Opinion about profitability in beef cattle

[Jacqueline]

What would you say is the most profitable stage of cattle business ? Is it cow/calf , backgrounding or finishing? If you had the means and resources to do any stage what would you say is the most profitable ??

 

[Dave]

Same post popped up yesterday over at Ranchers. No replies.

 

[Jacqueline]

Same post popped up yesterday over at Ranchers. No replies.

Yes and no one responded which is why I asked on this forum. If you are looking for an opinion or an answer to a genuine question isn’t it always best to ask a group of experts?

I’m a horse girl all my life and have been interested in getting into the cattle industry . I’d like to better understand the industry , thanks.

 

[Warren Allison]

What would you say is the most profitable stage of cattle business ? Is it cow/calf , backgrounding or finishing? If you had the means and resources to do any stage what would you say is the most profitable ??

You will get a lot more responses if you will finish completing your profile by adding your location.

 

[GoWyo]

I would say it depends on what you have for a climate, land base (owned, leased or combination), machinery, farming skills, cattle handling skills, and so on. I have cow-calf, summer stockers, backgrounder lots and feedlots within a 50-mile circle of where I live. Most are multi-generational places. There are a lot of variables and you have to look at what you have and the best way to use it.

 

[Silver]

We are too far from the packing plants to finish cattle here profitably. Which gets back to the “where are you located” question.

 

[Jacqueline]

We are too far from the packing plants to finish cattle here profitably. Which gets back to the “where are you located” question.

I updated my

 

[Jacqueline]

Located in southern Ohio. I updated my profile as well

 

[farmerjan]

@Jacqueline .......Hello, and welcome to CT forum. Yeah, some of the "crusty" members will give you a hard time... and the thing is , we get so many "fakes" or some that are trying to ask questions, that will be used "against" the farmers in some way...some of the longer time members find themselves rather tired of the BS artists.... Lots of "one time posters" and after several take the time to answer, never hear from them again.

All that said, thanks for coming back, updating your profile... The answers will vary as much as @GoWyo said... Different areas of the country work better for different things. @Silver and @gcreekrch are in Canada... FAR from the packing plants and such... read anything either posts and see how they cope with the environment and climate up there... cow / calf, raising heifers to breed other things work best for them.
Here in the "east" , we find that cow / calf works pretty good, and we personally, also try to put together some weaned feeders to sell in groups by raising our own, with a cow/calf operation, and buying some odd calves here and there to make bigger groups that match to sell as backgrounded feeders.
We do some beef... different laws in different places on kill facilities... having to use a USDA place to sell cuts of meat or a state inspec facility to sell in halves or whole.... Some find that the most profitable... but you HAVE to have the knack to deal with the public and that is NOT my forte.... do some for regulars, friends, but with the prices of feeders and such, not worth it for us to do much now...

Can I ask what are the reasons you are interested??? Are you a school age student looking at different types of farming to make comparisons? Older adult wanting to do something with some land of your own? Don't have to get into nitty gritty, but knowing a little of why someone new comes on here, helps to give a picture of what and how to answer someone..

@TCRanch has a cow/calf operation and sells most of her weaned animals that go into a specialized beef program.... her cattle are super friendly and she hosts a yearly "farm tour" type thing for chef's... Pretty neat thing....

Cattle in the south are often more acclimated to the climate and would not do as good in Canada, and vice versa... that we call "eared cattle" having some brahma influence are greatly discounted in this area and north...

So in essence... IT DEPENDS is not a smart a$$ answer but truly is the only answer...

 

[Stickney94]

Profitability will vary from year to year in each segment. I grew up on a cattle farm where we ran cow/calf to finish. It's all I know. In my opinion the "easiest" thing in the beef cycle would be buying some vaccinated weaned calves in the spring and running them on grass during the summer and selling in the fall. The other segments all require more infrastructure, time, and expertise -- all of which factor into profitability.

The first thing I would ask is how many acres of pasture do you have or have access to.

 

[Brute 23]

What would you say is the most profitable stage of cattle business ? Is it cow/calf , backgrounding or finishing? If you had the means and resources to do any stage what would you say is the most profitable ??

Welcome. It will be be different for every single person. If one was more profitable for every one, we would all be doing it. Your personal risk tolerance plays a factor, location, resources like land and capital, and also what kind of personality you have. Do you like building things over time or fixing them up and on to the next one.

At the top of the list would be Ag lending. Ag people love their debt. They won't pay some one else to build a fence or work on equipment but they will pay some one else for their money every time. It has to be the most profitable by far.

 

[TCRanch]

It's all subjective. I have a cow/calf operation and retain my own heifers. Actually, every cow, calf and heifer was born and raised on this ranch, but I do buy registered Angus bulls. How does that pencil in when I won't see a profit from retained heifers for 2 years? Short term, no. Long term in my world, absolutely. Because I know the entire history and only select top calves from top cows (that's the short answer). And, as Jan mentioned, I know who is buying the calves I sell. Whether a cow/calf would be profitable for you is contingent on your knowledge, facilities and geography. Probably not the best idea if you don't have good working facilities. And you'll have to have (establish) a good working relationship with a vet. How much do you know about breeding, calving, etc? Or will you have to pay for a vet call? Are you going to buy bulls or AI? Vaccines aren't cheap but necessary (again, in my world).

My neighbor runs stockers. It's a faster turn-around and he generally makes a good profit. But he's been doing it for years, has good working facilities and is knowledgeable about cattle health. It all factors in.

What are your goals? And how much time do you have to tend to your cattle? Will you have to buy hay &/or cubes or do you have enough land for them to graze/grass only? Assuming you don't have a drought. Even transportation is a consideration. Do you have a trailer, or would you have to pay to have them hauled?

Sooooo many variables!

 

[Jacqueline]

@Jacqueline .......Hello, and welcome to CT forum. Yeah, some of the "crusty" members will give you a hard time... and the thing is , we get so many "fakes" or some that are trying to ask questions, that will be used "against" the farmers in some way...some of the longer time members find themselves rather tired of the BS artists.... Lots of "one time posters" and after several take the time to answer, never hear from them again.

All that said, thanks for coming back, updating your profile... The answers will vary as much as @GoWyo said... Different areas of the country work better for different things. @Silver and @gcreekrch are in Canada... FAR from the packing plants and such... read anything either posts and see how they cope with the environment and climate up there... cow / calf, raising heifers to breed other things work best for them.
Here in the "east" , we find that cow / calf works pretty good, and we personally, also try to put together some weaned feeders to sell in groups by raising our own, with a cow/calf operation, and buying some odd calves here and there to make bigger groups that match to sell as backgrounded feeders.
We do some beef... different laws in different places on kill facilities... having to use a USDA place to sell cuts of meat or a state inspec facility to sell in halves or whole.... Some find that the most profitable... but you HAVE to have the knack to deal with the public and that is NOT my forte.... do some for regulars, friends, but with the prices of feeders and such, not worth it for us to do much now...

Can I ask what are the reasons you are interested??? Are you a school age student looking at different types of farming to make comparisons? Older adult wanting to do something with some land of your own? Don't have to get into nitty gritty, but knowing a little of why someone new comes on here, helps to give a picture of what and how to answer someone..

@TCRanch has a cow/calf operation and sells most of her weaned animals that go into a specialized beef program.... her cattle are super friendly and she hosts a yearly "farm tour" type thing for chef's... Pretty neat thing....

Cattle in the south are often more acclimated to the climate and would not do as good in Canada, and vice versa... that we call "eared cattle" having some brahma influence are greatly discounted in this area and north...

So in essence... IT DEPENDS is not a smart a$$ answer but truly is the only answer...

Thank you for your response . I really appreciate your time. I completely understand your concerns there are. lot of loonies out there especially on the internet.
I’ve never raised cattle just horses but my husband and I have talked about it on and off for years. We have 120 acres fencing/ shelters / watering so forth. My grandfather was a cattle rancher but he sold it before I was old enough to learn it and he passed away years ago. I have never done anything with cattle myself .

I think my main concern would be if it make “financial sense “ if we were to utilize our property as a beef cattle farm? What would a rough idea of profit look like in the different beef sectors?

I’m not concerned about having the grit or the ability to run a business Ive done that my entire life. Operating machines is no problem

But I also know it would take a lifetime to acquire the knowledge many of you have.

I’m not looking to hurt anyone by any means. I have absolute respect for those in the cattle industry and I’m genuinely interested in how it’s financially done before I get my hands and my families hands dirty .

I hope that makes sense and thank you

 

[Travlr]

Thank you for your response . I really appreciate your time. I completely understand your concerns there are. lot of loonies out there especially on the internet.
I’ve never raised cattle just horses but my husband and I have talked about it on and off for years. We have 120 acres fencing/ shelters / watering so forth. My grandfather was a cattle rancher but he sold it before I was old enough to learn it and he passed away years ago. I have never done anything with cattle myself .

I think my main concern would be if it make “financial sense “ if we were to utilize our property as a beef cattle farm? What would a rough idea of profit look like in the different beef sectors?

I’m not concerned about having the grit or the ability to run a business Ive done that my entire life. Operating machines is no problem

But I also know it would take a lifetime to acquire the knowledge many of you have.

I’m not looking to hurt anyone by any means. I have absolute respect for those in the cattle industry and I’m genuinely interested in how it’s financially done before I get my hands and my families hands dirty .

I hope that makes sense and thank you

Welcome to the forum... One of important things you will need to know is what your grass will handle, but you can build slowly and figure it out. Cattle aren't as hard on grass as horses, and rotating them through several pastures over the year will increase your carrying capacity.

As said, stockers are easy. Find out where you will be selling them and ask what they like to buy. Sit in on a local auction as much as you can and learn about prices, quality, and who buys and who sells. Get friendly and make contacts... and ask questions. People in your local area will know more about your local area.

If you want to try cow/calf get some older cows with experience. 10 year old bred cows still have some life in them and have survived by producing. And you can usually get them for one bid over kill price. Keep them long enough to raise a calf and sell them as "one-and-dones" or if you think they are holding condition breed them for one more year. @Dave does one-and-dones but he knows what to buy and doesn't fall in love if they get too expensive. Young, bred heifers are usually a bad idea for people that don't know cattle or whom they are getting them from.

Most people here have a cow/calf operation. Some raise their own replacement heifers. A few have registered stock, and some sell bulls.

With stockers you are selling gains in weight. Any color calf can gain the same weight and off color calves can make as much as black calves because they are cheaper to begin with even though they will generally sell for less. It's the weight gain you are selling. But with cow/calf you will have the same inputs to raise a scrub or a purebred longhorn or an off color commercial calf or a calf that will qualify for CAB (Certified Angus Beef) and the profits will vary greatly. You can raise black calves with red cows as long as you have a homozygous for black bull, and red cows may be marginally cheaper especially as stockers. Sadly, because of CAB, cattle are becoming blacker every year and many great breeds are going away.

Some people here feed cattle for commercial slaughter, and some for custom slaughter. If you have the market I would give the edge to the private, custom sales. But marketing is required.

This post is about cattle, but there are all kinds of ways to spend or save money on the farm as well. Money management is crucial...

 

[Jacqueline]

Profitability will vary from year to year in each segment. I grew up on a cattle farm where we ran cow/calf to finish. It's all I know. In my opinion the "easiest" thing in the beef cycle would be buying some vaccinated weaned calves in the spring and running them on grass during the summer and selling in the fall. The other segments all require more infrastructure, time, and expertise -- all of which factor into profitability.

The first thing I would ask is how many acres of pasture do you have or have access to.

120 acres/ fenced with water source

 

[Jacqueline]

Welcome to the forum... One of important things you will need to know is what your grass will handle, but you can build slowly and figure it out. Cattle aren't as hard on grass as horses, and rotating them through several pastures over the year will increase your carrying capacity.

As said, stockers are easy. Find out where you will be selling them and ask what they like to buy. Sit in on a local auction as much as you can and learn about prices, quality, and who buys and who sells. Get friendly and make contacts... and ask questions. People in your local area will know more about your local area.

If you want to try cow/calf get some older cows with experience. 10 year old bred cows still have some life in them and have survived by producing. And you can usually get them for one bid over kill price. Keep them long enough to raise a calf and sell them as "one-and-dones" or if you think they are holding condition breed them for one more year. @Dave does one-and-dones but he knows what to buy and doesn't fall in love if they get too expensive. Young, bred heifers are usually a bad idea for people that don't know cattle or whom they are getting them from.

Most people here have a cow/calf operation. Some raise their own replacement heifers. A few have registered stock, and some sell bulls.

With stockers you are selling gains in weight. Any color calf can gain the same weight and off color calves can make as much as black calves because they are cheaper to begin with even though they will generally sell for less. It's the weight gain you are selling. But with cow/calf you will have the same inputs to raise a scrub or a purebred longhorn or an off color commercial calf or a calf that will qualify for CAB (Certified Angus Beef) and the profits will vary greatly. You can raise black calves with red cows as long as you have a homozygous for black bull, and red cows may be marginally cheaper especially as stockers. Sadly, because of CAB, cattle are becoming blacker every year and many great breeds are going away.

Some people here feed cattle for commercial slaughter, and some for custom slaughter. If you have the market I would give the edge to the private, custom sales. But marketing is required.

I will absolutely take your advice thank you for the tips !

 

[Little Joe]

Thank you for your response . I really appreciate your time. I completely understand your concerns there are. lot of loonies out there especially on the internet.
I’ve never raised cattle just horses but my husband and I have talked about it on and off for years. We have 120 acres fencing/ shelters / watering so forth. My grandfather was a cattle rancher but he sold it before I was old enough to learn it and he passed away years ago. I have never done anything with cattle myself .

I think my main concern would be if it make “financial sense “ if we were to utilize our property as a beef cattle farm? What would a rough idea of profit look like in the different beef sectors?

I’m not concerned about having the grit or the ability to run a business Ive done that my entire life. Operating machines is no problem

But I also know it would take a lifetime to acquire the knowledge many of you have.

I’m not looking to hurt anyone by any means. I have absolute respect for those in the cattle industry and I’m genuinely interested in how it’s financially done before I get my hands and my families hands dirty .

I hope that makes sense and thank you

What do you think your stocking rate would be? If you could handle a pot load, you could custom graze other people’s stockers at a cost per pound of gain. This would allow you to get your feet wet without as much risk and you could save the profit to buy your own cattle later when the market is not as high.

 

[Little Joe]

What do you think your stocking rate would be? If you could handle a pot load, you could custom graze other people’s stockers at a cost per pound of gain. This would allow you to get your feet wet without as much risk and you could save the profit to buy your own cattle later when the market is not as high.

I hear Greg Judy’s book “ No risk Ranching “ covers a lot of the info on this

 

[Lucky]

Most all the studies I read claim cow/calf operators stand to make the money 8 years out of 10. To know if your profitable you have to really understand how to count your money though.

I think of the cow/calf guy like a stock that pays dividends and a stocker/feeder/finisher like a person getting a weekly pay check from their job.

Which is better depends on your personal situation in life.

 

[Lucky]

At the top of the list would be Ag lending. Ag people love their debt. They won't pay some one else to build a fence or work on equipment but they will pay some one else for their money every time. It has to be the most profitable by far.