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The
Economics of Preconditioning
*Adopted
from“Adding Value to Your Calf Crop by Preconditiong” Walt Prevatt,
Darrell Rankins, and Soren Rodning, Auburn University 4-07
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Table 1 |
Feeder calves sold at weaning non-preconditioned |
Feeder Calves
Sold after 45
days of
preconditioning |
|
Item |
|
Feed cost, $/ton
$110.00 |
| Number
of head |
75 |
75 |
|
Initial weight lbs. |
550 |
550 |
| Days
of preconditioning |
0 |
45 |
|
Facilities cost, $/hd. |
- |
$8.00 |
| Feed &
mineral cost, $/hd |
- |
$47.83 |
|
Labor cost, $/hd. |
- |
$10.00 |
|
Medication cost, $/hd |
- |
$11.00 |
|
Death Loss, $/hd. |
- |
$5.69 |
| Total
cost, $/hd. |
- |
$82.52 |
|
Total cost, $/hd./day |
- |
$1.83 |
Average Daily gain,
lbs/hd./day |
- |
2.25 |
|
Gross pay weight, lbs |
- |
651.25 |
Gathering and penning
shrink, percent |
2% |
- |
|
Sorting shrink, percent |
3% |
- |
|
Loading shrink, percent |
1% |
1% |
|
Transportation shrink, percent |
2% |
2% |
| Pencil
shrink, percent |
2% |
2% |
|
Total shrink, percent |
10% |
5% |
| Total
shrink, lbs. |
55 |
28 |
|
Net pay weight, lbs. |
495 |
624 |
| Sale
price, $/cwt. |
$115.00 |
$110.00 |
|
Gross receipts, $/hd. |
$569.25 |
$686.13 |
|
Preconditioning cost, $/hd. |
$0.00 |
$82.52 |
|
Net receipts, $/hd. |
$569.25 |
$603.61 |
|
Difference net receipts, $/hd. |
|
$34.36 |
Difference in net receipts,
total $ per group |
|
$2,576.72 |
MANAGING SHRINK—A
rancher cannot make decisions about marketing feeder calves without
considering shrink. Calf shrink occurs in following areas:
- gather and pen the cattle
- sort the calves from the brood cows
- sort the calves on sex
(steers/heifer)
- sort the calves on weight and
uniformity
- load the feeder calves
- transport the feeder calves
- handling at the auction barn
Various studies have estimated feeder
calf shrink to range between 10-15 % when marketing the un-weaned feeder
calf. On a 500-pound feeder calf that would be 50-75 pounds per head.
Thus, feeder calf shrink could have a significant impact on your net
farm income. Whereas, preconditioned calves have recovered the shrink
incurred during gathering and sorting process, have adapted to people
and the pen environment, and are use to being handled.
Table 1. illustrates the potential
value to preconditioning
MARKETING PRECONDITIONED CALVES—
Feeder calf preconditioning means different things to different people
and does not guarantee that buyers will always pay for the value.
Therefore, feeder calf producers must fully describe their
preconditioned feeder calves and market them in an environment where
they will be compensated for the increased value.
INDENTIFYING VALUE ADDED BUYERS—
Perhaps the most overlooked step in marketing preconditioned calves is
marketing to the right set of potential buyers. Who is your customer? Do
they have a value added endpoint for your calves? Marketing should be a
process; not simply a task. Coordinated beef programs such as Suther’s
and Power Genetics offer producers access to buyers searching for
preconditioned calves.
SUTHER’S PEN-START & RUM-START—Nutrition
is an important part of any preconditioning program. Suther’s line of
calf starters come in a range of package sizes to include products fed
at rates of .33 lbs., 1 lb., and 6 lbs. per head per day. Let us work
with you to determine the correct product and complete feeding program
for your ranch.
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