When cattle producers consider making bull purchases for their cow-calf operation, those bulls need to be evaluated relative to the benefits each offers the bottomline, according to Mark Z. Johnson, Oklahoma State University Extension Beef Cattle Breeding Specialist. Johnson says producers need to find the value proposition of those bulls.
Value proposition is defined as how a product or service can meet a customer’s needs and help them achieve their goals.
He shares these key points for producers to remember.
- The initial cost of the bull is only one part of the profit equation. Value added to calves is equally important.
- Identifying the trait (or traits) of primary economic importance is critical to determining the value proposition of each bull.
- Producers need to have a budget and it needs to be realistic.
- When multiple traits have economic importance, determining the value proposition of a bull is more challenging. It will require looking at current levels of production in traits of importance in order to determine where to focus selection pressure.
Put pencil to paper
Johnson gives the example for a cow-calf producer who needs two more Angus bulls for the spring and has narrowed down the selection list to the following five bulls to purchase private treaty.
| ID | CED | BW | WW | YW | CEM | HP | MW | Marb | $B | Price |
| 1 | 12 | 0.2 | 70 | 120 | 9 | 13 | 76 | 0.35 | 154 | $10,000 |
| 2 | 4 | 2.9 | 82 | 141 | 12 | 6 | 96 | 0.79 | 180 | $8,000 |
| 3 | 15 | 0.1 | 78 | 145 | 14 | 17 | 86 | 1.80 | 215 | $12,500 |
| 4 | 5 | 3.5 | 91 | 157 | 8 | 5 | 99 | 0.71 | 185 | $7,500 |
| 5 | 11 | 0.7 | 63 | 108 | 8 | 10 | 65 | 1.90 | 189 | $5,500 |
The bulls are all spring yearlings and will be approximately 15 months of age at turnout and accordingly should be expected to cover 15 cows this year. All the bulls have passed a Breeding Soundness Exam and sell with a registration paper and a breeding soundness guarantee.
“The buying decision boils down to identifying the right bulls for your operation,” Johnson says. “The right bulls to buy are the ones most capable of adding value to the calf crop sired relative to their purchase price.”
The bulls selected need to:
- Complement the females to which they will be mated
- Offer genetic values of economic relevance to the marketing endpoint of the calves they will sire.
As an example, your operation intends to use the bulls as terminal sires on spring calving cows, four to six years of age. After weaning, the calves will run on cool season grass until marketed as yearlings. In this operation the trait of primary economic importance is Yearling Weight (YW).
What bulls would you buy and why?
Johnson says to calculate the profit potential of each bull, assume each bull will sire 125 calves over their lifetime of service. Each will have the same salvage value and the value of a pounds of YW sired will be $2.50.
Table 1. Use the least expensive bull as the baseline to compare.
Table 2. The “Value Proposition” of each bull over their lifetime of service.
Read more: Answer These Cow Herd Questions to Help Make Smart Bull Selections
Three Questions to Ask Yourself When Preparing to Purchase Bulls
