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Adding value to dairy-beef crossbreds

Lyle Kruse for Progressive Dairy Published on 27 June 2019

With replacement heifer-raising costs often exceeding cash value, a growing number of dairy owners are recognizing the need to limit investing in excess replacement heifers and have developed a strategic breeding approach using a mix of conventional semen, sexed semen and beef semen.

Embryo use is also gaining popularity among more progressive commercial producers. A well-designed strategic breeding program allows herd owners the opportunity to genetically rank cows and heifers in the operation using genomic data or, if not available, parent average data to determine which cows and heifers are given the opportunity to make the next generation of replacements for the operation.

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If managed properly, this strategy should lead to significant increases in the overall genetic levels for future generations. With the increased adoption of strategic breeding programs in dairies across the U.S., there are estimates that between 2 and 3 million units of beef semen were used on dairy cows in 2018.

For dairy owners purchasing beef semen to use on their lower-genetic-ranking females, the initial priorities focused on semen price, sire fertility and calving ease, and in most cases, a resulting black calf; however, little to no focus was placed on the eventual growth and carcass merit of the finished dairy-beef crosses. To maximize the opportunities dairy-beef calves provide in terms of added value over straight dairy steers, dairy owners are challenged to make the right kind of cattle to appeal to feedlot owners, packers and, ultimately, consumers. Feedlots that invest in these youngstock will want calves that gain in an efficient manner and have limited health issues and death loss. Packers want fed cattle that have consistent carcass size and limited condemnation rates with exceptional ribeye area and marbling.

To start the conversation about which traits to prioritize in terms of beef sire selection, here are some of the disadvantages straight-bred dairy cattle have compared to native beef cattle for both feedlot owners and packers:

  • Poorer feed conversion, leading to a higher cost of gain

  • Lower dressing percent, leading to a higher breakeven

  • Dairy carcasses (narrow ribeye), which is a sizable packer discount

  • Lower carcass cutability, leading to less retail product yield and value to the packer

  • Larger carcass size and poor gut health (condemnation rates, downtime, safety)

To genetically improve on these disadvantages, beef sire selection should include a focus on increasing pounds of gain, increasing muscle mass and size of the ribeye area while maintaining the high level of marbling dairy cattle already have. Other areas of selection focus should be on moderate calving ease (not too big but not too small) and, particularly for Holsteins, limiting the carcass length and size.  end mark

Lyle Kruse is the VP of U.S. Market Development for Select Sires Inc. Email Lyle Kurse.

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How to maximize beef-on-dairy value

Beef industry experts offer their advice for creating a desirable dairy-beef cross for the market and suggest prioritizing the following traits in beef sire selection to improve the value of their cross calves.

Dr. Larry Corah (Kansas State animal scientist and former vice president at Certified Angus Beef):

To garner added dollars, the calves must generate additional value to those further down the production system, whether that is the feedlot, packer or even the restaurant selling the product to the consumer. Always remember, the only true source of added money in this industry is the consumer being willing to pay a few extra coins.

To see worthy premiums, it appears three key carcass traits need to be improved over the straight dairy steer:

1. The first is the shape of the ribeye. The oblong shape must become more of a rounded shape, which can be accomplished by focusing on the ribeye expected progeny difference (EPD) of the sire.

2. The second key is these carcasses need to marble, ideally reaching the Prime grade, as huge premiums exist for well-grading cattle. The use of the marbling EPD will ensure that is achieved. Fortunately, both ribeye area and marbling are highly heritable, so great progress can be made quickly.

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3. The last trait is harder to achieve, that being yield or dressing percentage (carcass weight divided by live weight). The big reason Holstein and Jersey fed cattle are discounted is their poor dressing percentage. The packer targets a 64 percent dressing percentage, and often even the beef-on-dairy crosses only hit 62 to 63 percent. Adding muscle will help, but we also will need to learn how to feed these cattle and market at the right compositional end point to get closer to the target.

Warren Rusche, extension beef feedlot management associate, South Dakota State University:

To maximize beef-on-dairy value, I’d still start with acceptable calving ease for all the usual reasons. I suggest targeting a 7 to 10 calving ease direct (CED) on an Angus. My thoughts would be to make sure we avoid the hard-calving tail and there’s no reason to go to extreme calving ease, except possibly on heifers.

I still think the low-hanging fruit on the beef-on-dairy model is converting an animal that would be considered a dairy beef at a discount to a carcass valued the same as a crossbred beef steer, or at least very nearly so. That also opens more potential packers. In my mind, that means selecting for more muscle, and the best predictor we have for that trait is ribeye area (REA). Size probably doesn’t translate perfectly to shape, and no one really measures “roundness,” but it makes sense that a larger ribeye has a different shape, especially if skeletal size doesn’t change. I’d look for bulls in the top 30 to 40 percent in the continental population, probably 15 to 20 percent for REA in Angus.

After that, I’d look for all the growth I could get while putting downward pressure on yearling or mature height. Again, I’m not sure if height alone solves the carcass length issue, but it can’t hurt. I’d also try to get as much marbling as I can after we’ve satisfied the first two objectives above. That opinion certainly isn’t universal, as I know there are folks putting additional emphasis on marbling with the intent of creating a large number of Prime carcasses. I get it, but to me they need to make sure the product is acceptable to the packer and is being priced off a beef base.

I think the biggest aspect that needs to change is the mindset of the dairy industry toward any calf that isn’t going to be a herd replacement. If they continue to treat that animal as a byproduct, the feedlot and packer sector will view those cattle as byproducts also and walk away when sufficient numbers of more desirable alternatives are available. I think the dairy industry has a tremendous opportunity to take advantage of changing technology to create an entirely new profit center that’s at least somewhat diversified away from the dairy product market. But that will mean some changes in the approaches to sire selection, calf care, the calf ranch business and probably some degree of retained ownership or at least longer-term tracking.

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