The Truth Is: Below Market Is Okay With Me!

So we got dinged. One calf–a fullblood–was super-small, expected out of a first calf heifer that was bred for extra-extra calving ease for her first calf, the bull she was bred to shrinks everything. Because the super-small calf came in with the other calves–which in past years have topped the sale–the buyers made the connection and we wound up getting $1.50/lb ($150 cwt), when other calves were bringing $1.80.

Two CCR calves, Biggie on the left (steer), Leap on the right (heifer). Calves at about 3 months old. Expect to wean off at around 400 -450 lb.

Two CCR calves, Biggie on the left (steer), Leap on the right (heifer). Calves at about 3 months old. Expect to wean off at around 400 -450 lb.

So how can I be tickled? Why am I “okay” with getting below what was reported on the market report as the low? (Yeah, they didn’t even report it; they didn’t count it).

All the calves were smaller than usual (only 400 weights)–due to a breeding decision we made, oops–but the one fullblood was super-small at 275 pounds (cute as a button, but cute isn’t what buyers at the sale barn are looking for).

So why was I still good with $1.50/lb? The sale barn owner was perplexed as to why I wasn’t upset. It was rather comical, actually. He thought I was calling to cuss him out.

The secret to my delight:

The 700 lb calves that week brought around $1.40/lb.

We got $1.50/lb. for 400 lb calves.

We are able to produce 2+ 400-pound calves on the same resources/acres (actually substantially less, but don’t want to get ugly about it…) as what other producers do around here; and what we were able to run in the past.

That means that we got $1.50/lb. for 800/lb., when the market was only paying $1.40/lb. for 700 lb. calves, and presumably less per pound for 800 lb.

We don’t measure by the head, we measure by the acre (See this post for more on measuring per acre). Our land resources are pretty set; cow numbers can change a lot easier. By measuring by the acre, we can tell if our operation efficiency is improving. Each cow contributes to the whole, but the ultimate measure is the return on the resources used.

The less resources used per animal that produces the same sellable product, the more efficient we are.

Sure, I would love to get $1.80/lb. when others are. And probably would have got close if that fullblood hadn’t been in there. But I was tickled pink that we could produce 800 pounds of weaned calf on less resources than we had used in the past! We made 800 pounds where others are taking more resources to produce 500 pounds. Even better, we did it with mistakes on our breeding decisions–yup, lesson learned.

In a 7″ precipitation area–which includes snow–and having to irrigate (which is very labor-intensive and hasn’t been completely reliable the last few years)–we are able to run a cow to about 2 acres, year-round, including pasture and hay ground. Completely unheard of in this area.

One of the operations that borders one of our leases has 300 acres. He runs a total of 30 SimmAngus, and runs out of pasture and has to start feeding hay in late summer (he does produce all his own hay). He feeds hay all the way through until late April. Another operation, across the road from one of our other leases, runs 25 American Angus on 300 acres. Both operations have significantly more irrigation water than any of the properties we run on.

We run 30 head on 63 acres total, including summer pasture, fall pasture, and hay ground (that does not include the 4 acres of worthless dry lot desert where the cows are calved out because it’s closest to the house). Even with the dry lot land included, 67 acres. 30 animals (including cows, bulls, steers, and heifers). 2.2 acres per animal.

We shouldn’t have to buy hay–except maybe some for the horses–this year. We had to buy some hay last year, but that was because we bought some more cows in the fall, we added 3 leases to the operation this spring. Last year, before we bought the cows, we ran a total of 28 acres, plus the 4 acres dry lot. 23 or 24 total head. We wouldn’t have had to buy any hay.

The new leases this year: 20 acres is new seeding and won’t be able to be used for any pasture until next year. The owner of 12 of those acres just sold her place and wants us out by September 1; our lease doesn’t end until March 2017. Will be interesting. With the new seeding and some other issues with irrigation, the hay yields are not going to be great.

Irrigation has been difficult this year. Speaking with neighbors, it seems they are noticing that there just does not seem to be the volume of water we normally have. To put it into perspective, 100 shares of Fire Mountain Ditch will fill a garden hose, normally. We irrigate 21 acres with 400 shares. There does not seem to be as much water this year, so cut any of that water away and try to get water over 21 acres before it scorches in 100-degree weather, we’re losing the battle. Between the lack of water and the increase in prairie dogs, we’re losing about 2 acres of hay and fall pasture production. Doesn’t seem like a lot, but 2 acres is almost a whole cows feed for the year!

I try not to compare/compete with people in this area, because we have completely different cattle. It is actually frustrating, because I can see how their operations could be easily improved, but they just won’t even think of changing anything they have or do. They’d rather sell a single 600-pound calf (although most claim 600, but are only really getting 500), than two 500 lb. calves.

“We’ve always done it this way.” Kills me.

Jeramie and I decided the other day that we’re going to buy a “commercial” (probably 44 Farms) bull and put on our CCR cows next year. Excited to see the results on that…in a few years. How many pounds can we produce per acre with genetics that produce larger calves, with our cows that eat 1/2 as much as an average cow? We’re predicting 600-pound wean weights, which would mean 300 pounds to the acre the first year, where we are only doing 200 pounds per acre now.

The more efficient we can build our cows, the more pounds per acre we can produce. The weaning weight is the result per cow, but the comparison of how many acres it took is the true measurement. No coffee shop bragging rights for a per calf weaning weight, but we can buy the round of coffee!

2 thoughts on “The Truth Is: Below Market Is Okay With Me!

  1. Karen L Maloney

    My husband and I have a registered Black Angus herd and we AI for smaller frame cows, feed efficiency, fertility,docility and other features and we test through Zoetis for tenderness, flavor, etc, and our cows produce calves that wean at 595 to 675 and sometimes higher weights. From the middle of may to November we have the use of 70 acres of irrigated pasture, that we don’t get until the owner ships his very large cows (numbering around 150 to 200) and calves to Oregon. The grass is pretty short by the time our cows and calves get to use it; we generally have 30 mother cows and between 8 and 15 heifers. PG&E rates are so high this year, that I am not irrigating between noon and 6 pm, but this has turned out well, due to the high temps and not wanting the sun to burn the grasses through the water during the heat of the day. Irrigation ends September 15th and we generally don’t have to feed until November. Pasture is being turned into Walnut orchards and irrigated pastures and dry range is disappearing pretty quickly here in Glenn County.

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