Economic Research

Getting under the hide for marketing decisions that maximize profitability

Research Lead: Mike McMorris , Beef Improvement Opportunities

PROJECT OBJECTIVE

Evaluate feedlot returns from different pricing mechanisms taking into account variability in groups of animals marketed.
Develop the cost/benefit and the value statement of feedlot ultrasound and bioTrack as new technologies for feedlot operators.

RESULTS

Producers involved in the project were marketing cattle in three different ways, but each producer would often be unique when compared to others within his stereotypic group.

The three groups include;

a) Conventional feedlot producers marketing cattle to the mainstream market through one of the larger packers.

b) Producers marketing products through a niche market or at the farm gate.
c) Producers selling into a grid market.

Researchers found that the use of carcass prediction could result in a cost benefit of more than $30-$40 per head and could be as much as $100 per head depending how those cattle were marketed and managed.
Using bioTrack Feedlot for record keeping and inventory management could result in: fewer OTM discounts, improved document adherence to production protocols and help producers make more informed buying decisions when purchasing replacements.

COMMENTS

Genomics in beef is an evolving field with the largest potential benefit arising from the determination of genetic merit for novel traits such as residual feed intake (RFI) and tenderness.
Based on the panels resulting from this project, BIO provided RFI and tenderness genomic predictions to beef producers so that these could be used in preselecting young bulls.
Commercial application will be challenging due to the cost of genotyping as well as the lack of clear market signals for breeding stock with evaluations for RFI and/or tenderness.