Benefits of Cattle Auctions
It is true, that people can buy cattle or any kind of livestock directly from the ranch. Some of the buyers also prefer to ask a broker to help you with the cattle purchase: they’re called order buyers.
It’s easy to say that those two methods might be effective, but is it true? We don’t know how effective those two methods are, but we can say one thing for sure: the best way to find and purchase cattle nowadays is through auctions. This method is the most popular among people and has its benefits as well.
Auctions are the best way of purchasing cattle for buyers. The biggest advantage is, that you have a big variety of livestock you want to choose, you have dozens of species of cattle and you can choose the specific breed you want to purchase.
Unlike the cattle auctions, purchasing cattle at the farm or ranch will leave you with less choice and you would have to choose the cattle from that specific herd. Auctions provide you with the opportunity to see the cattle raised on many different farms. This will help with improving any breeding stock.
One of the best advantages is, that on the cattle auction we get to pick from the different beef or dairy breeds from the region you are living in. For example, in the USA one of the most popular beef breeds is Black Angus. If you live in the USA and raise Angus cattle, you’re likely to have an easier time selling it than other less popular meats.
One of the less popular cattle breeds in the USA is Jerseys, even though they are a dairy breed, the yellow fat content in Jersey meat makes it a hard sell to the public. That’s why choosing the right breed to sell or purchase is important in the auction.
The tricky thing about the auction is, that it relies upon bidding to set the sales price. Usually your buyers should check the prices before going to the auctions, not to overbid. You can also go to the USDA’s livestock reports online and view the average sales price for animals you are interested in. It is very important to know the average sales price for cattle you’d like to buy, so you don’t overbid.
Preparing for Cattle Auction Season
Best season for the cattle auction is in the fall. This is the season when buyers should start getting ready for the cattle auction: start studying catalogs and watch as many sales videos as they can. After that they will travel to the auction to get the best buy for open heifers and bred females.
It is worth mentioning, you should never buy the cattle just by it looks. You should always look beyond the photo, study the EPDs, and think carefully about what type of cattle fit your breeding program best.
Jim Krantz, South Dakota State University (SDSU) Extension cow-calf field specialist, offers advice for making decisions when purchasing cattle online.
“Do your homework. Whether it’s online or at a cattle auction, producers should think about several factors before buying calves. One of the easiest things to do, whether looking at cattle online or in a sale catalog, is to scratch off the ones you won’t buy first.
Cattle that are carriers of genetic defects, or ones with poor expected progeny differences (EPDs) can be eliminated first. This will help keep your focus on your goals, so you don’t fall in love with something just because it looks good on sale day or in the picture or video. Stick to your priorities and narrow down the selection,” says Krantz.
Krantz also recommends asking several questions of the cattle and the rancher like:
- Who is the family behind the business?
- What values do they have?
- What guarantees do they offer on the cattle after the sale is complete?
- Will they deliver?
- How long will they keep the cattle?
- Are there genetic defects in the cattle offering?
- What are the EPDs?
- What are your goals for your operation, and which cattle offered in the sale might help you reach those goals?
- Do you have a market for the cattle you are purchasing?
With so much to consider – EPDs, genomic data, rate of gain, genetic defects, previous history, etc., Krantz cautions buyers not to get overwhelmed with all of the information offered by a breeder.
“I call it information overload. For the average commercial cattleman, I recommend just sticking to the basics; don’t get bogged down with all the extras. How will this new herd sire or heifer help your operation? Look at the important factors such as milk, disposition, birth weight and weaning weight. These are the fundamentals; leave the rest to the seed stock producers.
Be comfortable with your own priorities and use your goals to help make your purchasing decisions,” he says. As Krantz recommends, buyers should never feel rushed to make such big and expensive decisions.
“You don’t have to make fast decisions at a sale if you do your homework first. It all goes back to homework first. With a few clicks, you can find plenty of information online. We no longer need to make breeding decisions based on trial and error. Ranchers shouldn’t be afraid to ask advice from other breeders, mentors or the sellers themselves. A good operation will help you find the cattle that fit your needs first.
Asking for advice is the best thing producers, both young and old, can do for their own operations. Take the time to look at calves out of a sire you are looking at using. Take the guesswork out of it by doing your homework,” he adds.
What Should I Know if I am a Seller?
Since the cattle auctions are held for both sides: sellers and buyers, both of them should be fully prepared. It is very important to hold quality auctions. Buyers will remember your “Band name” and know your value, so sellers should always provide good products and quality service. That’s why sellers should be prepared to enter the auction with everything they have.
The main key to the successful cattle auction is time. It can take time to build up your reputation before you gain buyers’ trust. That’s because is critical in putting together a lineage program that customers can identify with. It takes years to test the lineage of any breeding line, then market-proven genetics, and develop a clear understanding of the needs of customers.
If a seller has a good understanding of the demand he can always provide the right supply and will always be among top sellers of the auction. As mentioned before in the article, it takes time to develop trust in the marketplace. As with anything in life, those things that have great value take time to create, develop, nurture and share.
Happy customers are your best marketing tool. One of the best marketing strategies in the cattle auction is the “word of mouth”. A good review from your customers is our best strategy since they tend to spread it. If most of the buyers are satisfied it is highly possible, that they will share this with their fellow farmers and so the seller’s reputation will be built.
Good review requires happy customers, which means that they have purchased cattle that have been proven to be functional cattle, and they have produced profits for them. This also why it is very important to have genetics – to help producers improve their programs, so they can be more successful, get good reviews and build up their own brand name.
It’s also very important to have a good sales pitch as well. The key to a good sale book is an offering of good cattle. The catalog should include all the necessary information that buyers want to know.
When you enter the auction as a cattle seller, you are not a farmer anymore. You become a salesperson, who needs to think of how to show the best features of your cattle to make it more presentable and attractive. That’s why you should provide all the information a buyer could possibly need or want on every single animal.
What Should I Know if I am a Buyer?
If you are a buyer on the auction, then buckle up. There are plenty of things you need to be prepared for and avoid making the deal you will regret for a long time. It is always good to remember that if you have a certain animal that you want to buy, it is very likely that animals will also be targeted by other buyers.
The best cattle species are always targeted by many buyers, so you should be fully prepared to go home empty-handed. To avoid this kind of situation a buyer must always have a backup plan. If the deal goes wrong and the buyers do not get anything, he or she should be prepared for the situation and know what to do next.
It is also very important for the buyer to study sales books and watch videos. Buyers should know what will be presented in the auction and what prices should they expect. This way you will have time to take care of your financial situation, calculate the gains and losses of a certain purchase. Buyers should also call the auction organizers ahead and ask for some detailed information if they want to be fully prepared.
Attending auctions, either private or consignment auctions is a great way to stock your ranch with cattle. But be careful and have a bidding plan in place before you go.
The buyers should always see the cattle before buying it. There is no substitute for viewing the cattle live, before buying it. As good as the picture may seem, you should always check for yourself if the cattle are good enough. There may be some details, that were missed in the description. This way you will get to know what you are bidding for exactly.
Process of Bidding on Cattle
If you are new to the cattle auction industry, you should know that the best thing to do it just observe. it’s easy to come across as being too overeager. As a buyer, you should avoid getting involved too early and don’t place the initial bids. That way you can overview the market and evaluate the process, which will help you determine the fair price for different types of cattle.
There are also some buyers who do this for a living–buying thousands of cattle for others.They know better that the occasional buyer what the value of each group of animals is.Since they have experience in buying cattle, they will always try to bid on the best cattle and try to get it in a lower price.
You should always be sure to arrive an hour or two before the sale to give you time to view the cattle and make some selections that you would like to buy. Know what your price limit is and how many head you need so you can plan you bidding.
It’s also noteworthy to mention that you should always try to place a winning bid on at least two cattle at an auction. Care, by nature, herd instinct animals. They don’t feel well alone so any single animal purchases should be placed with other cattle to keep them calmer and help them adjust to their new home. You should remember to take care of the cattle, because it’s productivity mostly depends on the care you provide.
It is not recommended to leave some cattle alone in the barn, so that’s why if you don’t have some cattle in your farm you should place your bid on the least two cattle at the auction. Remember, you buy them you own them. The cattle you purchase become your property as soon as you place a winning bid on them.
Another important factor when buying cattle at auction is finding healthy animals. Animals with signs of disease are usually culled before auction day, but you may occasionally see a calf with noticeable bumps, bruises, patches missing from his hide, or other issues. Sometimes these happen during transport or at the auction barn, but they can also be a sign of a bigger underlying issue. Do not purchase unhealthy animals unless you’re an experienced cattle buyer.
You should also know how to determine cattle’s age as well. The more experience you gain with livestock, the easier it is to determine the age of an animal by looking at them. If you are new at this, it is recommended to look over the specific breeds of cattle, this way you will know how the healthy cattle looks like at the certain age.
Animals will be grouped by different categories, like age or breed, it will help you narrow down your choices quickly and make the decision faster. As it was mentioned before in the article, the time management is one of the most important things in the auction process.
How to bid on Cattle at an Auction?
If you are new at the cattle auctions and intend to make a purchase, then here are some tips to help you better prepare for the auction:
- Make sure you have cash or checks on you. Some of the auction houses don’t have terminals and can’t accept your credit cards. Besides if you see a good deal, it’s best to be able to strike while the iron is hot!
- You should bring transportation. Even though some auction holders allow you to keep your purchase there overnight, most of them demand that cattle should be taken by the new owner.
- Once at the auction house, you will have to register for the auction at the office. You’ll be given a numbered placard or sign. When you want to bid, you hold up the sign.
- The auctioneer talks in a rapid-fire way that seems like nonsense until you get used to it. Most auction houses also have helpers who call out “Yep!” or use some other signal to tell the auctioneer that someone is bidding. Keep an ear out for this if you are bidding. It can accidentally cost you hundreds or thousands if you are not aware of who is competing against you.
- Take your time. Watch the bidding first before making your own bid. Remember that there are always seasoned buyers, who give signals by hand. You should be careful and try to spot them because going against them can be very costly.
- Never wave or stand up to greet someone. You may accidentally find yourself buying an animal you didn’t intend to buy. Been there and done that!
- When you place the bid and complete the purchase, it means that now you own it.
These are some tips you should know if you want to join the cattle action. The auction itself is a very fulfilling and interesting process. The speakers are the funniest part of it, but be sure to remember all the tips that were mentioned before in the article and your experience in the cattle auction will be productive.