Look at the cost the custom feedlot is charging you for the cost of gain? The feedlot guy is actually quite right...a lot of money is being lost by not feeding out that calf....and he wants to get it!
Not sure what the going rates are right now but last year in my area they were quoting around 75 cents/lb. of gain? If a steer gains around 3.5 lbs. a day that means about $2.63/day? With a 6.5 to 1 conversion rate on barley his feed cost was about 54 cents/lb of gain or $1.89/day. So he gets about 74 cents a day to pay for processing/yardage etc.? Is that a fair price?
If that 600 lb. steer calf was worth $1/lb. in November and he takes him to 1300 lbs at a rate of 3.5 lbs/day, he will be paid 200 days X $.74 or $148? You on the other hand will have $600 in the calf, $378 in feed, and $148 for his yardage/profit(plus you get to carry the interest costs). You will have $1126(without death loss/vet cost/interest) in your calf. With a fat price of 82 cents you will recieve $1066! You didn't make any money but the custom feeder did.