Herd Profitability Plans ?

[Stocker Steve]

The Minnesota Farm Business Management program annually publishes profitability by enterprise by region. The cow/calf data is reported for average, 40 to 60 percentile, and top 20 percent. Obviously 2014 was an outlier :shock: - - but typical data in other recent years showed about $100/cow net.
I think this means that there are some inefficient cows who produce no profit, and may not even pay much overhead. Have you looked at an individual wet cow, or a group of cows, to identify a break even? If so, what did you change to improve the financial outcome?
In my case - - late calvers were break even so I loaded them up, and then bought back in season cows for $81 per head less at a different sales barn. :cowboy: I think the next step is de selecting large hard keeping cows with average calves.

 

[Bigfoot]

It cost a bunch of money, to own a cow. I figure the law of diminishing marginal returns applies, so I'm heading to a maximum stocking rate. I figure wire is cheaper, than more land. I hovered well below my stocking rate, for years out of necessity (Too busy for more). To answer your actual question, I sell a cow, that won't wean a 550, and hopefully a 600 plus pound calf. That's straight off milk, and grass at 7-8 months old. i loaded some calves this morning, that my dad raised. He stripped them off the cows this morning, and hauled them. Smallest looked 650, and they went up from there. If it cost $500 to own a cow, it has to be better to wean a 650 pound calf, than a 450 pound calf. That thinking may be flawed, but it's a simple, as it gets to me.

 

[Stocker Steve]

If it cost $500 to own a cow, it has to be better to wean a 650 pound calf, than a 450 pound calf. That thinking may be flawed, but it's a simple, as it gets to me.

The sharp pencils look at per cow and per acre numbers - - which drives all the recent discussion on cow size. Your approach works for me as long as the cows are not huge. Because, as a man once said, "the smallest cow is a ewe". :lol: I am not going there.

 

[Bigfoot]

Won't lie, cows are big, and so is the bull. Probably polish off a lot of grass in a summer, compared to a smaller unit.

 

[Stocker Steve]

Won't lie, cows are big, and so is the bull. Probably polish off a lot of grass in a summer, compared to a smaller unit.

It happens. I have 3 cows that weaned 820# heifer calves. The calves were really nice but just too big to retain.









( The heifer calves are weaned at 10 months. )

 

[Bigfoot]

I hear the comment a lot, that grass is cheap. I've never really felt that way. I also hear, I'll feed a good one. I'm more of an I'll feed a good one kind of guy. A cow weans a 650 pound calf, she's a good one. I see the single trait selection argument, and I've freely admitted before, that I don't select for enough traits. I gotta wonder, what percent of a mans herd would make it through some of the selection processes I see here. Then you gotta keep a heifer to replace her, and that's not cheap. To me, its about how many pounds of calves, did I sell last year, and can I sell more with the same facilities and equipment.

 

[sim.-ang.king]

If it cost $500 to own a cow, it has to be better to wean a 650 pound calf, than a 450 pound calf. That thinking may be flawed, but it's a simple, as it gets to me.

The sharp pencils look at per cow and per acre numbers - - which drives all the recent discussion on cow size. Your approach works for me as long as the cows are not huge. Because, as a man once said, "the smallest cow is a ewe". :lol: I am not going there.

Those 6's are making quite a bit more than 4's right now.
Sold 2 week ago my fall calves.
1 Red Steer 615 1.64 1008.50
1 Black Steer 460 1.75 805.00
1 Black Steer 400 1.80 720.00

It cost just as much per head to raise that 615 pounder as it did the 400 pounder.
Find the balance of cow size, and weaner size is going to be impotent.
Of course if the cows feed conversion improves, that would mean you could have larger cows, and consume the same amount of feed. plus that efficiency would pass on to the calves going to the feedlot.

 

[bball]

Just my 2 cents on cow/calf op:
First and foremost, got to have a calf on the ground every year. No holdouts or hold overs. Has to rebreed to calve within next year's calving window. Outliers take a ride.
Try to maintain moderate framed cattle that maintain condition while raising calf, if not, they go. I track every calfs wean wt and divide by number of days on milk from mom. With my cows being virtually uniform in size, this makes it easy to isolate the cows that don't produce as well. The lowest ranking 3 are always on the chopping block (only thing that will save them is an open, or problematic 'better' cow).
I am constantly searching for lower feed inputs. Recently discovered an outfit that will deliver gluten pellets for cheaper than I can drive to get them (homerun).
I negotiate or atleast offer to on anything and everything..feed, fencing material,land, hay, etc. Youd be surprised how open to negotiation some folks are. With the large farm stores (not as apt to negotiate), I wait for sales, or every few months, they offer 10% mail in rebate. This winter, I fenced in about 40 acres of woodlot, hope it will buy pasture some extra 'rest' days, cows stomp some under brush down, and will.start to slowly open it up into perm pasture, as trees come out.
Great topic. Especially with projected prices this year; as someone smarter than me said earlier: "increase quality and production or trim input costs".....or do both!

 

[Stocker Steve]

Try to maintain moderate framed cattle that maintain condition while raising calf, if not, they go. I track every calfs wean wt and divide by number of days on milk from mom. With my cows being virtually uniform in size, this makes it easy to isolate the cows that don't produce as well.

Is there a pattern on why virtually uniform cows are poor producers ?

 

[Jogeephus]

I keep track of $/acre return. This way I can compare apples to apples. I think weaning a live calf is more important than weaning weights and ADG. I watch inputs closely and let the cattle be cows. Also work with nature and don't try and force things.

 

[Cross-7]

Food for thought

Chip Hines

Managing for Efficiency

Per Acre 5

Too compare profitability between the 1,000 pound cow and the 1,440 pound cow I pulled up market reports from salebarns (3/10/2016) in Colorado, Kansas and Wyoming. For the 1,000 pound cow and a wean weight of 500 pounds I averaged prices of steer calves from 485 to 515 pound range which averaged 2.07 and X 500 =$1,035 per head.

For the 1,400 pound cow I averaged prices from 575 to 600 pounds and for a 588 pound calf it was 2.00 and X 588 was $1,176. The big calves dollared out at $141 more per head.
Now forage cost per year is added in from post No 3. Beginning with the 1,400 pound cows, their total forage cost, $549.58 for 100 head is $54,900. The 137 head of 1,000 pound cows with a forage cost of $400, is $40,000.

Beginning with the 100 big cows I figured 5 head death loss and 15 head for heifer replacement which at 20% leaves 80 head of calves to sell. 137 small cows at 20% is 109.6 which I will round down to 109 calves to sell.

To keep this simple we will magically make all calves steers. From above, the big cows' calves were worth $1,176 per head with 80 at $94,080. The smaller calves were $1,035 per head X 109 = $112,815. This calculation shows that $112,815 minus $92,904 = $19,911 more dollars for the small cows. Not looking good for the big cows and it isn't over. This is the gross. What about forage cost?

Big cows forage was $54,900. Subtracting this from their gross of 94,080 = $39,180. Small cow forage was $40,000. Subtracting this from 1122,815 = $72,815. Now for the grand total, 72,815 – 38,004 = 34,111 additional dollars for the small cows.

Ignoring cull cow sales, and figuring all the calves as the same sex and not including all costs, simplifies the calculating while giving the same basic result which is that smaller, low milk production cows, raising smaller calves, are worth more per pound and more efficient converters of forage to profit.

Cow efficiency and resulting costs and profit must be determined on a per acre basis with the number of animals at a scale large enough to jar the reader into reviewing their own operations.
The value of more small, efficient cows, becomes apparent with a per acre assessment.

Wisconsin researchers (Davis et all., 1983) have shown that smaller cows can wean more pounds of calf per pound of feed than can larger cows.

Next are excerpts from my book "Cow Country Essays and a little Slantwise Logic."

"Data from Arkansas, Montana, and Oklahoma has shown adding 100 pounds overall weight to a cow will produce, at best, 6 pounds additional weight."

"On that basis, Oklahoma State University economist Damona Doye and animal scientist Dave Lalman calculated this added calf weight is worth $5 to $7, while the cost per cow for putting it on is $42-a net loss of $35 per cow unit.

I don't know when this research was done, but it only recently surfaced

This university corroboration of what I have been writing for years is all well and good, BUT why did it take them so long to figure it out?
They were enamored with the "book", I was not.

 

[sim.-ang.king]

Food for thought

Chip Hines

Managing for Efficiency

Per Acre 5


Now forage cost per year is added in from post No 3. Beginning with the 1,400 pound cows, their total forage cost, $549.58 for 100 head is $54,900. The 137 head of 1,000 pound cows with a forage cost of $400, is $40,000.

Maybe i'm reading something wrong, but wouldn't that be $54800 for the 137?

 

[bball]

Try to maintain moderate framed cattle that maintain condition while raising calf, if not, they go. I track every calfs wean wt and divide by number of days on milk from mom. With my cows being virtually uniform in size, this makes it easy to isolate the cows that don't produce as well.

Is there a pattern on why virtually uniform cows are poor producers ?

The only pattern i have been able to pinpoint so far is that the bottom end producers in my herd have the better body condition scores at weaning. So im thinking they put that energy into maintaining their condition instead of milk output for raising the calf.
All the girls start the season at a 5-5.5 BCS.

 

[Stocker Steve]

Is there a pattern on why virtually uniform cows are poor producers ?

The only pattern i have been able to pinpoint so far is that the bottom end producers in my herd have the better body condition scores at weaning. So im thinking they put that energy into maintaining their condition instead of milk output for raising the calf.

So you are culling cows for being open or culling cows for being thin?

 

[bball]

SS, i cull first for opens, then i cull based on least productive. The only pattern i have noticed is my least productive cows are always my cows with highest BCS at weaning. I may be thinking wrong, but my logic is theyre using more energy to maintain themselves and less to feed their calfs, hence the higher BCS scores and lighter calfs at weaning.

 

[Stocker Steve]

I think there is some gray zone between less productive and more efficient cows.
I buy enough turn around cows that there is usually a couple dinks that stand out. After that I think we could be weighing cows and doing a calf weight ratio.
By continuing to cull cows, and now selecting better bulls, my pool of potential replacements in increasing. So I am trying to pencil out how culling more cows and retaining more heifers can increase profits on a per acre basis. The bred heifer market is up and down here but the second calver demand is more consistent.

 

[bball]

I think there is some gray zone between less productive and more efficient cows.
I buy enough turn around cows that there is usually a couple dinks that stand out. After that I think we could be weighing cows and doing a calf weight ratio.
On a per acre basis - - I am trying to pencil out how culling more cows and retaining more heifers can increase profits.

I would be very interested in your results/assessment. It's very hard for me to cull a cow that has a proven track record for productivity....unless she open, poor temperament, etc. Heifer profitibility margins seem to fluctuate based on market supply/demand (speaking commercial girls).

Per acre. How do you formulate per acre productivity. Total net dollars divided by total acres used. Do you factor in time frames used for various pastures? I'm curious

 

[Stocker Steve]

Many folks look at $ profit/cow. It appears there are some efficiencies with herds over 100 cows. Obviously - - the 1,800 lb. stein crosses could then be some of the best cows for this metric.
Some folks focus on lb/acre. The fertilizer and seed dealers love this. The ultimate would be a tight crop/pasture rotation with lots and lots of iron. Been there in the $7 corn days.
I used to focus on gross margin $ per acre. The trade off here is you usually much better returns with smaller younger cattle, but you also need more capital and risk management. So the trick is how to grow profits while keeping risks reasonable. The cattle market last fall gave me a better appreciation for risk.
There are a lot of ways to go with heifers. Selling bred replacements may be the least profitable one.
The other key dollars per acre issue is stocking rate. Most folks like to spread per farm overhead over more animals. But the price of feed is low currently and you can end up with a pair per acre if you are not worried about drought...