Commercial Cow Breakeven

Stocker Steve · Dec 10, 2019

Crunched a few numbers last night using our current feed costs, recent calf and kill cow prices, and a guess of 10 cent calf price increase next year. Medium sized running age cows came out to a U$S 700 to 850 breakeven here. No, there is no return to labor or management in that number.

This is where local sales barn prices have been recently for running age cows. The most likely risk is another cold winter followed by another spring hay shortage. A few gamblers expect a repeat so they culled hard in early fall and are now sitting on some extra hay. The home run would be increased beef exports, but the talking heads have been debating that for years. Some day...

Have seen a few crazy prices for bred heifers. The fix might have been in. :shock:

skyhightree1 · Dec 10, 2019

Stocker Steve said:
Crunched a few numbers last night using our current feed costs, recent calf and kill cow prices, and a guess of 10 cent calf price increase next year. Medium sized running age cows came out to a U$S 700 to 850 breakeven here. No, there is no return to labor or management in that number.

This is where local sales barn prices have been recently for running age cows. The most likely risk is another cold winter followed by another spring hay shortage. A few gamblers expect a repeat so they culled hard in early fall and are now sitting on some extra hay. The home run would be increased beef exports, but the talking heads have been debating that for years. Some day...

Have seen a few crazy prices for bred heifers. The fix might have been in. :shock:

Bottle calves have been selling 2.00 a head and the fee to sell is 5.00 a lot of dairy farmers been giving them away so they don't go in the hole. They had some 3 year old breds sale last week .70 lb and some 5 wt heifers .50lb I like raising bottle calves so may get a few to fool with over winter.

Stocker Steve · Dec 10, 2019

skyhightree1 Bottle calves have been selling 2.00 a head and the fee to sell is 5.00 a lot of dairy farmers been giving them away so they don't go in the hole. [/quote said:
In parts of Wisconsin they will pick them up on the farm once a week, and process them immediately into sausage.

Aaron · Dec 10, 2019

Stocker Steve said:
Crunched a few numbers last night using our current feed costs, recent calf and kill cow prices, and a guess of 10 cent calf price increase next year. Medium sized running age cows came out to a U$S 700 to 850 breakeven here. No, there is no return to labor or management in that number.

This is where local sales barn prices have been recently for running age cows. The most likely risk is another cold winter followed by another spring hay shortage. A few gamblers expect a repeat so they culled hard in early fall and are now sitting on some extra hay. The home run would be increased beef exports, but the talking heads have been debating that for years. Some day...

Have seen a few crazy prices for bred heifers. The fix might have been in. :shock:

I did similar the other night and it suggests about $560 US for me. I factored in current calf price, no banking on 10 cent increase. You take the calculator and factor in a little debt for fun like many young guys are in and it gets very red in a hurry. The guys with heavy debt are going to have an impossible time surviving. No debt, minimal machine costs and low property tax (under $1k US) are what save my backside. Like I said before, there are going to be a lot of casualties once the accountants look at books in the New Year.

Stocker Steve · Dec 10, 2019

But there are always a few with free feed. They will still be in "business" after I am gone. ;-)

Stocker Steve · Dec 10, 2019

Commodity producers are getting a bit discouraged here even before they meet with their accountants. So we are seeing a few more For Sale signs. Meanwhile the Feds increased the max CRP acreage. No surprise there.

Aaron · Dec 10, 2019

Stocker Steve said:
But there are always a few with free feed. They will still be in "business" after I am gone. ;-)

Fewer and fewer every year. Too much money invested to be 'playing rancher'. The older ones are dying and the younger ones have their better half telling them they want to go on southern vacation during the winter or calving season.

Stocker Steve · Dec 10, 2019

Does the Bagley Sales Barn count as a southern winter vacation?

Aaron · Dec 10, 2019

Stocker Steve said:
Does the Bagley Sales Barn count as a southern winter vacation?

I guess that depends on how far the frost has set into a person's brain.

Stocker Steve · Dec 28, 2019

Talking heads are projecting a small increase in 2020 calf prices due to higher cow and heifer slaughter in 2019. Sounds like $5 to $10 per hundred. Calf prices have been so volatile here this fall that it is hard to come up with an average.

Are hay prices going up on the Rainy or have guys culled down enough to avoid that?

Aaron · Dec 28, 2019

Stocker Steve said:
Talking heads are projecting a small increase in 2020 calf prices due to higher cow and heifer slaughter in 2019. Sounds like $5 to $10 per hundred. Calf prices have been so volatile here this fall that it is hard to come up with an average.

Are hay prices going up on the Rainy or have guys culled down enough to avoid that?

If we don't see more increase than that, lots more guys are going to pack it in across North America. Looking at number of auctions already booked for spring in Manitoba, it is crazy. Not even end of 2019 yet.

Lots of guys locally are just crossing their fingers they have enough. Quite a few testing hay and finding out it's garbage. One fella's wrapped hay was 10% CP. Protein tubs are selling like hotcakes at feed store. If it is a hard Jan/Feb like last year and stays white till May, it is going to be desperate for a lot of people.

Stocker Steve · Dec 28, 2019

Retirement auctions have been heavy here for a couple years. Old equipment is going down in price, but old farm sites are selling well - - sometimes to out of state Amish.

What is hay CP that tubs are thought to be needed for overwintering a beef cow?

Seems like a good time for me to revisit stocking rates, but I have been culling enough in recent years that I don't have cows I dislike...

Lucky_P · Dec 28, 2019

I'd have been dancing a happy jig the last few years to have had hay with a 10% CP.
Last year's stuff was below 5... and my hay guy had, on his website: "Good hay ain't cheap and cheap hay ain't good!" - but his hay was neither; he'd gotten all excited about his ADF/NDF... not really all that applicable for a 'mostly warm-season' grass hay.

Gotta have a minimum of 7% CP for rumen 'bugs' to be able to effectively process the roughage... below that, they can - and will - literally starve to death eating it, if some other source of energy and protein is not provided. Free-choice? It doesn't matter... they can't eat and process enough to survive on. Bred cows with calves weaned off can do OK on some poor quality stuff, but the nutritional stress is inordinately worse for a fall-calving, lactating cow.

Commercial Cow Breakeven

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