The most expensive cut!

[cowman]

What is the most expensive cut on a beef animal? The T-bone? The sirloin? Neither! It is the ear! Just take in a calf that has frozen ears and watch the buyers cut him out and buy him for a 10 cent discount! Now if those frozen ears weigh 1/2 lb. that works out to about $140/lb. on a 700 lb. steer! They have some story that these cattle could go lame in the feedlot. There is a solution however...keep him at home and feed him out yourself! He will do just fine and when he sells as a fat the discount will have disappeared! Talk about value-adding!

[paladin]

Cowman, I had to chuckle about your "frozen ear" observations. We run a 'colorful' commercial herd where we don't cut the bulls and feed them and their sisters out to slaughter at 10-12 months of age. I have noticed through the past few years of records that the calves that generate the best profit (depends on market at the time) are the ones that come in at weaning a little light, off-colored and with frozen ears that you couldn't give away in the fall!

[cowman]

Pandianna: The way the market discriminates against certain types of cattle has always amazed me. Why are heifer calves routinelly discounted at the very least 10 cents and sometimes as high as 20 cents? Years ago I got tired of getting this particular shaft and quit selling them as calves. Feed them light over the winter and throw them out on grass. In early autumn guess what happens? They outsell the steers!!! And make more profit!!
A straight hereford calf gets discounted heavily in the fall but guess what happens if you keep him over? Voila! He loses that discount!
Every year it seems the cattle buyers want something different. A couple of years ago they didn't want Simmental calves...an old rancher gave me this advice...All you can do is try to put on as many pounds as you can. The fads come and go and you'll always be a day behind but in the end it is pounds that pay the bills!

[cowman]

Pandianna:Why don't you cut those bulls? I understand that a young bull will grow out better than a steer and all that. Do you have trouble getting enough fat on them to finish at an acceptable grade? Any dark cutters? As you probably know a bull calf takes a big hit when he goes through the ring, do you think that discount is really justified based on what you do? The justification of a discount,by the buyers, is that they have to cut him and take the subsequent loss. I wonder if a lot of these calves end up in a bull pen and never see the knife?

[paladin]

A number of years ago (must be getting close to 20 now) my dad decided to experiment with feeding bulls. Basically, we've never looked back. 1.) We estimate those bulls come in at weaning 25-50 lbs heavier than they would if steered.
2.) On average, the bulls will gain about 4.75 a day with the top ones doing 6, which outperforms a steer fairly handily.
3.) On average the bulls grade AA, yield 62% or better and the most dark cutters we've had is 1% and some years none at all.
4.) We sell the bulls on the rail for steer price.
We do push them pretty hard, and your management is a little different than with steers, but based on our experience if we were in the situation where we wanted to buy in calves to feed, we would gleefully take advantage of the discounts that the industry seems to want to hand down to uncut bulls in the ring and add that on to the profit in the spring when the hang on the rail just like a steer!

[cowman]

Pandianna: Where do you sell these bulls? I know XL used to buy them on the rail. Do you think the whole steer thing is sort of a lost opportunity? Could young bull meat ever replace the steer market?

[paladin]

Although we have dealt with XL the most (both pre-Dvorkin merge and after) all of the packers will buy virgin bulls on the rail. However, most of them like to try to start you out at a discount! Feeding young bulls works very well for us, and from our perspective we don't see returning to raising steers as it would seem to be going backwards. Now that having been said, we also seem to be in the "education business", as when you operate "outside the box", you seem to have to continually work to prove your system produces what they want. I think that raising virgin bull beef is a definite opportunity, particularly for the individual cow-calf operator looking to retain ownership, or possibly smaller feedlots. Three major problems I see with serious development of this sector of beef production are:
1.) the big feedlots have pens of such a size that they would run into trouble with the management of the bulls. Running them in groups of 50 hd or less seems to be the most successful.
2.) the silage feeding method might not work so well in this system, as there tends to be more growth and it can take longer to get the animal to finish this way. With bulls, you pretty much have to get them done and gone before they get to 14-15 months, as the very engine that is driving their great feed efficiency will start to turn to "other matters". You would begin to see higher level of discounts on the carcass at this age.
3.) supply. To do this on a great scale would require a complete paradigm shift within the industry. I think that it would take a fair bit of time for the industry to change their thoughts and practices, and frankly I really don't see it happening.
Now, what really might throw a wrench into things is the animal-rightist dialogue that is burbling within our industry. If enough pressure were to be brought into our industy from outside sources demanding the abandonment of practices like castration, it is possible that there could be more of a movement in this direction.