Uniform and healthy calves-that's what feeders say they can best manage, market and ultimately pay a premium for. But getting a premium by selling a few head through the auction ring is difficult at best. And if you're a smaller producer, offering your own truckload lots of similar, source-verified cattle is nearly impossible. Even if you manage 125 head of beef cows, it's impossible to sell 50,000 pounds of the same size, same sex and same type of calves. How can you offer feeders the type of calves they need, and receive the premiums you deserve? The answer: by working with fellow producers and pooling your calves at marketing time.

With 100 head of commercial cows, producer Steve Diehls of Fayette, Mo., is one of the larger producers in his county. Yet he was still a price taker, forced to take whatever he could get for his calves at the local auction barn.

With the help of the University of Missouri Beef Focus Team, Mr. Diehls and other neighboring producers set up the Mid-Missouri Premier Beef Marketing alliance with the goal of adding value to the calves they sell. There objective is to increase their collective marketing power by producing uniform quality animals, commingling them 45 days prior to sale, and offering load lots of like calves that can be traced from birth through slaughter.

"There are a lot of small producers in the county with only 25 to 30 head. We put them together so we can offer a buyer a semi-load of calves and we get a little better price for the calves," says Mr. Diehls.

What is stockpiling?

On the surface, stockpiling forage is not too complicated. You simply keep cattle off a pasture, allow forage to grow for a specific period of time and then utilize the forage at a later date. Effectively managing your stockpiled forage, however, requires that you consider when the forage is needed, the amount that can be produced and the level of nutrient quality.

Having identified high winter-feed costs as a problem, the purpose of stockpiling forage, in this case, is to minimize the need for stored feeds while supplying enough nutrition to maintain reproductive and growth performance. Maximizing both the quantity and quality of forage available when it is needed requires a little planning and the use of a few management tools.

Removing old growth

Delaying the maturity of the grass is an important step in producing higher quality stockpiled forage. An extended growing season may produce more forage by October and November, but the longer growing period results in lower nutritional quality due to plant maturity. Some form of forage harvest or clipping should be done in late July or early August regardless of projected quantity to ensure higher nutrient quality in the stockpiled forage.

"We remove old growth grass between Aug. 1 and Aug. 15 for our part of the country. Removal can be done with managed grazing, haying or just clipping. The forage then must not be disturbed before the first hard frost," says Mrs. Powell. "It's important to stay within that range of dates in our area for optimal quality and quantity of standing forage."

Steps in pooling calves

1. Participating producers develop production and marketing criteria that all participating members agree upon and then implement them into their individual herds. Ultimately this should include producing similar genetics using the same health and husbandry practices. Yearly enrollment and no up front membership fee help to minimize risk associated with committing calves to the program.

2. Calves are commingled on or about Dec. 1, backgrounded and listed for sale around Jan. 15.

3. Performance information is collected and developed into a marketing package for distribution to potential value-added-buyers and bids are collected from potential buyers.

4. Animals are transferred to feedlots where finishing performance and health information is collected.

5. Animals are processed and marketed through the value-based grid marketing system and carcass quality information is returned to producers.

6. Producers meet and upgrade the production and marketing criteria for their group in response to the data that indicates where potential improvements in quality, consistency and profitability can be made.

Benefits of pooling

Initially the Mid-Missouri Premier Beef Marketing alliance was just seeking higher bids, admits Mr. Diehls, but the potential benefits go beyond higher prices. Now the Mid-Missouri Premier Beef Marketers are looking toward genetic improvement and validation of value-added management practices. When soliciting bids, the group targets value-added feeding programs and requests that the buyers share feedyard and carcass information with the alliance members.

"We'd like to follow them all the way through to slaughter to get information on feed conversion, rate of gain and carcass data so we know which direction to go when we are buying bulls and changing genetics," says Mr. Diehls. "That's something we cow-calf guys don't get once the calves leave the farm. We want to find out how they perform, if they are healthy and how we can make them better."

Vern Pierce, beef economist at the University of Missouri who worked with the producer group in developing the pooling alliance, believes the benefits go way beyond first year profits.

"This is a program for producers that are interested in long term changes and need information now, so they can get ready," says Dr. Pierce. "And, so far we have been able to show some additional profits in each group compared to selling their animals at weaning."

The pilot program, with 182 calves from 9 farms, provided an average additional value of $50 per head after all costs of the program were deducted. That's in comparison to the value of the calves had they been sold through the sale ring at weaning.

Selling truck-load-lots direct from the backgrounding pen also can reduce shrink. Using certified scales at the backgrounding sight, producers can weigh the calves onto the truck and pencil in just 2 percent shrink. "I have been looking for several years for some way to direct market calves off of the farm. I was getting 10 percent or more shrink through the sale barn so I was looking for ways to keep the money I was losing," says Mr. Diehls.

"We are just starting to get the carcass data back on the first year's animals and just starting to look at that data," says Dr. Pierce. "Of course you are not going to make any big genetic changes on one year's worth of carcass data, but they are starting to look at that information to evaluate their production programs."

The earliest use of data will probably be to evaluate the health program. For example if pulling rates are high, producers can look back and ask, "Did we really do that health program right or are there changes that we need to make?"

Premiere Beef Marketing

The purpose of Missouri's Premier Beef Marketing program is to help small producers develop production and marketing criteria that include similar genetics, health and husbandry practices. The uniqueness of this program, however, is that each producer maintains their own independence in decision making right up the point of marketing the animals. The program is not the end all solution for every producer, admits Dr. Pierce, the idea is to help producers get more information and seek out profitable marketing options.

According to Dr. Pierce the use of the Premier Beef Marketing model is expanding quickly around Missouri. What started with one group marketing 182 head of calves has grown to 10 individual marketing groups this year representing 2,000 to 3,000 calves statewide.

Despite the program's success, getting people in the beef industry to change their thinking doesn't come easy, says Mr. Diehls. "People are slow to change. I talked to a lot of people trying to get them interested in the program, but a lot of folks have a wait-and-see attitude."
Filling demand

Growth in the value-added, identity preserved beef market has increased substantially in recent years and promises to grow exponentially in the coming years. Cow-calf producers may feel far removed from delivering the final beef cut, but consumers are demanding a more consistent and higher quality beef product. Creating a system that maintains the identity of beef animals from birth to slaughter, while allowing information feedback to the genetic decision maker is paramount to delivering this consistent, quality product.

Unfortunately, small and medium-sized beef producers have difficulty in attracting buyers from these alternative value-based marketing systems. The fact is, the fewer calves you have, the lower your bargaining power will be on sale day. By pooling like calves together, smaller producers can participate in providing this higher quality beef product to consumers and get the quality premium they deserve.