Potential Economic Returns from Selling Beef in a Specified Value-Based Market

Three groups of steers--one theoretical group and two experimental groups—were evaluated for marketing cattle live, as boxed beef, and grade and yield when the live price was $71 to $73/cwt, grade and yield price $125/cwt for Choice yield grade 3 carcasses with $20/cwt discount for Select carcasses, and in a commodity-trim or close-trim boxed beef market. The results show that the value of highyielding steers can be significantly increased if sold in a close-trim boxed beef market. The close-trim premiums ranged from $5.06 per head for Select close-trim yield grade 4 carcasses to $87.18 per head for close-trim Choice yield grade 1 carcasses. A group of experimental steers averaging 82% Choice and 60% yield grades 1 and 2 returned an additional $104 in the close-trim boxed market compared with selling live for $73/cwt. Another group of experimental steers averaging 21% Choice, 18% Standard, and 93% yield grades 1 and 2 had $29 per head greater return than if the steers had been sold live for $71/cwt. These comparisons emphasize the importance of knowing how cattle will potentially grade before selecting an alternative marketing strategy. This prior knowledge is most important when the spread in price between Choice and Select is high. Producers need to learn more about their cattle to predict how the cattle may grade for a specified value-based market.

Effects of Initial Body Condition, Frame Size and Concentration of Dietary Energy on Carcass Value of Finished Steers

Yearling steers were sorted into four groups based on hip height and fat cover at the start of the finishing period. Each group of sorted steers was fed diets containing 0.59 or 0.64 Mcal NEg per pound of diet. The value of each carcass was determined by use of the Oklahoma State University Boxed Beef Calculator. Sorting to increase hip height decreased the percentage of Choice carcasses and fat cover, increased ribeye area, and had no effect on carcass weight or yield grades 1 and 2. Sorting to decrease initial fat cover decreased carcass weight, carcass fat cover, and percentage of choice carcasses and increased the proportion of yield grades 1 and 2 carcasses. Concentration of energy in the finishing diet had no effect on carcass measurements. Increasing the percentage of yield grades 1 and 2 carcasses did not result in increased economic value of the carcasses when quality grades were lower and when there was a wide spread between Choice and Select carcasses, as occurred in 1996. With less spread between Choice and Select, as in 1997, sorting the cattle to increase yield grades 1 and 2 resulted in increased value, especially for close-trim boxed beef. The results of this study emphasize the importance of knowing how carcasses will grade before selecting a valuebased market for selling cattle.

Integration of Pasturing Systems for Cattle Finishing Programs

A 3-year study, using 84 fall-born and 28 spring-born calves of similar genotypes, was conducted to integrate pasturing systems with drylot feeding systems. Calves were started on test following weaning in May and October. Seven treatments were imposed: 1) fall-born calves directly into feedlot; 2 and 3) fall-born calves put on pasture with or without ionophore and moved to the feedlot at the end of July; 4 and 5) fall-born calves put on pasture with or without ionophore and moved to the feedlot at the end of October; 6 and 7) spring-born calves put on pasture with or without ionophore and moved to the feedlot at the end of October. A bromegrass pasture consisting of 16 paddocks, each 1.7 acre in size, was available. Each treatment group had access to 1 paddock at a time and was rotated at approximately 3-day intervals. In the feedlot, steers were provided an 82% concentrate diet containing whole-shelled corn, ground alfalfa hay, and a protein, vitamin and mineral supplement containing ionophore and molasses. As pens of cattle reached about 1150 lb. average live weight, they were processed and carcass traits were evaluated. Pasture daily gains were highest for cattle on pasture for the longest duration (P < .03), and overall daily gains were highest for drylot cattle (P < .01) and decreased with increased time spent on pasture. Although differences among treatments existed in numerical scores for yield and quality grades (P < .05 and P < .03, respectively), all treatments provided average yield grade scores of 2 and quality grades of low Choice or higher. Use of four production costs and pricing scenarios revealed that fall-born calves placed on pasture for varying lengths of time were the most profitable (P < .04) among the treatments. Furthermore, employing a 5% price sensitivity analysis, indicated that fed-cattle selling price had great impact on profit potential and was followed in importance by feeder purchase price and corn grain price. Overall, these findings should provide significant production alternatives for some segments of the cattle feeding industry and also lend substantial credence to the concept of sustainable agriculture.

Intensive Rotational Grazing of Steers on Highly Erodible Land at the Adams County CRP Project, 2001

A steer grazing demonstration was conducted in 2001 at the CRP Research and Demonstration Project farm near Corning, Iowa. Ninety-five steers were delivered to the Adams County CRP farm on April 27, 2001. The steer pasture at the CRP farm was 76 acres, divided into 33 paddocks with electric fence. Cattle were moved 101 times to a fresh paddock during the grazing season. Most of the moves (79.2%) followed 1 day of grazing in a paddock. No paddock was grazed for more than 3 days in succession. Rate of gain on pasture (2.12 lbs./animal/day) was higher in 2001 than in any previous year in the 8-year steer grazing project at the CRP farm. The 95 steers gained a total of 21,056 pounds on pasture, and the cost of the gain on pasture was $51.30/cwt. The 2001 steer grazing project showed a small profit above all costs. The net profit was $4.12/steer or $5.15/acre. Large profits and large losses are possible, primarily depending on the difference between the buying and selling prices.

Estimating the Value of Source Verification in Iowa Feeder Cattle Markets

Source verification and pooling of feeder cattle into larger lots resulted in higher selling prices compared to more typical sales at a southern Iowa auction market. After higher prices due to larger lot sizes were accounted for, cattle that received a specified management program and were source verified as to origin received additional price premiums. The data do not distinguish between the value of the specific management program and the value of the source verification process. However, cow–calf producers participating in the program took home more money.

Estimating the Value of Source Verification in Iowa Feeder Cattle Markets

Source verification and pooling of feeder cattle into larger lots resulted in higher selling prices compared with more typical sales at a southern Iowa auction market. After accounting for higher prices due to larger lot sizes, cattle that received a specified management program and were source verified as to origin received additional price premiums. The data do not distinguish between the value of the specific management program and the value of the source verification process. However, cow-calf producers participating in the program took home more money.