Extension by Scott LakeWritten by Scott Lake
By Scott Lake, UW Livestock Extension Specialist
This past year, the Wyoming Business Council and the University of Wyoming teamed up to develop the Wyoming Premium Heifer Program (WPHP). The program has drawn a lot of interest from producers looking for a good marketing opportunity for their bred heifers, as well as interested buyers from all over the West and Midwestern regions.
John Henn of the Wyoming Business Council advertised aggressively in trade shows throughout Texas, Oklahoma, Nebraska, Wyoming and Kansas, as well as placed several ads in regional publications, both online and print editions. The sale is tentatively scheduled to sell almost 2,000 head of bred and replacement females between the November and January sales.
Wyoming premium heifers
The objective of this program is to develop and market a source of quality replacement heifer calves and bred heifers that are produced and managed under a set of guidelines to meet the requirements of producers nationally. Through the verification of procedures by documentation provided by participating producers, buyers across the country will be assured that the certified animals are managed, raised, and bred as outlined in the program. The intention of the program is to provide an outlet for producers of all sizes to capitalize on market premiums.
The first sale was on Nov. 14, with nearly 400-bred heifers sold in a special internet video sale run through Torrington Livestock Auctions. Results from the first sale were very positive.
The sale averaged $1,318 per head and ranged from $1,235 to $1,375. The average of Wyoming bred heifers sold through other programs and auctions during the two-week time period around the WPHP sale was $1,295, with a range from $975 to $1,545.
Although this was the first sale for the program, a premium of $20 to 30 per head was realized, compared to other local markets. Additionally, many of the cattle in other sales were not exclusively video sales. Therefore, additional transportation and commission fees were likely incurred. Cattle from the WPHP were delivered as far away as Iowa, Oklahoma and South Dakota. Thus, it appears the aggressive marketing strategy of the Wyoming Business Council had a positive affect. It is our anticipation that as the program grows and gains a reputation and notoriety that the premium will continue to increase.
State of the industry
The beef cattle industry is experiencing the lowest cow numbers since the early 1950s. The 2011 calf crop was the lowest since 1950 and 2012s calf crop was estimated to be 1.9 percent smaller. Currently feeder cattle and calf supply outside feedlots is down two million head compared to two years ago.
The current calf and feeder numbers create an alternative market opportunity for cow-calf producers for replacement heifers and bred heifers. With the limited feeder cattle supply over the next three to five years, several factors will increase the value of heifers.
The feeding segment of the industry will be competing for heifers as cow-calf producers rebuild or expand their herds from the southern plains to the north. CattleFax projects the prices for bred cows will increase dramatically in 2013.
The opportunity and timing is ideal for cow-calf producers to take advantage of this premium market. Adding value to replacement heifers and bred heifers through a structured management and marketing program can provide potential buyers a source of females of known production practices and genetics.
If Mother Nature cooperates and the region gets moisture, the market for heifers next year could be tremendous. Plan now for marketing opportunities, no matter which outlet you chose.
It is difficult to develop a program and guidelines that everyone can meet or agrees with. However, we are continually trying to look at every guideline with in the program and make sure it fits with the best production practices for Wyoming producers. The new guidelines for 2013 are posted at wyobeef.com.