The Western Beef Development Centre (WBDC) has been assisting Saskatchewan cow-calf ranchers with their cost of production since the late 1990s. Often times cost of production benchmarks are reported as dollars per cow, but a more useful way to report cost of production is in dollars per lb of calf weaned. Weaned calves are the primary revenue source for a cow-calf rancher, so dividing costs over the primary unit sold is a very important calculation.

Dividing total production costs for the cow herd by the total pounds of calf weaned yields the unit cost of production or break-even price (see Equation 1 below). As the equation illustrates, a rancher’s break-even price can be lowered by either: a) reducing production costs, or; b) increasing pounds of calf weaned. Knowing production costs in $/lb of weaned calf allows a producer to do direct comparisons with posted market prices.

I deal with ranchers all the time that are interested in calculating their cost of production, but they become discouraged when they see the amount of production and financial information required for the analysis. In order to not be overwhelmed, it is ideal to track production information throughout the year. As the saying goes, “you cannot manage what you do not measure”.

One of the biggest areas of consternation is inventory numbers; how many females were exposed to a bull, how many calves were born, how many calves were weaned, how many cows were sold, how many cows died, how many bred heifers were purchased, etc. Figure 1 shows a timeline with the important times throughout the production year to count breeding stock (cows, bred heifers, bulls) and calves.

Tracking production data for cost of production extends beyond the calendar year and should start with bull turn out, making note of how many cows and heifers were exposed for breeding as well as the bull turn out and pull dates. The other critical time to count cows and bulls is January 1^st. Additionally, knowing how many females were safe in calf at pregnancy check, how many breeding stock (cows, bred heifers and bulls) died throughout the year, or were sold or replaced is important. Knowing these numbers will make it easy to reconcile with December 31^st inventory counts. The calf crop details to track are live calves, calf deaths and number of calves weaned.

If you are able to count breeding females, bulls and calves at the points indicated in Figure 1, you are doing yourself a huge service and you are well on your way to having the production details necessary to calculate your cow-calf cost of production.

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Vaccinating your herd is like paying an insurance premium. The cost of the vaccinations is the annual premium to avoid costly losses from death, illness, reduced fertility. In recent years, low prices have forced cattle ranchers to look for ways to operate leaner than they already do.

Producers who opt to not vaccinate may go years without a disease outbreak making the choice to not vaccinate seem like a wise one because of the dollars saved, but it only takes one outbreak to turn that insurance premium for vaccination into a good investment. The potential losses from disease, illness, or infertility can quickly outweigh the cost of vaccine.

Dr. Steve Hendrick, beef herd veterinarian at the Western Beef Development Centre in Lanigan, Sask., has drawn up a minimum herd health regimen for the centre’s own 300-cow herd. The cost of providing these minimum vaccination requirements in 2010 was $15.60 per cow-calf pair.

The veterinary and medicine expense calculated from WBDC’s Cost of Production benchmark study has typically been about $20 per cow. This includes vaccinations, treatment, preg checking and RFID tags.

Closed herd argument

To those people who argue that they have a closed herd, so they don’t need to vaccinate we would ask, “how do you define a closed herd?”

A completely closed herd is one where: all heifer replacements are selected from within the herd; all bulls come from the herd or AI: there’s no fenceline contact with any other herd; cattle are never taken to shows, auction marts, vet clinics, or assembled with other cattle as in a community pasture; strict biosecurity is adhered to for feed delivery personnel, nutritionists and vets; no visiting to neighbouring farms, auction marts, cattle shows, or sales due to the risk of bringing disease back to the farm on your boots or clothing.

In short, there are likely no totally closed herds, just varying degrees of open herds.

If you do not vaccinate, over time your herd’s resistance to disease erodes, which can lead to large outbreaks of diseases like anthrax and blackleg, which are not carried in from another animal but from spores that are in the soil. BVD can be passed to a calf before it is even born, resulting in a PI (persistently infected) calf that will wreak havoc in a feedlot by shedding the virus in its feces, saliva, and mucus, thereby infecting pen mates. PI calves also cause problems on your breeding pastures as the virus circulates through the herd resulting in infertility and the production of future PI calves.

Minimum recommendations

As a minimum, cow-calf producers should vaccinate cows, bulls, and calves for blackleg (Clostridial vaccine, 7-or 8-way) and BVD (vaccines often cover IBR, BRSV, PI3 as well). Provided the replacement heifers are fully vaccinated and risk of exposure on pasture is low, some producers will only vaccinate their herd for blackleg every two or three years.

Vaccinating calves for bacterial pneumonia (Mannhemia/Pasteurella and Histophilus) is a good idea, especially if you are retaining ownership of your calves.

Vaccinating for anthrax or foot rot is dependent upon your location and anticipated pasture conditions. If your farm or area has had anthrax cases, it is recommended that you vaccinate every year for several years.

If you are a community pasture patron in Saskatchewan, you are required to vaccinate all cattle under two years of age for blackleg vaccine (Sask. Ministry of Agriculture 2008). Anthrax vaccination may also be required. There is the expectation that your cattle are free of infectious and contagious disease or parasites, which may mean a pour-on dewormer must be part of your herd health protocol. Additionally, when cows and bulls are going to community pasture you should consider vaccination for vibrio.

The Cost

The table contains per-dose costs of recommended vaccines sourced from the WBDC’s local vet clinic. If you were going to treat each cow-calf pair with all the vaccines indicated below, the cost would work out to approximately $33 per pair. The cost of providing minimum vaccination requirements — blackleg, BVD, and bacterial pneumonia — was $15.60 per cow-calf pair as of July 2010.

Example

Let’s assume Producer A vaccinates his 100-cow herd each spring for blackleg and BVD/BRSV/PI3/ IBR. Calves receive the same shots in spring as their mothers, but they also get something for pneumonia, and all shots are repeated in the fall just before weaning. The total annual cost for the herd is $1,575 (100 cows x $2.87) + (5 bulls x $2.87) + (100 calves x $6.37 x 2 treatments = $1,575.35).

Producer B opts not to vaccinate his 100-cow herd, thereby saving $1,575 per year. He is outbreak and disease free for five years (5 x $1,575 = $7,875 in savings), when all of a sudden a dry spring results in 20 calves dying from blackleg. These calves could have been sold in the fall for over $11,000 (20 hd. x 550 lb. x $1.05/lb. = $11,550). Had Producer B been vaccinating each year he would have incurred vaccination expenses of $9,450 (6 years x $1,575), which is $2,100 less than the lost calf revenue from the disease outbreak. (6 years x $1,575/yr.) -$11,550 for a $2,100 difference.

Quickly do the math and you will see he would have to be disease free for eight years to save more than he would spend on vaccinations.

Is the gamble worth it? You have to decide that. What if it was a BVD outbreak and 50 per cent of his cows were open in the fall?

KathyLarsonisaneconomistandLeahPearceisaresearchassistantattheWesternBeefDevelopmentCentreinLanigan,Sask.

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