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CATTLE TODAY

SPECIAL HEIFER SALES ADD VALUE TO REPLACEMENTS

by: Clifford Mitchell

As markets have evolved, it has changed the face of the beef industry. In the early years it was almost sacrilegious to purchase replacement females from the so-called traders in the industry. After all the first question was “If they're so good why didn't you keep them yourself?” As the goals of different breeding programs altered, it became clear some outfits could maximize profits by replacing the cow herd with purchased replacements.

The ever changing market created something the commercial industry had never seen before, a specialist. Purebred breeders more fit this title because of the seedstock produced to help add genetic diversity within commercial programs. New opportunity helped each producer find a niche in the production chain. Most cattlemen eagerly accept a role as long as they get paid for the effort. As margins tightened and terminal genetics became more the norm, skilled cattlemen devoted their skill to creating replacements.

Defining quality and premium markets has always been elusive in the regionally challenged beef business. Cattlemen often respond to demand. If the market is paying a premium for a certain class of cattle, then it's time to evaluate production philosophies to take advantage of potential earning power.

Heifer sales in Houston, Ft. Worth and San Antonio have helped modify the industry and provided a place for cattlemen to accurately value top cut replacements. As producers worked to create a steady supply of the right kind of replacements, theses sales have weathered the storm with the breeders hoping to capture premium year-after-year.

“After the first few years, we started seeing people specialize in the production of replacement females. These females no longer came with a buyer beware sign. It was a legitimate function within the beef industry,” says J.D. “Bubba” Sartwelle, Jr., Port City Stockyards. Port City Stockyards has managed all 41 bull and heifer sales at the Houston Livestock Show and Rodeo.

“Twenty years ago there weren't many commercial female sales. Now, there are several good commercial sales and customer appreciation days held across the state. These sales have helped open marketing opportunities for commercial cattlemen,” says Charles Rollins. Rollins has managed all 21 sales held at the Ft. Worth Stock Show.

“Some guys are really good at developing heifers. This is their role in the production chain and the one goal they have with each year's calf crop. A lot of these producers have been able to sell at a premium,” says Jim Banner, Southern Livestock Standard. Banner along with Anthony J. Milhalski and Michael Sturgess are getting ready for the 17th All Breed Bull and Heifer Sale at San Antonio.

As the sales grew in reputation, they have become popular events. Like most sales struggling for identity, there were setbacks along the way.

“We were the last of the stock shows to have the special sale for commercial cattlemen. Our biggest challenge was to prove to everyone we could have a sale and sell good cattle,” Banner says. “We have gone from testing the market to being a premium sale.”

“In 1968, Lewis Pierce, my father and Rayford Smith got together and had the first sale. We did it on a commercial basis and tried to get the best cattle we could to sell,” Sartwelle says. “It didn't take long before reputation cattle were bringing a premium. It has been pretty well accepted from the start, but over the years we have learned a lot. I remember one year we had 1,000 heifers and 100 bulls. I worried all night about them getting out because the pens were so full.”

“We had 180 head the first year we had the sale. Last year we sold 700. We got the idea from the Houston sale, but the bull sale just didn't work for our market and we ended up just selling heifers,” Rollins said. “We struggled the first two or three years to get established.”

As the livestock shows focused on the purebred cattlemen, it took a lot of foresight to come up with creative ways to keep the commercial industry interested in this type of venue. Bringing the commercial cattlemen back to the stock shows was a goal of each.

“Lewis Pierce, who was president of the Houston Livestock Show at the time, was also a good cattleman. He knew it was time for the stock show to put emphasis back into the commercial industry,” Sartwelle says. “All of the stock shows have incorporated these sales into longer activities. The commercial cowman can come and stay for three or four days if he wants to.”

“We tried to make a south Texas reunion. We have a social gathering and many use this as their annual get together,” Banner says. “When we started there wasn't anything for commercial cattlemen to do. Our intentions were to bring the real world cattle back to the stock show.”

As these sales grew in popularity, one thing spilled over from the traditional events at most stock shows. A grading or evaluation of the sale cattle was put in place to help rank the offering.

“For several years, we just let the bidders decide the overall champion. The judging came later. When we started judging the cattle, it was one more way to spread the excitement and accolades,” Sartwelle said. “In the late 80s, this competition got very competitive because it was such an honor to have a champion pen. I think the judging made more people get in the business of raising replacements. At the same time, the judging really increased recognition of the good cattle.”

“All the sales have capitalized on the competitive nature of the commercial cattlemen. We have to find breeders that want to compete to get the offering better each year,” Rollins says. “Anybody can compete if they're willing to change. Most like the bragging rights they get of coming to the sale, showing their heifers and winning.”

“We were the first all breed sale to reward consignors for bringing the best of the best,” Banner says. “We want people to consign that want to win their division. We have to keep raising the bar, on our middle and bottom end, every year to keep the highest quality.”

The selection process for sale cattle causes these promoters to travel many miles to make sure the quality comes to the pens at their respective sales. This form of recruiting ensures a solid offering.

“We feel it's a form of good housekeeping to inspect all the cattle before they come to the sale. Another way of showing the buyers we stand behind what the consignors bring to the sale,” Banner says. “The consignors from the previous year have the first right to consign to the sale, if they meet requirements and have good quality. We try to recruit the best cattle we can. Since we have more people wanting to consign, than we have space, we can really make some changes in quality from year to year.”

“I am on the road from the third week of October to the first week of December to select the offering. I felt to promote the sale like I wanted to, I had to go select cattle I like to sell,” Rollins says. “This also allowed me to build a relationship with the consignors and I can count on these breeders to bring the best to the sale.”

A showcase of top cattle is what these sales have boiled down to over the years. These events may market pens of five to ten that day in one of the three locations, but producers have more incentive than the prize money and added premium to bring the best. An awesome display means added flexibility in the marketing program.

“Forty years ago you didn't have a lot of people producing replacement females, much less a good quality F1. Producers are using so many terminal cross bulls today they aren't going to keep replacements,” Sartwelle says. “The auction is the best place to define value. We often say these heifers bring a premium at the sale. Was it a premium or true recognition of value? She was that much better than what producers could get at the local sale barn.”

“The stock show sales help establish market for replacement cattle statewide,” Banner says. “The sales are a place for people to showcase their cattle and get people to the ranch where they can market heifers for a set price.”

“The idea a lot of commercial producers take is to bring heifers to these sales to get some exposure to bring people back to the ranch,” Rollins says. “When producers showcase heifers at one of these events, the sales help commercial cattlemen sell cattle in the country.”

Location and pen size has dictated differences in the offering in each sale. The F1 female has been popular with the two southern events because she's royalty along the Gulf Coast. The northern sale has evolved into a mix of breeds that will be close to the same year after year.

“The majority of our consignors are still middle to small operators. A pen is only five head. A small producer can be just as competitive as a big rancher,” Banner says. “Our sale has continued to specialize in the Brahman influenced cattle. We tend to showcase the F1 female because there are enough producers breeding them who are specializing in developing top replacement heifers.”

“Over the years as buyers started paying more for cattle, the F1 got more popular, now they dominate the offering. Not to the complete exclusion of other breeds and crosses,” Sartwelle says. “The F1 does not replicate herself. People want to buy the best and we have become known for top F1 heifers.”

“Over the years we have evolved into 250 English cross, 120 F1s, 250 Brangus and 140 club calf females. This has proven to be a good mix sale day and it's my responsibility to adjust the numbers, according to buyer demand, every year,” Rollins says. “From my perspective, we were trying to have the right mix of cattle since we started. We sell 10 to 12 head per pen because we have larger display pens and it has fit our buyers.”

Each sale took on its formula for making a successful event. Different sales fostered different ideas to offer the best product to potential customers.

“When we were trying to get established, Houston, kind of like the Rose Bowl, was the granddaddy of them all. We went and got sponsorships to entice producers to bring their best,” Banner says. “We didn't have the facility known for good sales, but we had cash and hospitality. It seemed to work.”

“We had to give buyers an incentive to bring top cattle to the sale,” Rollins says. “The added prize money allowed some cattlemen to cut expenses or pay for their commission if they did well enough in the show.”

The cattle and marketing strategies have continued to change over the years. Each sale building on the past to make next year better, with competition getting the most credit for making the offering better at each sale.

“Fifteen years ago most of the cattle consigned to the sale would have come from within 150 miles of Ft. Worth, now they come from all over,” Rollins says. “The cattle are getting so much better because of competition. The cattle we have today, we didn't have 10 years ago.”

“Anybody out in a rural setting must look at total asset management for potential income. We have several activities, built around the sale, for the rural land owner,” Sartwelle says. “Today, we can get additional information on animals, whether that is genetic testing, performance evaluation or whatever we want in an accurate format. The buyer is becoming more sophisticated and demands more information. With internet and video technology, I can take the “bull to the buyer”.”

“The cattle have gotten better and more uniform,” Banner says. “As a whole group we have been able to consistently improve quality in the sale. When you have more cattle to pick from, you can be very selective.”

Showcases, of any kind, are good for the beef business. With more education on selection and management, events can serve the commercial industry the better. Each sale has one thing in common, a goal of bring the commercial cattlemen to a different setting to evaluate and pay a premium for world class replacements.

These events have stood the test of time following the trends in the cattle business, the cow cycle or in some cases enduring a renovation. Buyers and consignors have used the events to garner attention, make needed purchases, but most of all to get to know each other and have a healthy form of competition.

“When you go to a lot of operations you'll see champion banners displayed any where from the living room to the ranch office. Breeders take great pride in winning one of them,” Sartwelle says. “Incorporating some social time has helped buyers and consignors get to know each other. Two things have happened to ensure the success of the sale. The Houston Livestock Show's commitment to the commercial industry and the committee making buyers feel special.”

“We have had the banners and over the years we have tried to have a very unique gift or trophy. A lot of producers like the hand made knife we give out and we have recently awarded a traveling trophy to our champion,” Rollins says. “I have tried to bring the buying public what it showed me it was willing to pay for. They're willing to pay for uniformity, tight calving interval and as much information as I can provide them.”

“The big banners and nice trophies for our winners were there from the beginning. It took a while, but we had the incentives in place to get better cattle,” Banner says. “This has been a tremendous experience. We've been able to take something that people said couldn't be done and turn it into an event second to none in a fun-filled atmosphere. The most rewarding part is our buyers and consignors look forward to the sale every year.”

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