No matter how I figure it pounds always wins. Monday at OKC an unweaned 480# calf brought $2.58 or $1,238, 480# weaned calf brought $2.84 or $1,363. A long weaned green yearling weighing 776# brought $2.57 or $1,994 and a 835# yearling brought $2.47 or $2,062. Tell me which one you'd rather sell a truck load of? $1,238 is a long way from $2,062. I could feed one 6# a day for a year for that money. Everyone's situation is different though. $824 per head adds up fast too.
whats driving cattle prices up so much
- Thread starter dieselbeef
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Not quite! You are equating total dollars with total profit dollars.
Aren't even close to the same thing. I would prefer whatever creates the highest return per day of investment dollars.
If you have a set amount of property you have only have so many mouths you can feed. If you hold your calves to yearling or over you reduce the number of cow calf pairs you can feed . Then figure death loss . Labor cost to import and feed for 4-6 months. Ect.
Profit dollars is not even close to the same thing as total revenue. Don't understand why so many people would rather work harder for longer to make less profit.
Doesn't matter how much you make if you spend more then you make you are still broke.
Travlr
Well-known member
Well if every step of the way people are eking out a small profit and the calves are changing hands at weaning, and at weights to go to the feedlot, and at finish... then it stands to reason that less the costs of sale barn commissions and transportation and whatever else a middleman takes from total dollars there would be more money in taking an animal calf to slaughter if you can set yourself up for it.
I worked for a guy that raised really fine registered stock... but he still averaged 18K head in feedlots every year.
It generally cost me $150 per head in feed and meds to get a yearling through the winter. Typically feed it for 120 days ( good feed and very little if any hay). I can run 2 1/2 yearlings for each mother cow I can run. There is some death loss and some leg work involved but aren't we running cattle? Everyone brings up the death loss deal and the risk involved. If you wanna talk about risk look at running more cows instead of retaining yearlings. You got extra bulls, extra open cows, extra calving issues, extra time wathing them calve, the list goes on and on. $150 or $200 a head profit doesn't sound like much until you do it times X amount. There's a reason people run yearlings.
One thing I can't understand for the life of me is how every small to medium producer is jumping up and down about local butcher shops and how they could buy locally sourced beef but they don't wanna keep their calves past weaning size. What local butcher shop is going to buy 500# calves? I'm going to go way out on a limb here and say zero or zilchy zilchy. They will want 1,100 to 1,200 # calves. Who's going to raise these calves when everyone is scared to death of retaining yearlings?
It's not about being scared. A cow can raise a calf a lot cheaper than I can. My time and my money is expensive. From what I have seen there is not enough margin in that weaning to yearling range to buy my extra time and money. If cattle is all you do or all you want to do... then by all means chase the highest gross you can get. For me (us) we want the highest return per dollar because there are other things, outside of cattle, that dollar can go to and generate more money.
Most your small to medium guys are not solely in cattle which probably has a lot to do with where they invest their time/money.
Most your small to medium guys are not solely in cattle which probably has a lot to do with where they invest their time/money.
Every word you say is true. Running yearlings is definitely the most profitable and easiest thing we do though. Had some growing pains but it is what it is.
And how many feet of snow do you get each year? How many hours a year of below 32 degree weather,where nutrient levels of cows increase?
As I said location and individual circumstances make a world of difference.
We have tried both ways and for us it is cheaper for us to sell calves at weaning in the fall and then purchasing calves after green up to feed out until fall. The entire world doesn't have Texas weather and none of us have identical circumstances.
Great it works for you but can't and work for everyone.
GoWyo
Well-known member
We have a pretty good mix of cow-calf and yearling operations around here. The big yearling guys bring in 8000-9000 head from May 1 to early September. They do well most years, but every few years get bit hard when the bottom falls out of the 900-1000 lb market after they bought the calves and had the expense of feeding them. Most cow-calf guys around here wean on the truck because they don't have the hay or facilities to background 300-700 head.
tex452
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It can be the most rewarding.
kenny thomas
Well-known member
These are the operations that need to check into the Livestock Risk Protection. Sure softens the losses. Actually pretty much eliminates most losses.
I believe I said everyones situation is different. I still stand by that pounds wins every time. Texas has it's share of terrible weather too. We have stretches over a 100* with no rain and stretches below 32* with snow and 30 mph winds. We feed extra on those days and do what's necessary. At the end of the day whether running cattle or producing widgets we try to make the most $$$$ possible. Is it more work yes but, it's what we do.
Nobody that sticks their neck out every year wins every year. Don't think for a second the big yearling guys don't hedge. The guys selling because they don't have the facilities could have the facilities if they'd find a way to keep the little jokers a few years in a row. The problem is it's such a big game with such a small reward most find it easier to sit on their hands. I'm sitting on my hands for the next several years for sure.
GoWyo
Well-known member
These guys are pretty sophisticated. They have the volume to hedge and they spend most of the fall and winter buying calves and put them in feedlots until turnout time when the trucks start rolling. LRP is likely way more expensive than their hedges cost and they can change their hedges as situations warrant.
kenny thomas
Well-known member
Possibly, good that they have it covered in some way.
I checked recently on LRP and the cost would have been around $2500 per 50,000 lb load.
GoWyo
Well-known member
Might be a good way to go. Wouldn't have to worry about meeting margin calls.
kenny thomas
Well-known member
Guess my point is that there are ways to protect yourself whether its 10 head or 10 thousand. With current prices the investment is costly and so could be the risk.
simme
Old Dumb Guy
I agree. I think retaining ownership gives feedback on the overall genetic worth of your cattle. Most smaller cow-calf producers only know how their cattle perform from birth to weaning since that is what they see and what they get paid for. Long held opinions about what makes a good calf might be validated or disproved if ownership is retained. Some of those traits and characteristics we argue about sometimes might be better understood or appreciated if you own the animal and take the risk/reward to the rail.
Dave
Well-known member
You can do LRP for any number from one head and up. And you can do it for different rates The upper price rate of course costs more money to insure. The lower rate isn't that much lower but a lot cheaper. My thought is that using the lower rate is much less expensive but protects you from the market collapsing.
Those yearlings I sold a couple of weeks ago made a huge profit. Every year won't be this good. But look at what the cow/calf guy got for the calves I bought. After selling cost they got less than $690. They fed a cow all year for that. With my cost the break even was $1.29 on those steers. For what works out to just a couple cents per hundred I could have put the low level LRP on those steers to insure a minimum price of $1.80.
Those yearlings I sold a couple of weeks ago made a huge profit. Every year won't be this good. But look at what the cow/calf guy got for the calves I bought. After selling cost they got less than $690. They fed a cow all year for that. With my cost the break even was $1.29 on those steers. For what works out to just a couple cents per hundred I could have put the low level LRP on those steers to insure a minimum price of $1.80.
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For the last 5-6 yrs we've been shipping to OKC. Last year I took a gamble and sold at the local salebarn to give them another shot. Some friends of mine bought it and have really turned it around. The cattle did good there but this year we shipped to OKC again.
That's yearling cattle. Any odd cows or bulls still go to the local barn.
Are you talking what are our calves on the ground worth today or what did our yearlings bring this year? We haven't wean this years calf crop yet.
