Profit on stockers

[Cross-7]

I see guys talking about profiting 300 or even more per head on stockers
Now I've never had big numbers of calves like these guys but I've never even come close to 300 a head
Even when not factoring in expenses I can't figure 300 a head profit

What am I missing ?

 

[yakker]

op:

 

[Son of Butch]

You would have to ask the guys who said it, I've never heard anyone claiming it.
$300 x 100 hd = $30,000 net
Maybe for a short period 2 or 3 years ago, but even then I'd say they were claiming dividends on their memory banks.

 

[Bigfoot]

I consider $70 a fairly successful turn. I have had isolated incidence of a particular calf doing quit well.

 

[Aaron]

I see guys talking about profiting 300 or even more per head on stockers
Now I've never had big numbers of calves like these guys but I've never even come close to 300 a head
Even when not factoring in expenses I can't figure 300 a head profit

What am I missing ?

$300 was possible in the late 90's when the spread between calves and yearlings was considerable. For many years since then, a lot of $100 or less years were possible. 2012 to 2013 was a very good period and margins could be upwards of $500 just because of the dramatic rise in prices.

This year, it is going to be hard to find someone who won't be bleeding. Just heard that a neighbor who bought some of my steers last fall, would sell everything (250 steers) this second if he could get $100 more than he paid. He has about $250 into each one and knows he will never get it back out of them this spring.

 

[Cross-7]

I see guys talking about profiting 300 or even more per head on stockers
Now I've never had big numbers of calves like these guys but I've never even come close to 300 a head
Even when not factoring in expenses I can't figure 300 a head profit

What am I missing ?

$300 was possible in the late 90's when the spread between calves and yearlings was considerable. For many years since then, a lot of $100 or less years were possible. 2012 to 2013 was a very good period and margins could be upwards of $500 just because of the dramatic rise in prices.

This year, it is going to be hard to find someone who won't be bleeding. Just heard that a neighbor who bought some of my steers last fall, would sell everything (250 steers) this second if he could get $100 more than he paid. He has about $250 into each one and knows he will never get it back out of them this spring.

That was my thought
Maybe in a rising market like we had the past couple years

 

[TexasBred]

I see guys talking about profiting 300 or even more per head on stockers
Now I've never had big numbers of calves like these guys but I've never even come close to 300 a head
Even when not factoring in expenses I can't figure 300 a head profit

What am I missing ?

Some consider "profit" as sales price less purchase price. Sounds good in the coffee shop.

 

[J&D Cattle]

I see guys talking about profiting 300 or even more per head on stockers
Now I've never had big numbers of calves like these guys but I've never even come close to 300 a head
Even when not factoring in expenses I can't figure 300 a head profit

What am I missing ?

Some consider "profit" as sales price less purchase price. Sounds good in the coffee shop.

I'd agree TB. I had a guy tell me how he can buy light Holsteins and background them to about 700lbs and make $300/head. He does raise his own corn but seems to never bill those Holsteins for the costs associated. He bills everything back to his cow herd and then brags about how much he makes. Nice guy, I just nod and go on.

 

[bball]

I see guys talking about profiting 300 or even more per head on stockers
Now I've never had big numbers of calves like these guys but I've never even come close to 300 a head
Even when not factoring in expenses I can't figure 300 a head profit

What am I missing ?

Some consider "profit" as sales price less purchase price. Sounds good in the coffee shop.

Exactly. The "sell/buy" model vs. The "buy/sell" model. Supposed to work pretty well if a fella is in it for the long haul (accumulating land and cattle)....atleast that's what the books and the ol'timers say...

Edit to clarify: purchase price of the next group...not current.

 

[tom4018]

I consider $70 a fairly successful turn. I have had isolated incidence of a particular calf doing quit well.

How long are keeping them for that amount?

The ones we have done are bought around 300 and sold about 600. Have averages about a $1 a day on them. Last year we did not do many because of the high prices I was afraid they would fall off before we got them sold and had some back trouble. The ones we did last year were bought early and sold before the prices got cheaper, had some that I lost big time on (died) and others I made $500 a head on, average has been a little over a $100. We do it on a small scale, less than 10 at a time to limit the risk.

 

[Bigfoot]

45 days, maybe out to 60

Had some good times on the ride up. Last quarter of last year, not so hot.

My normal routine would be to take a calf from 450 to 725. Market hasn't lined up for that in a while.

I hope the market moves back in a direction where it pays to background a calf. It's my favorite thing to do in the cattle industry.

 

[tom4018]

45 days, maybe out to 60

Had some good times on the ride up. Last quarter of last year, not so hot.

My normal routine would be to take a calf from 450 to 725. Market hasn't lined up for that in a while.

I hope the market moves back in a direction where it pays to background a calf. It's my favorite thing to do in the cattle industry.

So you are in the same per day range we are, mine is actually $1.04 a day.

 

[Bigfoot]

45 days, maybe out to 60

Had some good times on the ride up. Last quarter of last year, not so hot.

My normal routine would be to take a calf from 450 to 725. Market hasn't lined up for that in a while.

I hope the market moves back in a direction where it pays to background a calf. It's my favorite thing to do in the cattle industry.

So you are in the same per day range we are, mine is actually $1.04 a day.

What I like about stockers is that on a per acre basis, they are more profitable, and less work than cows/calves. It's your choice to winter them to. You can get in, and get out. You really don't have that flexibility with cows and calves. I don't have the cash, nor do I want to assume the risk of covering my place in them though.

 

[Rafter S]

I see guys talking about profiting 300 or even more per head on stockers
Now I've never had big numbers of calves like these guys but I've never even come close to 300 a head
Even when not factoring in expenses I can't figure 300 a head profit

What am I missing ?

Some consider "profit" as sales price less purchase price. Sounds good in the coffee shop.

I bought a few weaning age heifers at the auction barn last summer. Two of them just wouldn't settle down, so I gave up on them in December and took them back where they came from. I lost a smooth $500.00 per head on them. And that's not counting feed either.

 

[tom4018]

What I like about stockers is that on a per acre basis, they are more profitable, and less work than cows/calves. It's your choice to winter them to. You can get in, and get out. You really don't have that flexibility with cows and calves. I don't have the cash, nor do I want to assume the risk of covering my place in them though.

Your comments in the past got me to tracking things on aped acre basis instead of always tracking it per head. That is what I like about forums like this it gives you different ideas, not all ideas work for everyone but they are worth considering. What I like trackin it on a per acre basis is it also make you watch you cow size.

 

[shaz]

I've made 200 on some heifers a couple of years ago but that was because the market went straight up.

 

[js1234]

We have owned sets that profited $300/head, some quite a bit more. Those sets though are few and far between and certainly nowhere near the norm. Maybe even less frequent for us as we are very disciplined operators and $100-$150/head net will almost every time be locked up one way or the next letting most additional upside pass us by. I don't know the context in which he spoke of $300/head net on stockers in terms of consistency. Anything more frequent than "has happened a few times for me" and I'd say is very suspect. Stockers are much more consistently profitable when managed properly than many around here seem to think but $300/net with any consistency just doesn't happen.

 

[Cross-7]

I think as you said consistently and any large numbers of cattle.
Buying #2's that that have been mismanaged and need some feed and care to be #1 -1-1/2's.
To do that consistently year after year in any real numbers other than a few here and there would be tough.
Sure sitting in on lots of sales all day picking up a few here and there, but sourcing those type cattle in large groups year after year I don't see it
Buying calves in a rising market as we have had the last couple years, but summer and fall 2015 bought calves sure ain't going to make 300 a head

In my job I see small businesses struggle because they don't have the product lines or inventory and aren't willing to take the chance to grow.
The next guy that has numerous product lines, buying big inventory for the volume discount and is always looking to expand and grow is doing very well.

When I hear the big boys with large numbers of calves talking big profits.
A conservative guy like me playing with high dollar calves and slim margin that doesn't like to gamble with big numbers makes you look in the mirror and question your operation, risk tolerance and etc.

 

[BC]

I think as you said consistently and any large numbers of cattle.
Buying #2's that that have been mismanaged and need some feed and care to be #1 -1-1/2's.
To do that consistently year after year in any real numbers other than a few here and there would be tough.
Sure sitting in on lots of sales all day picking up a few here and there, but sourcing those type cattle in large groups year after year I don't see it
Buying calves in a rising market as we have had the last couple years, but summer and fall 2015 bought calves sure ain't going to make 300 a head

In my job I see small businesses struggle because they don't have the product lines or inventory and aren't willing to take the chance to grow.
The next guy that has numerous product lines, buying big inventory for the volume discount and is always looking to expand and grow is doing very well.

When I hear the big boys with large numbers of calves talking big profits.
A conservative guy like me playing with high dollar calves and slim margin that doesn't like to gamble with big numbers makes you look in the mirror and question your operation, risk tolerance and etc.

Cross 7, I think $300 per head profits on stocker calves on a consistent basis are unreal expectations. Most of the operators I know shoot for $100 to $125 profit on stocker calves. There was a period in 2014 to mid 2015 that some big money was made. On the other hand, cattle bought last spring were lucky to bring their first cost back after doubling their weight.

You mentioned trying to source some upgradable calves. I would suggest contacting some order buyers that work East Texas, Louisiana or Mississippi. Those calves do well in West Texas or Oklahoma wheat fields. They have already bought their chair at the sales they make.

 

[Stocker Steve]

Many people are not able to add up all their costs. Not sure that we have an average or normal year very often. That said:

- You need multiple turns per year of light calves to optimize.
- The bigger operators have out of the area buyers and make money putting their calves together.
- You need stocker quality pastures to get profitable ADG. So, the big operators may have a north/south operation to extend the grazing season.
- When you combine the back grounding GM and the 2+ ADG grazing GM - - it is about double what cow/calf can deliver per acre. But, you also need about double the cattle capital per acre. The big operators are often leveraged.
- Locking in a profit is key to avoiding a wreak. LRP and/or preselling on video are common.

So exactly what skills are you being paid for? Marketing? Back grounding? Networking? Grazing Management? Stockmanship? Risk Management? Making a consistent stockering profit is more complicated than producing home raised calves. You have to like the game.