CALF_News_June_July_2018

M A R K E T I N G BEEF NEWS CALF Connecting the Dots By Chris McClure Contributing Editor D o you remember doing connect-the-dots pictures when you were a kid? Sometimes it was obvious what the picture was and sometimes it was only after you had painstakingly connected all of the dots that the picture became clear. It often seems the cattle industry has failed to take the time to connect all of the dots. Consequently, we operate in an environment where the picture is unclear – unknown. When you consider the disparate segments of the industry – seedstock, commercial cow-calf, stocker/back- grounder, feedlot and packer – there are lots of points at which communica- tion can break down – places we fail to connect the dots. We want to believe the market sends clear signals between seg- ments that ultimately convey the desires and demands of the retail consumer all the way back through the system to the seedstock operator who builds the fac- tory. But does it really do that? I believe the answer is a resounding “Yes!” but, because of the lengthy produc- tion cycles involved, it takes many, many years for those signals to have a significant impact on production. By the time it does, everything has changed! The “perfect” bull or cow created by today’s seedstock opera- tion likely won’t have progeny reach the packer floor for at least six years. A lot can happen in six years. Connecting the seedstock producer As an industry, we must find effec- tive ways to shorten the time required to “cycle-up” the genetics that meet current consumer demand, find ways to meet that demand from current stocks of inven- tory, or we must look into the future and anticipate changing demand 6-10 years in advance. The crystal ball approach is probably not realistic, so we must exam- ine the other two options for a solution. When I speak of “cycle-up” I’m refer- ring to advancing the production cycle so that it no longer takes a minimum of six years to achieve change. This might be done through some of the genetic manipulation techniques available. It certainly worked for the broiler and pork industries. Yes, those species’ naturally shorter production cycles play a role, but by creating a system where most growers are custom producing a closely controlled product, those industries can quickly change the type of product coming to market on a large scale. Is such a thing possible in beef production? Maybe the better question would be, Is it desirable? If we consider looking at ways to meet quickly changing demand from existing stocks, one tool in particular comes to mind – genomic analytics. By genetically analyzing the potential of an animal, might it be that production practices could be revised in order to select and raise existing animals to better fit consumer demand? Could doing so also enhance production efficiencies? I believe it’s possible. Connecting the packer To accomplish these things, we must look at supply-chain management in a dif- ferent way.We must learn to connect the dots from seedstock producer to packer in a way that creates not only a clear picture of the goal, but clearly defines steps to achieve it. The grid-driven economic signals rippling through the supply chain need to become more transparent to the architects of the factories (cows) who build the product for the consumer. Supply agreements have been around for years. Negotiated grids have been around for years. They are great as far as they go, but they typically only connect two points in the supply chain. Separate agreements are required for the next two points, or the supplying side of the agreement is left to search the market continuously for suitable product. One key to the future is to re-think how we create supply agreements. The method needs to connect everything from retail to seedstock. It needs to focus on creating a reliable supply that meets changing demand. Connecting the feeder The next logical point of attack is to take existing supply and sort it into groups that can meet current demand. We know that animals perform in differ- ent ways and their production character- istics vary tremendously. Some animals marble easily and produce high-quality Choice or Prime cuts. Other animals, while often very efficient, grow slowly and produce a leaner product. Could these animals that have traditionally been discounted because of their reputa- tion of being on the “light” end of a pen fed to the average actually be the answer to meeting the Millennials’ desire for a lean and tender product? During the ‘90s a group created a system to propel the industry into the future, using elaborate sorting and management systems. The theory was that by sorting animals into groups with an expected uniform outcome, not only Continued on page 13  8 CALF News • June | July 2018 • www.calfnews.net