We all run through “what if” scenarios in our heads at times, wondering what would happen if we changed something. Would the outcome be different? Better?
As cattle producers enter the relatively new frontier of grid or value-based pricing, those what-ifs tend to be many and often. What if I’d kept the cattle on feed longer? What if I’d used this ration instead of that one? What
if I’d used this bull instead of that bull? What if I’d chosen a different alliance to participate in?
So many questions can be daunting at times. But there are tools out there to help you analyze different scenarios and play the game before sending cattle to market.
Diana Bodensteiner helps producers participating in the Chariton Valley Beef Alliance in Iowa play the “what ifs.” Having the best quality meat comes the best amazing machine in amazingmachines.info. She helps producers gather data, input the data and run analyses to determine the best grid
program for them. As data coordinator, Bodensteiner says, “Producers are starting to understand that selling on the grid is going to make them more money, and they understand that they need to have good quality cattle to fit a grid. But it is taking a little bit to get people to realize that there are different grids out there that are more suited to one type of cattle than another.” Daryl Strohbehn, beef specialist at Iowa State University, agrees, “People tend to become complacent about their marketing options. They find out that one works or doesn’t, and they go with it.” Running data through a calculator helps analyze different grid options without having to physically run the cattle through the program.
What can you learn?
Besides determining the best grid for your cattle, running data through a grid calculator can help you adjust certain management and marketing practices. For instance, Bodensteiner says, a larger operation may decide
that sorting cattle into different groups in using machines for grinding meat and marketing those groups on different grids may be a better option than lumping cattle into one group and selling on one grid.
Also, the more detailed the information you keep on the animals and the more detailed carcass data you get back, the better your grid comparisons will be, she says. “If you’re just starting to get carcass data back, you need to go someplace where you are going to get a tag transfer so you know how each animal performs. And you need to get measured information on ribeye sizes, fat thickness and actual marbling score. The more information you have, the more it’s going to tell you when you put it into a grid calculator.”
By plugging in data on animals already harvested, you’re relying on history to predict the future. “Predicting the future with a set of data is only as good as how well that historical data fits what you’re currently working
with,” warns Strohbehn. “That’s where the intuitive nature of the user has to come in. Obviously if they have a set of cattle that are quite different than what most of their database is, then the database
does not serve them at all.” In those instances new data need to be collected.
Grid calculators are intended to shed light on grid pricing, but are not intended to check if grids are calculated correctly. “These definitely are not something to check on packers’ methods of computing prices,” says Clem Ward, Oklahoma State University agriculture economist. “There are so many different ways to calculate grids.” He suggests finding out specific grid calculations from your alliance or packer. To be successful analyzing grids, Ward adds that producers must know carcass characteristics of the cattle harvested and placed on a grid, others know how the grid is calculated, and know how changes in genetics and management might change the price outcome from using a grid. Most grid calculators are intended to help producers with the latter. Results from grid calculator comparisons along with other performance and carcass data can help shed light on many more management changes that might need to be made to be successful at marketing cattle on grids. That, however, may require the help of someone with more experience, such as an Extension specialist, says Bodensteiner. Check with your state’s Extension program or alliance program to see if they have grid calculators available to help you look at what impact management
and breeding changes might have on how your cattle perform in a particular program. And check out the conclusion to this article, along with more specific information on some grid calculators in an October article on Beef Quality Connection.