Beef Cow Profitability CowCalf Workshop CREC, 21104

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Beef Cow ProfitabilityCow-Calf WorkshopCREC,
2-11-04

• Steve Metzger
• Farm Business Management
• Carrington Research Extension Center
• Carrington, ND

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Beef Cow Profitability

• What does it really cost to operate a beef
  cow-calf unit? Per Cow? Per cwt.?
• What differences are there between high profit
  and low profit beef cow-calf herds?
• How can a producer project profitability based on
  given costs and levels of production?

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Information for this presentation was gathered
from farms and ranches participating in the
Carrington Area Farm Business Management Program
from 1993-2002.Region 3 data for 1995-1999 was
also used for comparison charts graphs.
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Region 3Farm Business Management Programs

• Bismarck (Eastern)
• Carrington
• Jamestown
• Casselton (Western)
• Napoleon
• Wahpeton (Western)

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Crop Acres Increased to 2405 Acres per Farm, for
the Carrington Area
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Number of Farms per Year
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Number of Cows per Herd
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Culling Percentage
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Calving Percentage
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Calf Death Loss Percentage
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Weaning Percentage
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Weaning Weights per Calf
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Pounds Produced per Cow
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Weaning Weights vs. Pounds Weaned per Exposed
Female
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Weaning Weights vs. Pounds Weaned per Exposed
Female
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Total Feed Costs/Cow
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Veterinary Supplies/Cow
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Total Direct Costs/Cow
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Overhead Cost Breakdown/Cow
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Direct Overhead Costs/Cow
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Net Inventory Change

• The change in real dollars of value in the beef
  herd due to such things as lesser cull sale
  values, uninsured death loss and other items.
• Usually measured per head or per cwt. of
  production.

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Determining Net Inventory Change per Cow

• Assume a herd of 10 cows per year with a real
  investment of 800 per head or 8,000 total.
• One cow is culled for 500 or a loss of 300 of
  real invested dollars.
• 300 divided by the annual average of 10 cows
  equals a Net Inventory Change of 30.00 per cow.
• This is applied to all breeding stock including
  cows, bulls and replacements after they enter the
  herd.

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Net Inventory Change/Cow
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Direct, Overhead Net Inventory Change Costs/Cow
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Direct, Overhead Net Inventory Change Costs/Cwt.
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Gross Income Expenses/Cow
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Gross Income Net Inventory Change plus
Expenses/Cow
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Income with Net Inventory Change Expenses/Cow
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Gross Income Expenses/Cwt. without Inventory
Change
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Income, Inventory Change Expenses/Cwt.
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Beef Cow-Calf, Net Return after Inventory Change

• Beef Cow/Calf
• 1993 156.15
• 1994 53.09
• 1995 -51.00
• 1996 -82.46
• 1997 - 4.65
• 1998 -9.73
• 1999 61.27
• 2000 89.98
• 2001 71.18
• 2002 106.07

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Net Return per Cow
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Net Return per Cow with Operator Labor Charge
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Net Return per Cwt.
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Net ReturnBeef Cow/Calf, Region 3

• Beef Cow/Calf
• 1993 165.61
• 1994 47.67
• 1995 -40.46
• 1996 -50.16
• 1997 20.21
• 1998 8.52
• 1999 92.51
• 2000 114.80
• 2001 101.30
• 2002 62.82

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Net Return per Head, Beef Backgrounding, Cgtn.
Area

• Backgrounding/Hd
• 1993 64.24
• 1994 24.96
• 1995 11.23
• 1996 5.09
• 1997 68.92
• 1998 40.30
• 1999 43.59
• 2000 23.24
• 2001 6.30
• 2002 1.45

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Comparing High and Low Profit Beef Cow Herds in
East-Central, ND

• Herd data from 1995-1999
• 57 to 81 herds per year, total of 326
• 6,030 to 8,578 cows per year
• Total of 35,252 cows in the five years.
• 20 High Profit Group, 6,384 head.
• 20 Low Profit Group, 6,556 head.

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Weaning Wts. And Pounds Weaned per Exposed
Female Based on Profitability Levels
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Value Produced and Costs (without Inventory
Change) Based on Profitability Levels
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Inventory Change Based on Profitability Levels
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Net Return per Cow Based on Profitability Levels,
1995-1999
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Comparison of High Profit to Low Profit Herds,
1995-1999

• Decrease in total expenses 50.89
• Decrease in Net Inventory Chg. 62.60
• Increase in value of production 60.13
• Total annual average economic
• advantage per cow in the high
• profit herds over the low profit. 173.62

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Goals for High Profit Beef Cow-Calf Producers

• Pregnancy rate of 98
• Culling rate of 12-14
• Calving rate of 95
• Weaning rate of 91
• Calf death loss of less than 7
• Average Weaning Weight 550 lbs. minimum
• Pounds Weaned per Exposed 500 lbs. minimum
• Direct and Overhead costs 310-320 maximum
• Feed cost of 200 per cow
• Net Inventory Change of -35 or less.

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For More Information Steve Metzger
701-652-2951smetzger_at_ndsuext.nodak.edu