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Monday, September 22, 2014

'Shrink' and your bottom dollar

by Traci Eatherton, WLJ Managing Editor

In the beef production business, finding something “predictable” is kind of like finding the gold at the end of the rainbow…chances are slim. The weather is unpredictable. The markets are unpredictable. The government is unpredictable. Even the hired help can be unpredictable. The only two “predictables” still seem to be death and taxes, as Benjamin Franklin long ago pointed out.

So any chance of adding a little more guarantee to the bottom dollar at the sale barn is at least an improvement, a step in the right direction toward predictable. Producers hauling cattle to market this fall should take a look at reducing shrink, or lost weight from stress during transporting and processing. Reducing the stress placed on the cattle during this time will help reduce losses to the value of marketed cattle caused by shrinkage.

Consider a 600-pound steer calf that, for whatever reason, shrinks 6 percent on the way to the sale barn, or at market. At a price of $150 cwt, the 564-pound market weight would only net $846, compared to $900 net for the calf before shrink. That’s a difference of over $54 on one calf. With a semi-load or two, that adds up quickly!

Here are a few more numbers from the Amarillo Livestock Auction. Let’s say that a calf weighs 650 pounds at the ranch. He will probably shrink from 2-5 percent on the trip to market.

• Scenario 1: calf shrinks 8 percent (52 pounds) before sale – 598 pounds @ $114/ cwt. = $681.72

• Scenario 2: calf shrinks 6 percent (39 pounds) before sale – 611 pounds @ $113/ cwt. = $690.43

• Scenario 3: calf shrinks 4 percent (26 pounds) before sale – 624 pounds @ $112/ cwt. = $698.88

• Scenario 4: calf shrinks 2 percent (13 pounds) before sale – 637 pounds @ $111/ cwt. = $707.07

• Scenario 5: calf shrinks 0 percent (0 pounds) before sale – 650 pounds @ $110/ cwt. = $715.00

Ben Holland, a former South Dakota State University Extension Beef Feedlot Specialist conducted a study on shrink in 2012.

“As cattle defecate, and urinate, substantial weight can be lost, and if no feed or water is provided, these pounds may not be replaced before cattle go across scales. In fact, the magnitude of real shrink can be quite substantial,” Holland reported. “Cattle shipped to feedlots with a multiple hour haul can shrink 3 to 8 percent from weights on the ranch.”

The SDSU study gathered yearling steers off of grass at 5 p.m. and weighed them. After being held in a drylot overnight those steers had lost over 7 percent of their weight.

“This has real application for producers who deliver animals to an auction a significant amount of time before their cattle sell; they are running the risk of leaving a sizable amount of money on the table,” Holland noted.

Shrink is not a new concept, but it can be overlooked. Holland points out that cattle being sold through private treaty or video auctions often have weight conditions that include a “shrink” number.

“This pencil shrink is a way to estimate actual cattle shrink and include it in the price. For example, if weighing conditions for weaned calves include a $155/ cwt. bid and a 2 percent pencil shrink, that means, the buyer is really bidding $151.90/cwt. for those animals,” he said. “Alternatively, it means if cattle weigh 550 lbs., the rancher is really selling 539-lb. calves. For calves and feeder cattle, pencil shrinks are commonly 2-3 percent and, for fed cattle, shrink is usually 4 percent.”

Shrink types

Cattle in all age, weight and finish ranges can experience two kinds of shrink— fill shrink and tissue shrink. Fill shrink, also known as excretory shrink, is the loss of digestive system contents, manure and urine, typically caused from lack of water and feed. This weight loss is quickly recovered in a day or two once cattle are back on feed and water.

Tissue shrink is the loss of fluid from body tissues. This occurs when cattle go long periods without feed and water and are then subjected to other types of stress. Stress can be caused by events such as long distance trucking or rough handling. Tissue shrink occurs when cattle experience over 6 percent weight loss, according to extension studies.

Cattle experiencing tissue shrink may take from 10-36 days to recover their selling weight.

Excessive shrink can even affect finished cattle by increasing the number of dark cutters on a load or decreasing dressing percentage. It also has a detrimental effect on marbling and tenderness.

Prevention

Just the act of weighing cattle causes some shrinkage. According to a number of studies, calves can lose 3 percent of their weight during sorting and loading alone. Use quiet, low stress handling methods for moving and processing cattle to reduce shrink. Well-designed handling facilities will allow animals to be processed quickly while experiencing minimal stress. Avoid the use of electric prods, canes, whips and dogs. If not all animals are to be sold, then sort cattle 1-2 weeks before weighing and sale. Design facilities to allow cattle to move directly onto trailers without any delays after being weighed.

Plan before hauling

Plan the loads prior to shipping. Over-loading and even under-loading trailers can increase the amount of shrink. Over-loading or crowding causes stress, while under-loading causes excessive movement of the unstable cattle.

Plan ahead when marketing cattle. Shrink can be increased by bad storms, hot weather and long delays during the trip or while waiting for unloading. Shrinkage doubles when groups of cattle are stressed by being mixed during marketing.

Plan the weaning date ahead of shipping. Weaning is one of the most stressful times in a calf’s life. Weaning calves the day before the sale and shipping them to the sale barn to stand overnight creates the most shrink in calves. Additional stressors such as sorting, loading, transporting and commingling with other groups of calves, along with the calves’ decreased motivation to eat or drink, will cause additional shrink. Pre-conditioned calves will shrink less and provide a higher sale weight.

The bottom line—management is the key, according to the studies.

“Cattle shrink can be worth a substantial amount of money, so a thorough understanding of shrink is a critical skill for people in the cattle business,” Holland points out. — Traci Eatherton, WLJ Editor

 
 


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