Cattle prices
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I would have to disagree that backgrounding is a loosing deal. It's hard to tell what calves are really bringing from a generic market report. Some of the consignment firms put out more accurate market report videos but it's still hard to tell. Best I can figure I made over $175 a head weaning in October and selling in June. Feed cost seems high when you're buying it but it only cost about $125 a head to keep them that long. There's always off years but 9 times out of 10 backgrounding is the way to go.
Lucky said:
That is backgrounding, not preconditioning.
We have made big dollars a couple times by feeding our own calves for 6 months after weaning and going to a spring market. Lost some money a couple times too.
bird dog
Well-known member
I also disagree with you gcreekrch but the math is complicated. Your weight shrink is the big swing factor. Long weaned calves shrink very little compared to the trailer weaners. I guess if you are getting paid on the weight at the farm, it may not seem so bad, but I'm sure the the buyer is giving you a shrink deduction or figuring it into his price or both.
Preconditioned calves shipped to a market that feeds them for a day or so before they sell will have zero to 3% shrink. Might even have a gain if the weather is mild. Bawlers will lose 8 to 10% easily, maybe more if its hot and they don't know how to drink from a trough. Folks that haul unweaned calves to a sale barn the day before the sale have no idea how much money they are giving away.
Preconditioned calves shipped to a market that feeds them for a day or so before they sell will have zero to 3% shrink. Might even have a gain if the weather is mild. Bawlers will lose 8 to 10% easily, maybe more if its hot and they don't know how to drink from a trough. Folks that haul unweaned calves to a sale barn the day before the sale have no idea how much money they are giving away.
Douglas
Well-known member
tncattle said:
Some of it is the cost of corn:
https://www.raboag.com/mm/images/Corn-Basis-Map-800xNJuly10.png
Cheaper corn makes for more aggressive feedlots.
Hay too:
https://www.drovers.com/article/cattle-markets-feed-prices-2019
So the best place for feed/feedlots is the best place to be selling calves. To go further out and pay shipping cost and risk health issues you have to discount it. Guys that get profitable prices then plow some of that back into quality improvements.
Preconditioning or backgrounding feeders is a numbers game. Allot of guys doing it are happy with an extra $50 a head. If you have 20 calves that's not allot of money for the risk, but if you have 100,500, or a 1,000 that $50 adds up. I'm no expert on the subject but have sold all 3 ways and know selling off the tit is a loosing battle. The market always comes back, you just gotta be able to hold them until it does.
bird dog said:
Let's do a little simple cowboy 'rithetick.......
My figures will be in Canuck bucks so most of you will have to do the exchange. We will use last year's values as this year's hasn't been established yet. Each operation will be somewhat different, especially in the feeding department.
Steer calf sold off the cow 525 lbs @ $2.25 = 1181.25.
Weaning and preconditioning.....
Induction fee including 3 vaccinations, Draxxin and an implant. $35.00
Feed only, hay and barley. All 10 cents per lb last year here.
14lbs per day x 60 days. $84
Yardage @ .55 per day x 60. $33
Death loss @ 1%. $11.31
Interest on investment 5% x 1131.25 $9.43
Total. $172.74
In most operations a weaned calf will shrink 10 to 15% in the first week just losing baby fat, if your grass has been exceptional it might be more 525 x 10% = 473 lbs
In order to get your investment back this calf would have to put on 129 lbs from the day weaned, not many can get 2+ lbs per day unless they already have a TMR mixer and quality feed. Most, including our outfit would be lucky to achieve 3/4 lb per day. This brings us back to 525 + 45 = 570 - 4% at scale
547 lb calf @ 2.22 = $1214.34
Breakeven is 2.38, or $1301.86 per head, loss is $87.52 or ..16 per lb.
I for one like doing more than breaking even just so the feedlot guy is happy. Better to have a management system and vaccination protocol in place and get paid without the extra bs.
The only way I would change these thought was if there was a very good chance of market jumping at a later date. I would still keep them longer than 60 days. Then we aren't preconditioning any more. We are backgrounding.
Lets try this.
525# calf @ $1.50 = $787.50
Meds cost about $6 for first round
6# feed a day for 180 days @ $235 a ton = $126.90
As long as there's any kinda pickin at all they'll survive the winter just fine without hay or minimal hay when it's really cold. Sometimes I give them the core after I unroll hay for the cows.
Spring working =$6
Turn out on grass March 15th - July 15th
Total in calf = $926.50
775 x $1.42 = $1105.50
Looks like about $175 profit to me.
I know there's a little time and fuel involved but you gotta be there anyway to feed cows. I know this won't work for everyone but it works for me. I did loose one calf this year due to me not selling him when I first noticed the problem.
525# calf @ $1.50 = $787.50
Meds cost about $6 for first round
6# feed a day for 180 days @ $235 a ton = $126.90
As long as there's any kinda pickin at all they'll survive the winter just fine without hay or minimal hay when it's really cold. Sometimes I give them the core after I unroll hay for the cows.
Spring working =$6
Turn out on grass March 15th - July 15th
Total in calf = $926.50
775 x $1.42 = $1105.50
Looks like about $175 profit to me.
I know there's a little time and fuel involved but you gotta be there anyway to feed cows. I know this won't work for everyone but it works for me. I did loose one calf this year due to me not selling him when I first noticed the problem.
Lucky said:
That is backgrounding, not preconditioning. Also, you do need to add in yardage because you fed them not just because you were there for the cows. Your grass is also worth what you could rent it for. You do pay taxes on that land don't you?
Let's add in .40 a day US yardage for 180 days if you were giving them feed all that time $72.00.....
Then let's add in .75 a day for pasture, another $135.00. Now the picture changes. Looks like a $32 loss to me.
We haven't added in the odd core of hay you mentioned either.
The most expensive way to feed a calf is to background them. They should be put on feed and pushed to their limit in order to capitalize on their growth genetics if that is what you bred them for.
The only time this works when you aren't getting the gain is when the calf is worth very little at weaning because feed costs at the lots are high and you have the feed in your possession. Take that calf to green grass and keep him green and it will pay big.
We once had 300 calves pay us a buck a day each over expenses by keeping to green grass.
A 2015 tax dodge involving 200 heifer calves bought in November and sold in May lost us $60,000 in feed and yardage. Glad it was all ours and we weren't paying someone to feed them. They gained 200 lbs in 170 days and dollared out the same value they came in at.
Nesikep
Well-known member
current prices for 5wt steers is $1.60 USD, heifers are about $1.45-1.50
Stocker Steve
Well-known member
Glad you are not doing my taxes. ;-)
Many folks forget about yardage, time, depreciation... Had one stocker expert tell me they did not matter because his land was going up in value.
We have often carried calves into January to catch the seasonal bump up in prices. Works most years since we have some home grown feeds and by product that are not real marketable. Better return would be to sell good 5 wt. calves off the cow and buy back light weight calves that need TLC.
Many folks forget about yardage, time, depreciation... Had one stocker expert tell me they did not matter because his land was going up in value.
We have often carried calves into January to catch the seasonal bump up in prices. Works most years since we have some home grown feeds and by product that are not real marketable. Better return would be to sell good 5 wt. calves off the cow and buy back light weight calves that need TLC.
gcreekrch said:
When you say "yardage" are you referring to lease payments on the land or cost per acre? I really don't follow your line of thinking at all. Not saying it's wrong I just don't follow it. I have a fixed amount of land to use for the cattle so I try to maximize it the best I can.
Around here on an average year nothing is worse than selling a balling calf right off its mama at the local salebarn. Preconditioning for 45-60 days generally makes a little money and backgrounding for 7-8 months and shipping to a bigger sale generally maximizes profits. I'm not saying I've never lost money or thought I should have sold sooner but that's just how the market plays out some years.
I have a rotation for the cattle and running yearlings on one of the pastures is the best use of it during the winter. Once spring hits I give it a rest and move the yearlings to another pasture. Once its time to sell the yearlings the pasture they were in gets a 15-30 day break and the cows get turned in.
From what I see buyers want long weaned medium flesh yearling cattle that have been fed and givin time to grow, not pudgy calves that were fed 12#s a day for 90 days. We may just be in a different regional market.
gcreekrch said:
I understand what you are getting at now. If I got that technical I'd dig a hole to drink whiskey in. I just figure how much money comes out of my pocket to how much goes in. I'm pretty much a one man show out here so it's just my labor. 99% of the time feeding the yearlings in the winter requires opening 1 extra gate and driving down a row of troughs, takes 10 minutes tops. Hopefully in a few weeks I'll have that opening the gate problem fixed.
When your in business for yourself it's pretty easy to "figure yourself broke" on paper. I choose to look at the good side and maximize what I have available to me. I do let the tax man explain to me how much I lost each year though.
Double R Ranch
Well-known member
We have been discussing this as well recently. Our prices aren't great here right now but not that "low" yet.
We have a strict vaccination protocol, we do a more labor intensive weaning for less stress and shrinkage and feed them for 45+ days minimum to please the buyers.
I'm not convinced anymore it's worth it all. This year we stopped the little things we've always done like magnets in any calves destined for the auction.
We do get a premium at sale every year as our program is well known with the buyers BUT I'm just not sure it's worth it anymore.
We are short on pasture at this point in the year which means decrease calf numbers earlier is a bonus but is it worth the "loss" we face at market for not having all the extra things we have always done for the buyers including long weaning.
We have a strict vaccination protocol, we do a more labor intensive weaning for less stress and shrinkage and feed them for 45+ days minimum to please the buyers.
I'm not convinced anymore it's worth it all. This year we stopped the little things we've always done like magnets in any calves destined for the auction.
We do get a premium at sale every year as our program is well known with the buyers BUT I'm just not sure it's worth it anymore.
We are short on pasture at this point in the year which means decrease calf numbers earlier is a bonus but is it worth the "loss" we face at market for not having all the extra things we have always done for the buyers including long weaning.
Caustic Burno
Well-known member
I have seen prices fluctuate by as much as .30 in the last three weeks.
It's nuts! I sold four weeks ago 4 to 5 wts. avg 149. the next week neighbor got 162 on the same calves a week later my running buddy got 132 a hundred. All three of us are running the same cattle, literally the same as we share bulls.
Used to if you got a 1.50 next week they be up or down a couple cents.
I have no clue what drives the market anymore.
It's nuts! I sold four weeks ago 4 to 5 wts. avg 149. the next week neighbor got 162 on the same calves a week later my running buddy got 132 a hundred. All three of us are running the same cattle, literally the same as we share bulls.
Used to if you got a 1.50 next week they be up or down a couple cents.
I have no clue what drives the market anymore.
skyhightree1
Well-known member
Caustic Burno said:
Markets doing same here I don't understand whats going on. I just know my calves are going to be leaving in November no matter what the market is doing.
