What is $Profit?
The $Profit Index tells you which bull calves make you the most profit, from birth to slaughter if you retain ownership and keep replacements. It includes the cow traits, fertility, growth, carcase and feed intake.
Why Kurra-Wirra uses $Profit:
First, like most indexes, $Profit takes into consideration output and revenue, but it also includes the cost side of the equation, as feed and maintenance are the major cost in any livestock business. Other indexes ignore the cost and just help you find the cattle with the highest output and growth. The important goal is more net income or profit. The $Profit index helps us and our clients raise cattle that cost less... and produce more profit.
Second, $Profit recognises that many traits have ideal levels – more is not necessarily better, neither is less and less. Seedstock breeders like to chase big indexes because it helps them sell cattle. However, our program knows you make more profit when you are at optimum levels for traits like birth weight, milk, and cow size. As an example, more milk is good up to a point. However, too much milk hurts your fertility. Almost all traits have a cost that has to be balanced for optimum benefit.
Third, $Profit takes into account hybrid vigor because our Northern clients want and need to cross-breed. Many herds are struggling with fertility because they have become too straight bred. A crossbred cow breeds up sooner and lives longer. Crossbreeding can increase kilo’s weaned per cow exposed by 23% and that drives profit.
How $Profit works:
Profit assumes that the average commercial bull will have 100 progeny over its lifetime. The model assumes that you keep 30% of your heifers as replacements and that you retain ownership on the remainder of the calves through finishing and sale on a value based marketing grid for carcass merit. This grid rewards both beef quality (marbling) and red meat yield. We realise that many don’t retain ownership to slaughter, but even if you sell store you want to be known for someone with high quality cattle and be able to demand a good price.
An advanced simulation model, developed by Dr. Steve Miller and other geneticists at Guelph University, is used to develop partial budgets. The model factors in all of the effects on both income and expense to come up with a net profit figure for each bull. $Profit allows you to compare any two bulls and calculate the difference in profit that they are expected to generate in your herd. Let’s compare a $10,000 $Profit bull to $6,000 $Profit bull (the average 2015 born American Angus Association bull). The predicted difference between the bulls is $4,000 or about $40 per calf.
Difference in the amount of feed a bull’s progeny will consume to produce one kilogram of weight gain.
Example: A -0.50 F:G EBV means this animal’s progeny will consume 1/2 kilogram less feed per kilogram of weight gain than would progeny of a zero F:G EBV sire.
Difference in feed consumption of each of a bull’s progeny in a 112 day finishing period.
Example: A steer whose sire has a -100 Intake EBV will eat less feed in 112 days than one whose sire had a zero Intake EBV.
The sire's level of accuracy is determined by the number of progeny that have been evaluated in the $Profit System.
Several progeny recorded, use with confidence (over 90% accurate).
Pedigree and individual data only (about 30% accurate).
The predicted calving ease if you use the bull on heifers. The easiest calving bulls in the industry.
Use on smaller heifers with minimal assistance needed.
Use on larger heifers with some assistance expected. (If no stars are shown, the animal is recommended for use on cows only.)
A formula combines WW and YW to predict how much performance the sire will pass on to their progeny. Most growth.
An estimate of the maternal efficiency of the daughters this sire will produce. It includes cow size, milk, fertility and growth.
Keep these heifers! They will make the most profitable females in the business.
A formula that combines: gain, conversion, carcass weight and carcass merit to predict post weaning performance.
Maximum overall value in your feeder calves.
An observation of the sires disposition.
You can walk up to and touch.
Average - respects flight zones and handles well, but is not a pet.
What traits are included in $Profit
$Profit includes nearly every trait that impacts profitability. The effect of most traits on profit is fairly simple to understand. Here is the list of what is included and its effect:
Calving ease = more calves means more revenue.
200 Day Weight & 400 Day Weight EBV = more weight equals more revenue.
Fertility (days to conception) = more weight and more calves Carcass weight = worth more revenue.
Marbling = valued based on grid premiums
Eye muscle area = value as impacts yield grade
% Retail Product = more yield is more saleable meat
Cow mature size = generally bigger animals eats more & costs more
Cow intake = higher intake equals higher costs
Feedlot feed efficiency = more feed per kg of gain means more cost
Some traits are not so easily characterised for $Profit. Milk, for example, is a good thing until you get too much. When over +25, milk EBV has a more negative effect on fertility than it has a positive effect on weaning weight. There are a few traits not yet included in $Profit: longevity, structure, and disposition. These traits are important but difficult to express in dollars.
Are all small cows really efficient?
There seems to be a big disconnect in today’s beef industry. On sale day we want heavy, high quality steers to pay the bills. The rest of the time we want efficient cows to keep our costs as low as possible. Simply selecting for smaller cows with no regard for feed efficiency is not the answer. Likewise, selecting for shear growth with disregard for cost is just as poor of a strategy. The best way to make your cowherd truly efficient, and your calf crop earn more, is to use $Profit. This is the only index in the industry that works on both sides of the ledger (production and cost).
Cows that work! Steers that pay!