Marketing Feeder Cattle

How can I market feeder cattle through the CHB program?

Today cattlemen have more marketing options available to them than ever before. The key to marketing success is knowing which marketing option works best for you and your cattle and the willingness to do the research. Regardless of whether you market your cattle on a grid or on a cash basis, people in all segments of the industry are making it clear that if you want market price or to add value to your cattle, you must know how they perform in the feed yard and produce desirable carcasses. Once you have data on your cattle there may be genetic improvements that need to be addressed.

There are a few important factors when it comes to estimating the value of feeder cattle:

There are a number of options for marketing your feeder cattle in today’s industry. Some are very simple and some are complex.

HerfNet Internet Feeder Cattle Marketing

HerfNet is the information network for CHB feeders and their order buyers. It is a simple, well-proven and a free means of connecting buyers and sellers of white-faced cattle. HerfNet works when cattle sellers describe in detail the quantity, quality, and location of the cattle they wish to sell to a CHB feedyard. Those descriptions (listings) are posted to the HerfNet website and emailed to CHB feedyards and order buyers who choose to call the seller if they are interested in the cattle. HerfNet has a great communication system in place for feeders that are demanding cattle that fit the CHB program.

For more information go to www.herfnet.com or call Jim Williams, Certified Hereford Beef®, Director of Supply and Development at (816) 842-3758. The producer selling feeder cattle by any of the following methods is well served to list those cattle on HerfNet.

Traditional Auction Sales

These sales typically are based on the commodity cash market. The commodity market is available to all classes of cattle and even though the margins between good and bad quality cattle are beginning to spread, you are not guaranteed added value for producing higher quality cattle or using more advanced management practices. The Auction market or the Producer should list the cattle on HerfNet.

Video & Internet Sales

Producers with truckloads of feeder cattle and producers who want to forward contract often market through these channels. There is no set protocol for most of these sales but for the more progressive producers, there is a marketing edge for adding value. If you are marketing cattle through this channel it is important to communicate to your targeted buyers when your cattle are selling by listing your feeder cattle on HerfNet. Buyers of video cattle are matching delivery time frames, branded beef programs, health programs, weights and large groups of cattle.

Producer Co-mingled Auction Sales

These sales are often held at auction facilities where cattle are sorted or scanned into like kinds, like colors and like weights and are being sold in load lots. This is a way for smaller producers, to take advantage of added value that is often gained with selling load lots. This concept works great for both the seller and the buyer. There are some state organizations that have recently had numerous successful sales.

Special CHB Feeder Calf Sales

These sales are coordinated through state programs, national and state breed associations or through sale barns. These programs tend to have varying degrees of participation to help fit as many producers needs and capabilities as possible. The most progressive of these programs requires cattle to be castrated, dehorned, vaccinated, bunk broke and pre-weaned 45 days. It’s these that often have the most success for the buyer and seller. Some of these sales are offering information back to the producer. In order to receive this, your cattle must have visual or electronic identification.

Producer “pooling” Ranch Direct Sales

This practice is becoming more common by smaller producers who do not have enough cattle to make a truckload. Producers with cattle of similar type, weight, sex and health programs can make like loads of feeder cattle. This is a good value for the seller and the buyer, especially if the cattle fit similar management and genetic types.

Ranch Direct Sales

This type of transaction is used mostly on a minimum of one load (50,000 lbs) of cattle of the same sex and the same weight from one ranch. This marketing method works well for producers that have enough numbers that can supply even and uniform loads. The price is established off the cash market, the seller pays no freight and no commissions. The seller will have to pay for the health paper and brand inspections. Many CHB buyers like this method for the sake of the health of the cattle. It is very low stress and if you deal with the feeder that is buying your cattle there is a good opportunity that there will be information flow back to you.

Partnership Sales

This type of transaction is becoming more prevalent with the producer owning 25%-50% of the cattle until harvested. The negotiated price is just like a Ranch Direct Sale, with the seller splitting the cost based on the percent of retained ownership. The seller has more control in the marketing of the fed cattle and may receive the performance and carcass information back. Partnership sales eliminate all commissions and middlemen. It also gives the seller a repeatable market every year depending if the buyer was satisfied with the cattle.

Retained Ownership

CHB has a large number of feeders that are willing to work with you on getting started in a retained ownership program. This type of agreement can be the best deal for all of your marketing needs subject to the risk of the market, weather, health, genetics, and management of the cattle. Retained ownership can provide you with the individual documentation that will allow you to improve your economical management practices. To experience retained ownership with just 5 steers or more, producers can participate in the American Hereford Association’s Genetic Outreach Program.

Today cattlemen have more marketing options available to them. Selling their cattle out of habit or because they are out of feed, or out of money, is often a big mistake. We at Certified Hereford Beef urge producers to become savvier marketers. Look for different avenues and different angles by which to sell your cattle and your value as a supplier. Learning your strengths and weaknesses and producing for common goals is vital. Consumers are our end point. Everything you do affects them positively or negatively. Consumers are fragile and their perception is market reality. They not only want a product that is consistent, convenient, priced competitive, and tastes great every time, but the satisfaction of knowing the producer is actively involved in assuring the safety, quality and integrity of their food. Cattlemen are great stewards of the land and great producers of our beef products. Beef is safe for our family and it is produced with American pride. Let’s work together and develop a better marketing edge for your program.