In an age when selling commodity beef at the grocery store is no longer profitable, we can see that the days of selling commodity cattle at a profit are dwindling. For cattlemen who invest in registered Angus genetics and target our recommended selection criteria calves that bring an extra $35-$40 per head at weaning can more than double that in retained-ownership programs.
The amount you can capture through retained ownership and marketing finished cattle depends on the cattle, the risk you are willing to take and the amount of ownership you are willing to retain.
Retained ownership through finishing can be very risky for those with unknown genetics or those who take no steps to coordinate health and weaning. However, it may be the best way to realize the full feeding and carcass value of raised calves.
Retain up to 100% ownership in the calves through finishing and sell the cattle on a value-based marketing grid or formula. Many feedyards will partner with you on a set of calves with varying levels of ownership from 75% or more to less than 25%. Many also offer up to full-term financing for the feedyard phase, using the cattle as equity.
Select a feeding partner. The best place to start is our list of recommended feedyards. These feedlots are known for feeding high-quality Angus genetics and partnering with commercial cattlemen successfully to capture premiums. Conduct several phone conversations to narrow the list, then make personal visits to find a feedyard partner matching your goals. Finally, pick a feeding partner with whom you are comfortable. Get to know the management personnel and their philosophies. Success in feeding your cattle will be highly dependent on your comfort, trust and communication with each other.
Some of the calves from your herd may not be ideal for feeding with the group. Those born far earlier or later than average may present feeding challenges. Sort those very heavy or light ones out, along with any outliers for health (chronics) or genetics (neighbor’s bull), and market them as feeders. The older and younger cattle may still bring a premium from a buyer with orders to fill. Outliers may take a discount, but that would likely be amplified if you try to feed them with the rest of your calves.