Creating Premium Beef Maximizing Dairy Profit

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1 Creating Premium Beef Maximizing Dairy Profit Tim Timmons Marketing Manager ABS Global QUESTIONS YOU SHOULD BE ASKING Do I need all of my replacements? Do all of my heifers pay off their rearing costs? Why am I waiting 24 months to be disappointed? 1

2 $2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 IT S TIME TO REVIEW OUR STRATEGY Costs more to raise heifers than buy replacements Rearing Costs The days of raising every heifer calf as a replacement is no longer valid. Today Rearing Gap: $600 Springer Value BEEF X DAIRY PROGRAM How to Increase Cash Flow & Profit Which Bulls? Which Cows? $$$ Premium Beef Supply Chain Marketing 2

3 COW INVENTORY ANALYSIS 35,000 # Cows (1,000) 30,000 25,000 20,000 15,000 10,000 5, % Decrease in Beef Cows 0.5% Increase in Dairy Cows Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Beef Cows 29.3 million, were down 860K from January Dairy Cows 9.2 million, were down 100K from January BEEF COW INVENTORY DECLINING 2011 Beef Calf Crop Down 382, Beef Calf Crop Down 500, Projected Decline 860,000 Down last 15 of 17 years. 3

4 DAIRY EXPECTS PERFORMANCE Fertility Advantage Calving Ease More Live Calves $ Premium Over Bull Calf Market Dairies Should Demand Performance Benefits FIVE MAJOR FACTORS Before you breed a cow to Beef, consider the risk! Dairy Performance Risks: Fertility Gestation Length Calving Ease Calf Vigor/Quality Marketing Ability Accurate Data can Reduce Risk and Maximize your Benefits 4

5 Which Bull is the best option? ANGUS ARE ALL EASY CALVING? (Generic) (Proven) Option 2 Calving Ease: 11.5% Difficult Gestation Length: 286 days Option 1 Calving Ease: 1.5% Difficult Gestation Length: 281 days GROWTH RATE AND NOT BIRTH WEIGHT! COMPARISON Premium Beef x Dairy Outperforms Holsteins 400 Lbs. Holstein Heifers Holstein Steers Premium Beef x Dairy Steers Death Loss Rate of Gain Market Value (Jan. 2013) Medium Low $400 High Medium $440 Low High $580 5

6 PROVEN SIRES WITH BEEF INDUSTRY ACCURACY Tenderness Feed Efficiency Profit Evaluation Calving Ease Fertility ANGUS AND SIMMENTAL PERFORMANCE Angus and Simmental are Dominant Beef Breeds for Performance Economic Trait Angus Rank Simmental Rank Calving Ease First First Percent Choice Second First Carcass Weight First First Pounds of Retail Product First Second Tenderness First First Feed Efficiency First First Source: Germ Plasm Evaluation Project at the Meat Animal Research Center in Clay Center, NE 6

7 TOP 20 BREEDS FOR NAAB STUDS Angus is More Popular than All Other Breeds Combined Angus #1 for units in Industry Rock Solid A.I. Proven.98 Accuracy Rock Solid A.I. Proven.96 Accuracy Semimetal #2 for units in Industry Angus Simmental Angus (Red) Hereford Crossbreed Charolais Gelbvieh Maine Anjou Brahman Shorthorn Chianina Braunvieh Chi Maine Brangus Limousin 1,036, ,034 83,755 80,715 18,900 14,813 7,262 6,833 5,722 4,698 3,679 2,875 2,827 2,794 1, , , , ,000 1,000,000 1,200,000 # Units WHAT GENETICS NEED TO BE REMOVED FROM MY HERD? 7

8 MANAGE YOUR HERD GENETICS Segment Herd Into Management Groups Identify the Right Cows for Heifer Replacements Use Premium Beef Semen on Bottom Segment to Produce the Most Profitable Terminal Beef Cattle KEY COMPONENTS Herd Audit Ranking of Female Genetics Segmentation Genetic Audit Calculator Alternate Genetic Options Marketing Unwanted Genetics 8

9 CONFUSING? BEEF X DAIRY COMPANION PRODUCT - SEXATION Keep High Performing Genetics In Your Herd Top Performing Cows Dairy Semen Sorted or Conventional More Top Performing Cows Keep Low Performing Genetics Out of Your Herd Lower Performing Cows Beef Semen Premium Beef x Dairy 9

10 InFocus x Holstein BEEF X DAIRY WORKS WITH ALL BREEDS InFocus x 3-Way Cross InFocus x Jersey MARKETING OPTIONS Sell calves to qualified calf grower at birth: Premium price male and female calves. (regional) Dairy Retained Ownership to Finish: The dairy shares in the profit and the risk in feeding the calf until harvest. Dairy Retained Ownership to Feeder Weights: The dairy agrees to feed the calf to 3 5wts and markets the calf with the support of the Marketing Team. 10

11 Supply Chain Relationships for Selling Generic Beef SELLING DAIRY BEEF Dairy Producer Genetics Supplier Supply Chain Relationships for Marketing Premium Beef SELLING DAIRY BEEF Dairy Producer Genetics Supplier Calf Performance 11

12 FEEDLOTS EXPECT PERFORMANCE Genetics Donor ID Program ID Tags Calf Care at Birth GOAL PREMIUM DAIRY BEEF $ $$ $$$ $$$$ Dairy Generic B x D Premium B x D Beef Current Wisconsin Market Value 4wt Price 400 lbs. Lbs. Feed/ 1 Lb. Grain Holstein Steers $105 $ InFocus Steers $145 $ Beef Steers $158 $

13 Tim Timmons Marketing Manager ABS Global QUESTIONS 13