Cow feeding economics for the 2019-20 winter season

Keep in mind prrice and availability of feed

High feed costs again in 2019 have many producers wondering about the economics of overwintering their cows. Ted Nibourg, farm business management specialist at the Alberta Ag-Info Centre, looks at the economic factors when developing a feed strategy for this winter.

“The question,” says Nibourg, “Is it even feasible to keep cows? Some are liquidating their entire herds. Others are culling heavily, and many are trying to find economical ways of maintaining them.”

He says that the two main factors to consider in developing feeding economies are price and availability of feed.

“One factor to consider this winter will be the availability of quality forage. Parts of the province experienced drought again this summer while others suffered the other end of the spectrum. The wet areas of the province had difficulty getting their hay off dry and many producers resorted to putting their forage up as silage or haylage. This tends to solve the supply dilemma locally, but it greatly increases transportation costs to areas of reduced supply as much of what is being trucked is water.”

To arrive at daily feed costs, Nibourg ran some rations through CowBytes to add perspective to feed price variations, and its effect on a producer’s bottom line.

“The rations assumed 1,400 pound cows at mid-pregnancy. The barley-straw ration priced barley at $5 per bushel and barley straw at $50 per ton. The result was a ration that came to $2.20 per head per day. With a straight grass hay ration for hay priced at 8 cents per lb., the daily cost increased to $2.75 per head. Hay priced at 10 cents per lb. jumped the daily cost to $3.40 per head. With hay at 12 cents per lb., the daily cost bounced up to $4.10 per head. “

Nibourg then ran the numbers through Rancher’s Risk and Return to provide insight into the effect varying feed prices have on a producer’s bottom line.

“Using a 100 head herd with a weaning percentage of 85%, it assumed that 650 lb. steer calves averaged $210 per cwt and 600 lb. heifer calves averaged $190 per cwt. The feed costs for the barley-straw ration amounted to 53% of the total production costs for the herd and resulted in a gross margin of $13,250. A hay ration priced at 8 cents per lb. increased feed costs to 58.5% of total production costs and reduced the gross margin to minus $250 – basically break even. Hay at 10 cents per lb. jumped feed costs to 63.5% of the total, resulting in a negative $15,131 gross margin. Feed costs increased to 68% of total production costs for hay priced at 12 cents per lb. resulted in a loss of $30,350.”

“Feed costs this winter are basically charges against next year’s calf crop,” he explains. “Break evens in the fall of 2020 for this example herd on a barley-straw ration, comes in at $176 per cwt for next year’s calves. The herd on 8 cent per lb. hay ration would need $202 per cwt to break even. At 10 cents per lb., break evens are $229 per cwt. Break evens for 12 cent per lb. hay are $258 per cwt. This analysis underscores the necessity of managing feed costs for a cow-calf operator. Feed costs are by and far the largest component of the production costs in a cow-calf operation.”

-Alberta Agri-news

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Wetaskiwin Legion ‘Branch Briefings’

Branch #86 is planning its 90th anniversary

Feed replacement cost, precipitation threshold and more tweaked by AFSC

AFSC announces enhancements to perennial crop insurance programs

Road allowance closure goes to prov govt

Encroaching house situation could set ‘precedent’

County of Wetaskiwin council approves water rate hike of 3 per cent

Councilors balk at proposed rate increase of 4 per cent

Trudeau hypocrite on Iran plane crash

Writer says P.M. not that concerned about China hostages

‘Presumptive case’ of coronavirus in Canada confirmed by Ontario doctors

Man in his 50s felt ill on his return to Canada from Wuhan, China

‘My heart is going to bleed’: Bodies brought back to Canada following Iran plane crash

Remains of Sahar Haghjoo, 37, and her eight-year-old daughter, Elsa Jadidi, were identified last weekend

Alberta Urban Municipalities Association wants province to make tax changes

The Alberta Court of Appeal ruled last year that municipalities are unsecured creditors

Alberta woman charged with child abduction pleads guilty to lesser charge

Womann can’t be identified under a court-ordered publication ban

Canada slips in global corruption ranking in aftermath of SNC-Lavalin scandal

The country obtained a score of 77, which places it at the top in the Americas

Wuhan bans cars, Hong Kong closes schools as coronavirus spreads

Hong Kong leader Carrie Lam said her government will raise its response level to emergency, highest one

RCMP receive tip on Amber Tuccaro’s homicide file

Banff RCMP contacted by a male who alleged that his father may be responsible for a missing person

Here’s what Canada is doing to stop the coronavirus from getting in

Health officials are monitoring multiple possible cases in Canada

Most Read