The dairy connection

Drive by a commercial feedyard in western Kansas or the Texas Panhandle and pens of black and white Holstein steers often will contrast with the colored cattle from typical beef breeds.

The dairy connectionBut while dairy steers make up a significant portion of fed-cattle production sometimes as much as 20 percent they've always been treated as stepchildren in the beef sector. They don't gain as quickly or efficiently as beef breeds, they produce lighter-muscled carcasses and lack cold tolerance. They do, however, typically marble well and perform predictably, allowing profitable finishing when purchased at the right price.

Steer calves, of course, are essentially a byproduct of dairy production. Most dairies use artificial insemination (AI) almost exclusively, with a small number of bull studs providing the majority of semen, so the industry needs just a small number of elite male calves. But dairies breed their cows once a year to maintain lactation, historically producing about 50 percent male calves. Those calves typically leave the dairy within the first week after birth, shipping to growing facilities and eventually to feedyards.

A changing model
Reproductive technology has turned the traditional dairy-breeding model on its ear. Around 2003, sexed semen became commercially available to the cattle industry, and many in the dairy sector adopted the technology. Using sex-sorted semen allows dairies to breed their best females to the highest-quality AI sires, with about 90 percent certainty of producing a heifer calf. Dairies do not need, however, to replace 90 percent of their cows each year, so they still typically use conventional semen with their less productive females and produce about half steer calves from those matings.

Unlike beef producers, dairies stagger calving throughout the year to maintain a consistent number of lactating cows. Typically, young steer calves move to "calf ranches" or growing facilities that source cattle from multiple dairies. The growing operation then commingles the calves into age groups for management and eventual marketing to cattle feeders.

A few innovative producers, on the beef and dairy sides, have looked at that process and recognized an opportunity. Since a significant portion of a dairy's calf crop goes into beef production, why not use semen from proven beef-breed bulls, selected for calving ease, performance and carcass value, to upgrade the value of calves destined for the feedyard?

Beef and dairy synergy
Jerry Wulf, president of Wulf Cattle Company based in Morris, Minn., is one of those innovators. Wulf Cattle Company is a multi-generation seedstock, ranching and cattle-feeding business operation specializing in Limousin, LimFlex and Angus seedstock cattle. The operation also markets over 40,000 head of fed cattle annually, and for years, the family has purchased value-added feeder cattle from their seedstock customers to finish in their feedyards.

Last year, Wulf formed a partnership with a neighboring dairy operation, Riverview LLP, and its CEO Gary Fehr. The dairy milks about 45,000 cows in Minnesota and South Dakota, with about half of those being Jerseys.

The idea behind the "Breeding to Feeding" program was to breed a portion of the Riverview cows with Limousin AI sires proven for calving ease, feedyard performance and carcass quality. The program has two primary goals: a high pregnancy rate in the dairy and high-value feeder calves for beef production. Wulf agreed to purchase the crossbred calves for finishing, providing a new revenue stream for the dairy.

They began testing the program within the Riverview herds and now have thousands of Limousin-Jersey births on record. They found that using Wulf genetics in the Jersey herds provided calving ease, with 98.8 percent unassisted births, and consistent, high-value carcasses for the packer. Now the Wulf operation tests AI sires in the Riverview herds before marketing semen to other dairies, with an agreement to purchase the crossbred calves for finishing.

The finished cattle, Wulf says, have been well-accepted in the beef industry. The cattle typically  fit in the Choice quality grade and 91 percent achieve Yield Grade 1 and 2. Tyson currently purchases them at a $3- to $4-per-hundredweight premium over the market on a carcass-based grid. That compares with a typical $6-per-hundredweight discount for finished dairy-breed cattle. "They want as many as they can get their hands on," he says, adding that other packers also have expressed interest in purchasing the crossbred cattle. Bradley Brandenburg, director of cattle procurement for Tyson, says the finished Limousin-Jersey cattle perform exceptionally well at the packing plant. The breeding program, he says, turns them into beef cattle, and the carcasses show virtually no dairy influence. Some past efforts in crossing Holsteins with beef breeds such as Angus resulted in steers that still looked like dairy carcasses on the rail.

Using the Limousin or LimFlex sires on Jersey cows, Brandenburg says, creates an altogether different animal, and a high percentage of the black cattle qualify for the Certified Angus Beef program. All the calves are age-, source- and process- verified and typically go to slaughter at less than 20 months of age. They also qualify for export to Europe through USDA's Non-Hormone Treated Cattle program.

The dairy connectionIn recent years, feedyards have fed beta agonists, particularly zilpaterol, to add muscling to cattle, and the technology is particularly beneficial in dairy-breed steers. With zilpaterol temporarily off the market, Wulf says crossbreeding can more than make up for that loss in performance. The Wulf operation recently ran a trial in cooperation with the University of Minnesota to compare genetics and management systems. They finished two groups of straight-bred Jersey steers, using zilpaterol in one group and not with the other. They also finished a group of their Limousin-Jersey steers for comparison, and the crossbred steers exceeded the muscling and feed efficiency of the zilpaterol- treated Jersey steers by over 30 percent.

Jersey cattle, in particular, benefit from the crossbreeding system, although crossbreeding also adds value to calves from Holstein- based herds. Jerseys are small framed, lightly muscled and inefficient for beef production. Straight-bred Jersey steer calves produce a high percentage of high-Choice or Prime carcasses, but quality grade, Wulf says, cannot make up for their other shortcomings. He adds, though, that Limousin or LimFlex genetics provide ideal breed complementarily, improving growth, feed efficiency, muscling and carcass weight while maintaining quality grade. The ribeyes from the crossbred cattle are large and round, rather than the narrow ribeyes typical from finished dairy steers. Crossing such dissimilar breeds also provides a high level of heterosis, further increasing vigor and calf performance.

Currently, the program uses conventional, rather than sexed, semen. The primary reason is to address the dairy's priority of high conception rates. Sexed semen generally provides a lower fertility rate, so the dairy uses sexed dairy semen for the first service, then moves to conventional semen from the Wulf sires for cows that fail to conceive. The conventional Limousin semen, Wulf says, provides significantly higher conception rates than the dairy achieves with conventional semen from dairy sires.

This system produces crossbred steer and heifer calves. The heifer calves do not perform as well as steers in the finishing program, but Wulf says they far exceed the performance and value of straight-bred dairy heifers. Wulf Cattle Company currently is running a test using sexed semen to determine whether a program focused on steer calves can provide economic benefits while meeting the dairy's fertility priorities.

The dairy connectionThe Wulf operation purchases the calves on day one and sends them to a calf-growing facility. The growing facility manages the calves in age-group pens, with an age spread of just two or three weeks. Those groups remain intact through the finishing period at Wulf feedyards. This provides extremely uniform groups at finishing, compared with typical pens of beef cattle where ages can vary by several months.

Wulf plans to experiment with a grazing phase for some Limousin-Jersey calves next summer, putting them in a stocker program between the calf ranch and feedyard phases, to evaluate potential economic benefits. Grazing all the calves would not be feasible because of year-round calving in dairy herds and the seasonality of forage, but for some calves, the timing could offer an opportunity to reduce production costs. Grazing probably also would not fit with Holstein-influenced calves, as the extended production cycle probably would result in overly-large finished cattle.

Change moves slowly, Wulf says, but dairies increasingly are embracing the idea of using beef genetics to round out their breeding programs, after they meet their replacement-heifer needs with sexed semen from top dairy sires.

Wulf believes crossbreeding in dairies could significantly increase U.S. beef production from the current low levels. The 2013 cattle-inventory report from USDA showed about 29 million beef cows in the United States and 9 million dairy cows. Wulf says that if one-third of those dairy cows were bred with beef-breed semen, beef production could increase by 5 to 6 percent. Among Jersey herds specifically, the increase in beef production would be dramatic, since few of those steer calves currently go into finishing programs. Holstein steers typically go to feedyards, so crossbreeding would increase their productivity but at a lower rate. And in terms of carcass quality, Wulf says, "It would make them better."