Online, local markets have their advantages, auctioneers say
By MATTHEW WEAVER
Buying and selling livestock online might help larger producers expand their customer base, as long as they stick close to their local auctioneers.
California Polytechnic State University beef cattle specialist and animal science professor Mike Hall said online auctions are increasing in popularity and opportunity for cattle producers all the time.
It's another venue for producers to advertise and get their name out, Hall said.
Mark Winter, owner of Enid, Okla.-based buyer and seller network CattleUSA.com, explained that his company puts auctions online so that buyers can watch and purchase the cattle live as they go through the ring.
For a video auction, the company films the cattle on a ranch and describes them, Winter said.
The 75-year-old company has been offering video auctions for about eight years and the live auction ring for about four years.
Traditionally, professional buyers would purchase cattle for individuals in other states alongside local buyers. The Internet option is an additional element, allowing buyers to participate in a live manner.
"They may still pay that professional buyer to buy the cattle for them, but they get to view what's going on," Winter said.
The goal is to open the market up and get as many prospective buyers as possible, Winter said.
The operation does 60 to 70 online auctions per week, Winter said.
"The major advantage is just exposure for the cattle and cattlemen," he said. "They don't necessarily all sell online. We attract buyers to the auction just from the fact they get to see what cattle are like in that area, what's going through that market."
Online auctions can have an impact on price. Hall believes there's slightly more opportunity for a higher price on a live auction.
Winter's opinion reflected an opposite sentiment.
"You can get more for (livestock)," Winter said. "When there's more buyers, the more you get."
Another disadvantage would be the need to fill load lots of typically 45,000 to 50,000 pounds, Hall said.
In response, smaller producers are forming co-ops to pool their cattle in the East and Midwest, Hall said.
Ted Kerst, owner of the Davenport, Wash.-based Stockland Livestock Exchange, said he is currently not offering online auctions. Most of his trade is smaller ranchers and farmers with smaller numbers of cattle, Kerst said, and online auctions don't serve such purposes.
"Most of them aren't load lots," he said. "I know the buyers prefer to buy load lots of cattle when they're buying them. They need a semi load of calves that all look alike."
Kerst's exchange has one large sale each year.
"To us, it's a way better sale than an online sale would be," he said.
Online auctions can serve as complementary services to local auctions, Winter said.
"Just selling your cattle online with someone you don't know anything about may not be the best idea," Winter said.
He recommended sellers work through their local auctions for online services. Some random stranger selling cattle online may not possess the necessary experience with the livestock, he said.
"There's a little more to it than just, 'Hey, we got on the Internet,'" he said. "You've still got to clear the check, make sure the money is good, make sure everything suits everybody, deliver the cattle. Just to throw them up on the Internet, you're kind of taking a shot in the dark."
Hall said reputation is a key factor. Livestock sellers have to pay their dues for several years, but if the cattle perform, the buyers will return.
Hall believes there are more opportunities in the future, but he hopes small auction yards remain viable and functioning, especially for smaller producers who need immediate sale on livestock.
"That's where a lot of the video markets and Internet sales are doing all different systems to be able to stay current in the market but also meet the bottom line," he said.