Posted by JD Seller on July 29, 2014 at 21:32:16 from (208.126.198.123):
This is not tractor related but is farm related.
I can not show any way to make a profit on feeding out calves this fall/winter. It makes little difference if they are my calves or purchased calves. The high price of the calves has negated any gain by lower feed cost and higher market prices.
The future fat prices are not high enough nor the lower feed cost(corn market price) to off set the high current cost of the feeder cattle.
So I am really thinking about not filling the silos this fall. I will fill one to finish the cattle we currently have and for insurance next summer to feed the cow herd in an emergency. That could be the only one.
I would sell my calves as feeders not fat cattle.
This would be the first time in my lifetime there would not be cattle in the fat yards here.
Here are the numbers:
500 lbs. steer $2.50-3.00 per LBS. $1250-1500 1400 lbs. fat $1.45-1.60 per LBS. $2030-2240
So you would need to grow the calf 900 lbs. and your gross less calf price would be $740-780 or .82-.86 per pound of gain. With all costs figured in, either of those numbers shows a loss between $100-140 per head.
I have gambled when I could just show a break even before but not a true loss per head. The dollars involved warrant consideration of the risk factor big time.
A 100 feeder cattle can easily be $150K with delivery and vet cost included. Then do all of the work/risk and LOSE $10-14K for doing it. WOW
This is a major topic between me and the boys. They are all excited by the current high fat market. I am worried by the HIGH capitol cost of finishing the replacement cattle/calves.
You add in the fact that the corn/soybean prices are going to be way lower this fall and next year too. So there is not the money/profit to pull a loss up. I know some would say you need to carry some of the current profit over against the future loss. I just can't see my way to go into this with a KNOWN loss looking you in the face.
What do you guys think???
This is not about the way we feed cattle either. Natural, organic or even conventionally raised cattle will all suffer the same effect.
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