OMAHA (DTN) -- Cattle prices have fallen in the last month but are still higher than in previous years. Meanwhile, the cost of production has continued to rise. If producers aren't in control of their costs, they could be below break-even levels.
Paul Beck, an Oklahoma State University Extension beef cattle nutrition specialist, wrote in the Cow-Calf Corner e-newsletter recently that there are 10 activities that are important to him for managing a profitable cow-calf operation.
Here is his list:
1. Know your cost of production. "Beef cattle Standard Performance Analysis of cow herds across the Great Plains shows that high-net-income producers have 43% lower cost of production than low-net-income producers," Beck wrote. This allows for more effective marketing, risk management and setting production goals. It also makes it easier to figure out where to improve.
2. Have a defined calving season that matches your environment. This produces a more uniform calf crop to market; larger uniform groups at auction markets receive $5/cwt compared to single-head lots. This also allows better health and nutritional management, as well as managing calves pre- and post-weaning.
"This is the foundation for development of least-cost winter nutrition programs," Beck wrote.
3. Selection of replacement heifers for fertility and longevity. "Heifers that have their first calf early in the calving season tend to rebreed earlier and calve early in subsequent years, and heifers that reach puberty before their first breeding are more fertile," he wrote. "Assessing Reproductive Tract Scores of heifers 30 to 60 days before their first breeding season can help sort out the heifers that have not reached puberty and are more likely to breed late," Beck said.
4. Pregnancy testing and culling cows. "Culling open cows obviously will decrease winter feeding costs, but also culling old cows, infirm cows, unsound cows, and cows with poor dispositions can improve calf performance and decrease calf losses. Culling open cows and not selecting heifers out of these cows as replacements will improve reproductive efficiency over time and increase calving rate," Beck wrote.
5. Improve forage management. Forage is the foundation of cow production. "Improved management will increase carrying capacity of the land, improve cow and calf nutrition, increase productivity of livestock and decrease cost per unit of forage produced. Reduced reliance on feed and hay is a key to decreasing costs and increasing profitability," Beck said.
6. Hay testing and least-cost supplementation. Having "knowledge of hay quality will allow you to match the hay being fed to the cow's nutrient requirements and has the potential to reduce or totally replace supplementation," he explained.
"The supplement being fed and supplement rates can better match what is needed by the cow," he wrote.
7. Crossbreeding with a superior sire. "Heterosis or hybrid vigor is the only free thing you can expect in the cattle business. Crossbred cows with hybrid vigor have higher conception rates, weaning rates and longevity. These benefits combine to increase the pounds of calf weaned per cow exposed to a bull by 15% to 25%. Increasing sire quality leads to higher weaning weights, post-weaning growth and improved marketability," Beck said in the newsletter.
8. Have a designed herd health program. "A close veterinary-client relationship pays dividends for your business," he said. "A good herd health program will reduce cow death loss and increase cow productivity. More productive cows with good immune systems will produce more and better colostrum, which will reduce calf morbidity and death loss ... and makes for more productive calves," he said.
9. Add value with preconditioning and retained ownership past weaning. "Preconditioning added $15 to $20/cwt premium on calves over the last few years. Extending ownership will allow you to capture more of their true value. This can be a good thing or a bad thing, depending on your calf's quality," he said.
10. Reduce debt and keep expenses low. "Referring again to the beef cattle standard performance analysis, high-profit producers have lower costs of production with less invested per cow in all asset categories than low-profit producers, but especially less invested in machinery and equipment and real estate. Low-profit producers have more total debt on a per cow basis," he noted.
Russ Quinn can be reached at Russ.Quinn@dtn.com
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