Understanding… the Cost and the Value of Gain –

 

It seems as though most cow-calf producers are always looking for ways to increase weaning weights.   They can accomplish their goal by using large-framed, high-growth bulls, feeding expensive supplements, implanting calves and by using wormers and other toxic chemicals.  Of course, the companies that market these products claim they will increase both pounds and profit.   While these products may increase calf weights, they don’t necessarily increase profits. 

 The example below illustrates that not all pounds produced are created equal and that the value of gain is often much lower than we think. 

 Valentine Livestock Auction – November 21, 2019

 472# @ $180.18 = $850.45 per head

 572# @ $161.55 = $924.07 per head

Value of Gain = $924.07 – $850.45 = $73.62 or $0.74 per pound.

 Most producers believe the value of the added weight is the price received per pound.   As you can see, that is not the case.   The value of the additional 100 pounds in the example above is only $0.74 per pound.   

 Unfortunately, most producers underestimate the cost associated with achieving the additional calf weight and overestimate the value of the additional gain.   Increased expenses, reduced stocking rates, additional labor and increased overheads are usually associated with these practices.

 Producers must understand the cost associated with the additional weight gain in relation to the value of gain in order to maximize profitability.   A large-framed, high-growth, high-maintenance cowherd that produces large calves can be great for bragging rights but terrible for profits. 

 

2 responses to “Understanding… the Cost and the Value of Gain –

  1. I agree with your statement but I will no longer be able to practice it because I am selling out, my Pharo influenced bred cows and heifers will be in the special cow replacement sale at S O L A on Dec 7 at 10:00 am Ada OK 

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