Purely a stocker operation only

[pwilli3]

From reading posts for the last few months I gather most everyone here does cow/calf. Anyone out there do stocker only? What is your real world experience of the income difference between stocker and cow/calf? If I run stock only through the Spring and Summer I'm looking at buying high and selling low for the market trends in this area. Has anyone got a better strategy for stocker? Like hay twice in the summer and run stock over the winter feeding the hay? Would this work?

 

[Aaron]

Not sure in your area. Should be profitable, but not a great time. Was overhearing a fella talk on Friday at the sales barn. This year he made $30-35 on his feeders. Last year was $60 and 2 years ago he was over $100 a head profit. :cowboy:

 

[Jogeephus]

Not sure in your area. Should be profitable, but not a great time. Was overhearing a fella talk on Friday at the sales barn. This year he made $30-35 on his feeders. Last year was $60 and 2 years ago he was over $100 a head profit. :cowboy:

That's about right. Here, winter stockering is where the best money is - when and if there is any to be made. Most people build their numbers during the winter and reduce in the spring. Its a hit and miss deal involving a lot of money - preferably out of your pocket and not the bank - but on a 10 year average $35-$40 is a good figure to use. Its a huge investment for little return but then again everything in agriculture is.

 

[novatech]

Like hay twice in the summer and run stock over the winter feeding the hay? Would this work?

Correct me if I am wrong but I have always thought stockers were put on grass. If you hay it first then feed the hay that is just more input cost. Now if you have good winter pasture and need the hay to go with it that is a different story. I am not from your area and do not know how things are done there but I cannot see the economics of it.

 

[S B Knap]

Im new here but thought i might be able to weigh in on this. I dont run stockers myself but my inlaws do and they run them on wheat, corn stubble and standing corn that didnt produce enough. They will run 3-400 head from a feed lot this year they are getting .75 a hd per day. He will also buy 3-400 of his own and run them all till about March. With the feedlot calves you can do the math pretty easy on what kind of profit a guy can make. Buying your own calves your gambling a little with the market but stand to make a greater profit if you can be flexible.

They have thousands of acres of wheat and miles of electric fence so unless a guy is growing wheat already it dosent pay to put up hay or lease wheat for calves. The inlaws dont have any grass pasture and dont keep any cattle through the summer but dont always run calves in the winter. Myself i have a small commercial herd thats enough work for me.

Once in a while they will also buy heavy breed slaughter cows toward the end of winter calve them out and he turns a decent profit with that might be something to look into.
Scott

 

[Stocker Steve]

Cows eat a lot. They can make you a some money if you have inexpensive roughage . Otherwise they are a tax loss hobby.

Stockers require more management and better feed quality. Grazing light calves was the best $/acre option back when grain and N were cheap. :banana: ROE was triple digits. I miss the old days...

Conventional wisdom is the that stockers should be much more profitable now that feedlot cost of gain has gone way up. Reality is that calves are still overpriced compared to the kill market, and folks with stocker inventory took a big hit in October.

There is still some profit in stockers if you know how to market - - when and where to buy, when and where to sell.

 

[Howdyjabo]

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Conventional wisdom is the that stockers should be much more profitable now that feedlot cost of gain has gone way up. Reality is that calves are still overpriced compared to the kill market, and folks with stocker inventory took a big hit in October.
There is still some profit in stockers if you know how to market - - when and where to buy, when and where to sell.

I agree with Steve --Now is not the time for experimenting with stockers-
I still can't understand what is holding the price of calves up- Do you see it Steve?

 

[apical meristem]

Projected profit this year on grazing south plains wheat was $20/hd. Running 1,000 calves to make $20,000 just isn't very appealing. Way too much risk, too much work for too little reward. And Steve is exactly right, those that have inventory in October took a hit.

 

[apical meristem]

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I still can't understand what is holding the price of calves up- Do you see it Steve?

The ever decreasing size of the US cow herd and a relatively weaker dollar that makes imports more expensive. Of course now demand has weakened somewhat and the currency has strengthened some. When feeder margins are positive, they can also afford to pay a little more for lighter weight calves to have more pounds of gains to spread fixed costs.

 

[Stocker Steve]

At the simplest level - folks still want to buy stocker weight calves...

I asked Allen Nation why calf prices were out of line with kill price and he could not give me an answer, so asked him again. What I got out of a long discussion is that it is cheaper short term for feedlots to keep running than to shut down. They may shut down after losing money for several years in a row.

I asked a breed rep the same question. He said many feedlots have long term feed contracts so the big jump in grain prices does not effect them for a year or so.

I think the bottom line is it takes several years of pain for most people to react and make a change. They may have lots of money in the bank (I wish), or lots of roughage (I do), or they don't belive in selling hay (I don't sell unless a neighbor is needy) or they have locked in a spread (I try to use LRP).

 

[IluvABbeef]

From reading posts for the last few months I gather most everyone here does cow/calf. Anyone out there do stocker only? What is your real world experience of the income difference between stocker and cow/calf? If I run stock only through the Spring and Summer I'm looking at buying high and selling low for the market trends in this area. Has anyone got a better strategy for stocker? Like hay twice in the summer and run stock over the winter feeding the hay? Would this work?

Like others say it depends for your area. We used to do stocker only up here. I find that you're really vulnerable to price fluxuations than for cow-calf, and carry more of a risk in terms of market prices and demand and supply and feed availability. Costs are a bit less with cow-calf (from what I read/was told on here) because of buying/selling, costs for good quality feed & supplements (better than what cows need), veterinary (shipping fever, pneumonia more common with stockers, plus booster shots among others), higher land, labour and interest costs, and transportation and shrink costs.

From what I was reading a lot of stockers around your area are lightweight (probably ~500 lbs) and are grazed on small grains thru the winter, though this can be costly if the winter grazing program doesn't work due to weather conditions both when winter wheat is grown and afterwards, and the stockers have to be fed a costlier roughage, since these lightweight calves need to be fed higher quality feed than the heavier wt calves. Hay would work if its tested to be of high quality (high % protein) comprised primarily of legumes; not only that but since legume hay only tests to have ~12% protein (assuming here), light weight calves at around 500 lbs need ~16% protein diet, so that means you need to supplement with grain to get the needed gain of 1.5 to 2 lbs/day.

When we ran stockers we aimed to buy low and sell high, and have them run thru the whole year, selling them as long yearlings. Hay wouldn't cut the needed ADG for growing stocker steers because of the lower quality than grain silage, thus they were also fed grain silage over winter. Then out to pasture they went, and gained well on good pasture. They were I guess lightweight (~500 to 600 lbs) and finished backgrounding at ~900 to 950 lbs going into the feedlot.

 

[Texas PaPaw]

Like hay twice in the summer and run stock over the winter feeding the hay? Would this work?

Correct me if I am wrong but I have always thought stockers were put on grass. If you hay it first then feed the hay that is just more input cost. Now if you have good winter pasture and need the hay to go with it that is a different story. I am not from your area and do not know how things are done there but I cannot see the economics of it.

My program begins with stockpiling as much grass as possible in the fall. In (usually)late October, when the sale barn numbers increase (and price usually decreases) I start buying calves every week thru the winter. My objective is to have the numbers built up in time for the spring flush of grass. Buying every week thru the winter allows me the pick off the bargains as they become available and gradually build my numbers. By shifting the buying and selling forward a few months allows me to minimize buying during the spring highs and avoid selling in the fall lows.

I winter these calves by strip grazing to ration out the stockpiled grass and supplementing with corn gluten and soy hulls. Hay is an expensive option as stockpiled grass costs me less than 1/2 the cost of hay. I do keep some hay on hand in case there is not enough stockpile to last till spring. The objective is to have these calves healthy and ready to gain when spring grass arrives. We sell them in June, July and August as grass growth fades with the heat. Then the stockpiling begins for the next round.

 

[IluvABbeef]

My program begins with stockpiling as much grass as possible in the fall. In (usually)late October, when the sale barn numbers increase (and price usually decreases) I start buying calves every week thru the winter. My objective is to have the numbers built up in time for the spring flush of grass. Buying every week thru the winter allows me the pick off the bargains as they become available and gradually build my numbers. By shifting the buying and selling forward a few months allows me to minimize buying during the spring highs and avoid selling in the fall lows.

I winter these calves by strip grazing to ration out the stockpiled grass and supplementing with corn gluten and soy hulls. Hay is an expensive option as stockpiled grass costs me less than 1/2 the cost of hay. I do keep some hay on hand in case there is not enough stockpile to last till spring. The objective is to have these calves healthy and ready to gain when spring grass arrives. We sell them in June, July and August as grass growth fades with the heat. Then the stockpiling begins for the next round.

Excellent post.