Cost control without sacrificeCost control without sacrifice
Calf prices are off significantly from where they were the last two years. Cost control will be important, as always, and close attention needs to be paid not to sacrifice performance. Here are three things to consider when it comes to nutrition and economics this year.
November 10, 2016
We’ve been reading about it, we’ve experienced it, we’ve denied it and we’ve accepted it. Calf prices are off significantly from where they were the last two years. This seesaw of a cattle market over the past couple years has made for a lot of optimism and grief, depending on which side of the seesaw you sit. Nevertheless, time moves on as does our business. Our job is to adjust, make improvements and work through the market gyrations to assure our long term future. Cost control will be important this year (it’s always important) and close attention needs to be paid not to sacrifice performance.
Three things to consider when it comes to nutrition and economics this year:
Don't sacrifice performance in order to save on costs; rather, invest in programs that make sense and provide a return.
The price of a 550 lb. calf this fall is likely to be at least $500 less than last year. This reduced revenue will no doubt bite into profits. There’s no perfect supplement, medication, additive, or mineral that can make up that difference. Likewise, there’s no way to cut out this much expense, or even ½ - ¾ of it without seriously impacting performance and revenue. Annual cash cost per cow can vary widely by region and by operation. Pasture and winter feed cost are usually the highest categories, but overlooked costs such as depreciation on cows due to poor breed back can be a huge cost too. Self-fed supplement programs can help improve the use of these resources and more importantly contribute to better health and performance which reduces cost and improves revenue. The nutritional focus should be on improving breeding parameters, weaning rate and weight as much or more so than simply cutting a program.
Don't let cows lose condition this fall prior to winter feeding programs.
Summer has been good to us in a lot of places, and if we’ve done a good job with grazing programs, herd health, etc, we should have cows in pretty good shape going into the fall. The easiest keeping cow is the one you don’t have to feed back into shape. In other words, keep the condition on her by making sure fall and winter forage sources provide or are supplemented with adequate protein, minerals and vitamins.
Be wary of "good buys" on cheap feedstuffs. They aren't always the least cost.
It’s been said that some commodities cost as much to feed as they do to purchase. It’s good news to the cattle industry that a lot of feedstuff costs should be down this year. Keep in mind however that to feed many commodities as a supplement requires considerable investment in equipment, storage, and labor. These programs make sense for large operations that have the infrastructure in place more so than mid and small size operations. Also, commodities such as distillers are good sources of protein and energy, but don’t come with many quality guarantees or a fortified mineral and vitamin program. Be sure to really compare “true cost” and consider the additional value you get in a self-fed supplement program.
It will be necessary to scrutinize cash costs of cows. Unfortunately, cutting supplements out like a mineral program won’t change the overall bottom line cost that much. In fact if performance is hindered, cost per unit of production will go up and revenue will go down --- not smart economics. If we better utilize stored forages, improve grazing performance and the days spent grazing, have better health and reproduction, use minimal labor and equipment, then we have a better chance of improving revenues and controlling cost.
For more information about how CRYSTALYX® self-fed supplements can help control costs on your operation, visit www.crystalyx.com.
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