Day after day, livestock auctions in the United States (US) provide a reliable, secure way for producers to sell their livestock. Annually, approximately 31 million head of cattle, 7 million head of hogs and 3 million sheep/lambs are sold through auction markets in the US (2016 GIPSA Annual Report). This equates to more than $40 billion in annual gross sales of livestock that are sold on auction markets (2016 GIPSA Annual Report).
Market managers work diligently to bring in multiple buyers to bid competitively on sale day, providing true price discovery of the value of all types of cattle and maximizing the return to the seller. In turn, they provide buyers with a centralized location and a ready supply of cattle in the offering. Through this process of bringing buyers and sellers together, the local auction markets create the base market price for all other methods of selling cattle.
As new marketing avenues continue to be explored, the auction method of selling continues to be the safe, sure way for cattlemen to receive fair prices and prompt payment for their cattle. By acting as the bonded agent, auction markets assume risk for the seller, for a low commission fee.
Auctions provide services that benefit cattle producers in other ways as well. For example, they conduct animal health inspections on all animals at the sale, which provides early detection of diseases. This practice protects herd health for their local producers and cattle across the state and nation. Auctions also collect and send in checkoff dollars used for education, promotion and research in the beef industry, thus increasing demand for beef.
The Livestock Marketing Association (LMA) is the national trade association for livestock marketing businesses. The LMA represents nearly 75% of all viable, regular-selling (minimum 1 sale per week) livestock markets in the United States.
Further, livestock auctions contribute to the vitality of local economy by providing jobs and purchasing goods and services from local businesses. A recent study conducted by LMA, in collaboration with a private research firm, showed that a standard, fixed-facility auction market provides approximately $1 million in total value-added dollars to its local community (population of 5 000) annually.
As LMA provides services that improve business for the livestock auction markets, the work that they do creates a better business atmosphere for local producers.
One example is internet sales via www.lmaauctions.com. This is one of the ways LMA has adopted evolving technologies to improve market opportunities for buyers and sellers. The internet allows cattle to be purchased from a remote location, providing additional buyers to bid for cattle on sale day. The service can also be used by producers to watch their cattle sell from home, buy replacements, and watch sales from across the country.
LMA also represents its members in state legislatures and in Washington, D.C. While they act as the voice for the marketing sector, they also benefit cattle producers, as they work for improved market conditions for the entire industry.
In the US, selling through your local auction market remains the time-tested, secure method for selling cattle to obtain fair prices and prompt payment. – LMA