Maternalizer Moneymakers: Maddux Cattle Company focuses on maximizing profit through mama cows
When the Maddux Cattle Company started their cowherd from scratch after a drought, they threw out a lot of things.
They threw out breed loyalty. They threw out trying to have the biggest steers in the sale ring. They threw out hide color. And they threw out a conventional approach to raising cattle.
When Madduxes dispersed their cowherd following a drought in western Nebraska in 2005, John Maddux, who earned his MBA from the University of Chicago, and worked for several years on Wall Street before coming home, spent a lot of time figuring out how to reimagine the ranch that had been in the family for more than 120 years.
When he threw out all the preconceived notions of how to make money in the cattle industry, he figured out how to be profitable.
“Our cowherd has a completely different focus than most commercial operations,” Maddux said.
While most commercial producers are trying to maximize pounds of beef produced by steers–the highest numbers in the sale ring–Maddux focuses on producing high-quality commercial dams, which he’s branded “Maternalizer.”
“That’s basically the way get the bulk of our revenue from our cowherd, not from the steer calves, but from our cow sales,” Maddux says.
The ranch, like most Nebraska Sandhills ranches, did their time raising Herefords, then Angus, Red Angus and Simmental-cross cattle. “We were feeding all our cattle out back then, so having a higher performance calf was more important,” Maddux says. Following the drought dispersal in 2005, and new environmental regulations in 2009 that shut down a big part of their family feedyard, Maddux opted for red hides. He chose a foundation of Red Angus, for carcass quality, maternal traits and calving ease. Maddux also added Tarentaise, South Devon, Red Poll and Devon.
“There’s no magic to our percentages, or composition,” Maddux said. “It just more or less reflects our faith in each breed.”
When they started building their Maternalizer herd, Maddux went looking for Red Angus heifers. He spent four years buying the lighter end of Red Angus heifers from 11 states. He was looking for heifers that weighed less than 500 pounds, and would mature at between 1,100 and 1,150 pounds.
“If we have moderate-size cows, we can run more of them and make them tough it through drought and blizzards better than if we had a bigger, 1,500 to 1,600-pound cow. We can run 20 percent more cows because we have these modest-size cows relative to some of the bigger cows in the commercial industry today,” Maddux said.
Rather than focus on growth, they emphasize udders, disposition, calving ease and fleshing ability–everything most commercial producers want in a mama cow, but that many trade for rapid gain and carcass merit.
Maddux calves in May, allowing the cows to graze the most nutritious forage when they need it most–calving through breeding season. All but the first-calf heifers carry their calves over the winter, and they wean at 11 months of age. The cows run on grass all summer, then on cornstalks all winter, supplementing with about three pounds of dry matter, and wet distillers’ grain. “It’s the cheapest way we know to winter a calf,” Maddux said.
They wean the calves off the heifers in the fall, to increase the odds of breeding back that challenging second year.
Which way at weaning
Maddux says anything that weighs more than 625 pounds at weaning time goes straight to grass. The lighter steers and heifers are backgrounded until they get to 625 pounds, then they go to grass. “We really try to minimize the amount of stored feed we put into them,” he says.
Since Madduxes hold off on breeding season until the middle of July, it gives the heifers a chance to get to their goal of 680 to 690 pounds, and reach the weight threshold for maturity and fertility.
The trade-off for smaller-framed cows is smaller-framed steers. “I think it’s important to point out that because we’re not focusing on high growth and high milk, we have just modest growth out of our steer calves,” Maddux says. They run the steers on grass in Wyoming from yearling age–around that 625 pound mark–until they’re about 16 or 17 months, weighing 900 pounds coming off grass.
Building a cow
While the steers are still profitable, with the business focused on producing ideal mama cows, Maddux decided to try to maximize the number of heifer calves that are born.
Maddux is a big believer in using data to make decisions, and recognizes that the U.S. Meat Animal Research Center (USMARC) in Clay Center, Nebraska, and University of Nebraska, Lincoln Extension are excellent sources of information and ideas. Maddux has adjusted his business based on the research on low-input heifer development and the benefits of heterosis, and which breeds would best help him achieve his goals.
“They’re doing the research that allows you to adapt to the changing economic world, and all this information is for free,” Maddux said.
Maddux called Dr. Rick Funston, beef cattle physiologist and beef cow-calf professor of animal science with UNL, when he wanted to increase the number of heifer calves born.
All the heifers Maddux breeds are AI’d with semen from bulls they’ve raised. The last two years they’ve used sexed semen to get more heifers, for calving ease and to meet their production goals. Maddux saw about a 10 percent decrease in conception rate using sexed semen–down to about 50 percent, 93 percent of which were heifers. In an attempt to maximize that conception rate, Funston suggested pooling semen, mixing semen from three different bulls.
In the process of sexing semen, some of the sperm are damaged, but it’s damage that can’t be seen under a microscope, Maddux said. Research has shown that different bulls’ semen responds differently to the sexing process, and they can’t tell which semen is damaged, or what makes some semen more susceptible to damage. “We hedge our bets by pooling the semen, putting three bulls in one straw,” Maddux said. “If one bull’s semen has been damaged, we might make up for it with another bull that wasn’t affected by the sexing process.” Funston estimates that pooling the semen may be responsible for about 10 percent more AI success with sexed semen, but he’s planning to continue studying and compiling data.
While Maddux focuses on producing heifers, the real profit center of their business–and the goal of every decision he makes–is farther down the road, in running-age bred cows. It’s a rigorous process to get a cow from a baby heifer calf to a 5-year-old cow in their herd, but the ones that make it are worth a premium, Madux has found.
For a heifer to make it as a Maddux replacement heifer, she has to breed within the first 30 days of the breeding season. That increases the future chance she’ll breed within the first 45 days, the window they allow for cows past the heifer stage.
Though they keep the calving period short, their breeding season runs from July to November. They preg-check during that time, and sort off the heifers that bred via AI or the first cycle afterwards. That usually adds up to retaining around 800 bred heifers a year. That high replacement rate allows them to sell their running-age cows to people looking for trusted, moderate-framed, hardy, fertile, fuss-free cows.
But even if they don’t make it through the gauntlet of a selection process, Maddux maximizes their value.
“One thing we try to make sure of around here is that if we have a cow leaving the ranch, we want to make sure she’s bred,” Maddux said. Out of more than 3,000 females that are exposed, Maddux estimates they have less than 100 opens that leave the ranch each year, a .3 percent open rate.
“Those heifers and cows that don’t conceive early have value to other people. If you have a cow that’s bred for the summer, she’s not going to have the value of a March-calving cow, but she has more value than an open cow.”
You won’t find many cows over 6 years old on the Maddux ranch. “We have a cow sale the second Wednesday in April, at Ogallala Livestock Auction Market, of good, solid, running-age cows. We’ve found a lot of demand for those kind of females,” Maddux said. “There’s just a big market for those no-problem, maternally-oriented cows. A lot of people don’t want to mess around with first-calf heifers. People don’t have the labor to deal with imperfect udders and high-headed cows and that sort of thing. Labor gets harder and harder to find, and more expensive.”
A lot of producers like Maddux’s cows because they’re low-input, and when crossed with a high-growth bull, like a Charolais, they can get big calves without big cows. Others buy Maddux’s cows because they run in tough country and are looking for cows that can calve without assistance, keep weight on and raise a moderate-sized calf without a lot of extra inputs. “We sell into parts of Wyoming, New Mexico, Arizona, Colorado and here in Nebraska, places where a high-performance cow isn’t likely to get bred back,” Maddux said.
Maddux raises most of the bulls he uses on his heifers and cows, whether breeding via AI or natural service. He uses yearling bulls on most of his cows and heifers, counting on the five-way cross, and sheer numbers to maintain genetic diversity and heterosis.
Once he’s done with his yearling bulls in November, he trich tests them, and markets them via private treaty.
“We sell them to bigger operations in tougher country, where these convenience traits are important, where their country wouldn’t support having a big cow,” Maddux said.
Maddux said he thinks one of the reasons there isn’t more emphasis on maternal traits among the purebred industry is that they’re hard to measure. “The one thing about a weaning or yearling weight is it’s a real objective measurement. Some of these other traits are far more subjective. People don’t focus on them as much, but they’re extremely important.”
The next generation on the Maddux ranch may feel differently. That’s one of the principles Maddux focuses on–being aware of the economic climate, and adjusting accordingly.
“The one thing about business is that each generation has different roles, what makes the most sense for the business, given the circumstances at the time. In my grandfather’s era, and my father’s era, it was adding value to our cowherd by feeding our calves to slaughter weights. As the economic and regulatory environment changes, the people who are able to survive are the ones who can recognize that and be hard-hearted about what the world is like around us, and how do we best fit our business model to the economic realities. Each generation has to ask the question, ‘Has the world changed around me? Is my business model appropriate for the economic environment I’m facing?'”
At this point, Maddux can answer, “yes.”