monitor Condition Scores3) Decreased hide damage ~ Insects4) Reduce Bruising5) Reduce Injection site lesions6) Market clean cattle7) Euthanasia disabled cattle
Market in a Timely Manner!!!
Marketing
• Live– Auction markets– Live basis– Risks???
• Packer Direct– Delivery– Carcass basis– Risks??
Marketing
• Live– Auction markets– Live basis– Risks??? NO Risk
• Packer Direct– Delivery– Carcass basis– Risks?? Great Risk ~ condemned
carcasses trim ect
Marketing
• Where to sell– Local Auction Markets– Ask how many cow buyers and who they
represent
• How to sell– Do Auctions use sorting– How many do the sell (large groups or Small)
Marketing
Maximizing Price
• Time of year
• Dressing percent
• Condition– Quality, Fatness, Structural soundness and
Age
Importance of Understanding Cow Slaughter
• 15-20% of a producers revenue comes from the sale of cull cows and bulls
• Cow slaughter generates 70-75% of domestic non fed beef
• A high percentage of ground beef comes form cows– Ground beef accounts for 44% of all beef consumed
• Approximately one half of all cows slaughtered are dairy cows
• About 1/3 of domestic non-fed beef production comes from dairy cows.
Marketing Cull Cows
• Questions– When are most cull cows sold– When is the greatest demand for cull cow meat
• Most sold from October – December– Pregnancy checked off grass, old poor performance
• Greatest demand for Ground BeefSummer Months ~ can be frozen for storage
