Programs Provide Premiums for This Cattle Producer

Becky Mills
Contributing Editor

Yep, prices for 750-pound feeder calves are already unbelievable. While you're collecting hefty checks, though, you might as well reach for the top. For Jamie Dail, that comes in the form of third-party-verified programs.

The Wallace, North Carolina, producer has his herd enrolled in Global Animal Partnership 4 (G.A.P.) through EarthClaims, as well as Non-Hormone Treated Cattle (NHTC) and Verified Natural Beef (VNB) through IMI Global. His reasoning is simple: "It is hard to say with the prices as crazy as they are today, but you do get a premium over commodity-type cattle. I believe it's 10 cents a pound."

Mindi Birkeland, IMI Global regional manager and business development, agrees. "Our first-quarter data shows premiums of around $74 a head for load lots of cattle sold with IMI-verified certifications."

MARKETING JOURNEY

For Dail, who raises Angus and SimAngus cattle with his wife, Maria, son, Cody, and daughter- in-law, Grace, the verified programs are part of a marketing progression. First, he sold truckload lots of preconditioned calves through a video sales company. Next, he retained ownership for two years. "I wanted to get carcass data back. It cost me. We fed everything that were good cattle, and I thought we would make a little extra money, but that was the year COVID got us. My calves wound up staying in the yard an extra 30 days because we couldn't get them on the kill floor, but they still had yardage and feed, and weren't gaining all that much. It hurt."

The last four years he circled back to video sales, this time with Mid-Atlantic Cattle Sales (MACS), Richfield, North Carolina. "They have the best buyer base on the East Coast, and they come out, video and take all the information," Dail explains. That's also when he enrolled in the value-added programs.

Brooke Harward, MACS office and sales manager, not only encourages producers to participate in value-added programs but helps them choose between the confusing selection, as well as navigate the paperwork and prepare for the audits. "The value-added programs are very valuable tools and a way to get more dollars per head," she stresses. "Four to five years ago, at its peak, there was up to a 25 cents per pound premium for G.A.P. cattle versus commodity cattle. Now, it is closer to 5 cents to 15 cents, depending on the weight class, genetics, weaning and health program."

Harward emphasizes the programs are not one-size-fits-all. Feeders in Ohio, Pennsylvania and Virginia prefer G.A.P.-enrolled cattle since cattle can't be hauled more than 16 hours and still meet G.A.P. standards. MACS customers in east Georgia, North Carolina and South Carolina fit the requirements.

Harward adds, "The verified natural and NHTC are a different set of buyers. Currently, the most marketability and demand we have is for G.A.P., but we have buyers that demand both."

Since most producers who market through MACS also have Angus-based herds, Harward says the American Angus Association's AngusLink is a good choice, too. IMI partners with the Angus Association to verify AngusLink cattle and can also offer Care, their sustainability program, as well as Verified Natural, NHTC and Age and Source Verified. Harward says, "With IMI, AngusLink is a great addition to get out in front of more buyers."

IMI Global also partners with other breeds with similar programs including Hereford Advantage, CharAdvantage, Red Angus Feeder Calf Certification Program, Gelbvieh and Balancer Edge, and Brangus Vigor. For beef on dairy, they partner with ABS for its Beef InFocus program.

CHECK PROGRAMS' ECONOMICS

Brian Beer, Clemson University livestock and forages agent, says programs like G.A.P. and IMI can pay, but they may not be economical for smaller operations. With G.A.P., Harward says fees are typically around $1,900 for the producers who market through MACS, with the travel expenses of the auditor added on.

Malissa Lucas, director of certification services for EarthClaims, the company that handles G.A.P. certifications, says, "Producers can choose to apply for G.A.P. as a stand-alone certification or bundle it with several other programs including Source and Age Verified, NHTC, Verified Natural Beef, Vegetarian Fed and Grass Fed. Bundling multiple certifications into a single trip offers additional cost savings."

IMI Global's Birkeland says its fees average around $10 to $12 a head for a 200-cow herd. Like G.A.P., they can bundle their Care program with other certifications including Age and Source Verified, NHTC, Verified Natural Beef, Verified Grass Fed, Non-GMO, Vegetarian Fed and Organic.

To hold down costs, Beer says smaller producers in his area who market through MACS, including the 60-cow herd he runs with his father, Allen, go with producer-signed affidavits stating no added hormones, antibiotics or ionophores have been given to the cattle. The affidavits are typically supplied at no cost to the producers by the buyers, who range from large food companies to smaller farmer-feeders who market their own beef.

He notes, "Producers may or may not see premiums from that. Third-party-verified programs have a little more creditability, and buyers tend to pay a little more." However, "They cost the same whether you have 15 to 20 head or a larger herd," he adds.

The value-added programs may also come with the hidden costs of loss of production from leaving off growth-promoting implants and ionophores. Dail doesn't see it. "I've always done implants, but once we quit using them, I couldn't tell a difference."

His weaning and shipping weights have actually increased and now average around 640 pounds for steers and heifers. They ship at around 750 pounds. "All of the data on implants is older, but our genetics have improved so much, I'd love to see some new data to see if there's still a gain," he points out. "The genetics available now are superior to what we had 10 or 15 years ago."

Dail also says they haven't been burdened by the recordkeeping required for the value-added programs. "We've always kept records," he stresses. "My wife's got records forever. We were in the registered business for a couple of years, and we started keeping individual animal information then, and we still do that today."

The other producers who market through MACS agree. Harward says 75% of the load lots sold through MACS are affidavit-signed or verified by a third party. Of that 75%, at least half or more are verified.

If you decide you do want to tackle a verified program, Harward says to go in with a plan. "The people with the third-party-verified programs are very good to work with, and they can help you find a marketing company," she says. "Experience with the programs is very valuable. We try to work as the middleman to bridge the gap."

Dail says it is worth the effort. "The premiums will offset the expense of it by far."

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VALUE-ADDED CALF PROGRAMS:

-- Global Animal Partnership: Animal Welfare Food-Labeling Program: https://www.globalanimalpartnership.org/…

-- EarthClaims LLC: https://www.earthclaims.com/…

To enroll, contact: Seth Diehm, 541-286-3205, EXT. 1

Malissa Lucas, 541-286-3205, EXT. 713

-- Mid-Atlantic Cattle Sales: https://www.macsvideo.com/…

Brooke Harward, 704-322-9770

-- IMI Global: https://www.imiglobal.com/…

https://wfcfCARE.com/…

To enroll, contact:

Doug Stanton, 620-260-7210

Mindi Birkeland, 605-210-0789

-- To enroll in AngusLink, go through https://www.imiglobal.com/…

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