Cost Of Raising Beef Cattle

The current level of high prices within the beef industry and the current position of cow-calf producers within the cattle cycle has given rise to renewed interest in the management of beef cow herds to produce the greatest level of profitability possible.  Beef producers need to maximize their profits at all levels of the cattle cycle may generate the profits needed to operate and grow their businesses throughout the cycle.  Producers need to know and understand their own levels of production and expenses.  A better understanding of how an individual producer’s cow herd compares to others in both production and profitability is critical to the sustained operation and growth of their beef cow-calf business.  One way to better understand production and profitability numbers is to review the production, income and expense numbers for average-and high-profit beef cow-calf producers within the same geographic area.

Description

Data for this study was compiled through the Carrington Area Farm Business Management Program in conjunction with the North Dakota Farm Business Management Program.  The Carrington program is one of 13 programs in the statewide North Dakota system.  The data of producers enrolled in the program from 1994 through 2004 was summarized using the FINPACK farm analysis software program.  In some very limited instances where particular high-profit group numbers were unavailable in the database, the average of the annual figures present was used after careful consideration and correlation with the high-profit data in both the local and regional reports.

The minimum number of producers involved in the study in any one year was 18 with a maximum of 27.  A total of 245 herds was involved with a total of 27,752 cows.  The 20% high-profit herds numbered 51 with a total of 5,488 cows.  The high-profit herds are included as part of the total herd group.  The base of herds was quite consistent over the 11 years with several herds being involved for the entire 11-year period.

While all costs were gathered on a 12-month basis, the income side of the enterprise, except for the sale of cull breeding stock, was terminated at weaning when the calves were physically separated and sold or transferred to a separate feeding enterprise.  While producers were encouraged to weigh all calves, it must be acknowledged that some producers did not weigh all calves at the time of weaning and transfer out of the herd.  For these calves, weights were estimated using the sale weights of herd mates and similar type calves.  All replacement breeding stock was held in separate enterprises and its costs and returns are not included with the beef cow-calf data contained within this study.

Festures of Raising Beef Cattle

The cost to produce a lb of beef is largely dependent on the price of feed, which is the major expense for the cow to get the calf raised from birth to weaning. Then in the feedlot phase, because the diet is mostly corn, the price of corn will impact this cost as well. If the cost from birth to weaning is $400 and the cost from weaning to finish is $390 then the total cost is $790. If the calf weighs 1200 lb at finish, then the cost per lb of gain for a calf that goes through a “calf-fed” system, then the cost is $0.658/lb. In these figures, it assumes that the producer retain ownership and the “in” cost of the calf is what it cost to produce the calf to that point. Cow expenses may be higher because of drought causing the price of forages to go up. If you had to purchase the 500 lb calf at weaning and paid $1.20/lb, then the “in” cost is $600 and total cost is $990 and the cost per lb is $0.79. If you retain ownership of the calves and they are the type of calf that can go through a growing period during the winter and grass pasture in the spring and summer, then to a short feedlot phase and the total cost after weaning to slaughter is about $520, then the total cost is $905 per head (using cow cost to produce the calf to weaning). Usually calves that go through this system will weigh more at finish and let’s say 1375 lb so cost per lb would be $0.658/lb. These are just estimates and producers need to put in their costs, because it will vary within states and across states depending on your resources.

Breads of Beef Cattle

In the United States of America, the most famous breed is the Black Angus. This breed requires extra maintenance and care during the calving season. There are more breeds of beef cows that are great providers of beef such as:

  • Charolais: This breed is heavier in weight and in winters their coat thickens.
  • Hereford: They mature early and their fattening abilities are great. They are docile and are efficient at milk-producing.
  • Simmental: Easy to work with during the calving season. They too have good fattening abilities.
  • Red Angus: They are docile and have good fat marbling.
  • Texas Longhorn: These are survival cows and they have longhorns.
  • Highlands: They have thick coats, they can easily survive in colder weather. Their meat is lean and marbled.

Cost Of Raising Beef Cattle

The cost of beef heifers is around $2,500 to $3,000 individually with an average cost of $2,800 per cow. The cost of the calf will generally be based on its weight. The unit of measurement used to put prices on cows is CWT which stands for 100 pounds. For a beef cow, CWT is between $135 and $165. It is an average of $140 per 100 pounds. A calf that weighs 500 pounds costs around $700. As compared to a heifer, bred heifer costs more. A bred heifer can cost around $1,300. Whereas matured cows can cost around $4,000 to $5,000 each. A matured cow can weigh around 2,200 pounds i.e. $1.85 cwt.

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