Feeder Profit Calculator (FPC)

Feeder Profit Calculator (FPC) (3)

Finally, you have a powerful, no-nonsense tool to highlight the true profit potential in your calf crop.  It is time to leverage the investment you’ve made in your bull battery and the expense you’ve put into your health program to receive a third-party validation of the predicted feedlot success of your feeder calves.  The IGS Feeder Profit CalculatorTM incorporates the genetic knowledge of most mainstream sires, regardless of breed, by referencing their EPD profile.  At the same time, the extra time and serious effort you’ve put into your preconditioning and vaccination program are also considered as a fundamental part of feeder calf value.  Weaning management and a responsible health program set your calves up for success.  

Tuesday, 20 February 2018 14:58

Watch the IGS Feeder Profit Calculator Webinar Sessions

Written by
Bar CK Cattle, Culver, OR, hosts an IGS Feeder Profit Calculator Session with Chip Kemp. Watch it here and get in on the Q and A segment.
 
 

by Chip Kemp                   

In the March Issue of SimTalk, we introduced the revolutionary IGS Feeder Profit Calculator™ and its role in providing true awareness of feeder calf profit potential. In this article, we are going to walk through the simple and straightforward process of getting an IGS Feeder Profit Calculator certificate generated on a specific set of calves.

The first step is to get to the IGS website. You can either use the IGS link at the top of Simmental.org or you can go directly to InternationalGeneticSolutions.com. The IGS Feeder Profit Calculator link can be found in the upper right-hand corner.

The second step will take you to the input form. Complete the form and submit that information for certification. You will provide contact and location information, weaning and herd health specifics, marketing weights and timelines, and of course registration numbers on sires.

It is possible that staff will reach out seeking additional information, but roughly three business days following your submission you will receive an email providing you a digital copy of your IGS Feeder Profit Calculator certificate.

Now it is time to interpret the information on your certificate. On the left side of the certificate will be all information provided by the producer. This gives confidence and knowledge to a potential buyer, knowing you are hanging your credibility on the details you provided. The buyer is able to quickly gauge your management and health practices that built value into this set of calves.

The lower right-hand-side of the certificate focuses in on five categories that are crucial to feedlot and carcass success. The star metrics reflect the ranking of your calf genetics versus the IGS database.

The upper right portion of the certificate is the true foundation and core of the IGS Feeder Profit Calculator. Using the largest genetic database in the industry and some of the elite minds in the business we have leveraged known genetics, herd health, current economic conditions, and basic accounting principles to provide the most robust indicator of feedlot profit potential to date. It breaks it down to a language we all understand — dollars and cents. Frankly, feedlot buyers want to know if a set of calves has a reasonable chance to turn a profit.

Three measures are highlighted on the certificate:

Relative Genetic Value: Predicted difference in value due to genetics between the calves being evaluated and the average Angus calves of the same sex, starting weight and management conditions.

Relative Management Value: Predicted difference in value due to management between the calves being evaluated and those same calves under the assumption of an industry average of 60% of calves being vaccinated against BRD and 60% of calves being weaned for 30 days or more.

Total Relative Value: A combination of Relative Genetic Value and Relative Management Value.

When evaluating each of the relative value categories it is important to be aware that the average in each category is zero.  A $0.00/cwt means these calves reflect the breakeven potential of the average calf.  There is no artificial adjustment to the base just for marketing advantage or to provide a feel-good effect.  You expect the truth and the facts. So do your customers and your buyers.

On the example certificate provided, we predict a breakeven price (at the time they are sold as feeder calves) based on their predicted feedlot performance of an additional $9.84/cwt.  In laymen’s terms, that means the buyer at your local auction market or through your online platform could afford to pay an extra $9.84/cwt over the average animal on that day and still come out breaking even.  To be clear, the buyer isn’t looking at these calves to break even.  Like you, the buyer has an eye on profit.  But in this example, the buyer has true awareness, through IGS, that leads him to believe these calves are a safer bet. So is he looking to pay an additional $9.84/cwt? No. Is he willing to give $2, $3 or $4 more on a safe bet rather than risking everything? We think he is.

Additionally, a second page highlighting all registration numbers and known genetics accompanies each certificate.

It is really that simple. And you won’t pay a thing. Roughly 20 minutes of work will provide you with the most credible and trusted information available on the potential feedlot performance of your calves. Trust is the Gold Standard.

Your success is wrapped up in the value of each year’s calf crop. You’ve invested years, significant dollars, and countless hours of sweat to get the calves to this point. Why leave calf knowledge to chance? You can either Know or Guess. Choose Know.

Friday, 20 January 2017 12:22

International Genetic Solutions Feeder Profit Calculator

Written by

by Will Townsend and Chip Kemp

The Problem

Imagine you had to find bulls for your operation but you didn’t know any breeders, nobody used EPDs, or even shared actual data. It’s obvious to anyone interested in building quality cattle and maximizing profit this would be a major blow to the bottom line.

Yet, this is how the feeder calf business exists today. Frequently, when purchasing quality feeder calves, we can receive crucial information regarding environmental factors such as management and health protocols, weights, etc. However, when it comes to genetic awareness, color and polled status are often asked to substitute for true knowledge. A common scenario, and at times the best-case scenario, is that the calf buyer has a previous relationship with the seller and has owned and experienced the performance of the seller’s calves before. In more rare cases, we may have some information on the seller’s bull purchases. Again, this is a powerful step forward. It provides at least some insight into a portion of the genetics within the program.  However, in a data-driven world, this level of genetic awareness is woefully inadequate.  Especially since the financial stakes for feeder calf procurement are even higher than the stakes for bull procurement. Understandably, most large cattle buyers have technology to estimate genetic and environmental performance on feeder cattle but that information is not public and, for obvious reasons, is kept to those companies. Therefore, price discovery as we know it today, most often does not take account the actual performance potential of a producer’s feeder cattle.

The Solution

Attempts to determine relative value of feeder cattle have been made for a long-time; however, certain issues have made it difficult.  The foremost limitation has been accurately gauging the profit potential in the largest genetic group within the beef industry — the crossbred calf. It is a known scientific fact that commercial beef producers wishing to maximize cowherd fertility and longevity must crossbreed. This not only provides them a sustainable and profitable cow base, but fortunately generates an end product that is known to be the best combination of growth potential and carcass merit — the crossbred calf.  The history of the Feeder Profit Calculator (FPC) has its roots in ASA’s Terminal Index ($TI). The $TI was developed over a decade ago by ASA in collaboration with Dr. Michael MacNeil, who was a USDA research geneticist at the time. The $TI is an economic selection index designed for selecting terminal sires.  Though $TI could do a reasonable job valuing feeder calves, it was determined that evolving $TI into a tool that could account for such things as a current accounting of prices/costs, heterosis, and non-genetic factors (e.g., vaccination status), would improve the accuracy of predicting feeder calf values. Dr. MacNeil, now with Delta G Genetics, was tapped to evolve $TI into that tool — the FPC. Many of the FPC’s non-genetic components were sourced by Dr. David Lalman of Oklahoma State University.  Providing the most robust genetic awareness of crossbred calves requires the most robust multi-breed genetic evaluation.  Fortunately, International Genetic Solutions (IGS) provides the ideal platform to generate unparalleled information on crossbred and composite feeder calves. IGS, along with its’ member associations, the science team at Theta Solutions, and scientific contributions by Dr. Matt Spangler of the University of Nebraska is ideally suited to provide the industry’s benchmark in gauging feeder calf value. The IGS Feeder Profit Calculator empowers producers to market with confidence and allows feeders to maximize their purchasing dollars.

The Future

Capitalizing on novel technology usually requires a tremendous learning curve and a major outlay of dollars.  Not this time! The IGS Feeder Profit Calculator is unique. It will offer a level of genetic awareness of crossbred feeder calves that has not been previously possible in the beef business.  The IGS science team, the IGS partner associations, and the world’s largest beef genetic evaluation database allows the IGS FPC to be delivered at no cost to producers. That is correct. No Cost!

Beef producers looking for a transparent and straightforward assessment of their calves will harness the power of IGS by simply making a call, sending an email, or visiting the IGS website.  IGS and/or breed association personnel will request information on herd health, basic management protocols, the bull battery used in previous years, and insight into the makeup of the cowherd. The more thorough the inputs from the producer, the better the predictive ability of the FPC.  While individual sire identification isn’t required, identification of the bulls used in the operation is required.  Producers will be asked to share preconditioning information and the health program in place.  The IGS FPC will be demonstrated at the 2017 NCBA Convention in Nashville, TN, and be made available to the public shortly thereafter. Three short demos will be held at the IGS booth each day of the convention.  For producers who have interest in having their calves evaluated through the IGS FPC please contact one of the IGS breed partners or contact beef@internationalgeneticsolutions.  com. Cattle feeders who are interested in integrating the capabilities of the IGS FPC into their purchasing decisions please use the same email. Additional information and highlights will be provided in the coming months.