WEBVTT 00:00:10.530 --> 00:00:14.289 Hello, everyone, and welcome to the 203rd episode 00:00:14.289 --> 00:00:18.010 of the Bullvine Podcast. I'm Bella, joined as 00:00:18.010 --> 00:00:22.070 always by my co -host Douglas. Today, we're diving 00:00:22.070 --> 00:00:25.489 into a fascinating market disruption that's reshaping 00:00:25.489 --> 00:00:28.660 the dairy genetics industry. Traditional genetics 00:00:28.660 --> 00:00:31.820 companies are being blindsided, while dairy farmers 00:00:31.820 --> 00:00:34.560 and beef specialists are capturing a massive 00:00:34.560 --> 00:00:37.140 portion of the beef on dairy market. That's right, 00:00:37.200 --> 00:00:40.079 Bella. We'll be unpacking how this seismic shift 00:00:40.079 --> 00:00:42.899 happened seemingly overnight, who the new players 00:00:42.899 --> 00:00:45.280 are, and what it means for dairy producers across 00:00:45.280 --> 00:00:48.759 North America. We'll look at the economic drivers, 00:00:49.020 --> 00:00:51.579 explain why traditional companies missed the 00:00:51.579 --> 00:00:54.460 boat, and provide some practical advice for producers 00:00:54.460 --> 00:00:58.039 navigating this new landscape. I've heard that 00:00:58.039 --> 00:01:00.700 traditional genetics companies now control only 00:01:00.700 --> 00:01:04.680 about 25 % of the beef on dairy market. That's 00:01:04.680 --> 00:01:07.140 a dramatic change from just a few years ago. 00:01:08.500 --> 00:01:11.140 Absolutely. And we're going to explain exactly 00:01:11.140 --> 00:01:13.760 how that happened and who's winning in this new 00:01:13.760 --> 00:01:17.680 reality. So let's dive right in. And Douglas, 00:01:17.939 --> 00:01:21.519 let's start with the basics. What exactly happened 00:01:21.519 --> 00:01:23.700 in the genetics marketplace that traditional 00:01:23.700 --> 00:01:26.980 companies didn't see coming? Well, Bella. It's 00:01:26.980 --> 00:01:29.739 quite simple. While the main AI players were 00:01:29.739 --> 00:01:31.599 busy perfecting their dairy genetic evaluation 00:01:31.599 --> 00:01:36.060 systems and marketing high TPI bulls, they completely 00:01:36.060 --> 00:01:38.459 missed the explosion of beef on dairy breeding. 00:01:38.959 --> 00:01:41.640 They were so focused on dairy genetics that they 00:01:41.640 --> 00:01:44.219 never anticipated how quickly dairy farmers would 00:01:44.219 --> 00:01:48.200 shift to using beef semen. But how quickly did 00:01:48.200 --> 00:01:51.239 this shift actually happen? Do we have any numbers 00:01:51.239 --> 00:01:54.670 on that? According to peer -reviewed research 00:01:54.670 --> 00:01:58.629 published in January 2023, the contribution of 00:01:58.629 --> 00:02:01.370 dairy steers to the U .S.-fed beef supply increased 00:02:01.370 --> 00:02:07.109 from 6 .9 % to 16 .3 % over just two decades. 00:02:07.569 --> 00:02:09.750 That's more than doubling their market presence. 00:02:10.550 --> 00:02:13.509 That's a remarkable increase. What drove this 00:02:13.509 --> 00:02:17.650 change? Several factors converged. First, we've 00:02:17.650 --> 00:02:20.780 seen declining beef cow numbers nationwide. Second, 00:02:21.000 --> 00:02:23.319 there's been increased use of sex dairy semen, 00:02:23.419 --> 00:02:25.780 which allows dairy farmers to produce replacement 00:02:25.780 --> 00:02:28.919 heifers from only their best cows. And third, 00:02:29.139 --> 00:02:32.360 maybe most importantly, Holstein bull calves 00:02:32.360 --> 00:02:36.319 essentially became worthless around 2016. Major 00:02:36.319 --> 00:02:39.300 U .S. beef packers were actively rejecting Holstein 00:02:39.300 --> 00:02:42.240 -fed calves, leaving dairy farmers in a terrible 00:02:42.240 --> 00:02:45.400 position. So, when dairy farmers couldn't sell 00:02:45.400 --> 00:02:47.879 their Holstein bull calves, they needed an alternative. 00:02:48.460 --> 00:02:51.000 and breeding to beef bulls provided a solution. 00:02:52.180 --> 00:02:55.719 Exactly. It was simple economics. If you can't 00:02:55.719 --> 00:02:58.000 sell a Holstein bull calf for a profit, but you 00:02:58.000 --> 00:02:59.939 can sell a beef cross calf for significantly 00:02:59.939 --> 00:03:03.500 more, the decision makes itself. What started 00:03:03.500 --> 00:03:06.139 as a survival tactic quickly became standard 00:03:06.139 --> 00:03:09.400 practice. It sounds like traditional genetics 00:03:09.400 --> 00:03:12.780 companies were caught completely flat -footed 00:03:12.780 --> 00:03:15.900 by this market transformation. They absolutely 00:03:15.900 --> 00:03:19.360 were. They spent decades building elaborate genomic 00:03:19.360 --> 00:03:21.960 indexes and commanding premium prices for dairy 00:03:21.960 --> 00:03:24.419 genetics while assuming their market dominance 00:03:24.419 --> 00:03:28.039 was untouchable. Meanwhile, innovative dairy 00:03:28.039 --> 00:03:30.500 producers and beef -focused companies were quietly 00:03:30.500 --> 00:03:34.240 building a parallel genetic supply chain. Let's 00:03:34.240 --> 00:03:37.560 talk about these new players. Who exactly stepped 00:03:37.560 --> 00:03:39.860 in to fill this market need when traditional 00:03:39.860 --> 00:03:43.300 companies weren't paying attention? There are 00:03:43.300 --> 00:03:45.900 really two major groups that captured this opportunity. 00:03:46.539 --> 00:03:49.180 First, we have specialized beef genetics providers 00:03:49.180 --> 00:03:52.120 who understood both the dairy production system 00:03:52.120 --> 00:03:56.080 and beef quality requirements. And second, perhaps 00:03:56.080 --> 00:03:59.340 more surprisingly, we have large dairy operations 00:03:59.340 --> 00:04:01.860 that started producing their own genetics in 00:04:01.860 --> 00:04:04.500 -house. Can you give us some examples of these 00:04:04.500 --> 00:04:08.620 new providers? One fascinating example is Grimius 00:04:08.620 --> 00:04:11.240 Cattle Company. They were primarily known as 00:04:11.240 --> 00:04:13.780 a cattle feeding operation handling dairy steers 00:04:13.780 --> 00:04:17.720 and heifers since the 1960s. But they've transformed 00:04:17.720 --> 00:04:20.699 themselves into a genetic powerhouse by aggressively 00:04:20.699 --> 00:04:24.100 acquiring premium Angus genetics. How exactly 00:04:24.100 --> 00:04:27.379 did they do that? Rather than trying to build 00:04:27.379 --> 00:04:30.300 a genomic program from scratch, Grimmius purchased 00:04:30.300 --> 00:04:33.399 high -selling bulls from elite breeders, including 00:04:33.399 --> 00:04:37.300 Hoover Angus Farm, Spring Cove Ranch, and Gardner 00:04:37.300 --> 00:04:40.569 Angus Ranch. They went straight to proven genetics 00:04:40.569 --> 00:04:43.610 that deliver in the feedlot, something they understand 00:04:43.610 --> 00:04:45.990 better than most dairy -focused genetic companies 00:04:45.990 --> 00:04:49.629 ever could. So they leveraged their practical 00:04:49.629 --> 00:04:54.189 experience in feeding beef dairy crosses to identify 00:04:54.189 --> 00:04:57.389 the genetics that would work best. Precisely. 00:04:57.949 --> 00:05:00.649 But perhaps even more disruptive are the large 00:05:00.649 --> 00:05:03.269 dairy operations that have completely bypassed 00:05:03.269 --> 00:05:06.569 traditional genetics providers altogether. How 00:05:06.569 --> 00:05:09.720 are they doing that? Operations like Riverview 00:05:09.720 --> 00:05:12.360 and Faria have thousands of cows under management. 00:05:12.800 --> 00:05:15.980 At that scale, they've determined it's more economical 00:05:15.980 --> 00:05:18.279 to develop their own semen production facilities 00:05:18.279 --> 00:05:20.660 than to purchase from established companies. 00:05:22.019 --> 00:05:25.279 Faria now produces all its own beef semen, leveraging 00:05:25.279 --> 00:05:27.839 its massive scale to justify the investment in 00:05:27.839 --> 00:05:31.379 collection facilities and bull maintenance. That's 00:05:31.379 --> 00:05:34.439 vertical integration in the dairy industry. What 00:05:34.439 --> 00:05:36.660 makes this approach so economically attractive? 00:05:38.029 --> 00:05:41.110 The economics are actually quite simple and devastating 00:05:41.110 --> 00:05:44.569 for traditional providers. At sufficient scale, 00:05:44.910 --> 00:05:47.910 in -house production eliminates markup, allows 00:05:47.910 --> 00:05:51.009 customized genetic selection, and even creates 00:05:51.009 --> 00:05:53.689 potential for additional revenue by selling excess 00:05:53.689 --> 00:05:57.470 inventory to neighboring operations. It's a complete 00:05:57.470 --> 00:06:00.470 upheaval of the traditional business model. Let's 00:06:00.470 --> 00:06:03.050 talk about the impact this market transformation 00:06:03.050 --> 00:06:06.689 has had on traditional genetics companies. How 00:06:06.689 --> 00:06:11.269 badly have they been hurt? The financial consequences 00:06:11.269 --> 00:06:14.829 have been severe and are getting worse. As beef 00:06:14.829 --> 00:06:17.509 on dairy breeding has exploded, the market for 00:06:17.509 --> 00:06:20.290 conventional dairy semen has contracted significantly. 00:06:20.910 --> 00:06:24.509 Some estimates put the reduction at 25 to 35 00:06:24.509 --> 00:06:27.509 percent virtually overnight. And this market 00:06:27.509 --> 00:06:30.170 contraction coincided with inflationary pressures 00:06:30.170 --> 00:06:33.310 that increased operational costs across the board. 00:06:34.120 --> 00:06:36.980 So they're getting hit from both sides, selling 00:06:36.980 --> 00:06:40.920 less product while costs are rising. Exactly. 00:06:41.279 --> 00:06:43.660 For companies structured around high -volume 00:06:43.660 --> 00:06:46.560 sales with substantial overhead, the math simply 00:06:46.560 --> 00:06:49.459 doesn't work anymore. Their entire business model 00:06:49.459 --> 00:06:51.819 was built around a specific blend of sales and 00:06:51.819 --> 00:06:54.420 volumes that the beef -on -dairy revolution has 00:06:54.420 --> 00:06:57.220 completely undermined. Let's see what specific 00:06:57.220 --> 00:06:59.680 challenges do they face in competing in this 00:06:59.680 --> 00:07:02.959 new market. Traditional genetics companies now 00:07:02.959 --> 00:07:05.860 face higher per -unit costs for dairy semen production 00:07:05.860 --> 00:07:08.860 because their fixed expenses, things like facilities, 00:07:09.240 --> 00:07:12.399 bull housing, genetic testing, and staff, must 00:07:12.399 --> 00:07:15.819 be spread across fewer units sold. Meanwhile, 00:07:16.120 --> 00:07:18.439 their beef programs lack the specialized expertise 00:07:18.439 --> 00:07:20.920 and market connections that give focused beef 00:07:20.920 --> 00:07:24.600 genetics providers their competitive edge. It's 00:07:24.600 --> 00:07:27.579 a classic disruption scenario. So their cost 00:07:27.579 --> 00:07:30.740 structure doesn't work with lower volumes, and 00:07:30.740 --> 00:07:32.699 they don't have the specialized beef knowledge 00:07:32.699 --> 00:07:36.800 to quickly pivot. That's exactly right. They 00:07:36.800 --> 00:07:38.920 were optimized for a market that has fundamentally 00:07:38.920 --> 00:07:43.240 changed. Douglas, one thing I find fascinating 00:07:43.240 --> 00:07:46.339 is how differently dairy farmers and beef producers 00:07:46.339 --> 00:07:49.959 think about genetics. Can you explain that disconnect? 00:07:50.459 --> 00:07:52.240 This is actually one of the most interesting 00:07:52.240 --> 00:07:55.439 aspects of this market transformation. Dairy 00:07:55.439 --> 00:07:58.040 producers have traditionally selected which cows 00:07:58.040 --> 00:08:01.319 to breed to beef based primarily on reproductive 00:08:01.319 --> 00:08:05.000 performance, lactation number, and milk production. 00:08:05.480 --> 00:08:07.920 Basically, which cows aren't worthy of producing 00:08:07.920 --> 00:08:10.839 replacement heifers. And what criteria do dairy 00:08:10.839 --> 00:08:13.420 farmers use when selecting which beef bulls to 00:08:13.420 --> 00:08:16.439 use? That's where it gets really interesting. 00:08:17.019 --> 00:08:20.079 For many dairy producers, the criteria are remarkably 00:08:20.079 --> 00:08:24.899 straightforward. calving ease, and solid black 00:08:24.899 --> 00:08:28.259 hair coat. This black calf syndrome, as some 00:08:28.259 --> 00:08:30.980 call it, represents both a market failure and 00:08:30.980 --> 00:08:34.299 an enormous opportunity. So many dairy producers 00:08:34.299 --> 00:08:37.460 are just looking for any black calf without much 00:08:37.460 --> 00:08:41.159 concern for specific beef genetic traits. That's 00:08:41.159 --> 00:08:43.720 right. Most aren't considering comprehensive 00:08:43.720 --> 00:08:46.580 genetic merit that would maximize value throughout 00:08:46.580 --> 00:08:49.720 the beef supply chain. Research shows that of 00:08:49.720 --> 00:08:52.879 the beef breeds used in dairy herds, Angus dominates 00:08:52.879 --> 00:08:57.200 at 89%, followed by Limison at 12%, Charolais 00:08:57.200 --> 00:09:01.620 at 7%, and Simmental at 4%. This preference for 00:09:01.620 --> 00:09:04.019 black -hided calves is driven by U .S. beef production 00:09:04.019 --> 00:09:07.620 premiums for black, coat -colored calves. Healing. 00:09:08.279 --> 00:09:10.740 But there must be significant differences between 00:09:10.740 --> 00:09:13.100 dairy and beef cattle beyond just hair color, 00:09:13.220 --> 00:09:17.860 right? Absolutely. Many dairy producers don't 00:09:17.860 --> 00:09:19.759 fully appreciate the significant differences 00:09:19.759 --> 00:09:23.279 between dairy and beef cattle carcasses. Scientific 00:09:23.279 --> 00:09:25.519 research shows that dairy steers have lesser 00:09:25.519 --> 00:09:29.000 dressing percentages and yield 2 -12 % less red 00:09:29.000 --> 00:09:31.879 meat compared to beef steers. This is due to 00:09:31.879 --> 00:09:34.679 a greater ratio of bone to muscle, internal fat, 00:09:34.960 --> 00:09:37.620 organ size, and gastrointestinal tract weight. 00:09:38.259 --> 00:09:40.879 Additionally, Holstein carcasses tend to be longer, 00:09:41.000 --> 00:09:43.220 while Jersey carcasses are typically lighter 00:09:43.220 --> 00:09:46.980 weight than carcasses from beef breeds. I understand 00:09:46.980 --> 00:09:49.460 there have been some efforts in the industry 00:09:49.460 --> 00:09:51.860 to address these challenges with specialized 00:09:51.860 --> 00:09:56.080 genetic indexes. Could you explain these initiatives 00:09:56.080 --> 00:10:00.039 in more detail? Absolutely. The beef industry 00:10:00.039 --> 00:10:02.580 recognized this opportunity and developed specific 00:10:02.580 --> 00:10:05.179 tools to help optimize beef on dairy breeding. 00:10:05.440 --> 00:10:07.840 The American Angus Association, for example, 00:10:07.919 --> 00:10:10.120 developed the Dollar Angus on Holstein Index, 00:10:10.399 --> 00:10:13.519 commonly written as Dollar AXH, and the Dollar 00:10:13.519 --> 00:10:16.659 Angus on Jersey Index. written as dollar AXJ. 00:10:16.879 --> 00:10:20.120 How exactly do these indexes work? Are they similar 00:10:20.120 --> 00:10:22.480 to the dairy indexes most of our listeners are 00:10:22.480 --> 00:10:27.120 familiar with? In concept, yes. Just like how 00:10:27.120 --> 00:10:29.919 the dairy industry has net merit, or TPI, that 00:10:29.919 --> 00:10:32.019 combine multiple traits into a single economic 00:10:32.019 --> 00:10:35.419 value, these beef on dairy indexes combine traits 00:10:35.419 --> 00:10:37.919 that matter specifically for crossbred animals. 00:10:39.370 --> 00:10:43.570 The $AXH index emphasizes calving ease, which 00:10:43.570 --> 00:10:46.070 is less of an issue in Holstein crosses, but 00:10:46.070 --> 00:10:48.230 heavily weights marbling, muscle conformation, 00:10:48.409 --> 00:10:50.710 and appropriate carcass length to address the 00:10:50.710 --> 00:10:53.350 specific challenges of Holstein -influenced carcasses. 00:10:53.690 --> 00:10:56.149 And what about the Holcim index you mentioned 00:10:56.149 --> 00:11:00.330 earlier? The Holcim index is particularly interesting 00:11:00.330 --> 00:11:02.710 because it represents a formal collaboration 00:11:02.710 --> 00:11:06.350 between the Holcim Association USA and the American 00:11:06.350 --> 00:11:09.840 Cemental Association. It was specifically designed 00:11:09.840 --> 00:11:13.159 for selecting cemental and angus -crossed bulls 00:11:13.159 --> 00:11:16.399 for use on Holstein females. What makes this 00:11:16.399 --> 00:11:18.919 unique is that it represents the dairy and beef 00:11:18.919 --> 00:11:21.480 industries actually working together to solve 00:11:21.480 --> 00:11:24.580 these challenges. With these specialized tools 00:11:24.580 --> 00:11:27.659 available, why aren't more dairy producers using 00:11:27.659 --> 00:11:31.659 them? That's the million -dollar question. Despite 00:11:31.659 --> 00:11:34.080 these resources being available, adoption has 00:11:34.080 --> 00:11:36.970 been limited. Part of the issue is that dairy 00:11:36.970 --> 00:11:39.529 people don't think like beef people, as the saying 00:11:39.529 --> 00:11:42.549 goes. Dairy producers are accustomed to selecting 00:11:42.549 --> 00:11:45.149 for milk production components and health traits. 00:11:45.350 --> 00:11:48.269 The concept of selecting for carcass traits, 00:11:48.549 --> 00:11:51.590 feed efficiency in the feedlot, and beef quality 00:11:51.590 --> 00:11:54.450 grade is simply outside their traditional area 00:11:54.450 --> 00:11:59.470 of focus. Are there any success stories of dairy 00:11:59.470 --> 00:12:02.029 producers who have embraced these specialized 00:12:02.029 --> 00:12:05.490 indexes? While individual success stories exist, 00:12:05.789 --> 00:12:08.490 the broader industry hasn't yet made this transition. 00:12:08.929 --> 00:12:11.830 The peer -reviewed research shows that of beef 00:12:11.830 --> 00:12:14.429 on dairy crosses reported by the Council on Dairy 00:12:14.429 --> 00:12:19.649 Cattle Breeding from 2016 to 2019, 95 % used 00:12:19.649 --> 00:12:23.529 Angus semen. But very few were using specialized 00:12:23.529 --> 00:12:26.789 beef on dairy indexes to select those Angus bulls. 00:12:26.809 --> 00:12:29.730 This represents a significant opportunity for 00:12:29.730 --> 00:12:32.379 education and improvement. Let's dive deeper 00:12:32.379 --> 00:12:35.360 into the specific differences between dairy steers 00:12:35.360 --> 00:12:38.700 and beef steers. I know there's research on this 00:12:38.700 --> 00:12:41.059 topic that could help our listeners understand 00:12:41.059 --> 00:12:43.759 the economic implications better. I'd be happy 00:12:43.759 --> 00:12:46.759 to walk through the research findings. Based 00:12:46.759 --> 00:12:49.000 on peer -reviewed research published in January 00:12:49.000 --> 00:12:52.919 2023, there are six key characteristics where 00:12:52.919 --> 00:12:56.200 dairy steers differ from beef steers, and each 00:12:56.200 --> 00:12:58.879 represents an opportunity for improvement through 00:12:58.879 --> 00:13:02.909 optimized breeding. What's the first characteristic? 00:13:03.750 --> 00:13:06.690 First is dressing percentage. That's the ratio 00:13:06.690 --> 00:13:09.629 of carcass weight to live weight. Dairy steers 00:13:09.629 --> 00:13:12.029 have a lower dressing percentage than beef steers. 00:13:12.210 --> 00:13:14.710 However, with optimized beef by dairy breeding 00:13:14.710 --> 00:13:18.269 strategies, producers can achieve a 2 -5 % improvement 00:13:18.269 --> 00:13:21.389 in this metric. And what about the actual meat 00:13:21.389 --> 00:13:25.690 yield? That's the second key difference. Red 00:13:25.690 --> 00:13:28.590 meat yield from dairy steers is typically 2 -12 00:13:28.590 --> 00:13:31.559 % less than from beef steers. This is considered 00:13:31.559 --> 00:13:35.320 the baseline in the industry. With proper beef 00:13:35.320 --> 00:13:38.019 on dairy crossbreeding, producers can see a 3 00:13:38.019 --> 00:13:42.259 -8 % improvement in red meat yield. That's significant 00:13:42.259 --> 00:13:45.159 when you consider the economics of beef production. 00:13:45.620 --> 00:13:49.039 What about carcass conformation issues? The third 00:13:49.039 --> 00:13:51.120 and fourth characteristics relate to carcass 00:13:51.120 --> 00:13:54.240 dimensions. Holstein carcasses tend to be longer 00:13:54.240 --> 00:13:57.039 than standard beef carcasses, while Jersey carcasses 00:13:57.039 --> 00:14:00.179 are typically lighter weight. Both of these characteristics 00:14:00.179 --> 00:14:02.379 can be addressed with proper sire selection. 00:14:02.899 --> 00:14:05.679 This is where those specialized indexes we discussed 00:14:05.679 --> 00:14:16.580 can be particularly valuable. Absolutely. The 00:14:16.580 --> 00:14:19.220 fifth characteristic is quality grade, where 00:14:19.220 --> 00:14:21.580 dairy steers often have more desirable scores 00:14:21.580 --> 00:14:25.299 on average compared to beef steers. And the sixth 00:14:25.299 --> 00:14:27.659 characteristic is performance predictability. 00:14:28.299 --> 00:14:31.220 Dairy animals show high uniformity compared to 00:14:31.220 --> 00:14:34.299 the more variable beef steers. Both of these 00:14:34.299 --> 00:14:36.539 advantages can be maintained with proper genetics 00:14:36.539 --> 00:14:38.940 while addressing the disadvantages. So with a 00:14:38.940 --> 00:14:41.759 strategic breeding approach, dairy producers 00:14:41.759 --> 00:14:44.720 can maintain the quality advantages of dairy 00:14:44.720 --> 00:14:47.740 animals while improving the characteristics that 00:14:47.740 --> 00:14:50.559 typically make them less valuable for beef production. 00:14:51.799 --> 00:14:54.700 That's exactly right. And that's why selecting 00:14:54.700 --> 00:14:58.220 bulls based solely on black hide color and calving 00:14:58.220 --> 00:15:01.960 ease leave significant value on the table. There's 00:15:01.960 --> 00:15:04.879 potential for much greater economic returns with 00:15:04.879 --> 00:15:08.139 a more sophisticated approach. Earlier, you mentioned 00:15:08.139 --> 00:15:10.500 five questions dairy farmers should ask when 00:15:10.500 --> 00:15:13.919 evaluating beef genetics providers. Let's explore 00:15:13.919 --> 00:15:17.120 these in more practical terms. How might a typical 00:15:17.120 --> 00:15:19.840 dairy producer actually use these questions? 00:15:20.779 --> 00:15:22.940 Let's walk through each question with a real 00:15:22.940 --> 00:15:25.960 -world example. Imagine you're a 200 -cow dairy 00:15:25.960 --> 00:15:28.539 operation looking to change your beef semen provider. 00:15:29.379 --> 00:15:32.059 When meeting with potential suppliers, the first 00:15:32.059 --> 00:15:35.620 question to ask is, beyond black hide and calving 00:15:35.620 --> 00:15:38.139 ease, what specific genetic traits does your 00:15:38.139 --> 00:15:40.899 program select for that will maximize my calves' 00:15:41.019 --> 00:15:44.659 value in the beef chain? What should producers 00:15:44.659 --> 00:15:48.019 listen for in the response? They should listen 00:15:48.019 --> 00:15:51.139 for specific traits like feed efficiency, ribeye 00:15:51.139 --> 00:15:55.299 area, marbling score, and red meat yield. A quality 00:15:55.299 --> 00:15:57.539 provider will talk about these traits in economic 00:15:57.539 --> 00:16:00.519 terms. For example, explaining that a one square 00:16:00.519 --> 00:16:02.840 inch increase in ribeye area might translate 00:16:02.840 --> 00:16:06.879 to $15 more value per calf. If they just talk 00:16:06.879 --> 00:16:09.100 about better beef qualities without specifics, 00:16:09.399 --> 00:16:12.720 that's a red flag. What about the second question 00:16:12.720 --> 00:16:16.899 regarding feedlot performance? When asking, what 00:16:16.899 --> 00:16:19.399 data can you provide on feedlot performance and 00:16:19.399 --> 00:16:22.059 carcass characteristics of your sire's progeny, 00:16:22.600 --> 00:16:24.879 Producers should expect to see actual data sheets, 00:16:25.080 --> 00:16:28.000 not just marketing claims. A serious beef genetics 00:16:28.000 --> 00:16:30.419 provider should have information on average daily 00:16:30.419 --> 00:16:34.120 gain, feed conversion ratios, and USDA yield 00:16:34.120 --> 00:16:37.379 and quality grades from actual progeny. Ideally, 00:16:37.539 --> 00:16:40.019 they'd have comparison data showing how their 00:16:40.019 --> 00:16:42.940 genetics perform, specifically in beef on dairy 00:16:42.940 --> 00:16:45.899 crosses, rather than just purebred beef settings. 00:16:46.519 --> 00:16:49.259 The third question was about specialized beef 00:16:49.259 --> 00:16:52.279 on dairy indexes. How should a farmer evaluate 00:16:52.279 --> 00:16:56.019 those answers? When asking if they use specific 00:16:56.019 --> 00:17:00.759 beef on dairy indexes like $AXH or HALSIM, listen 00:17:00.759 --> 00:17:02.720 for whether they understand the unique challenges 00:17:02.720 --> 00:17:06.480 of beef -dairy crosses. A good answer would include 00:17:06.480 --> 00:17:09.259 an explanation of how these indexes weight different 00:17:09.259 --> 00:17:12.420 traits compared to standard beef indexes, and 00:17:12.420 --> 00:17:15.880 why that matters for dairy producers. If they 00:17:15.880 --> 00:17:18.660 dismiss these specialized indexes or seem unfamiliar 00:17:18.660 --> 00:17:21.480 with them, That suggests they haven't really 00:17:21.480 --> 00:17:24.220 focused on the specific needs of dairy clients. 00:17:24.680 --> 00:17:27.180 The fourth question was about price premiums. 00:17:27.180 --> 00:17:31.019 What constitutes a good answer there? For the 00:17:31.019 --> 00:17:34.299 question, what price premiums are your beef on 00:17:34.299 --> 00:17:36.619 dairy calves averaging compared to generic black 00:17:36.619 --> 00:17:39.559 calves? Producers should look for specific dollar 00:17:39.559 --> 00:17:42.420 amounts backed by auction data or contract prices. 00:17:43.119 --> 00:17:45.819 A quality provider might say something like, 00:17:46.410 --> 00:17:49.289 Our beef on dairy calves consistently bring $25 00:17:49.289 --> 00:17:52.569 to $40 more per hundredweight than standard black 00:17:52.569 --> 00:17:56.190 crosses at regional auctions. Vague answers suggest 00:17:56.190 --> 00:17:58.390 they don't track this critical economic information. 00:17:59.390 --> 00:18:02.230 And finally, what about references from other 00:18:02.230 --> 00:18:05.910 dairy producers? This might be the most important 00:18:05.910 --> 00:18:08.950 question. Can you provide references from dairy 00:18:08.950 --> 00:18:11.690 producers who've seen measurable economic benefits 00:18:11.690 --> 00:18:15.150 from using your genetics? A reputable provider 00:18:15.150 --> 00:18:17.329 should immediately offer contact information 00:18:17.329 --> 00:18:19.930 for existing clients with operations similar 00:18:19.930 --> 00:18:23.190 to yours. Follow up with these references and 00:18:23.190 --> 00:18:26.589 ask specific questions about calving ease, buyer 00:18:26.589 --> 00:18:29.710 feedback, and price differentials. Real experiences 00:18:29.710 --> 00:18:32.950 from other dairy farmers are invaluable in evaluating 00:18:32.950 --> 00:18:36.089 these claims. So these questions help dairy producers 00:18:36.089 --> 00:18:38.990 cut through the marketing hype and determine 00:18:38.990 --> 00:18:42.089 which genetic providers are truly offering superior 00:18:42.089 --> 00:18:47.460 value. Exactly. These five questions transform 00:18:47.460 --> 00:18:50.660 a dairy producer from a passive buyer to an informed 00:18:50.660 --> 00:18:53.180 consumer who can make breeding decisions based 00:18:53.180 --> 00:18:55.720 on economic outcomes rather than just tradition 00:18:55.720 --> 00:19:05.220 or convenience. We're witnessing a fundamental 00:19:05.220 --> 00:19:07.519 restructuring that traditional companies simply 00:19:07.519 --> 00:19:11.380 cannot ignore. Of the beef on dairy crosses reported 00:19:11.380 --> 00:19:16.609 from 2016 to 2019, A staggering 95 % used Angus 00:19:16.609 --> 00:19:19.809 semen, demonstrating just how concentrated this 00:19:19.809 --> 00:19:23.009 market has become on one breed. What do traditional 00:19:23.009 --> 00:19:25.910 genetics companies need to do to survive in this 00:19:25.910 --> 00:19:30.450 new reality? They really have two options. Either 00:19:30.450 --> 00:19:33.210 dramatically downsize their operations to match 00:19:33.210 --> 00:19:36.910 the reduced dairy semen market, or develop specialized 00:19:36.910 --> 00:19:40.049 beef genetics divisions that can truly compete 00:19:40.049 --> 00:19:43.720 with focused providers. Major genetics companies 00:19:43.720 --> 00:19:45.920 have already begun moving in this direction by 00:19:45.920 --> 00:19:48.359 expanding their beef operations, but they're 00:19:48.359 --> 00:19:50.240 playing catch up in a market where specialist 00:19:50.240 --> 00:19:52.839 providers have established significant advantages. 00:19:54.200 --> 00:19:57.559 And what about dairy producers? Will we see more 00:19:57.559 --> 00:20:02.140 vertical integration? Absolutely. Innovative 00:20:02.140 --> 00:20:04.599 dairy producers are likely to continue moving 00:20:04.599 --> 00:20:06.920 toward vertical integration of their genetic 00:20:06.920 --> 00:20:10.099 supply. The economics are simply too compelling 00:20:10.099 --> 00:20:13.099 to ignore. Why pay premium prices for genetics 00:20:13.099 --> 00:20:15.500 when you can produce custom -tailored semen in 00:20:15.500 --> 00:20:18.720 -house at a fraction of the cost? Of course, 00:20:18.799 --> 00:20:20.960 this only works for operations with sufficient 00:20:20.960 --> 00:20:25.140 scale. What opportunities do you see for specialized 00:20:25.140 --> 00:20:28.960 beef genetics providers? The opportunity is enormous. 00:20:29.930 --> 00:20:32.450 By focusing exclusively on the beef on dairy 00:20:32.450 --> 00:20:35.150 segment and developing products optimized for 00:20:35.150 --> 00:20:37.630 this specific market niche, they can deliver 00:20:37.630 --> 00:20:40.490 superior economic outcomes compared to generic 00:20:40.490 --> 00:20:43.990 black calf programs. The real innovation will 00:20:43.990 --> 00:20:46.329 come from providers who can bring dairy -style 00:20:46.329 --> 00:20:48.690 genomic evaluation to beef on dairy breeding 00:20:48.690 --> 00:20:52.430 decisions. As this market transformation continues, 00:20:52.930 --> 00:20:55.390 who do you see as the clear winners and losers? 00:20:56.940 --> 00:20:59.440 The winners are definitely the nimble, specialized 00:20:59.440 --> 00:21:02.920 beef genetics providers who understand both dairy 00:21:02.920 --> 00:21:05.559 production systems and beef quality requirements. 00:21:06.000 --> 00:21:08.839 We're also seeing large dairy operations with 00:21:08.839 --> 00:21:11.940 sufficient scale to justify in -house semen production 00:21:11.940 --> 00:21:15.279 coming out ahead. And the third group of winners 00:21:15.279 --> 00:21:18.140 are the innovative crossbreed specialists who 00:21:18.140 --> 00:21:20.539 can optimize for both dairy and beef traits. 00:21:21.339 --> 00:21:25.160 Traditional genetics companies that fail to adapt 00:21:25.160 --> 00:21:27.890 quickly enough are the clear losers in this scenario. 00:21:28.930 --> 00:21:31.289 The market share they've already lost is likely 00:21:31.289 --> 00:21:34.349 gone forever. The only question is whether they 00:21:34.349 --> 00:21:37.049 can stabilize their position or continue losing 00:21:37.049 --> 00:21:40.690 ground. Newfall, what does this transformation 00:21:40.690 --> 00:21:42.930 mean for the average dairy producer who might 00:21:42.930 --> 00:21:47.390 be listening to our podcast right now? For dairy 00:21:47.390 --> 00:21:50.329 producers, this transformation creates both opportunities 00:21:50.329 --> 00:21:54.430 and challenges. The proliferation of genetic 00:21:54.430 --> 00:21:57.049 sources provides more options than ever before, 00:21:57.269 --> 00:22:00.089 but it also requires more sophisticated evaluation 00:22:00.089 --> 00:22:03.869 of potential partners. Those who approach beef 00:22:03.869 --> 00:22:06.210 on dairy breeding with the same analytical rigor 00:22:06.210 --> 00:22:08.349 they apply to their dairy breeding program will 00:22:08.349 --> 00:22:10.950 capture significantly more value than those settling 00:22:10.950 --> 00:22:15.990 for commodity black calves. We've covered a lot 00:22:15.990 --> 00:22:19.109 of ground today. The beef on dairy revolution 00:22:19.109 --> 00:22:21.690 has permanently altered the genetics landscape. 00:22:22.480 --> 00:22:24.700 What was once a market dominated by a handful 00:22:24.700 --> 00:22:27.460 of large genetics companies has transformed into 00:22:27.460 --> 00:22:30.420 a diverse ecosystem where specialized providers 00:22:30.420 --> 00:22:33.339 and vertically integrated dairy operations play 00:22:33.339 --> 00:22:37.140 increasingly important roles. That's right, Bella. 00:22:37.259 --> 00:22:39.759 The established genetic providers were caught 00:22:39.759 --> 00:22:43.400 flat -footed by this transformation. While they've 00:22:43.400 --> 00:22:45.970 begun adjusting their strategies, The question 00:22:45.970 --> 00:22:48.150 remains whether they can adapt quickly enough 00:22:48.150 --> 00:22:50.849 to recapture market share from the upstarts who 00:22:50.849 --> 00:22:57.569 recognized this opportunity first. For our listeners, 00:22:57.849 --> 00:23:00.670 the message is clear. The genetic marketplace 00:23:00.670 --> 00:23:03.589 is more competitive and diverse than ever before. 00:23:04.049 --> 00:23:06.309 Whether you're running a large -scale operation 00:23:06.309 --> 00:23:09.299 considering vertical integration, or a medium 00:23:09.299 --> 00:23:12.319 -sized farm evaluating breeding options, the 00:23:12.319 --> 00:23:15.299 days of simply defaulting to traditional genetics 00:23:15.299 --> 00:23:19.180 providers are over. Absolutely. The genetics 00:23:19.180 --> 00:23:21.559 industry has been disrupted, and smart producers 00:23:21.559 --> 00:23:23.819 will leverage this disruption to capture more 00:23:23.819 --> 00:23:27.460 value from every breeding decision. I recommend 00:23:27.460 --> 00:23:30.000 all dairy producers take a fresh look at their 00:23:30.000 --> 00:23:32.920 beef on dairy strategy with the same attention 00:23:32.920 --> 00:23:36.400 they give their dairy genetics program. The economic 00:23:36.400 --> 00:23:39.930 benefits can be substantial. That brings us to 00:23:39.930 --> 00:23:42.390 the end of today's episode of the Bullvine Podcast. 00:23:43.289 --> 00:23:45.549 We want to thank you for listening, and we'd 00:23:45.549 --> 00:23:48.150 love to hear about your experiences with beef 00:23:48.150 --> 00:23:51.170 on dairy breeding. You can reach us through our 00:23:51.170 --> 00:23:56.390 website at www .thebullvine .com or on all major 00:23:56.390 --> 00:23:59.089 social media platforms. And don't forget to subscribe 00:23:59.089 --> 00:24:01.490 to the Bullvine Podcast wherever you get your 00:24:01.490 --> 00:24:06.289 podcasts. Until next time, I'm Douglas. And I'm 00:24:06.289 --> 00:24:07.690 Bella. Thanks for listening.