In the Driver’s Seat: Schiefelbein, Leachman on Data, Game Changers and Angus Momentum

If a breed association “takes its eye off the ball” of making commercial cattlemen more profitable, it’s set to fail, says Donnie Schiefelbein, Kimball, Minn., Angus breeder. He joined breeder Lee Leachman for this episode that covers the changes in the Angus business over the decades, the data that has made a difference, and ways that coordination can produce solutions. The pair talks about the shift to grid marketing, and how to prioritize your cow herd while aiming for carcass quality. 

HOSTS: Mark McCully and Miranda Reiman  

GUESTS: 

Don Schiefelbein, along with his seven brothers and three nephews, own and operate Schiefelbein Farms, Kimball, Minn., where the family manages more than 1,000 registered females, farms 4,600 acres and feeds out 7,500 head of cattle. 

The operation was started in 1955 by his father, Frank, and before Don returned to the family farm he served as executive director of the American Gelbvieh Association. He previously worked for the North American Limousin Association after graduating from Texas A&M University. 

Don has served the industry in numerous roles including American Angus Association president, National Cattlemen’s Beef Association (NCBA) president and Minnesota Cattlemen’s Association president.

Lee Leachman is the CEO of Leachman Cattle of Colorado. He graduated from Harvard University with a degree in economics in 1988 and completed graduate-level work in animal breeding at Colorado State University. 

Leachman Cattle markets more than 2,000 Angus, Red Angus, Stabilizer and Charolais bulls produced from a pool of 12,000 females in more than 45 cooperator herds. Selection objectives are largely based on the company’s proprietary indexes. The company’s flagship sale is hosted in March each year in Fort Collins, Colo. 

Lee has been active in the industry through groups including the NCBA, various breed associations, and the Beef Improvement Federation, where he is a past president. Lee frequently speaks to cattlemen both in the United States and internationally. 

Don't miss news in the Angus breed. Visit www.AngusJournal.net and subscribe to the AJ Daily e-newsletter and our monthly magazine, the Angus Journal.

Transcript

Miranda Reiman (00:00:02):
Welcome to the Angus Conversation. I'm your host Miranda Reiman with my co-host, Mark McCully, and we just recorded an episode live from the Cattle Industry Convention and trade show. Mark, as I think about when we talk about who we want to have on the Angus Conversation, what kind of conversations we want to have, I mean, our main goal is always to grab conversations that breeders are actually having out in real life and just put a microphone to 'em.

Mark McCully (00:00:27):
Absolutely. We talk so much. We want this to be kind of the hallway talk, right? We even say sometimes like a bar talk, like what would we be talking about? And sometimes that's philosophy, right? Sometimes that's about what people are thinking about. And in the genetic space there's a lot of changing and we had two guests, Don Schiefelbein, Schiefelbein Farms up in Kimball, Minnesota and Lee Leachman of Leachman Cattle of Colorado. Two guys that are thought leaders and fairly outspoken, so they're fun to bring in. We knew we'd have some fun and they wouldn't be shy about sharing some of their ideas and thoughts about where the genetic business is going.

Miranda Reiman (00:01:08):
Honestly, it was a natural pairing because we knew if we put Donnie with somebody who was a little bit quiet and shy, maybe they wouldn't get the mic. But I think it was pretty split between Lee and Donnie. Yeah,

Mark McCully (00:01:18):
We wanted them to banter and argue. I don't know if we got a whole lot of that, but no, it was a lot of fun. And one of those things, again, very much I would say it represents conversations that are happening here at the Cattle Industry Convention. It represents conversations that would happen at the Beef Improvement Federation or at the Angus Convention around where are we today in this genetic space and where do we think we're going to be five, 10 years down the road? And some real questions around what does the American Angus Association need to do and be to maintain relevance to our members and to the bigger beef industry as we go.

Miranda Reiman (00:01:54):
So we talked everything from vertical coordination and supply chains. We talked sustainability, we talked about tools all the way to what they're reading now and what kind of information they're getting.

Mark McCully (00:02:05):
Yeah, I think it is a conversation that I think our listeners are going to enjoy and maybe stimulate some discussions. We hope it stimulates some discussions or some questions. That's really what it's all about.

Miranda Reiman (00:02:22):
So today we've got a couple of guests with us that we are excited to have live and in-person here at the Cattle industry Convention and trade show.

Mark McCully (00:02:29):
Some conversations are easier when they're in person, aren't they?

Miranda Reiman (00:02:31):
Way more fun. And I know today's is going to be a lot of fun. In fact, we've got Megan Silveira over here producing it and I think her and Julie maybe had to arm wrestle over who got to be the producer for this one because they were so excited. So our guest today, we have Donnie Schiefelbein. He's past president of the American Angus Association

Mark McCully (00:02:49):
And National Cattleman's Beef Association

Miranda Reiman (00:02:51):
 and National Cattleman's Beef Association. Absolutely.

Mark McCully (00:02:53):
You're a glutton for punishment.

Don Schiefelbein (00:02:54):
Well, the key word there is past, right? Everybody's excited about the past. Mark,

Lee Leachman (00:02:58):
Your hair did turn a little bit gray, Don.

Don Schiefelbein (00:03:01):
Yes.

Miranda Reiman (00:03:02):
Excellent. And then on the voice you just heard, pop in there would be Lee Leachman, Lee's the past president of the Beef Improvement Federation. Long history

Mark McCully (00:03:12):
Was just recognized I see on Facebook just a week or so ago by Colorado State University, correct? Distinguished alumni.

Lee Leachman (00:03:20):
Very nice award.

Mark McCully (00:03:21):
Yeah, congratulations.

Lee Leachman (00:03:22):
Honor to win that. Yeah,

Mark McCully (00:03:24):
Thank you guys for both being here.

Miranda Reiman (00:03:26):
So we'll just jump right in and get to a little bit of your guys' story and maybe we'll start first with you, Donnie. Yes. So give us your elevator speech.

Don Schiefelbein (00:03:34):
Well, I'm from a family operation on steroids is the way I like to explain it. What that means is I just don't have one brother or two brothers or three brothers or four brothers or five brothers to deal with. I've got eight brothers, they have their eight wives. We have 32 grandchildren, collectively, they have their husbands and wives plus another 30 some more on the next generation. All told there's 80 of us, almost a hundred of us depending on if you use Catholic terms, getting this thing together and farming together. Seedstock operation, largely Angus. We're probably a little bit unique in that we also have a feeding enterprise and of course a crop enterprise as well

Miranda Reiman (00:04:15):
That helps support all of those families.

Don Schiefelbein (00:04:17):
Exactly, yes.

Mark McCully (00:04:18):
Very good. How's the winter in Kimball, Minnesota?

Don Schiefelbein (00:04:21):
Well, it's really lack of winter that we're talking about because it's really has not been other than one week, and one week was incredibly cold. It has been spring like for most of the winter. Very nice.

Miranda Reiman (00:04:33):
I was in Minnesota, that's of course where I'm from for Christmas and it was brown Christmas there while it was blizzarding back in Nebraska. So

Don Schiefelbein (00:04:40):
Yeah, we've been blessed.

Mark McCully (00:04:42):
And Lee Leachman Lee, I just saw an article or, it was a piece done by Dale Runnion back I think in 2002, and talked about depression era kids that went through Ohio State. And the names on it were these illustrious names, two Leachman names, Lee and Les Leachman that both came the Ohio State. So tell us about the Leachman. I think most everyone would be familiar with the Leachman name. Talk about that heritage and that tradition.

Lee Leachman (00:05:10):
You bet. Well, I was fortunate that as I was growing up, mark, I got to spend a lot of time with my grandfather Lee. And in fact there's some great pictures where we were assigned a set of cows on the home ranch and we had to AI 'em and we were riding and heat detected together and he and I made a trip to Argentina and revisited some of the fellas they sold bulls to in Argentina back in the 1950s. And then of course Les ... was in Bozeman when I was growing up in Billings. So got to spend a lot of time with Les and his sons Bill and Jay and similar to Donnie, although we never have accumulated quite that many on one operation, we tended to splinter up

Miranda Reiman (00:05:50):
It's the Catholic factor.

Lee Leachman (00:05:51):
Once it got to about three we splintered. But yeah, so I'm third generation obviously that first operation was Ankony in upstate New York and that's where I was born. But we moved to Montana in 1970 and so I grew up on that operation in Montana, which was Leachman cattle. And then more recently I've been in Colorado and now I am transitioned into Wyoming. Kind of moving a little further away from folks.

Miranda Reiman (00:06:19):
That sounds very intentional.

Lee Leachman (00:06:20):
Yes.

Miranda Reiman (00:06:23):
Well we've gathered you guys together today to kind of talk a state of the industry, I guess a breeder perspective. You guys have a lot of perspective and wisdom across a lot of different areas

Mark McCully (00:06:35):
And maybe as you guys look at your traditions and both of your operations, maybe speak to a little of the past. If you look back 5, 10, 15 years, what are some of the biggest changes you've seen? You can talk about the beef industry as a whole, but maybe specifically in the genetics business or the seedstock business. What are some of those big paramount monumental changes that you've witnessed and in both of your guys' cases led in many ways?

Don Schiefelbein (00:07:00):
Yeah, I would say I think Lee you would agree, is moving towards objective analysis of cattle has to be by far in a way the biggest change. The old days Lee and recall when we picked one because it was going to be the next great one based on visual. Boy that's sure been shaken up here a lot lately. And when you have genomics and the EPD predictions and the indices that we have available, to me it's just a whole different world. And if you're still living in that past where you think just taking a gander at one defines who that critter is, boy you've got a lot to catch up to I think.

Lee Leachman (00:07:37):
Absolutely. And there's obviously a lot of breeders breed for different things, but I think what's driven that objective use of data is that we're seeing such a large percentage of our commercial cattle end up on a grid system at the end of their life. And when Donnie and I got in the business, fed cattle brought a price

Miranda Reiman (00:07:58):
Period

Lee Leachman (00:07:58):
And that was it one price, they got the price, there was no grid. And we saw the battles over grid pricing that everybody said was going to destroy the industry and exactly the opposite, it has incentivized the rise in quality production of beef, which Angus has led. I mean, and I think it was really motivated by those premiums that would be able to pass down to producers and incentivized making the right choices on those objective measurements

Don Schiefelbein (00:08:27):
And the beef demand deal. I think because of that, anybody who saw the CattleFax discussion this morning understands producers have moved the needle for quality which moves the needle for demand, where the competing proteins aren't even in the same league with us as far as demand is concerned.

Mark McCully (00:08:46):
Yeah, we talk about this change to value-based marketing and I've always wondered and have I guess somewhat believed back in the day when everyone was receiving the same price, that balancing, there was not much of a balancing act. You took care of the cows because everybody's calves were basically worth the same. How do you guys think about that balance today? That's something I think we feel like we talk about a lot and try to put tools to how do you balance that maternal side and keeping that cow herd functional and profitable with these stronger and stronger economic signals. We just heard this morning, as you mentioned Randy Blach, talk about the Choice-Select spread being record large and getting larger, the CAB to Choice or CAB to Choice and CAB to Prime spreads. Is that, how do we balance that as we look at profitable beef production moving forward?

Lee Leachman (00:09:34):
I think for starters, it's hard. It's hard for people to balance because we maybe don't really understand the trade-offs, but they're there. I think all ranchers know they're there. I think there's this ideal cow, we could all debate what she's like, but she's probably a little different than the ideal feeder steer and genetically. And I think that then the challenge is, do we have the right tools to help us discern what is maternal and what is terminal and what are the trade-offs, and then we can make those proper decisions.

Don Schiefelbein (00:10:08):
And I believe it's the transparency is missing on maternal. That's the big key that nobody gets is you get a check written for your calves, right? So the clarity of what's got value is absolutely black and white dollars and cents. You go to the maternal factor and there's some numbers that guys like you help print that says supposedly what it ought to be worth. But as far as the tangible check being written that says, because I have a maternal influence cow herd, here's your reward. To me, we have to get better at realizing even though that transparency isn't there, the value's real. And to me that probably needs to come into focus a little more as we go forward.

Lee Leachman (00:10:54):
And if we look at what happened to the dairy industry, they made the same kind of a mistake. They pursued the production of milk at the expense of fertility and really kind of got into a pickle and we had to make sure we don't do the same thing in cattle. And so you almost see a dichotomy today. You see producers who are going after that end product merit. You see other producers that say, look, it's all about the cow. I don't even care about those EPDs and that end product. And the reality is that neither of those are right. You have to worry about the cow and the end product and you have to balance that.

Miranda Reiman (00:11:34):
And isn't it easier to be objective on an end product measure? I mean, what people determine is a good cow is kind of in the eye of the beholder. So to put a tool out there that

Mark McCully (00:11:44):
Maybe shouldn't be, I always contrast our, if you look across other proteins, I would say most hog producers know their cost of unit production. Most chicken producers would know their to the tenths of penny, dairy producers. If you ask a cow calf, the average cow calf guy, what his unit cost of production is. Back to your transparency, we probably haven't. And maybe those are tools in the toolbox we need to be helping our producers with to look at what is truly profitable.

Don Schiefelbein (00:12:14):
And I would even push back even a little harder than you did there, Mark. I would say this idea, the eye of the beholder sounds a lot to me like making excuses so you can continue to raise the cows you want to raise, not the cows that return the best bottom line. And I think you got to be clear on that. And I think that's why when you go into, Lee, you're an expert at this, these indices, you better pay attention to 'em. We had a dollar beef indices that was largely terminal,

Mark McCully (00:12:44):
A hundred percent terminal.

Don Schiefelbein (00:12:44):
That led us probably in a direction that we probably had to retreat from as an Angus breed significantly. So I am applaud, applaud, applaud for the movement towards dollar C.

Miranda Reiman (00:12:55):
The first time I interviewed you, Lee was for a article, gosh, I think it was like '08 or something like that. And it was something like the cow in the carcass was the main line for it. And I think the opening line in that article was, it's easier to explain away why you don't have it by saying like, oh, tools don't work. I don't have it, than it is to make change and get it. And I think that was probably wisdom I got from you.

Lee Leachman (00:13:18):
Well absolutely. But I do think that while it's less transparent on the maternal side, I think there's more noise today in the industry than ever that we have to pay attention to the cow. I think that's why $C was so well received as a modification to put influence back on the maternal side of the equation. And you see these large commercial operations and what are they talking about? They're not talking about their end product merit. They're talking about how long does a cow stay in the herd? What's their calf crop percentage weaned? They're looking at that. They're looking at how much it costs to put a replacement heifer in the herd and then are they going to get two calves or six calves or nine calves, a nd it makes a big difference

Don Schiefelbein (00:14:07):
And it's because it's the largest economic driver. I mean they're just weighting things businesslike, which says, boy, you better pay attention to the thing that affects your bottom line the most.

Lee Leachman (00:14:19):
And it's hard for us in the seedstock business because we're trying to make genetic change in our herds. And so we're turning over cows quickly. I would say in our herd, and I'm assuming your herd, Don, there aren't a lot of cows around that are over eight years old because we're just trying to make genetic change so quickly that we're not measuring that critical metric as well as we need to. And I think that's a big challenge to all of us today. How do we find that information? How do we do a good job characterizing them and part of that, are we running our seedstock herds like they're running their commercial herds? Probably not. Just to be frank, none of us are. And so then are we getting good indicators of what that lifetime fertility's like and how do we select for that? That's a challenge

Mark McCully (00:15:06):
And that's a discussion we've had around board tables for a while and I think there's a common agreement there that data at the commercial level is probably to your point around females, man, we got to try to get at that data, but boy, that is hard data. That is hard data to get to. But I don't know how you guys, if either of you guys were able to be in the general session yesterday, they had I think a futurist was the title, I want to be a futurist someday. It's kind of like a weatherman. You can just say, Hey, this is going to happen 20 years from now. And then nobody ever, but no, he was great. He was fantastic and I always kind of nerd out on some of that stuff, but talking about some new technologies, maybe getting at some of this data at a commercial level is going to be more possible down the road.

Don Schiefelbein (00:15:56):
And that's one of the things we strive at our operation. I would say Lee would be more cutting edge than us, but we like to see a technology proven and once we know it really is going to be impactful, we put all chips in and I am still waiting for the technology and the information feedback that gives us a better tool, a better way of gathering that information to move us in that direction really fast. And I think we're going to get there, but I'm not sure we quite have those abilities to grab that data easily.

Miranda Reiman (00:16:26):
Is that your way of saying you let him make a wrong decision that you can just follow up on?

Lee Leachman (00:16:31):
I do find myself occasionally on the bleeding edge, which is just a little bit ahead of the leading edge.

Don Schiefelbein (00:16:38):
Yeah,

Mark McCully (00:16:39):
That's the early adopters. We need those. We need

Lee Leachman (00:16:42):
Those. Somebody's got to stick their toe out even if you lose it.

Don Schiefelbein (00:16:44):
One thing I'd add though, Mark on this discussion is a lot of people as they hear these podcasts, they tend to want to hear what they want to hear. And so when we said maternal and Lee emphasized maternal to a lot of maternal thinking breeders, they just turned off end product. Don't do that, don't do that. And the same thing goes the other way. The reality is if you're in this beef business, you're in it from conception to consumption. Don't pretend that if you sell 'em at weaning, carcass doesn't matter because guess what? Those that buy your calves, that does matter to and if it matters to your customer, it better matter to you.

Lee Leachman (00:17:30):
You said it earlier, Donnie, but for sure this whole quality trend, the increase in the marbling in the cattle is floating all boats right now. We would not have the demand for our product that we have today if we hadn't achieved those quality levels. And I would just, when I give my talks to producers, I tell 'em, there's a red circle that you need to aim for and it's CAB and Prime. If you're not producing for CAB and Prime and you're in North America, the odds that you really are making money is going to be tough because there's just not enough demand for that lower quality product and it hurts the industry.

Don Schiefelbein (00:18:08):
Agreed. The only thing I would add is you target CAB and then you also target CAB Prime.

Mark McCully (00:18:15):
I once had a guy and Robbi Pritchard from South Dakota, I always remember he said, we were talking about the target being Certified Angus Beef, and he said that's not the target. The target should always be Prime and only in Robbi fashion. He said, if you're going to get in a fight, you're not going to aim for a guy tip of a guy's nose. You're going to aim for the back of his head. And I'm like, wow, that's really

Lee Leachman (00:18:35):
Don't get in a fight with him.

Mark McCully (00:18:36):
That's really graphic Robbi, but I get what you're saying.

Miranda Reiman (00:18:41):
Mark never went back to South Dakota to speak again.

Mark McCully (00:18:43):
No, I love Robbie. He's always full of wisdom and good soundbites.

(00:18:46):
Can I back us up a little on indexes? I don't want to lose an opportunity here. You guys have thought about indexes, Lee. You've thought about this as much as anybody. Maybe speak to one of the, today obviously from the Association standpoint, we present an index based on, I'll call it a national index, national averages. How do you guys think about indexes? And I'll go specifically down this idea of customizable indexes, regional indexes. How do you guys think about those? How should we be thinking about those?

Lee Leachman (00:19:23):
Yeah, a great question. We've provided customers with the ability to customize their indexes since about 2006. And I've not had one single producer do it. And I think, look, these indexes are hard. They're complicated, they're hard to understand. They're hard to move on. When a whole breed has one index they pursue, you make progress. If you split that up into five indexes, you're not going to make near the progress on the five as you do on the one. That doesn't mean that the concept's wrong, Mark. I think the concept is right. I mean if I'm in Florida, I need a little different selection criteria than if I'm in Nebraska. That's a given, but I'm not sure I need a different index. I end up subselecting within a population. We do this in real time. Our Angus cattle are targeted to high altitude. That's our niche with our Angus.

(00:20:21):
So we're selecting everything to be really low on the Pap EPD. That doesn't mean I can't use $C, it just means that I'm going to use $C after I apply a culling criteria on PAP. And I think that that can solve a lot of those regional questions without muddying the waters. I'm a guy that thinks in simplicity. We put stars in our catalog in addition to indexes. We did a survey. Everybody uses the stars. They don't even look at the numbers. So what that tells us is our clientele want to keep it simple. They want to keep it simple. And I think a lot of breeders are the same.

Mark McCully (00:20:59):
They're looking to you as the seedstock provider. You're going to sort that out for 'em. Is that,

Lee Leachman (00:21:04):
And I think your job as a breed association is to help give people tools that are sophisticated as they want them, but can be as easily understood as they need to be so they get used.

Don Schiefelbein (00:21:17):
Yeah, that's what I believe. Exactly. In fact, exactly. I believe there's this quest for perfection that can lead you down the wrong road when you try to be too smart for your own good. And there's a lot of professors who lead you down this road that says, but we know it would be better if we could customize it. You can be too smart for your own good.

Mark McCully (00:21:41):
It's always been my problem, Don.

Lee Leachman (00:21:42):
Yeah,

Don Schiefelbein (00:21:43):
I've heard that.

Miranda Reiman (00:21:44):
I feel like Donnie's had experience with that, right?

Don Schiefelbein (00:21:47):
It's been my consolation in life as well. At least I'm not too smart,

Mark McCully (00:21:53):
Whatever. Yeah. Lee, you mentioned you've offered those and no one's used them. The Association had a tool out there for a long time that you could go in that was before $M and $C, but back when $F, $W, $B all first came out, there was a function on the website, you could go out and we finally took it down because no one was using it.

Lee Leachman (00:22:17):
I was one of three that used it, I think.

Mark McCully (00:22:19):
I'm sorry for taking it down then.

Miranda Reiman (00:22:22):
Did you call and complain to Mark?

Lee Leachman (00:22:23):
But this is an interesting thing. Okay, if you put seven traits in an index and change the weightings, it doesn't move the index very much. The way you move an index is take a trait out or put it in. And that's what you did with $C is you put in some really important traits that weren't in $B, right? Yeah. So it really kind of comes down to what's in the index, what am I watching? And even a better question is what am I not watching? If you're using an index and a trait that matters to you not in there, the likelihood it goes the wrong way is pretty high. It's what we call it sort of unintended consequences of selection. And we can just look to pigs and chickens and know that they can be severe. So let's pay attention to everything. What's great about the EPD suite that you guys offer?

(00:23:14):
I mean we have claw and angle and people are like, well, I don't know if I need that. Look, I think we all know at this point that those traits went the wrong way because of something we were selecting for. So they were excluded, they were not around, we weren't looking at 'em. It got worse. So this is the big argument for expanding the traits we cover. If there's something that's important, if it's heritable, we need to have an EPD for it. I know people hate that. They hate more numbers, and you heard me say simple is good, but as a breeder we have to make sure we're not creating unintended consequences. PAP EPD is another great example of that. If we don't measure that trait, maybe we're going the wrong way and

Miranda Reiman (00:24:02):
You wouldn't even know.

Lee Leachman (00:24:03):
We wouldn't even know. And so this is, I think as you look at the database that you provide the members of the Association, you're giving them the broadest suite of EPDs possible. It's a great thing.

Mark McCully (00:24:18):
Philosophically, as you guys think about indexes, are they a breeder tool or are they a commercial producer tool?

Don Schiefelbein (00:24:24):
Well, from our perspective, I know what our commercial producers demand of us, they put the heavy lifting on us. They want us to produce the right animals for them. And I have a strong belief, and I don't know what your thoughts are, I really believe a seedstock guy's job is to produce stuff for commercial guys that they don't have to re-sort. Your job is to create this stuff at the beginning point, not create a bunch of stuff and say, well, this will work for Bill and this will work for Bob. Create the stuff with an end product in mind to produce a product that they need. So I think really the pressure's on us and I think when you work into so many end product buyback programs that are occurring, a lot of times it's coming right back at you anyway, so you better put those inputs going the right way correctly.

Miranda Reiman (00:25:14):
You didn't answer the question though.

Don Schiefelbein (00:25:16):
What's that?

Miranda Reiman (00:25:16):
Is the index a commercial producer's tool or your tool?

Don Schiefelbein (00:25:21):
I believe it's upon us. I think we create the stuff and we use those indexes to create the stuff that they can use appropriately. So onus is on us, so we pretend to these commercial guys that they need to be geniuses and all that stuff, but really I think as the world gets more complicatedly, I think it's going to get more simple and where it's going is they're going to start sorting seedstock guys based on their ability to sort the information they know matters to their operation and align themselves with seedstock producers that push information the right way to them.

Lee Leachman (00:26:00):
Say it a different way, if a commercial guy can come into our bullpen or Donny's bullpen and throw a rock and take home any bull that hits and be OK, we're providing a better product, we're providing a better product. And so it's our job to make sure that we're in conformity to what our region requires to what our customers' marketplace is and what they need. They're not going to understand the intricacies of these indexes. They're not. We're going to struggle as breeders to understand that. And so I see the job of the association is to teach the breeders, then the breeders make a choice on what to breed and then their customers trust in them and trust that that was a good choice.

Don Schiefelbein (00:26:46):
And they sort seedstock guys based on it, right?

Lee Leachman (00:26:48):
They do. If you take 'em down the wrong path, you're going to lose a customer.

Don Schiefelbein (00:26:52):
Exactly.

Mark McCully (00:26:53):
I think trust and confidence. I look at my iPhone here, I have no clue how this thing works, but I trust that it will. I have no clue how GPS works, but I trust it's going to get me where I need. And I think as we think about it with our commercial producers, we want that confidence, right? Confidence and trust that the tools that you as breeders are using that ultimately they have are they don't need to know the intricacies of it. They don't care if they did, they'd probably be in the seedstock business.

Don Schiefelbein (00:27:18):
And they got too much on their plate too. They just have too much on your plate. You're asking too much of a commercial person to say, now you have to take a complicated understanding of indices theory, right?

Lee Leachman (00:27:29):
Yeah. It's not practical. I say you really got into ranching because you wanted to understand these numbers. No, no, no one did that. Okay. None of our customers did that. Right?

Mark McCully (00:27:40):
Yeah.

Miranda Reiman (00:27:41):
So you brought up the breed association should be kind of in the education role in that. How have you guys seen breed association work maybe change over your time in the business and what do you think our role is in the future?

Lee Leachman (00:27:56):
It's a great question.

Mark McCully (00:27:59):
How do we stay relevant?

Lee Leachman (00:28:00):
Yeah. Well, we didn't mention the molecular piece, which is another of the big changes we've seen in our lifetime. I mean, we used to measure these cattle and measure 'em and measure 'em so we'd figure out what they were, and now we can take a DNA sample and learn more about 'em within 30 days of birth than we ever knew. And I think that the value of that database is critical and I know probably within the membership there are people that value it more and people that value it less. But I would tell you that that is the biggest value that the association is providing outside of perhaps the whole CAB marketing channel. But those two channels are super valuable, association's providing realtime demand for the product and a realtime tool to help people breed whatever they want. That's pretty valuable.

Don Schiefelbein (00:28:50):
And I guess maybe I'd take it a little different, maybe I sat in that chair at one time, but relevancy is going to be dependent on accommodating lots of different members. When you look at a membership, there are some that may not have the same desires and needs as Lee and I, but what I have always believed as a breed association, you better keep those that keep commercial guys in business at the top of the list of providing service for Don't keep, take your eye off the ball when it comes to making sure you're serving those needs. But it doesn't mean that those that want to have a sandbox that involves junior activities that you can't do things like that. And there may be a sandbox, believe it or not, about shows and handing out ribbons that some people are really, really excited about. But the bottom line, the second a breed association gets its eye off its ball on making sure commercial cattlemen are being assisted in making the most money, they become irrelevant and they will again, exit the business I believe.

Lee Leachman (00:29:56):
It just comes back to that idea that a high tide floats all boats. I mean undoubtedly what makes those niche or various ideas of what you want to do with your Angus viable, is that the whole boat is floating on a high tide, and so you can't lose sight of that. Can you, Donnie? I mean if you lose that core demand, there are breeds that have very little core demand for their commercial bulls. Agreed. Those breeds are not in very good shape. You just have to look around. I mean, there's more of them that have a trouble with that than then have an advantage, and so they need to be thankful for where the breed is and they need to recognize what brought it there, and it is that commercial demand that creates that opportunity in the breed. It's why people want to show Angus instead of some other breed. It's why you want to be a junior Angus member instead of a junior member in some other breed. It's that core penetration of the bull market for commercial ranchers. It's driving that

Don Schiefelbein (00:30:59):
And what becomes incredibly difficult, Mark, you know this, is you've got to compete in the real world too. So when these private companies are out there doing things, people like Lee and I are deciding, do we play in their sandbox? So as soon as you begin to lose that progressive edge and get too conservative, all of a sudden that breed association becomes at risk of survival because as soon as you start pairing off that top end industry cutting edge type people, all of a sudden the utility of that breed is in jeopardy

Mark McCully (00:31:40):
And commercial relevance starts to slip, right?

Lee Leachman (00:31:42):
Well, and we look at all the food livestock industry and say, where are breed association still relevant cattle? I mean the Holstein association's still relevant and the breed associations in beef are still relevant and they're relevant because producers are small. We don't have a 30% market share leader in genetics. If we go to swine and poultry, that's happened. If you have 30% market share, you can do your own R&D. If you sell a hundred bulls, you can't. OK, so where are we going to get that R&D, from the association. The association is necessarily our R&D component, and if the association doesn't do that and private entities do, then we as breeders lose out. We want to be privy to that. And most of that's in the realm of product development and characterization of the genetics, and you're doing a lot of that, which is fantastic.

Miranda Reiman (00:32:43):
It's the thing that puts us on a level playing field. No matter if you're a hundred head, 500 head, 2000 head.

Lee Leachman (00:32:48):
Everybody's got access to those tools.

Mark McCully (00:32:52):
So we've started down this. The past is not, there's nothing controversial or debatable about the past, it's history. The future, however, is obviously yet to be determined. As you guys think about, and we've kind of headed down this direction, I guess very specifically as you guys think about genetic evaluation, there was a day and time where the breed associations were basically the only folks doing genetic evaluation for beef cattle, not the case today. What's the genetic space and the seedstock space look like? What are going to be maybe the biggest changes as you see it five, 10 years down the road?

Lee Leachman (00:33:29):
Well, I think that as much as people hate to hear it, we are going to have more traits. I think the number is in chickens, they got about 1700 traits they measure, help us. We're not going to go there, but

Mark McCully (00:33:42):
We're going to have to get that paper bigger that we print all of those out.

Lee Leachman (00:33:44):
But we're going to find stuff that's a problem, right? I mean if tomorrow there's a respiratory disease selection as a breeder, don'tyou want that? Yeah, yeah, you do. If tomorrow there's more emphasis on a carcass trait that we're not measuring right now, you want that. So how do I as a breeder get access to that? I can't do it. I have to rely on this association to help me. Now we're in a little different position at Leachman because we've got some scale, so we're able to do some things, but we still rely heavily on the associations within the purebreds. We select to provide us accurate and thorough across a host of traits. We want those EPDs and we use them. And if the association can't provide that to us, we're going to leave a breed. We are kind of multi breed. We can pick what breeds we play with and

Don Schiefelbein (00:34:44):
Or whether we go to a private entity that provides that same service. That's where I think it really comes into shine, and I think that's what, and from Mark's perspective, I get a little nervous for him because to keep a board of directors progressive enough to compete with the private industry, that is a feat because you have a collective group of 15, 16 people, you have to get moving in the same direction where a private person can just be one or two people who think the same. To me, that's a huge, huge change. The other thing I would add, Lee, is I think supply chain coordination is going to be a game changer. I already feel it happening as we speak, and I'm not sure where an association fits in supply chain coordination. We know CAB contributes positively in a component of it, but where do they fit actually in supply chain coordination?

Lee Leachman (00:35:42):
I think that supply chains are a great thing. People are scared of supply chains. People are like, it's going to be like pigs and chickens. No, it's not going to be like pigs and chickens because at least 50% of the industry's never going to do that. OK, so if you and a 50% that don't think that's a good idea or you don't want to do that, have fun, OK, because we're not going to push you out of business. That's not going to happen. But the supply chains are going to offer an opportunity to breeders who want to tie into a known marketing channel to produce a very specific product that hits that target. Now, what's a good thing that comes out of that? There are going to be opportunities for private entities and breed associations to collect more data they couldn't get otherwise. Okay? So I think that's a great thing.

(00:36:31):
Then those tools are going to spill back into the rest of the industry. It's going to allow us to understand what could be in a way that we haven't without the coordinated supply chain. We're going to discover how much value could be there. That always helps us. It's like we get a lot of, we're part of Urus group now. We sell a lot of semen to dairies. People say, well, that dairy beef's going to change the beef industry. Well, first of all, the number of calves that come out of dairy cows has really not changed. They were mostly black and white before

Mark McCully (00:37:02):
They changed the composition.

Lee Leachman (00:37:03):
They were mostly black and white and horned. Now they're mostly polled and black, but they're the same animals. They may have a little bigger carcass, they may have a little more beefy carcass, but the same number of animals.

(00:37:14):
That's not going to change. We're not going to have more dairy cows, if anything, 10 years from now we'll have less because those cows get more milky every year. And so that's the way it is. But what happens on a supply chain basis on the beef on dairy is going to teach us what could be say, Hey, what if we coordinated supply chains on the beef side when we're sitting here really close to the biggest supply chain? I think in the beef side of the industry, what Walmart and 44 Farms are doing, it's teaching the rest of us what could be. I think that's a great thing. I don't see it as a negative at all.

Don Schiefelbein (00:37:53):
The one thing I would do, and maybe I'd put an asterisk on what you said, and you can disagree with me if you want you, right?

Mark McCully (00:37:58):
I hope you do. We want you guys to disagree on something.

Don Schiefelbein (00:38:01):
Well, and it might be right here, is I believe you're right, there's room for all sizes and the 50% are going to be around. But I would asterisk that 50% and say you will see a movement, what I call the haves and the have nots, and that's a pricing issue. There's going to be more value in certain kinds of cattle in a coordinated system and others can still play, but it may be at a different price level than those that have the halves or in the coordinated system. And to me, Lee, that's where the rub may start to take place. And we're seeing maybe just a little bit of that Mark in some seedstock sales. You'll see some seedstock producers who maybe have relationships and coordinated systems whose bulls prices are maybe higher than a 50%. Maybe that don't. And to me it's where their industry can accept that little asterisk that says, yes, you get to exist, but not at the same playing level.

Lee Leachman (00:39:02):
I tell people they get a choice. They can breed their cattle and hope someone has a desire to show up and buy the calves, or they can be in a coordinated supply chain or the supply chain says, produce X, Y, Z and we'll pay you A, B, C. You just got to pick which system you like. I think at the end of the day, both markets are going to be viable. I personally believe that the supply chains offer more premium opportunities if you can thread the needle and hit the bullseye. And I kind of like trying to do that. And so I think that's more fun. I think that's going to be more profitable, but you'll get the choice. You're not going to be forced into one or the other.

Miranda Reiman (00:39:43):
Do you think it's been happening at a slower pace than you would've predicted, the coordination?

Lee Leachman (00:39:49):
Well, the industry is incredibly fragmented and land ownership is going to make that unchangeable. And so you really have a challenge. How can you aggregate a significant supply? I mean, any of us can put together a supply to supply one small butcher shop, but how do you supply Walmart? How do you supply any of these big retail outlets? It's hard. And I think that's been a limitation for us. Yeah, when I got out of college in the eighties, I thought this was going to happen imminently. And so then when it didn't, then I said, I'm going to make it happen. Then it went broke. Then that dream died literally in my lifetime, that dream that that was going to happen died. Now it is resuscitated because of technology as much as anything. And because the genetic tools that we have allow us to create cattle that are way better than average. Anybody out there listening to this, you got to go away understanding that the difference between the very best ones and the average ones is hundreds of dollars per head of profit. It's not tens, it's not fifties, it's hundreds. And that's why these value chains are forming. They want to produce that better. They want to produce it more consistently. They want to know that supply is available there.

Don Schiefelbein (00:41:22):
And I would also add, and this is what COVID taught our family, is that if you produce a product that most people want, people will buy the product. So even during the harshest times of COVID when nobody could find a spot to get their cattle harvested, we had five different processors wanting to buy our cattle. And so for those of you who may say, well, I may not have the relationships to get into a supply chain arrangement, rest assured you produce the right kind of cattle. The great thing about America, if there's profit opportunity, your cattle will be found. You'll get paid for 'em and life will be good.

Miranda Reiman (00:42:05):
I kind of feel like we need to play the Star Spangled Banner in the background after that.

Mark McCully (00:42:10):
When you guys think about supply chain, we've talked about carcass merit. We think about the profit drivers as we understand them today. Let's throw in the environmental sustainability discussions. Talk about how you think that potentially plays out in the genetic space as we start thinking about accounting for carbon or promises that our end users are making on their carbon reduction emission reductions. But what's the role in the genetics? How does that play out in these supply chains, do you think?

Lee Leachman (00:42:42):
I think that we have to look at the whole cycle. I mean, that's the sustainability deal now is looking at the whole system and necessarily it's going to look at that cow calf unit and we're going to become accountable for how many calves we get out of a set of cows. And we go back to the transparency and the maternal function, the people that participate in these supply chains that are targeting sustainability, and they're going to happen. They're coming. They're going to have to prove that they're efficient at the cow calf level, and that means that they're weaning a high calf crop percentage. And those cows are lasting a long time. And we think that we need genetic tools to help us find those cows. The only non-genetic tool we have is to cross breed. And so I think we are going to see some pressure on that function, that percent calf crop wean function. And I think the other thing that if we look down the road, and we talked about futurists earlier. I didn't go to the talk, so I don't know what he said, but

Miranda Reiman (00:43:50):
You're kind of a futurist in your own right, I think

Don Schiefelbein (00:43:53):
I think so.

Lee Leachman (00:43:53):
But if there's a trait that I think is coming when we look at all the other beef markets in the world and we look at all the other species, they all are selecting for increased muscularity. Good thing we didn't do that in the US, because if we go to Europe and eat the beef, it's terrible and demand has dropped precipitously and it should because terrible. And we got a great product, had a great, this is a side note, I was with some Canadians yesterday. They went to one of these high-end steakhouse here in Orlando, and they were like, that beef was unbelievable. OK, well, we know we have the best beef in the world.

(00:44:35):
We do.

(00:44:37):
And even Canadians like it better than what they got at home. But I think at the end of the day, now that we've got that product quality thing so focused in on, I think now we're going to start to ask the question, what about yield? What about yield? And I think that's going to become an emerging issue because when you do the sustainability, the way that's going to be measured is impact per pound of edible product. That's why the cow matters. The efficiency in the feedlot matters. We knew that, right? We'd all land, oh yeah, that matters. But then what happens in the packing plant? How much of that's low value or non-edible? I think we're going to see pressure on those ends of the spectrum where it hasn't been. And we think feed efficiency is obviously something we've measured a lot. We turn a lot of records into Angus. At the end of the day, there are big differences on feed efficiency and that's important.

Don Schiefelbein (00:45:36):
And I think you have to start maybe on a basic level for the audience listening here who when you say sustainability, it might be a four letter word for a lot of folks, right? Absolutely. So the one thing message I would like to get across to 'em is this idea, and this is what we struggle as a NCBA guy. This idea that 2% of the population gets to write the rules for the 98% is flawed. The consumer wins at the end of the day. So whether we believe sustainability ought to be talked about, ought to be discussed, or ought to be included in our production systems, really the 98% who vote with their dollars get to decide that and they care. The good news about sustainability is we are in the driver's seat as a beef production because nobody in the world raises beef as efficient as the United States. And guess what? At the end of the day, Lee, efficiency wins. That's what gets you the highest score. We are absolutely in the driver's seat.

Mark McCully (00:46:43):
You mentioned a percent calf crop and we had a market insight survey and it just prompted me to think about it in that data we asked cow-calf producers, what's their percent calf crop weaned? We had 10% that said they were under 80%. This was an industry and we had 10% that said they were over 95%. Now I'm not sure. One, it's a survey. So they didn't go maybe necessarily back in their books and actually measure it, or if that was just their gut feel.

Miranda Reiman (00:47:15):
But the fact that 10% admitted they were below 80 or thought they were,

Mark McCully (00:47:18):
... an opportunity for improvement, for one. And again, you start thinking, you start talking about sustainability metrics and what I call carbon accounting that I think we're going to have to do. Man, there's a spot right there where we got to make some improvements. Most definitely.

Lee Leachman (00:47:35):
It's like anything. Donnie and I are in the bull business and we sell our bulls. They have our brand on them and we're accountable for that brand. People expect us to do the right thing. And it's no different with commercial beef production, what those consumers think is the right thing we're going to have to do. And we've done that. I mean if you go back into beef quality audit that identified that eating quality was a huge problem, we're addressing that and that's good for us. And so we should learn from that. When we meet a consumer demand, we get paid more. If we want the industry to expand or continue at its current level, we need to meet consumer demands. And I think we have the tools to do so. And I think that any thought that sustainability is going to eliminate cows, that's not going to happen any more than it's going to eliminate airplanes or cars. OK, I'm a futurist, so I predict 20 years from now we still have airplanes, cars, and beef cows.

Miranda Reiman (00:48:42):
We'll check back in.

Mark McCully (00:48:44):
That's a quote.

Lee Leachman (00:48:45):
A pretty safe bet, folks

Mark McCully (00:48:47):
Take it to the bank.

Don Schiefelbein (00:48:49):
But the one thing I would add on that, and you mentioned it, and I think you have to be careful. You make progress by things you measure, not things that you survey where they guess. OK. And I would venture to guess on that survey on that particular question, the ones that actually measured and came up with a true answer would be fairly minimal. I agree. So we have to take that next step and start getting 'em focused on measuring.

Mark McCully (00:49:14):
And you guys think about, you guys are both incredibly data driven. I guess as you guys think about the data that we can collect, and maybe this ties back to the futurist discussion the other day where he was talking about machine learning and AI and camera technology and drone technology. Is there any one of those that you're especially excited about or as you think about that you think is a little bit game changer, disease diagnosis, any of these things that you're looking at or excited about from a future data that we're going to be able to collect and make improvement on?

Don Schiefelbein (00:49:48):
I think anything that you can do around the health situation, we'll move paramount. And I don't know if that's weighing them every time they drink, we're doing some of those things. But by gosh, this health thing, if I were to grade our industry on all the things we do have done really well over the 20 years, it would be improved growth, improved grade. If I were to give us a black mark, a negative mark, it would be health. I think if you survey and you actually went into feedyards and said, what is your death loss? What is your morbidity today versus what it was 10 years, 15, I think it might be going the wrong way. That be what our operation would

Mark McCully (00:50:29):
That same survey, we also surveyed feedlots and they said we're increasing on bovine respiratory disease, congestive heart failure, and AIPs.

Miranda Reiman (00:50:38):
And the episode that we recorded just ahead of this yesterday, I mean we would've had Kee Jim and Mike Thoren say the same thing.

Don Schiefelbein (00:50:46):
And this flip phone or this smartphone that we have, and Lee, I'm sure you're exactly the same

Mark McCully (00:50:52):
For our young listeners. A flip phone was the predecessor. Go ahead.

Don Schiefelbein (00:50:56):
But what we're doing in our operation is every animal that gets a treatment, if somebody figures out how to harvest and maybe it's Angus, how to harvest all this information out. Everyone that we do because of withdrawal, we're documenting when they get a shot, why they get a shot, and if the consequences was life or death in the end. But really it's just kind of sitting out there as, in space, if you will, with nobody really refining it.

Lee Leachman (00:51:24):
I'm going to go a different way on you. I think that the industry is going to go to commercially DNA testing heifers, and I think that's an opportunity for the industry to collect real reproductive data on those commercial herds and feed it back through that genetic loop. And I think that's what we lack. I mean the dairy industry's got, it's such an advantage. Those cows are in confinement and they can measure all that stuff and they put it in their software system and all those cows are eID'd, and they know what happens to 'em. They know how much milk they produce every day. They know whether they were in the sick pen. They know when they were there. They know when they leave the herd. And so when the low heritability trait fertility came time to be in the indexes and move, guess what?

(00:52:09):
They moved it moved it fast. Hard for us to do in beef, because a low heritability trait takes tons of data and lots of time. Yeah, your example of health is one of those low heritability traits. We need more data. Same thing on fertility. So I think those two areas are where we can exert pressure because we can handle the data now, but as we know, it's got to be tied to the genomics, that health record. If we don't have genomics on that animal, I don't know it's going to help us If that fertility record without genomics on a commercial female, probably not going to help us. But when we combine the genomics with that data at scale, boy, now we're kind of cooking with gas. And I think we're going to see that as a change going forward, Mark

Mark McCully (00:52:51):
And we've had this discussion, will this rethink, and I'm not a geneticist, but rethink genetic evaluation, big data if you will, tied to genomics as opposed to what I'd say, what we normally think of as our good pure data contemporary grouped up, will there be a day that the big data trumps or will it be in concert with the two different approaches to genetic evaluation and data?

Don Schiefelbein (00:53:16):
And I think it depends which data you're after. If you're looking low heritability traits, birth weight, it better be big data, right? You got to have big, big, big data.

Lee Leachman (00:53:23):
Big data or no data.

Don Schiefelbein (00:53:25):
Yeah. I think for traits that are highly heritable, you don't need big data. Refined data is just as valuable. I dunno what you'd say on that, Lee.

Lee Leachman (00:53:34):
There is this issue, right? This genomics works so darn well. It's like a lot of us are sitting there saying, do we need to gather all this data? But we also know that it's like having a table without legs. You better collect that data, otherwise you're table will sit on the floor. And that's where we're at with the genomics. We got to turn the phenotypes in. And I think that that's a challenge for breed associations, right? Because there's sort of this, it's cheaper and easier for a seedstock producer to say, I'm not going to measure that. I'm just going to do the genomics. And I'm sure that's happening. It's happening in our system. I'm sure it's happening in association. So we got to figure out ways to incentivize the right decisions. We got to think about ways to get that big data where we need it, and to get enough good data on the existing traits to make sure that we can still predict well.

Don Schiefelbein (00:54:24):
I think that's where breed associations have to get into that supply chain involvement because you're trying to gather data either upstream or downstream from where you're at. And so you better have relationships built in. And to me that's where some of these seedstock guys, with that relationships already built in place, will come to play.

Miranda Reiman (00:54:42):
So as you guys look to the future, you sound mostly excited about all the things, like you like change, you're innovative people, but what keeps you up at night? What worries you?

Don Schiefelbein (00:54:54):
For me, what worries me is this, and it is not seedstock oriented, it's a bigger picture beef production oriented, is that if you look at how many people are removed from production agriculture, we now have 50% of our population are three generations removed from ag. Three generations. There is little or no understanding of our business, yet those people are writing rules and regulations that we have to live on. And to me, our industry is so good at debating and fighting amongst ourselves. There's a whole group of people whose only goal is to put us out of business. If they can get the megaphone to those 50% who have no idea what our operations are like, well, we're fighting. They win. So we better get our acts together and begin to say, you know what? We may disagree on this or that, but the 95% of the stuff we agree on, let's use the megaphone to tell these consumers this is what the true answer is.

Lee Leachman (00:55:57):
Well, just to echo that, I got up this morning and I looked on my phone like we all do, and looked at the newsfeed and there was a story in there about how the Farm Bureau was spreading misinformation about the goodness of raising beef. And of course that was written by somebody who's spreading misinformation about the badness and guess where they're doing that — in schools. And so thank goodness we have organizations like NCBA and Farm Bureau and the Beef Checkoff that are putting the message out there and spreading the truth. Donnie and I know a lot of people within the industry, we fight over whether we should be in those, but boy, we better have a voice.

Don Schiefelbein (00:56:33):
We better have a voice. I would even go one step further, Lee and the social media, how to manage social media to me is a big unknown because you can start spewing out things that may or may not be true. And the more controversial they are, the more likes you get, the more shares you get, the more everybody wants to hear what you had to say. And boy, that goes contrary to going in the right direction a lot of times. And I don't think our industry has figured out how to combat that effectively or combat it at all. And to me that is a big fury because that builds into that infighting and builds into this whole thing that Joe just said. And it gets repeated a million times instantly.

Lee Leachman (00:57:19):
If you're spreading much of your energy shooting arrows at people who are in our industry, I think you got to really question what you're doing. It's not helping. It's not helping. I want to shift and just go back on one other thing because you asked what the hardest thing was, and Donnie and his family don't have to worry about labor. It's all indentured servitude from kids, but the rest of us that don't have such numerous families, labor's a big problem and we've got to get people who want to come work for us and we've got to provide a good workplace for 'em. And that's a challenge today. And it goes back to a little bit of what you said, Donnie, a lot of the people that apply for work don't have any experience. They didn't grow up in it. And so labor's a challenge. It's a challenge on these cow-calf operations challenge in the feedlots. It's a challenge everywhere. And that means we have to breed our cattle with that in mind, right? Absolutely. There's going to be less labor.

Mark McCully (00:58:19):
Calving ease was still the number one trait that we heard from and as a trait of priority from our cow. And I think that's directly tied to we all understand,

Don Schiefelbein (00:58:28):
And disposition,

Mark McCully (00:58:29):
Right? And disposition, right? Things that they, we used to call 'em convenience traits. My good friend Joe Elliot in Tennessee pushed back. He said, you got to quit calling 'em convenience traits. They're not convenience traits, they're foundation traits. So I've picked up that term. I think that's

Lee Leachman (00:58:44):
Non-negotiable.

Mark McCully (00:58:45):
Non-negotiables, baseline. Absolutely. How about a piece of advice you would give to a young producer? You talk about labor and we talk about the next generation coming back into this. What one or two pieces of advice would you share with them or encouragement? Because we need them. We need 'em excited about our business and we need 'em to be able to see their, I always say see their spot in this business and I think the opportunity is huge for them. So any advice?

Don Schiefelbein (00:59:10):
From my perspective, I think you have to be creative when you're looking at the wall in front of you, and it's a financial wall to get involved in this industry. You better be creative, thoughtful, and maybe a relationship you need to build, how you need to crawl, walk, run into this industry because it's almost insurmountable sometimes the equity needed. So you develop these relationships with this guy who you say, you know what? He's at an age where he needs somebody for assistance. Labor is an issue. I can provide that labor in exchange. I get a chunk of the business. I think that whole creativity thing is going to be key if you want to jump into our industry.

Lee Leachman (00:59:51):
That's exactly where I was going to go with it. Donnie. I think at the end of the day, you get into the industry, the last thing you need to worry about is buying land. You need to figure out a way to partner on cows where you're the owner who is watching those cows. Because what we all know is when we have cows and ownership is close to the management of that cows, things go a lot better than when it's not. And our challenge is if there's a hundred acre pasture for lease 10 miles away, we're not going to probably do that because we're just not going to get over there and see 'em. But if you've got your acreage over there now, maybe you should be talking to somebody about leasing cows and working together, then build up your equity in the cows and then worry about the land. I think that's those stepstone in that's probably more available to people today than ever because of the profitability of cows. You find that most producers are constrained by land and labor. If you can solve one of those, say, Hey, I'm the labor. If you can solve two of those and say, Hey, I'm the labor and I got a piece of land I can lease, then I'd say you find people that want to sharecrop with you.

Don Schiefelbein (01:00:58):
I'm spot on with you, I think that's exactly the mode. And I think there are more opportunities like that because how you take care of a cow herd is a make or break for that landowner as well.

Lee Leachman (01:01:10):
Let's talk about the requirements to get into that. Go work on a place. Don't come to me and say you want to lease cows from us and have had no experience running cows. And I think there's, there's a little bit of that mentality. I went to college, I got that learning. Well, that's great.

Mark McCully (01:01:29):
You have a license to learn more.

Lee Leachman (01:01:31):
That's great. You're going to put me on the bleeding edge, right? So I think the young people, I mean for starters, you got to make a commitment. If you want to get in this business, you better spend several years doing what needs to be done in the real world and learning how it's done. If you don't do that, you got to understand that those of us that run cows are not going to have a lot of confidence in your ability.

Mark McCully (01:01:56):
That's great wisdom and great insight from both of you guys.

Miranda Reiman (01:01:58):
Great advice. So we always end on a random question of the week. So random question, what are you reading or listening to right now?

Lee Leachman (01:02:08):
I'm reading a book called Scaling Leadership. OK. Turns out that I ran our business historically like a small dictatorship and that was effective, but as you get too many people, that's not effective. And it turns out that my skill set as a manager was not very good for that different system. So I had to learn something new. So I'm 57 years old, almost 58, and I got to learn something new and luckily I got a couple people beating me with a two by four encouraging me to learn. So it seems that I'm learning a little bit. So that's kind of fun.

Miranda Reiman (01:02:48):
I like that. Good for you. I'm going to write that one down. I think

Mark McCully (01:02:51):
I actually just started a Harvard Business Review, top 10 case studies on innovative companies and changes innovative companies made. I'm on this innovation theme. I've been there for a while of just trying to learn.

Miranda Reiman (01:03:07):
I think you were born in that theme.

Mark McCully (01:03:08):
I like it. Well, I think so much about a breed association and how do we stay innovative enough to keep up with guys like you that are on the innovative, the top one percenters in the innovation space, and how do we stay relevant? So I think about business models, traditional business models, like a breed association, but we have other vehicles, other business models in our, AGI and Angus Media. So yeah, I'm trying to learn from in those top 10 case studies that Harvard Business Review put out.

Don Schiefelbein (01:03:38):
And this is going to surprise you. I know a lot Mark, but I've actually learned the technology of podcasts. Good.

Miranda Reiman (01:03:44):
So you're listening.

Don Schiefelbein (01:03:44):
And so there's a podcast out there called Business Wars. If you've not seen the podcasts or listened to Business Wars, it goes up to some of the big corporate wars that have occurred, the missteps, some have taken the advantages some have taken, and it is truly fascinating and so much of it relates to the cattle business. You can just relate it right back to the cattle business. Boy, this person decided not to play in that technology arena and they were no longer the leader. And it is just fascinating. So if you ever get a chance, Business Wars.

Mark McCully (01:04:21):
Good. Good. Well guys, we do need to let you go. Would you come back and do another one?

Lee Leachman (01:04:28):
Sure.

Mark McCully (01:04:29):
All right. Well, we've got that. Donnie didn't commit. Donnie just smiled.

Miranda Reiman (01:04:34):
He abstained, I think

Don Schiefelbein (01:04:35):
I was seeing if Lee was going to say yes or no, because I don't know if I want to come back with Lee.

Lee Leachman (01:04:39):
He was waiting to see if I prefaced it on whether he was in or not.

Don Schiefelbein (01:04:43):
I assume I'll be culled after this.

Mark McCully (01:04:46):
No, I know we could go on a long time, but we need to wrap up here today. But just want to thank you both for being a part of this and coming on and sharing truly, guys.

Miranda Reiman (01:04:56):
And having a voice in the industry

Mark McCully (01:04:58):
Absolutely, applaud two leaders and fought leaders in our industry, not just in the genetic space of the beef industry. And so coming and sharing that with us and some friendly banter, man, we appreciate it. Appreciate both of you guys a great deal. So thank you.

Don Schiefelbein (01:05:13):
Thank you guys.

Mark McCully (01:05:14):
Thank you for having us.

Miranda Reiman (01:05:15):
For continuing coverage Cattle Industry Convention., be sure to pick up our March issue of the Angus Journal and we'll have continuing coverage throughout the spring. This has been the Angus Conversation, an Angus Journal podcast.