Profit in Backgrounding

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Durn.. Didn't see that date. I did think that was low. Let me recalc.

Using your chart, from low (avg 584#) weights to high weights (765#) is still on a gross of $127. Assuming 2# ADG that is $127 for running the stocker for 90 days. Is that good?
 
If the price doesn't drop while you have them, any time is a good time to background calves. I don't want to kiss, and tell , but I just sold a few that I took to 735. I'm kicking myself, that I didn't do 70 head.
 
Bigfoot":35sqxrbz said:
If the price doesn't drop while you have them, any time is a good time to background calves. I don't want to kiss, and tell , but I just sold a few that I took to 735. I'm kicking myself, that I didn't do 70 head.
I get the price drop thing. And I appreciate you being a gentleman and all. I am just dense. I don't see the money in backgrounding.

Going back to 1992 prices. I see a $165 dollars gross buying steers at 500 and selling 800s. That is a little better than right now.35% gross margin.
http://www.extension.iastate.edu/agdm/l ... /b2-12.pdf
 
There isn;t a ton of money in backgrounding, just like the rest of the industry. Volume pays, the more head the more "total" profit. A hundred bucks a head for a couple of months seems like a fairly good return to me.
 
dun":379fblhj said:
There isn;t a ton of money in backgrounding, just like the rest of the industry. Volume pays, the more head the more "total" profit. A hundred bucks a head for a couple of months seems like a fairly good return to me.
That's what I am thinking. Thanks.
 
I also figure that I can background 2 calves on the acreage of one cow calf pair. I can also do two groups a year. That means that even if the profit per animal is small (say as little as $80). I made $320 on the land of one cow calf pair. Right now, with weaned calves grossing $1200, that doesn't seem real appealing. When 500 pound calves were $1 a pound, that $80 profit per head was very appealing. I have 45 acres kind of permanantly dedicated to what I call backgrounding. Per calf, it doesn't blow me way on its profitability. Per acre, it's more profitable than my cow calf pairs. My cow herd is here, the financial risk associated with building it is over. I'm not going to sell my herd to do nothing but background cattle. I sometimes would love to only background. I'd take January, and February off, and not drag through the mud. That'd be the greatest accomplishment. I just am not ready to cross that bridge yet.
 
I had a thread on here once were I posted my actual cost per head on a group I backgrounded. I think it was at the end of 2013, or the beginning of 2014. I can't find it now. I pretty much included everything. Maybe one of the big guns can find it. I did more for informational reasons. I got quit a bit thru pm's.

Sidenote;
I backgrounded so few this year, that I was able to cut hay off of that 45 acres. I was just afraid of the price drop. In hind sight, I wish I had bought hay, and crammed that 45 acres full of calves. Even to the point of supplementing their forage with the hay I bought.
 
Bigfoot":11bdlpif said:
$780.00 purchase price of steers
$16.00 Meds
$180.00 Feed
$70.00 hay
$15.00 mineral
$1061.00 total. I'd say more like $1075


Calves brought $1160

Roughly $85 profit a piece. This is why I say I make nothing on cattle. That $85 doesn't include a host of things like-------fuel, wire, insurance, fertilizer. You name it. Probably in the end, it was a break even or lose group.

But guess what. I'll start all over again here in a few weeks.


Big - I am digging thru some of your stuff.
 
I played with my numbers a little after church. I didn't dig my shoe box out, and actually look at receipts. Looks like my return "actual profit" per acre for last year was just shy of $400 per acre backgrounding calves. I have never actually figured it on my cow/calf operation. It would be a mute point because I'm not really maxed out on my grazing. This land wasn't suitable to lease for row crops.
 

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