Penciling out economics of winter cattle feeding

Feeding: News Roundup from the September 30, 2019 issue of Canadian Cattlemen

Drought took its toll on many hay fields, while others were so wet that producers struggled to get a dry bale. For many beef producers on both ends of the spectrum, the result is high-cost feed.

Ted Nibourg, a farm business management specialist with Alberta Agriculture and Food, outlined some of the economic factors producers should consider in their feed strategy in the department’s Agri-News series. Price and feed availability are the two main factors, he says.

Nibourg crunched numbers around daily feed costs by using the department’s CowBytes software, which balances beef rations. CowBytes is available at www.alberta.ca/cowbytes.aspx. Assuming the cows were 1,400 lbs. at mid-pregnancy and consuming a barley-straw ration, where barley was $5 per bushel and $50 per ton, the ration costs $2.20 per head per day. A grass hay ration, with hay costing eight cents per pound came out at $2.75 per head per day. If hay costs 10 cents per pound, the daily costs rise to $3.40 per head.

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Nibourg also used Ranchers Risk and Return, an Alberta Agriculture program that evaluates the profitability of beef operations, to pencil out how these feed costs would affect a ranch’s profitability. In a 100-head herd with an 85 per cent weaning percentage, the program assumed 650-lb. steers averaged $210 per cwt, and 600-lb. heifers averaged $190 per cwt.

“The feed costs for the barley-straw ration amounted to 53 per cent of the total production costs for the herd and resulted in a gross margin of $13,250. A hay ration priced at eight cents per pound increased feed costs to 58.5 per cent of total production costs and reduced the gross margin to minus $250 — basically breakeven. Hay at 10 cents per pound jumped feed costs to 63.5 per cent of the total, resulting in a negative $15,131 gross margin.”

Alberta producers can reach Nibourg by calling the Ag Info Centre at 310-FARM.

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