Market Closeout

No Bull Here

If you have invested in bull power, you should get paid for it.

I have always believed no single factor has a bigger effect on the profitability of an operation than that operation’s bull power.

We’ve all heard animal breeders tell us that 85%-90% of the genetic improvement observed in a beef herd is the direct result of sire selection. While this is certainly true, your bull power has ramifications that go beyond genetics. It tends to play a big role in marketing, and it is a pretty good indicator of management, as well.

Not about the money
For clarity purposes, I do want to make the point that while purchase price and bull power tend to be highly correlated, it is not a perfect relationship. I’ve seen some good genetics sell relatively cheap, and some poor genetics sell high.

Creating bull power goes beyond purchase price. It is about having an objective and a target that is clearly defined within the constraints of your environment and your marketing plan. Bull power is measured by how closely the bulls you are using align with those objectives.

In today’s market, where we are experiencing record-high input costs with record-high price premiums for high-quality cattle, genetics have never been more important. It is exciting to see the changes we can now make in the three big selection buckets of a breeding program — reproductive efficiency, production efficiency and product composition.

Forgotten bucket
But there is a component of bull power that has an even greater effect on profitability than any of these three, and we don’t spend much time talking about it. Most would call it uniformity, or consistency. I think predictability might be a better descriptor.

Predictability/consistency is what enables those who purchase your cattle to manage them appropriately. Uniformity is the greatest risk-management tool we have available to us. While management plays a role (length of calving season, etc.), the consistency of the bull battery and your bull selection are the drivers.

Science has given us some amazing tools to make better selection decisions. Most producers with defined targets and goals have a pretty narrow range of acceptable expected progeny differences (EPDs) for the economically related traits for which they are selecting.

Indexes do a lot of the initial work for us, but the tricky part is that as the science has gotten better, the art of breeding better cattle has become more important. Indexes get us to the right outcome, but there are a lot of ways of getting there, and they aren’t all equal. Cattlemen must determine not only the goals, but the path they want to take to get there.

Most progressive and successful cattlemen fully understand how important bull power is, and they have made a substantial investment in both time and money to create the best bull battery they can. Unfortunately, while they see their bulls as the key genetic input, which they are, they forget that this should make them the centerpiece of their own marketing program.

The commercial cow-calf and seedstock industries have long known the value of genetics, but appreciation for the effect of genetics on profitability is exploding among cattle feeders and supply chains. The problem in conveying the message of one’s bull power to the broader marketplace is that we had no good way of doing that in an objective, reliable way.

Reputation is a great thing, but one’s reputation tends to have limited reach. The only people who truly have confidence in your reputation are those who have owned your cattle and who know how they have performed.

Objective, reliable
The Angus Genetic Merit Scorecard^® was created to fill this void — to offer commercial cattlemen the ability to provide an objective, reliable way of describing the genetic merit of a pen of feeder cattle based on the bull power that the operation has utilized.

If you have invested in your bull power, you should get paid for it. Genetics have a huge effect on your operation’s profitability. It simply makes sense to leverage bull power beyond the ranch gate.

Editor’s note: Troy Marshall is director of commercial industry relations for the American Angus Association.