In The Cattle Markets
The cost of wintering cattle.
As we move into the winter feeding months, cow-calf producers have additional opportunities to impact their bottom line. Winter feeding costs represent the single largest cost to cattlemen, typically representing 55%-80% of total costs for their cow herd. This cost is important to consider when making the decision to cull open or unproductive cows or to feed them through winter while trying to improve body condition score. Additional consideration should be given to feed resources available and market value for cull cows.
Cow-calf producers should consider what their individual feed costs are, along with feed availability. The average cow can eat 2.2% of her body weight in dry matter each day during the feeding period. For producers in the upper Midwest, where hay prices are averaging $65-$100 per ton and long feeding periods (around 150 days), feed costs can add up quickly. Depending on hay quality, producers may need to add corn or another energy source into the ration along with providing a supplemental mineral.
Individual costs will vary with different management practices depending on labor, yardage, vet fees and ingredients in the ration. Assuming feed costs of $65 per ton for hay, $2.90 per bushel (bu.) for corn and an average mineral price of 35¢ per pound (lb.), total ration costs can average $1.43 per head per day. This feed cost assumes a 1,300-lb. cow eating 2.2% of her body weight in dry matter and a 15% shrink due to hay feeding losses. Assuming an average daily gain (ADG) of 0.84 lb. for 120 days, the daily feed costs give us a cost of $1.70 per lb. of gain. Producers looking to reduce costs should look for strategies to reduce feeding shrink, such as using hay rings or considering a total mixed ration (TMR).
When looking at marketing cull cows now or feeding them through the winter and selling them this spring, cow body condition needs to be considered along with feed resources on hand. Thin cows with low body condition scores may be candidates to feed through the winter as they have the greatest opportunity for body condition improvement. With thin cows currently selling in the upper Midwest for $40 per hundredweight (cwt.) there currently may be revenue opportunities, assuming a producer can increase the cow’s body condition score during the winter.
If March price is $56 per cwt. for a cow in average condition (as opposed to the $40 per cwt. for the thin cow today), the producer has the opportunity to gain an additional $250 in revenue by improving the cow’s body condition, while the feed costs (assuming the above prices for this gain) are approximately $153. Note that no yardage, management fees, vet costs, etc., have been included. Also, the risk is whether she gains condition. If not, she could possibly receive the same or lower price per cwt. in the spring than she does today.
Cow-calf producers looking to cut costs this winter should look for strategies to reduce feed waste and cut feed costs along with looking for marketing opportunities for cull females to increase revenue. Open or unproductive cows cost producers in the long run if kept in the herd; producers should look at their own costs to see if it benefits them to market their cull cows now or continue to feed them until spring. Individual costs will vary depending on location, as well as management practices, but opportunities to improve the bottom line may currently exist for this winter’s feeding months if appropriately priced hay can be procured.
Editor’s Note: Jared Geiser is a research assistant and Brenda Boetel is a professor and extension economist for the Department of Agricultural Economics at the University of Wisconsin–River Falls.