Profitable Cattle Marketing Options and Alternatives Modified by Georgia Agricultural Education Curriculum Office June, 2002

Georgia Feeder Cattle Market 70 % of Southeastern calves are sold during the Fall. Based on Seasonal Index Average (100), February is 106, July is 97, October is 96. Plan for the Market.

What Kind Should I Raise? 1/2 English & 1/2 Continental Uniformity (color, size, weight) Medium Frame Number 1 Muscle Raise the kind the buyers want!

Discounts FactorsDiscounts/CWT Small Frame $10.00 Large Frame$ 2.00 No. 2 Muscle$11.00 Breed $

Marketing Methods Public Livestock Auction Market Graded and Pooled Sales Tele - Auction Video - Auction Private Treaty

Auction Market Disadvantages Seller has little control of prices Encourages multi-handling spec trading Overhead cost is high Excessive stress and shrink may occur Lack of volume and uniformity Cannot ID stock & producers after sale Hard to establish reputation for good cattle

Auction Market Disadvantages Grade & price info hard to interpret Prices are uncertain Disease spread is more likely Number of buyers may be small, reducing competitiveness of bidding

Auction Market Advantages Provides competitive bidding Convenient Open to all sellers and buyers Prompt cash payment All types of livestock can be sold Prices are determined and known to all Supervised by the federal government

Auction Market Advantages Requires no market knowledge Requires no minimum number of cattle

Graded and Pooled Sales ADVANTAGES Can put large lots together Costs savings passed along to sellers Large numbers attract buyer competition

Graded and Pooled Sales Disadvantages Grading, weighing, sorting, penning, time consuming and expensive Individual producers lose their identity Facilities not designed for efficient processing for this system Hard to get producers to agree on terms

Tele-Auction Advantages Potentially increases competition Less transportation reduces stress, shrink, and death loss Reduces buyer cost Reduces marketing cost

Tele-Auction Disadvantages Requires prior producer commitment Reduces marketing flexibility Requires partial or full truckload lots

Video-Auction Advantages Largest number of potential buyers Reduced buyer cost passed along to seller Direct buyer-to-seller transportation Delivery schedules very flexible

Video-Auction Disadvantages Marketing cost is generally higher than tele-auction Requires producer to have on-farm truckload (or more) of uniform cattle

Private-Treaty Advantages Seller controls the marketing process Costs less than other methods of marketing Producer can establish a reputation Animals are farm fresh with no stress Disease spread is minimal Producer can condition animals to buyer specifications

Private-Treaty Disadvantages Requires excellent marketing knowledge by seller No supervision by the federal government Producer must assume risk of payment collection May be little or no buyer competition

Keeping Up With The Markets Federal State Market News Thomasville, GA Toll Free Georgia Farm Bureau Toll Free Price Reports by Phones

Keeping Up With The Markets Published Price Reports Georgia Livestock Market News P. O. Box 86 Thomasville, GA Market Watch University of Georgia Cooperative Extension Service County Extension Office

Parting Thoughts A marketing plan is another important tool to have in your management toolbox! It is dependent upon other good management practices! Controlled breeding, predictable sires, right type and kind. It may require a cooperative agreement with neighboring producers! Incorporate it into your long range plans! It will require some hard work!