Livestock Marketing Information Center data shows that average cow-calf producers are operating with negative returns; however, there are still opportunities for the above average cow-calf producers, margin cattle (stockers and feedlot) and grain producers to be profitable. Today, the value of gain on stocker and feeder cattle is ranging from $0.85 per pound to $1.25 per pound.
So what’s a producer to do?
Swigert advises that cattlemen follow these simple, cost-cutting measures.
- Reduce trips to town to get parts or supplies by being more organized.
- Drive the vehicle that gets the best gas mileage, even if it means the vehicle is a 4-wheeler.
- Fertilize in areas that have had a recent soil sample.
- Simplify operations to cut back on labor and vehicles.
- Reduce stocking rates.
- Consider alternate feedstuffs.
Although the major factor in profitability for cattlemen is directly related to the market prices received for calves, bred cows and culls, producers can control their input costs much easier than they can control the market. To be competitive and profitable in the long run, each operation needs to be a lower-cost producer with expenditures carefully scrutinized. Contact your local Extension agent to help calculate your production costs, analyze all costs and challenge yourself to become an efficient producer.