Maximize Profitability with Wagyu

Beef Cattle producers are feeling more optimistic. With an El Nino winter forecasted, cattle producers are anticipating a reprieve from multi-year drought conditions. For consecutive years the beef cattle herd has been in decline due to environmental conditions. A March 2023 USDA report shows that since 2022, there has been a 4% decrease in beef cows, 6% decrease in replacement heifers, and 5% decrease in heifers expected to calve this year. According to another published USDA article, the latest cattle inventory peaked in 2019 at 94.8 million and has since plummeted 6% to 89.3 million this year. The rapid decline in beef cattle inventory over the past four years was driven by drought conditions; however Northern states experienced above average rainfall during the 2023 spring and summer months and in the coming months NOAA predicts a wetter-than-average winter in the southeastern United States, allowing calf producers in recovering areas to consider opportunities to rebuild their herd.

When rebuilding, heifer selection carries significant economic importance. Phenotypic characteristics such as udder quality, temperament, and body conformation are initially considered in replacement heifer selection. Yet with fertility and longevity being highly heritable, it is critical to evaluate the stayability of heifer’s dam. The University of Florida recommends ranchers introduce 17% first calf heifers annually into the herd; however, when emerging from a sustained drought, the ranchers may consider increasing this percentage.

Investing in replacement heifers – purchased or ranch raised – will have long term implications on the operation’s profitability. With the multi-year decline of cow numbers, cattle are being traded at historically high prices causing additional pressure around the economic investment.

Journal of Applied Farm Economics Article Profitability of Developing Beef Heifers on Stockpiled Winter Forages calculates the breakeven cost of heifer development in years of calf production. Heifers on forage-based systems would breakeven after 3-4 years of calf production, while dry lot heifers would breakeven after 9-10 years in calf production. All management decisions should be considered to increase longevity and profitability in the young female’s production lifetime.

When breeding heifers, producers should be seeking bulls with high fertility and increased opportunity for a low-birth-weight calf to ensure a successful first calving season. For this very reason many producers select Wagyu bulls for increased profitability when developing heifers.

Wagyu bulls are known for their high libido and consistency in producing low birthweight calves, reducing the risk of dystocia and increasing the opportunity for profitability. Using Wagyu bulls provides many quantifiable benefits: increased opportunity for pregnancy, low birth weight calves, increased breed back, and a calf that yields a premium over market.

The crossbred calf produced from Wagyu bulls warrants a premium due to Wagyu cattle’s genetic ability for increased deposition of intramuscular fat (IMF). Unlike other beef breeds, the intramuscular fat is abundant and possesses a unique fatty acid composition. The IMF in Wagyu and Wagyu cross cattle is higher in oleic and linoleic acids, with a higher concentration of unsaturated fat providing an elevated eating experience.

The recognition of these unique breed attributes had contributed to the increased growth of Wagyu cattle in the United States. All domestic Wagyu cattle are DNA traceable back to the original imports from Japan during the 1990’s. Less than 200 black wagyu cattle were originally imported, and The American Wagyu Association currently estimates that over 40,000 head of Full Blood Wagyu and Wagyu cross feeder cattle. The growth of the breed steams from the commercial application of feeder cattle production as well as the increased demand for quality beef from the consumer.

For calf producers working with a branded beef company provides ranches the ability to forward contract each calf crop of F1 Wagyu cross calves. Mishima Reserve American Wagyu Beef – a branded beef company – provides a calf buy back program after supplying producers with high quality Wagyu bulls or semen. Mishima raises and sells hundreds of fullblood Wagyu bulls across the Western United States annually, offering quality genetics to their producers – focusing on low birthweight and carcass merit EPDs.

By buying back calves out of these Wagyu bulls, Mishima can monitor feed conversions in the yard and produce calves with elevated carcass quality. Mishima Reserve strives to improve feed efficiency and feedlot performance while producing a consistent quality beef product.

An initial hesitation of cow calf producers when committing to a Wagyu crossbreeding program is due to the belief that a low-birthweight F1 Wagyu calf will not wean enough pounds for the premium to warrant a change in their production system. Yet, many producers that have committed to the F1 production program report that their Wagyu cross calves wean on average 50 less pounds in comparison to their straight Angus animals, but still profit more dollars per head than calves produced out of their cows.

Montana producers who have been partnering with Mishima Reserve Wagyu Beef to produce F1 Wagyu Angus calves for the luxury beef brand were interviewed about their initial decision to breed their heifers to Wagyu. Producers interviewed reported the average birth weight is 65 pounds and attested to the additional attributes in participating in Mishima Reserve’s calf buyback program.

Mishima Reserve is a proven partner when considering breeding heifers and marketing into a premium market. Turk Stovall of Billings, MT, owner of Stovall Ranches and partner in Yellowstone Cattle Feeders stated “We really put a lot of effort into research and data and working with Mishima Reserve and their team has been awesome. We couldn’t find a better partner.” Producers like Turk Stovall have been using wagyu bulls on their heifers for years and marketing their calves to Mishima Reserve.

With beef demand sustaining amongst the end consumer, a tightened feeder cattle inventory warranting increased prices, and starting to see reprieve from the drought, there is opportunity for rebuild of the beef cattle inventory in the United States.

To capitalize on your calf crop from your first calf heifers – consider participating in a buyback opportunity with a branded beef company such as Mishima Reserve. Mishima Reserve bulls are housed in Montana and Texas but can be shipped nationwide. For more information on the program visit Mishimareserve.com or come by booth 2484 during NCBA’s Annual Convention in Orlando, Florida January 31 – February 2,2024.

Education Opportunities for Young People Desiring Ag Careers

Today there are many educational programs for young people who hope to find work or a career in various agriculture industries. Many colleges and universities offer courses in agriculture, animal science, ranch management, etc. Here’s a sampling of some of the university programs around the country.

Texas Christian University

A unique program at Texas Christian University (Fort Worth, Texas) prepares young people for careers in ranch management. Kerry Cornelius recently stepped down as Director of the Ranch Management Program but still teaches, as the Burnett Ranches Professor. He and his family run a stocker operation near Weatherford, and he has been on the staff of the Ranch Management Program since 1995.

“The biggest problem today for young people trying to get into in agriculture is cost. Land is expensive and we’re also seeing new all-time highs in cattle prices, which makes it harder to get started or gain equity,” he says. There is still opportunity, however, because many producers are becoming older, wanting to slow down or sell out.

“Our Ranch Management program is 9 months, and within that time the students go on 5-week-long field trips, travel about 9000 miles and observe about 70 different operations. There are many different ways to run cattle, create a health plan or nutrition program or grazing system. There is no one way to have a successful ranch. If I want to make a cake, I can buy a Betty Crocker cake mix and follow directions on the box and have a perfect cake, but ranching is a different,” he says. There are many variables and the recipe must change to fit the situation.

“In my own operation, rarely do I do exactly the same thing two years in a row. I’m always needing to tweak something to make it work. Maybe it’s raining, or drought, or the market is different; we have to be flexible,” says Cornelius. A rancher needs to know what the options might be, to tweak something enough to make it work that year, and sometimes it must be trial and error. Programs like this one at TCU are helpful to give students a basic background.

“One of the things about ranch management that’s unique, compared to other agricultural education options is that we focus on money and economics. This is like a business school for ranching.” To stay in business, this is crucial.

“A student came into my office recently to ask what he needs to focus on, in terms of courses, to be successful after he graduates. I told him he didn’t need to focus on any one thing. He needs to be a generalist on all things. It’s like a spoke in a wheel. If I have one really strong spoke but the rest have cracks, it could be a bumpy road and you will fail,” says Cornelius.

“We don’t want to teach you how to be a specialist in any one area; we want to teach you how to be a generalist and know enough to ask for help; when you need more expertise you might hire an accountant, consult with a veterinarian or a nutritionist. You’ll know enough to understand what they are saying and doing, and also know when you need help.

Dr. Matthew Garcia, Director/Associate Professor TCU School of Ranch Management says that currently the program is trying to modernize more and also look at agriculture as a whole. “We want to train our students to look at the entire system they are managing and the upstream and downstream effects of every management decision they make. They need to understand that the decision they make in any time frame will have both a production and an economic effect, and that all their decisions are related. Nothing operates independently,” he says.

“We are trying to teach them to manage in ways to avoid negative production and the economic consequences. The other thing we try to teach them is that they need to be adaptable in their knowledge. The same strategy won’t work every year. They have to be able to look at a situation, critically evaluate the system or the situation and apply management decisions accordingly, compatible with that system,” says Garcia.

“We want to help the young people who will be running agricultural industries in the future for us, and enable them to be successful in a changing world.”

Missouri State University

There are multiple opportunities for students to learn about beef cattle production at Missouri State University, with classes and hands-on learning opportunities. Adam McGee, PhD (Assistant Professor, William H. Darr College of Agriculture, Missouri State University) teaches animal science classes that include animal nutrition, a breeding class, a cow-calf production class and a stocker-feeder production class.

“We also offer a minor in Ranch Management. The goal is to hopefully get students prepared if they want to go into production agriculture, specifically the ranch side. It gives them an opportunity to intern with a ranching operation.” This can help provide the experience they need, to be successful when they graduate and go into that industry.

The Ranch Management minor is a 20-hour program. “This would be added to a major. At some point we hope to get it set up as a certificate by itself so it wouldn’t have to be included with a major—if a student just wanted the Ranch Management program by itself. Classes within that minor include one on Farm Business Management, looking at business records and all that’s involved, such as what is meant by depreciation, etc. The cattle industry has become more of a business; we have to find better ways to balance that aspect.” A person could do a lot of things right–taking care of cattle, producing forage, etc.–but if the business end is ignored or neglected and poor business decisions are made, and the operation doesn’t make a profit, it won’t be sustainable long-term.

“The other course required in that major is Forage Crops. It covers what they are, how they are grown, how to manage them, etc. There is also a 6-hour credit in ranch management experience—where they intern at a ranch. This can be an opportunity to see all the different sides of that operation. We are starting to flesh out this program more, especially at the University’s Journagan Ranch. My goal is for students to spend some time on the management side with Marty Lueck who manages that ranch. This enables the students to see what’s involved in managing a ranch, as well as the records and the business side,” says McGee.

“They discuss forage production, grazing, etc. and learn that side of the business, as well as the mechanic side.” They gain experience with all the different factors that go into ranching, and spend time at each of those stations to gain a well-rounded introduction to all of it, so they will be more prepared to do this after they leave.

Marty Lueck (Journagan Ranch Manager, Missouri State University) takes care of the cow herd for the university and also teaches and advises students who come for hands-on experience at the ranch. He says it’s fun to see students learn some things that are not in the book. “Their experiences here on the ranch add to their knowledge.”

“We also have internships at the ranch in summer. Students come for 2 or 3 months during their summer break. We’ve had several grad students over the past few years who came here to do projects using the cattle and forage on the ranch.”

Lueck also teaches a marketing class in November. “We try to cover many bases and the main thing is to give students lots of hands-on experience. I’ve been at this ranch 42 years and I’ve also gained a lot of experience over those years, through various weather cycles and droughts. Just as soon as you think you’ve seen it all, something new comes along!” he says. It’s always a work in progress.

“I rarely go to a ranch or farm that I don’t pick up some innovative idea that I can bring home–that I can tweak to work for me or try to make it work here. Students in their senior year often ask if I have any suggestions. I tell them to move to a different part of the country for a while to experience what it’s like; they don’t have to stay there—but before they get married or get tied to one place, they should get some experience somewhere else.” They will broaden their horizons and be better for it in the end. They can realize that not all farms and ranches do things the same.

“I had a grandfather who was in agriculture but I didn’t grow up with it. My father wanted to be in agriculture but ended up working at a factory all his life, to support 7 kids. I didn’t have ‘traditional’ ways to do things and therefore didn’t have the idea I couldn’t do something because that’s not the way my father did. I pretty much had a wide open canvass to work on. There are many ways to do things and to solve problems.” It’s good for students to gain an open mind.

“Several students, when they realized I grew up in Minneapolis in the suburbs, have asked me how I figured all these things out. I tell them I did it just like anybody can; you just need to have a passion for it, and if you want to do it badly enough, you will figure out a way. Some of them are from an urban background and they realize they can do this, too.” This ranch is a perfect opportunity for students who want to learn, and Lueck is happy to be able to be a part of it.

Montana State University

Rachel Frost, Program Lead, Dan Scott Ranch Management Program (Montana State University, Bozeman) says this is a relatively new program at MSU, and a 4-year bachelor’s degree in Ranching Systems. “This covers the disciplines of Animal Science, Rangeland Ecology and Management, as well as Business. Equal credits are offered in each of those three disciplines,” she says.

This is a limited admission program. To be accepted students need to be a sophomore in the Ranching Systems degree and have at least a 2.75 GPA. “They need to go through the application process, which requires them to supply a resume, letters of reference, their current transcript, and a letter of intent stating why they want to be in the program and what they think it is going to do for them. They also must answer some essay questions about the ranching industry and trends,” she explains.

“After we grade the application, they go through a face-to-face interview with members of the steering committee. Then they are notified as to whether they are accepted into the program.”

“Our main focus for expansion is looking at financial scenario analysis so the students will have the skills needed to take an operation and compare different management scenarios to see which one is the most beneficial for that ranch, from a systems perspective,” says Frost. There are now nearly 30 cooperating ranches.

“One of the other things I think is really great is that we are working with a number of different partners in what we call the Range 2 Range Program, in which we recruit veterans and help them gain experience through working on ranches.

They can go through this program to get the education necessary—so they can move into the ranching industry. This has been great; they are older than most of the other graduate students and have a lot more responsibility and a well-defined work ethic,” says Frost.

This last year the program started working with Select Sires to offer AI certification at a reduced price to students. “We are hosting a clinic at MSU every other winter to get all the students in the program certified in AI. We also have sponsors and brought in Whit Hibbard to do a low-stress livestock handling clinic. All the students went through low-stress livestock handling before they went out to do their internships this past summer,” she says.

“If they don’t have any background in ranching they need to figure out if this is truly what they want to do or if they have unrealistic expectations about ranch life. We try to work with each student on an individual basis to help them grow in experience and skill sets as they head out to ranches,” she says.

“I have students here from New Jersey to California and all regions in between, coming into the program. I’ll have some 5th-generation ranch kids and some kids with no experience. I tell all of them that experience is good to have but if you know that this is what you want to do and come into it with unquestionable work ethic, and unquenchable desire to learn, you can do this. There are gateways into this industry and no one can keep you out—but you’ve got to have the work ethic and desire to learn. In our internships, we are not allowing any students to intern on their own family ranch,” says Frost. They can learn some other things and then come back to their family ranch if they wish, and have the best of both worlds.

Nebraska

The University of Nebraska has multiple programs and events that provide great educational opportunities, according to Maria Tibbetts (Communications Specialist, Beef Extension and Innovation). “The Extension programs and the academic side both offer opportunities for beef producers in Nebraska and other states as well. We are involved with the Range Beef Cow Symposium which is an every-other-year program hosted by Nebraska, Colorado, Wyoming and South Dakota. This year’s meeting will be in Colorado,” she says.

“We also have several annual events, like our grazing conference and stocker-yearling tour. These are conferences that bring together people who have interests in specific segments of the beef industry. We talk about the latest developments and practices that we are seeing and learning about in those areas,” says Tibbetts.

“We also helped out with the annual Herd That! Women in Ag Conference, Sept. 19-20 in Broken Bow, Nebraska, and a variety of other conferences and local events put on by Extension Educators in each geographic area,” she says.

The Nebraska Ranch Practicum is a three-season set of classes based on practical aspects of ranching. “These cover a lot of management practices in animal health, range quality, forage analysis and all sorts of different topics. These are held monthly at the Gudmundsen Sandhills Laboratory near Whitman, Nebraska. The participants get to see a lot of the practices they talk about, in real life. This is open to anyone, through an application process,” she says.

“We also help coordinate the BQA training, which includes certification, recertification, continuing education and best practices for animal handling, stockmanship, animal health and other facets of responsible animal management,” Tibbetts said.

“We also have several publications and communication efforts; we have a Beefwatch e-newsletter that goes out monthly, plus other times as issues come up. We put together stories that we think would be of interest to beef producers.

We are currently putting together the October one that covers things like interest rates, lice control going into winter, and other topics that are timely for producers to be thinking about. Our Extension Educators and Specialists produce the content for this e-newsletter and it also responds to producer questions,” says Tibbetts.

There are many opportunities that come along. “We try to publicize these through social media channels and our website beef.unl.edu and we also use Facebook, Twitter, Instagram, Linked-in, etc.” If people are trying to find an education opportunity they should easily be able to find something helpful.

“We are always willing to talk with producers; we love to have producer input and feedback on what sort of educational opportunities they’d like to see that we are not producing currently, or specific questions they’d like to have addressed.

We try to make sure that all of our educational efforts are reaching the audience they need to reach, with the messages they need to hear—to help them make the decisions that will allow them to be profitable and enable them to carry on with business in the beef industry.”

Roots That Run Deep

Tucked in the heart of the Bear Paw Mountains, Shipwheel Cattle Company has been making its mark on the Angus cattle industry since the family ranch was first homesteaded on the Rocky Mountain front in 1896. Multiple generations later, the family-run operation is now headed by Klint and Lori Swanson, along with their children, Austin and Bree, who oversee the family’s ranches located in North Central, Montana, about 60 miles from Canada. The Shipwheel Cattle Company’s sale barn and grow yard are located about 15 miles southwest of Chinook at the Clear Creek Ranch, with most of the registered cows located at the family’s Snake Creek Ranch in Lloyd, MT in the Bear Paw Mountains.

Today, Klint and Lori pride themselves on continuing the family ranching legacy that was first established by Klint’s grandfather, one of the first cowmen to bring the Angus cow to Northern Montana in 1945, transitioning from ranching Herefords at the time.

“Klint’s parents founded Apex Angus in the 1960s and began raising and marketing bulls from the registered cows they had purchased,” explains Lori. “The Shipwheel herd originated from two bred heifers given to Klint when he was nine years old in 1984.”

From those two original heifers, the Shipwheel Cattle Company’s herd has grown to nearly 500 cows, along with 100 additional cows that were purchased from Dr. Gale Jellum from West Fork Angus in Chinook, MT. After marrying in 1998, Klint and Lori moved to Lori’s parents’ land on Clear Creek, south of Chinook in 2000.

“We continued to market bulls with Apex Angus until 2009 when the decision was made to go on our own and we formed Shipwheel Cattle Company,” Lori says. “In 2010, we purchased the Miller Ranch at Lloyd in the Bear Paw Mountains, where the mature registered cows reside.”

Today the Swanson family runs 1200 mother cows with 500 being registered. With limited feed and labor resources, the ranch’s cows are required to run in a true commercial environment and range calve on their own and graze winter pastures after weaning until the snow gets too deep.

As Klint explains, Shipwheel Cattle Company’s main focus is breeding sound, problem-free cattle with longevity and fertility. Their cows are required to have excellent mothering ability and maternal instinct along with good feet, udder and teats. If they don’t, they get sorted out pretty quickly. “These aren’t barn cows, they calve out on their own in the hills and we ride through them once a day and tag,” Klint says.

“A medium framed, easy fleshing, 1350-pound cow is ideal for us. We don’t breed for big numbered, terminal-type cattle. Mother nature sorts them out pretty quick here. Renown and Resource females have the extra body, length, and fleshing ability that we like and the bulls carry extra muscle over their top and rear quarter,” Klint says. “Every registered cow is artificially inseminated once, then they are put with our top clean-up bulls. We put in approximately 100 embryos into our commercial cows from our elite donors every year.”

For both Klint and Lori, retaining and improving the qualities that the Black Angus cow is famous for is their priority. In fact, their donors must prove themselves before being flushed, with many having pathfinder status.

“We rely on these cows to pay the bills here and pay for the ranch we purchased in 2010. Every cow needs to do her job, do it well and do it for a long time. This is the mindset we have for every animal that we produce,” Klint says. “That animal needs to be profitable for our customers and keep them in business. We stand behind our sale cattle with a 110% guarantee. Our bulls’ feet are guaranteed for three years.”

Being a multi-generational family ranch requires the entire Swanson family to personally handle everything they can on the ranch. This not only allows the family to ensure the quality of their herd and their overall operations, but it allows them to pass along the traditions of ranching onto their children.

“There is no better way to raise kids. Our kids started working with cattle and horses and running machinery at a young age. We put up most of our own feed for our cowherd and feed yard,” Lori says. “Ranching isn’t just a way of life, it’s what God put us here to do. It’s no different than our cow dogs that are bred to work cattle. They don’t want to do anything else.”

A Continued Focus

In addition to exuding exceptional qualities of longevity and fertility, the Shipwheel Angus cattle are hardy, grazing on native short grass as well as tall grass, traveling in some steep terrain in extreme climates with temperatures ranging from -60°F to 110°F,” Lori says.

Because of these attributes, Shipwheel Cattle Company has earned a name for itself within the cattle industry, thanks in part to its long-standing, proven genetics. As such, the ranch hosts an annual sale, providing the opportunity for industry members to purchase various bulls and females from the herd.

“Our first sale was a silent auction where we sold 25 yearling bulls. We have since grown and transitioned to a December sale at the ranch and offer 100 18-month-old bulls along with 150 to 200 bred females,” Lori says. “We also market 80 private treaty bulls in the spring. Every bull we market is bred, born and raised here.”

Having been ranching Angus cattle for nearly 80 years is testament to the Swanson’s family success in the industry.

“God, family and freedoms that this great country have blessed us with, along with a whole lot of faith, determination and hard work, have led us to where we are today,” Klint says. “We are truly blessed to do what we love and wouldn’t be here without the people before us. The seedstock business is as much of a people business as it is a cow business. We breed these cattle to work for people. The countless relationships we have made over the years with our customers and friends that support us is truly one of the best parts of this business. Our hope is to pass this ranch and way of life on to the next generations, with each generation improving on the previous. We work every day to improve the quality of our cowherd and ranch.”

The next Shipwheel Cattle Company sale will be held on Wednesday, December 13, 2023 at 1p.m. They will be offering sons by Shipwheel Dreamer 8522, Basin Rainmaker 4404, U2 Coalition, Shipwheel Essential, Duff Real Deal, Fairview Pacesetter, Connealy Packer.

For more information about the upcoming sale, visit www.shipwheelcattle.com

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