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Montana producers fight Mother Nature and distance to compete in
the fed cattle market and those opponents can be formidable
forces to overcome.
Yet, Ken Schilz sees a distinct
advantage for Montana backgrounders: The sun and moon rise and
set in the same place for a huge number of weaned calves.
“You’d be amazed at the
difference it makes to a calf’s health when it is at home,” says
the operations manager for McGinley-Schilz Feedyard in Brule,
Neb. McGinley-Schilz feeds calves for the natural beef market.
Antibiotics, growth hormones and other artificial growth
enhancers are not used so feeders must compensate with
innovative management.
Three years ago, Ledger, Mont.,
farmer and rancher Paul Jones decided to exploit that home court
advantage and take on the management challenge. He saw the high
2004 cow market, sold all 300 mother cows and invested in his
growing feedlot enterprise as an added-value avenue for his
crops.
Today he backgrounds calves for
McGinley-Schilz and raises replacement heifers.
This year, for the first time, Jones, his brother, Clark;
father, Tom; and business partner Russ Offerdahl bought the
calves Jones backgrounds at his 1800-head feedyard instead of
custom-feeding for McGinley-Schilz.
Jones and Offerdahl “use the
opportunity to own those calves longer to take advantage of
their great genetics to put weight on cheaper than the average,”
Schilz says. “That’s what’s special about what Paul’s doing.”
McGinley-Schilz’18,000 head
feedyard is big enough to take advantage of economies of scale,
yet small enough to pay individual attention to their
backgrounders. They provide nutritional and veterinary advice,
deliver performance and carcass data back to the backgrounder
and cow-calf producer and are working to develop cooperative
markets with packers and retailers. Already, they sell cattle to
Coleman’s Natural Beef, Creekstone Farms and Meyer Natural
Angus, among others.
Yet higher feed costs are
shrinking the profit margin on feeder calves so smaller
feedyards increasingly depend on backgrounders such as Jones to
retain ownership of calves for custom finishing.
“We just don’t have the capital
to buy all those weaned calves,” Schilz says.
Feed the farm’s forages
Jones’ feedyard is essentially a market for his barley, wheat
and rotation forages. A typical feed ration includes peas, wheat
screenings, barley, alfalfa haylage, barley silage, barley
straw, sorghum-sudan grass silage and a little purchased corn.
Jones works with a McGinley-Schilz nutritionist in Dodge City,
Kans., and Ron Amidon, a beef nutrition consultant from Bozeman,
Mont., to use everything he grows and give the calves what they
need.
“It takes a lot more feed per
pound of gain in a natural program. Paul is fortunate because he
has a lot of good quality feed to start with,” Amidon says.
“Improving conversion is the only way (feeding for the natural
beef market) will pay and you have to have quality feed to
improve that feed-to-gain ratio.”
By testing all of his forage,
Jones discovered he was needlessly adding phosphorus to his
mineral supplement. The peas already provide enough phosphorus,
saving Jones a couple cents each day on each calf’s mineral
supplement.
Those peas add 26% to 30% protein
and lots of energy, too. Jones grinds them to mix the ration
consistently.
Protein can become a problem in
many Montana feed rations because often it is based on 12%-14%
protein barley. Barley grows well in Montana so it provides a
less expensive, local ration base, but too much protein can
cause problems with feet and scours.
“We had to add straw to Paul’s
ration to reduce the protein a little bit and now his calves are
gaining really well – over 3 pounds per day,” Amidon says.
Jones also grows flax, including
it in the ration to increase omega-3 fatty acids in the meat. He
bales the flax straw and stacks it as a windbreak against 80 mph
winds that regularly rock the area.
“We had a flax-walled barn that lasted 25 years,” he says. “That
stuff just doesn’t break down.”
“Windbreaks make a big difference
around here,” says Amidon. “Paul has one corral that doesn’t
have much protection. Those calves huddle in the corner and
don’t spend as much time at the bunks.”
Keep ‘em healthy au naturel
The natural beef market provides a bit of a premium for finished
calves, but rules forbidding antibiotics increase the risk of
sickness.
Paul Jones accepts that risk when
he buys weaned calves to background, but he works hard to
minimize it. The stress of weaning and learning to thrive in a
feedyard increases the likelihood of illness; prevention is the
only weapon available to Jones.
To give himself a little edge,
Jones injects his water supply with concentrated hydrogen
peroxide. A $1200 55-gallon drum lasts about two months when the
hydrogen peroxide is mixed at 50 parts per million.
“It has dramatically reduced the
number of pulls in our doctoring program,” Jones says. And it
cleans the pipes and troughs, too.
The right mineral program reduces
sickness, too.
Amidon formulated Jones’ mineral
supplement to include the right balance of calcium and
phosphorus; a lot of vitamin A, which acts as an anti-infection
agent; and enough vitamin D. By substituting a balanced mineral
supplement in the ration for other coccidiosis control measures,
Jones saves about $6,000 each year.
“We don’t usually use pellets for
the protein and energy – it’s hard to see what is in a pellet
and they aren’t always consistent -- but mineral pellets work
well in a ration because then you can see how well they are
mixed,” he says.
“We have to do everything better
– genetics, pre-conditioning, nutrition, good weather when we
wean – everything to keep the calves healthy,” says Schilz.
Jones keeps a close eye on his
calves by allowing his three pen riders – including his son,
18-year-old Dusty, 19-year-old Jesse Fuson and Steve Thompson,
26 – to make extra money training young horses while they work
in the lots.
“They dearly love to ride and
they see those calves all the time,” Jones says.
A sick calf gets treated and its
natural beef identification tag gets pulled.
“Paul truly cares about the
animals and for the animals. What he doesn’t know, he learns,”
says Schilz.
Jones’ heifer development
program compliments his feedlot.
In 2004, market cow prices in the Northern Plains averaged 15%
to 20% higher than 2003 prices and 25% to 30% higher than the
five year average. Since then, bred cow prices have increased
even more; Jones takes advantage of those prices with his heifer
development program. And the heifers keep the feedyard full
after the feeder cattle leave about the beginning of March.
Those replacement heifers will go
back to grass after they are sold so Jones feeds them to gain
about 1.5 pounds each day instead of the 3 pound target for the
natural beef calves.
“We use the same principles to feed those heifers; we just
formulate a higher roughage ration for them,” Amidon says.
In the future, Jones plans to
expand the feedlot to 5,000-head capacity. And he might buy
another cow herd.
“Dusty wants some cows,” he says
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