Call the Market
Price or Profitability -- Which Matters More to Cattle Producers?
Three seasoned cattlemen -- one large commercial operator, one seedstock producer, and one feedlot manager -- sat down over the Fourth of July holiday and bantered back and forth over what makes a "perfect" cow.
The commercial operator spoke up with sternness in his tone and said, "It's simple; you need a cow that can graze 10-plus months out of the year, calve unassisted, wean a calf and breed back every year. That's it."
The steedstock producer spoke up quickly, "In today's industry you must have a cow that possesses the genetic potential to produce calves that can thrive in any environment."
Lastly, the feedlot manager looked at both men, took another sip of iced tea, and said, "Boys, you can piss around chasing a lot of things that are supposed to be 'important' in our line of work. But if you don't have cattle that feed and marble well, I feel plum sorry for you."
It's easy to see how each of these men came to the conclusions they did. I'm sure you've heard of similar rhetoric shared at sale barn cafes, cattlemen's meetings or around the branding trap.
But I'd argue the answer is much simpler than what these gentlemen explained. The only good cow is a profitable cow -- period.
As we progress and develop new technologies that help us perfect our business across the different segments of the trade, from things such as DNA testing, to collecting feed-efficiency data, or to procuring new genetics, we need to put a greater priority on understanding the profitability of our business.
I was thinking about this point just the other day. Rarely will you stumble across a cowman who forgot what his steers sold for last year; but if you ask what his net profit per cow was, most wouldn't know how to answer. Which is what I intend to focus on in the weeks ahead in this column -- better understanding how to figure out if your operation is profitable or not.
Initially I was hesitant to cover this topic because each operation is so drastically different from the next. But It's an area of weakness in our industry. And I truly believe if we want our children and their children to someday take over and grow and expand our operations, we must ensure that we are passing down financially sound operations. You can instill in their hearts the love for ranching, but if we can't pass down businesses and operations that are financially sustainable, we are merely passing down a sad story of heartbreak, despair, and disappointment.
So please, join me in my upcoming Call the Market columns as we continue to discuss profitably as we all want to be better cowmen and better businessmen.
ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com
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