Focus on your markets
From the edition of Agriculture Today.
Beef cattle producers are continually encouraged to fine tune their business and be more focussed on the decision making process.
But fine tuning should not bet reated lightly as it can end up having a significant flow-on effect in a couple of years time.
An example may be changingt he breeding program to improve growth rate in the progeny which may over time lead to a change in maturity patterns (that is, fatness at a certain age or weight) which then may affect financial returns in the existing market.
So, if you are either starting from scratch or contemplating making a change to your breeding program such as:
- introducing a new breed,
- making a major change in type within your existing breed, or
- moving from straight breeding to crossbreeding, I suggest you follow a simpleprocess.
Ask yourself a few basic questions:
What are the specifications (eg. weight, fatness, eating quality indicators, etc) for the markets available to you?
Does the environment you operate within impose constraints on what you produce? For example, how much of the year can you grow high quality pasture?
What are the key profit drivers for your business relative to your targeted market?
The latter question is often overlooked but these key profit drivers can vary enormously between the market segments. Know which are important to your business and your target market when changing or fine tuning your breeding program.
For example, if your breeding program is targeting the high marbled beef trade and is returning you a premium then a focus on intra muscular fat (IMF) is appropriate. But if you are targeting say a domestic table beef market, then weight for age, yield (muscling), fatness and eating quality are going to have much greater impact on financial return.
So in summary, don’t treat decisions about changing your breeding program lightly.
Make sure they are made with an end market in mind and consideration for your environmental constraints and key profit drivers.
This column appears in Agriculture Today.