The current beef production system is saturated with uncertainty. In the past year, a dramatic rise in feed prices has added pressure to depressed live cattle markets. Producers have been forced to reduce their operating expenses. Cow calf producers are actively seeking methods to improve calf value to insure longevity in the beef production business. This increase in calf value must be real, and can only be learned through monitoring calf performance and value beyond the farm setting.
The NC Steer Feedout program offers cattlemen an opportunity to learn the real value of their product in a commercial feeding environment. Information generated from this program can be used to improve profitability of the cow-calf segment of production, as well as improving the future value of all cattle produced on an operation. However, careful study and interpretation of the results is necessary to pinpoint changes to increase the total net return to the enterprise.
The test site for the 1995 NC Steer Feedout was a custom feed yard near Guthrie, Oklahoma. This is the same yard which hosted the 1994 NC Steer Feedout and has hosted the Oklahoma Steer Feedout for the past several years. Only steer calves estimated to weigh a minimum of 600 pounds at take up were eligible for consignment. A consignor could enter one or more lots of five steers that were nominated by the deadline stated in the rules and regulations published for the test. A summary of the results of this feedout follows.
Two loads of steers (Fall calves) from 13 farms were assembled in three locations on August 29, 1995, weighed individually and trucked approximately 1300 miles to Oklahoma Feeders, Inc. of Coyle, Oklahoma. Two more loads of steers (Spring calves) from 13 farms were shipped on November 7, 1995. A total of 279 steers were fed in the two programs. Prior to shipment, these steers had been weaned at least 30 days, vaccinated, de-wormed, bunk broke and re-vaccinated. After resting overnight with access to feed and water, steers were weighed individually and photographed. All steers were re-vaccinated with 4-way Blackleg and Lepto 4 by the feedyard. Pasturella was administered at processing, 10 days and midway through the feeding period. Rectal temperatures were taken on suspect steers and an antibiotic administered as needed as a preventative health measure. A second implant was given when the check weights were taken, approximately midway through the feeding period. Individual weights were also taken at the conclusion of the feeding period. Individual slides were made of each steer upon arrival and prior to slaughter.
A ration of dry rolled corn (83%), chopped alfalfa (4%), molasses (5.6%), and cottonseed hulls (3.7%), plus supplement (3.7%) was fed. Four lower concentrate rations were fed and progressed through over a three week period prior to reaching full feed.
Steers were observed daily for health problems by feedyard personnel. Those deemed ill were pulled to the hospital pen and treated there until exhibiting a normal appearance and temperature for at least two consecutive days. At that time they were returned to their home pen. With the Fall born group, both pens of steers were treated at processing with a strong antibiotic due to elevated rectal temperatures. Weather conditions were poor as daytime temperatures reached record highs for the first seven days cattle were at the yard. Two steers died in the heat within three days of arrival. Approximately two weeks into feeding, a severe level of respiratory problems caused extreme levels of morbidity and mortality. A total of 12 steers died due primarily to respiratory illness. With the Spring born group, health problems were minimal and no death losses occurred. A portion of this sickness incidence in the Fall group may be attributed to the hot weather conditions in North Carolina during the preconditioning period as well as those encountered upon arrival.
The program intent was to market steer groups when it was established by feedlot management that 3 out of the 5 head would grade low Choice at no later than 180 days on feed. However, due to the high incidence of sickness and reduced gains in the Fall group, only 40% of these cattle graded Choice. Twenty-eight steers were sold on the rail to Excel in Dodge City, Kansas on December 12, 1995. Another 97 steers were sold to the same plant on January 29, 1996. Three steers were railed to a local packer in late January. In the Spring group where performance was good and sickness minimal, 61% of the cattle graded Choice.
Average daily gain is the information most cattlemen are interested in when they first send calves to the feedout. This is probably because they relate the Feedout to traditional bull tests where gains are a major criteria for selection. The ability of calves to gain on feed is extremely important.
The NC weight was taken prior to loading in North Carolina. Starting weights were taken the day of processing at the feed yard. Hay and water were available to the steers overnight prior to this starting weight. Average daily gains are calculated from the weights taken in North Carolina to the final weight at the yard less four percent. Overall average daily gains ranged from -0.04 to 3.98 with an average of 2.80 pounds in the Fall group, while the Spring group range was 0.35 to 4.69, with a 3.03 lb. average.
Description of Quality Grade
Feedout steers are eligible for four quality grades; Prime, Choice, Select, and Standard. Quality grades are based on two factors:
There are five maturity classes for beef: A, B, C, D, AND E. Since "A maturity includes beef cattle from 0 to 30 months of age, all feedout steers are "A" maturity carcasses.
Marbling is the intermingling or dispersion of fat within the lean. Marbling score is taken on the ribeye muscle at the 12th rib. The nine degrees of marbling and the quality grade they equal are shown in the chart below. The majority of feedout steers exhibit slight, small or modest degrees of marbling. In addition, each degree of marbling is subdivided into percentages from 0 to 100% in increments of 10%. Thus, small marbling would be identified Sm , Sm10, Sm20, etc.
Quality grades are often referred to in ranges: Low (-), and High (+). The degree of marbling and their corresponding quality grade would include:
Finances
Carcass quality and yield grade become more important to cattlemen after participation in the feedout. Very few producers have this information about their herd prior to consigning to such a program. Steers consigned to the feedout are sold grade and yield resulting in discounts for cattle that don't grade Choice or whose carcasses do not fall within acceptable weight ranges. The Fall cattle in this year's feedout sold for $112.00/Cwt. for Choice carcasses and $100.00/Cwt. for Select carcasses sold in December. In January, prices were $105.00 and $99.00/Cwt. for Choice and Select carcasses, respectively. The Spring cattle sold for $100.00 and $96.00/Cwt. respectively, for Choice and Select carcasses in early April and were $.50/Cwt. lower two weeks later. In all cases, Yield Grade 1 and 2 carcasses brought a $2.00/Cwt. premium above the listed prices. CAB designated carcasses brought an additional $1.00/Cwt. in the Fall group but there was no premium on these carcasses in April. Yield Grade 4 carcasses were discounted $15.00/Cwt. in both groups. The acceptable weight range for carcasses was 550 to 950 lbs. Any carcasses falling outside of these weight ranges were also discounted.
Cost to participate in the feedout is the same as that charged to other cattle feeders at the feedyard. An entry fee of $40.00 is used as a prepayment to purchase ear tags and to ship cattle to the yard. Advanced payments are collected and credited to the owners account for expenses incurred. Careful records of individual steer expenses are maintained. Any feed costs or other expenses including interest on the feed, are deducted form the sale price at the end of the feedout. Consignors receive the actual dollars received for the carcass less the feed cost, interest, vet-med charges, implants, hay, processing, freight and the promotional fee. Oklahoma Feeders, Inc. includes yardage in the feed cost.
In each group, cattle were separated into two pens of uniform lots as determined by the yard. Each pen was billed for the amount of feed used. Feed cost for individual consignors were determined and allocated using the net energy system. Feed charges are based on the energy content of the ration, the average weight of each steer during the feeding period and the average daily gain of each steer. Feed prices continued to rise throughout the feeding period and ranged from $123/ton in September, to $165/ton in April, including the $20.00/ton mark-up charged by the yard.
Net return reported by the NC Steer Feedout program must be carefully interpreted by each producer. A price of $60.50/Cwt. for 694 lb. steers (with a $.02/lb. slide to adjust for weight differences) was used to calculate starting value of the Fall group. Due to a declining market, a value of $59.50/Cwt. for 673 lb. steers (with the same slide) was used for the Spring group. This was our best estimate of what the cattle would have sold for in load lots at the time of shipment to the yard. Each consignor should evaluate those values and make appropriate adjustments for grade and breed variations.
Summary
Cow-calf producers may not want to produce calves capable of winning the profitability phase due to the influence of the feeder calf value at the start of the test. Those that are valued low off the cow could have an advantage in the feedlot phase, but would be less profitable at home. As profits are compared from year to year, keep in mind changes in feed cost, current markets and cattle inventories. Any or all of these factors can greatly affect the profitability of any feeding period.
Get Informed
Based on the current level of interest, we do anticipate offering the program again this year. If you have an interest in participating in this program or would like a copy of the full report for 1995, you may contact me at 919/515-7772, or send your request to:
Dale Miller
Box 7621, NCSU
Raleigh, NC 27695.