Two Minutes In Ag: April

They say the world is full of bad news; unfortunately, there is some truth in that. However, we can always find the good if we look, too. This month we will bring you some of both in our industry in a quick two-minute read.

Highly Pathogenic Avian Influenza (HPAI) has impacted poultry production in more than half the states so far. To date, the virus is linked to the death of nearly 23 million birds. Iowa—the nation’s largest egg producer—is the hardest-hit state, having lost 13.2 million poultry already. This is the largest virus outbreak in the poultry industry since 2015.

The United States Department of Agriculture (USDA) has announced a relief package specifically for livestock producers. USDA will launch the Emergency Livestock Relief Program (ELRP) to address increases in supplemental feed costs in 2021. The ERLP will use data from the 2021 Livestock Forage Disaster Program (LFP) to make payments to affected producers—producers do not have to apply for the aid if they were approved for an LFP payment. There will be a pay cap, but details have not been released on that front.

Phase 1 of the payments is expected to total $577 million, basing the payments on percentage of an eligible producers’ gross 2021 LFP payment—90% for historically underserved producers and 75% for all other producers. USDA said it was evaluating impacts of 2021 drought and wildfires on livestock producers as it develops the Phase 2 component.

Derrell Peel, Oklahoma State University Extension Livestock Marketing Specialist, does offer some encouragement for profitability in the cattle business, as prices are higher than they were a year ago at this time, and he doesn’t expect them to dip. Where the revenue will be affected is on the expense side of the equation, as drought continues. Feed prices will be the highest input cost for producers. Peel recommends grazing cattle as long as possible without feeding hay, even if that means some targeted fertilizing for both pasture and hay production. This is just another reason promoting a mineral with Amaferm® is so important for that nutrient utilization.

Two Minutes in Ag: March

Last month, many of the BioZyme sales and marketing staff attending the Cattle Industry Convention in Houston. It was great to talk to so many customers and potential customers about our products. While there, CattleFax presented its annual market and weather forecast, which is typically right on target. 

 According to CattleFax, even with continued challenges and uncertainty from the pandemic, cattle price and profitability trends for producers are heading in the right direction. While issues around labor and packing capacity have lingered, both are expected to improve in the year ahead. Expansions in capacity combined with strong global and domestic consumer beef demand suggests increased profitability across segments, good news for our customers. 

Kevin Good, vice president of industry relations and analysis at CattleFax, provided the following market forecast: Average 2022 fed steer price at $140/cwt., up $18/cwt. from 2021, with a range of $130-155/cwt. throughout the year. All cattle classes are expected to trade higher, and prices are expected to improve. The 800-lb steer price is expected to average $172/cwt. with a range of $158-184/cwt., and the 550-lb steer price is expected to average $205/cwt., with a range of $180-230/cwt. Finally, Good forecasted utility cows at an average of $75/cwt. with a range of $65-85/cwt. and bred cows at an average of $1,850/head with a range of $1,700-2,000 for load lots of quality, running-age cows. 

The weather forecast isn’t quite as favorable as the cattle market with La Niña staying in control of the ocean-atmosphere system. For the U.S., barring any change to the La Niña outlook or sudden warming in the Gulf of Alaska, dryness continues across the Southwest and South with warms temperatures, too. The Northern Plains and Corn Belt are expected to have wetness farther east this spring and drier conditions for this summer, with temperatures closer to normal compared to last year. 

As you know supply chain and transportation issues continue to challenge everyone in agriculture.

Look for more positive news next month, when hopefully we start to see some April showers! 

Two Minutes this Month: February

A new year is upon us, but the same challenges exist if you’re in agriculture; land values are high, feed costs are high, and if you are a farmer, seed and chemical costs are going to be higher than ever this spring. However, those involved in U.S. production agriculture continue to persevere and produce the world’s safest food, just like BioZyme focuses on producing safe, accurate products. 

New this month, we’ll start highlighting some news from across the ag community that you can read in a quick two minutes.  

Cattle slaughter was down in December, and overall declining cattle numbers are projected to reduce cattle slaughter by 2.5 -3% in 2022 and lead to a 2.5% decrease in beef production for the year. However, drought could change the timing by forcing more liquidation and slaughter sooner and delaying the decrease in production until later. 

Mother Nature cannot play nice; she either sends excessive rains and storms to parts of the country or drought continues to wreak havoc elsewhere. The U.S. Forest Service along with other government agencies are partnering to help eliminate the spread of wildfires moving forward. This 10-year plan initially will target some of the highest risk areas, including the Pacific Northwest, the Sierra Nevada Range in California, the front range in Colorado and the Southwest. 

The BioZyme brands were represented in January at both the Cattlemen’s Congress in Oklahoma City and the National Western Stock Show in Denver. In its second year, Cattlemen’s Congress boasted strong open cattle shows with great sales, many sponsored and supported by breed associations after a successful first year, as a pivot show when the National Western cancelled during the height of COVID. The new stockyards at the National Western are very impressive, and the NWSS staff was very exhibitor friendly this year. Quality junior market shows among the species make Denver a special place in January, with the junior market auction better than ever. Sales in the new auction arena in the Yards were strong and though attendance was slightly off this year, foot traffic at the BioZyme booth was tremendous. 

Effective Action: Producer Meetings Offer Support

Producer meetings are an integral part of your business for several reasons. They provide information, allow for camaraderie among people
of like minds and interests and perhaps most importantly, they give dealers the chance to offer support to their customers.

People like to know that they are appreciated. Furthermore, customers like to know that they are valued as a customer when taking their business to a particular company or brand. Beyond the appreciation factor, customers want to know that support will be available to them after the sale.

That’s where producer meetings add value, they are the continued support after the sale and the beginning of a great conversation that will start the support prior to a sale (see Know Your Customer for more). Read up on three ways that a producer meeting can offer support.

Discover Customer Needs

One of the best things about a producer meeting is that you gather your customers together collectively and find out their goals and needs at the same time. If you are in a drought area, many will obviously have the same concerns. Some customers will have unique goals that you will need to address individually, but coming together in a meeting setting, providing a meal and inquiring about your customers’ goals for the year shows that you care, and you appreciate them.

Exchange Ideas

Since you have this group together, encourage them to share ideas. This shouldn’t be a problem; it’s just a larger gathering of their local coffee shop chatter. Remember, if you have potential customers at your meeting, it is a good idea to have some of your most progressive customers prepared to speak about the products that work for them to help reach their goals. After all, most producers want to be like the guy or gal that is highly respected in the area for having a successful operation. Make sure what these spokespeople have to say is genuine and doesn’t come across as rehearsed, or it could be a turn off.

Introduce New Products

Finally, make sure you talk about any new or improved products that you know are coming down the pipe or any new services you will be offering, especially if they will help your customers reach their goals. Be sure to share the key benefits, any key ingredients and any research that you are aware of. Of course, if it is a product that includes Amaferm®, it is always good to provide a refresher on the Amaferm advantage.

Customer support and appreciation goes a long way. It can often be the difference between repeat customers and unhappy customers. Make sure to host a productive producer meeting that shows that you are available to your customers. Show them the support they are looking for and watch your business grow!

Effective Action: Producer Meetings Can Help You Meet Sales Goals

Producer meetings serve multiple purposes. They are a great way to interact with customers and meet potential customers. They serve as an educational tool and a way to say thank you. However, did you know that they can also help you meet your sales goals?

That’s right. Producer meetings can help you meet or exceed your sales goals. There is no better time to ask for the sale than when customers and potential customers are excited about the products. Perhaps you had your ASM or someone from BioZyme come in and speak at your meeting. Or, even better, maybe you had some local, loyal customers share about their results with the products you offer. That will get the other attendees excited, because if the products work for XYZ Customer who everyone in the tri-county area strives to be like, then it is likely to generate interest in those same products at your meeting.

At the conclusion of the meeting, offer pre-order discounts for products that were discussed at the meeting. Make sure these discounts are attractive enough to make them worthwhile to the customer, but still at a level where you will be profitable. If you are taking bulk orders, the sales should help you meet your sales goals.

  1. Clearly Outline Pre-order Terms: The night of the producer meeting announce the pre-order opportunity to your customers. Make it exciting and let them know they are the first customers to have this opportunity, which makes it even more exclusive. Let them know how much they owe up front, and that they can’t back out of the order once it has been placed.
  2. Offer a Discount: Who doesn’t like a good deal? Offer a discount for their pre- order business! Perhaps their discount is one or two percentages greater than the discount you will run in the store the next week since they took the time to attend your dealer meeting.
  3. Create a Deadline: All good things must come to and end, and so do these specials. Maybe you run the special for two weeks or through the end of the month. Whatever deadline you decide, stick to you, but make sure you announce it to everyone through your advertising and marketing efforts and stick to it. When the pre-order deadline closes, it is over.
  4. Follow up: If you have customers at the Producer Meeting who are on the fence about the products and are not sure about making a pre- order, follow up with them with a simple phone call or better yet, stop in and visit with them. See if they have any questions and if they are ready to try the product. Remind them there is no better time to try it than when it is on sale!

Yes, Producer Meetings might serve as a great source for education and fellowship, but they can also help you meet your goals.