Cow-calf profits show big range
The 119 herds, consisting of 17,300 cows, in the North Dakota Farm Business Management Program generated an average loss of $12.85 per cow last year. The 25 highest-profit herds did considerably better than the average with a profit of $73.25 per cow. The lowest-profit group lost $185.14 per cow. The spread between the two groups was $258.39 per cow.
While total direct and overhead expenses totaled $465 per cow for the average herds, the high-profit herds trimmed this to $397, and low-profit herds pushed the total to $590 per cow. Feed cost, including both grazing and winter feeding, was the single largest direct cost at $303 for the average cow. Low-profit herds showed a larger feed cost at $347, while the high-profit herds trimmed this expense to $256 per cow.
• Cow-calf profits vary greatly across North Dakota.
• High-, low-profit herds in 2009 had $258-per-head spread.
• Four factors account for most of the differences.
The average cost to maintain the breeding herd was calculated at $53.61 per cow for the average herd. High-profit herds narrowed this to $37.47 per cow, and low-profit herds came in at $68.47 per cow. This breeding herd maintenance cost is affected by such things as death rate, annual culling rate within the breeding herd and the value of cull animals.
The average herds posted an average weaning weight of 569 pounds and managed to wean 504 pounds per exposed female. High-profit herds posted entries of 573 pounds and 505 pounds.
So, what makes up the difference between a low-profit and a high-profit herd? First, the high-profit herds tend to raise more pounds of beef per cow exposed. Second, the value of the high-profit calves was shown to be about $3 per cwt. higher than the calves from the low-profit herds. Third, high-profit herds typically spend less, $193 less in 2009, for direct and overhead costs. Fourth, high-profit producers tend to maintain their breeding herd for less dollars of inventory change, about $31 less per cow in 2009.
Metzger is the North Dakota Farm Business Management coordinator at the Carrington Research Extension Center, Carrington. E-mail email@example.com or phone 701-652-295.
This article published in the September, 2010 edition of DAKOTA FARMER.