Betty Jo Gigot, Editor and Publisher

Every February, CALF News invites several cattle feeders to share their thoughts about the industry. We tend to think of cattle feeders as a group, running the same organizations, doing the same thing. Even though they all provide room and board to the animals in their care in the most efficient and profitable fashion, each in his own way is looking for better ways to provide that service, whether at the feed bunk, in the health barn or at the supermarket, providing the consuming public with the best possible product. As you will see, cattle feeding is a continually evolving industry, and those who provide that service are always looking to the future and using the tools available to provide the best of services to their cattle-feeding and beef-consuming customers.

Predict the fat cattle prices in 2006? Well, I think I better leave that question for the boys in Chicago. What I can say about the cattle business is that it is constantly changing and one needs to be able and willing to react to those changes. An old-timer once told me that nothing is forever, and he was correct.

May it be source verification, age verification, medication withdrawal, etc., an operator needs to continually determine which way he or she is headed and whether that is the best direction. The modernization of the beef industry is happening at an almost dizzying pace and for an operator to not be left out sometimes requires one to head in a direction that they believe in, even if the market is not yet there. For our company that belief was in the potential of natural beef. For years we pushed through endless skepticism, outright hostility, and returns that were not very promising. Finally, the consumers we had been waiting for have arrived and boy, they are hungry.

The consumer of today is the product of the information age. They are smart and they want to know about the food they eat. Whether it’s feeding practices, humane handling, and/or reducing the use of antibiotics – anything that you as a producer can do to give those consumers some confidence and ease of mind in their dining experience – you will be ahead of the pack.

Our natural beef operation, Brandt Beef “The True Natural”™, has turned the corner after a rather rough start. Marketing these days is not cheap. With Brandt Beef, our main belief was that we had to be not only competitive regionally but also nationally. To be competitive nationally when you are raising cattle in a state that is rather inhospitable to business is a challenge. The cost of doing business in California is high: there are a myriad of environmental regulations, stifling state income taxes, exorbitant workman compensation rates and high labor costs. With Brandt Beef we believe we have a superior product that can go after the niche natural market and command the higher prices we need to succeed. Our target at Brandt Beef is primarily Prime and Choice product. The challenge for us now is to develop the natural market beyond the current premium for ribs and loins to include the rest of the carcass. Our staff is continually trying to do a better job to improve production costs. The final aim, however, is always constant and that is producing a dining experience that will keep consumers coming back to Brandt Beef time and time again.

One other issue that is sure to have a huge impact for 2006 is the opening of the Pacific Rim markets to U.S. beef. We believe this will be a big shot in the arm for Brawley Beef, of which we are a member. Brawley Beef is the nation’s most modern beef plant, and this plant is where we send our conventional cattle. Brawley Beef, currently, has one of the largest supplies of age- and source-verified cattle in the nation. The Asian demand for Choice and Prime beef will surely increase the Choice/Select spread. Another benefit of Brawley Beef in the opening of the Asian markets is the proximity of the plant versus the other plants in the Midwest. This issue has become even more important with the rise in freight costs.

In closing we reiterate that, for the beef industry to succeed in the future, our focus must be the consumer. After all, they deserve it. May everyone have a healthy and prosperous New Year.

Andrew Murphy, CEO
Innovative Livestock Solutions
Larned, Kan.

One person’s opinion is shaped by the viewpoint and situation from where they stand. Let me tell you first about my new position, which in the following document may well help you understand the viewpoint that I am about to expand on. I am the chief operating officer for a company called Innovative Livestock Services, Inc., a company that was forged by the combining of two of the oldest feedyards in the business to marry the old, experienced, traditional cattle feeding operations into a new and exciting company that is approaching things slightly differently than before. Great Bend Feeding, Inc., and Ward Feedyard, Inc., are two of the older feedyards in Kansas, established in 1959 and 1962, respectively. The question becomes how do you bring a strong, family-held corporation and a strong, stockholder corporation together? The answer: great partners, great planning and a “let’s move from here” attitude. However, it doesn’t mean squat if you don’t execute. That is why I am so excited about the staff I will be working with; experience, innovation and enthusiasm are what drives us. It is my job to keep that moving forward. I have seen my father Roger Murphy as motivated about cattle feeding as he has been in years. That is my greatest reward.

In the past, I have talked about issues and opportunities that lie before us as an industry. The time for talking about what could happen is past. We are indeed masters of our destiny from here on. We will always have things that are potential pitfalls to our business. The environment, workforce, animal identification and food safety and bio-security, which were my topics last year, will always be there. It is our responsibility to overcome these topics and show the world why we have the safest and highest quality beef in the history of mankind.

Value-added products will redefine the role of beef in the meat case. A new era of pioneers has evolved in our business. As my partner Chris Burris, general manager of Innovative Livestock Services, Inc., so eloquently put it recently, there are two ways to improve profitability. Reduce margins to entice more volume or find an added value for the product we produce. Our personal belief is to add the value to the product, coupled with the ability to track and feed them that will be the most in line with our own philosophy. Both methods are strong strategic plans and will most likely be successful over the long term. But this may start a trend of two different schools of thought that will border our industry for a long time to come.

Consolidation and alliances will continue to exist and will push our industry farther and faster than ever before. Whatever your personal belief about this topic, it is a trend that will not only continue, but most likely cannot be stopped. My personal belief is that this method creates not only opportunity in the market, but also longevity. If we are not around for the long haul, we will not be able to participate in all of the advantages that will mark our industry for years to come. I don’t believe that any of us are in this for just today.

Feeding and scientific improvements will aid us in becoming a more user-friendly product. Necessity will breed innovation in this area. The need for better science and technology in this industry is enormous. We will need to look to private industry and our universities to create the systems and technologies that will assist us in taking the step to the next level. However, they cannot do this without input from the industry. We must let them know what is coming and how we want to do it. We will be able to shape the systems that tie the entire process together. What we do not know about our product is the biggest problem. We have made dramatic strides in this area, but we are far from where we need to be.

Consumer confidence in the system, not just the product may well define who we are to become. We have a story to tell, and quite frankly, it is one of the best stories in any industry. Most of the public has very little idea what it takes to go from calf to plate. Nor do they have any idea how much care and expertise we add. They already believe that our product is safe, now is the time to tell the rest of the story. The things we do as producers should not only instill confidence, but inspire and engage them to look to the beef industry as a model for all food systems.

Bottom line is this: we are positioned to become the premium product that we have always believed that we were. The corner has been turned and we are accelerating toward a tremendous renaissance in this industry. It is one that defines who we are to the entire consuming public, whether they are in New York City or Beijing. I think Dad was right, there is reason to be excited.

Doug Karl, Manager
Mid-America Feed Yard
Ohiowa, Neb.

Mid-America Feed Yard, located in southeast Nebraska near Ohiowa, is a 100-percent commercial custom feedyard with a “no conflict of interest” approach, which is often complimented by our customers. Our job is to provide a complete plan of service, from the day the cattle arrive to the day we market and ship them through packer buyers.

Built through years of solid management, our team is lead by six managers who have a combined total of over 120 years of experience. This, coupled with an excellent group of long-term employees, gives us a great knowledgeable edge in the field. Our 25,000-head capacity makes us large enough to be competitive yet small enough to be able to create individual personal and business relationships. We believe in family and have worked hard through the years to create a family-type atmosphere that reflects our strong work ethics and integrity.

In recent years, we have added a corn steamflaker, which has proven to be a positive influence on gains and efficiencies. Because of our location, we also have readily available corn by-products from the ethanol plants springing up around us. Pen size is something we continually consider since we can adapt from 40- to 300-head capacity. We believe it is unfair to tell the customer how many cattle they should feed; instead we like being able to accommodate their current needs.

For years we have chosen to align ourselves with vendors who are able to enhance our technology and provide quality and reliability, all of which help provide us an even more competitive edge.

There is one major element that we have not changed and that is that we continually work to earn the trust of each and every customer. Trust must be earned. It is key to our success and one that we take very seriously.

Just like any team, we love competition and strive to be competitive ourselves. It’s what makes us all better, gives us spirit and a fighting edge always to strive to perform at a higher standard, supporting each other as a team.

We are a people business with the philosophy to continually market our services in front of as many cattle feeders as we can reach. Technology has made this much easier with the use of our own Web page, www.midamerica-feedyard.com and informational videos as well as traditional approaches. We strive to satisfy current customers for repeat business and to create long term relationships.

There are no secrets out here. We simply work hard, have a great team of employees and align ourselves with reputable businesses, products and programs.

We choose to take a pro-active approach when it comes to regulatory issues. This helps us to eliminate the attitude of an offensive demand or “something we have to do.” It was this pro-active technique that allowed us to be awarded the Tyson Environmental Stewardship award, which will be presented to us in February 2006.

We view the future as the sun is coming up, not going down. Our industry has so many exciting things going on and it is time for us to wake up and see what is in front of us today. For example, programs like verified beef will not only improve our cattle herds but will align our sales for foreign and domestic markets for years to come. Each of us must respectfully do our part, no matter how tough the job may seem, in order to comply with the environmental guidelines set before us.

As an industry, we need to recognize that we can be the pivot point to meet the demands of the customer, the packer and the retailer to supply what they need, not what we think the should have.

At Mid-America, our team arrives to work each day asking, “What is new today?” We continue to strive to be smarter, faster and more versatile. Let’s view our industry as though we are inventors, always looking for a better idea for us all, willing to accept change and to be flexible.