Feed Costs Too High?

October 31, 2008 10:23 AM

Sky-high feed costs are making it tougher than ever for cattle producers to break even and make a profit. While high feed costs are a reality for every cattle operation today, you can better manage the costs on your farm or ranch by evaluating your long-term goals and daily practices.

Two basic factors should be considered to manage feed costs, says John Lawrence, director of the Iowa Beef Center (IBC) at Iowa State University (ISU).

"First, it's a strategic issue. If you built your cow-calf or feedlot system around $2 corn, you need to reevaluate it because that world no longer exists. Your current system may work, but look at it in the light of higher feed and land prices," Lawrence says.

Producers need to evaluate their entire operation, Lawrence says, not simply whether they are feeding the right products or coproducts. Producers may also need to change their grazing systems, cow size or weaning dates to better fit the environment.

Bonus Content:
ISU web tools to help you manage feed costs.

The second factor in managing feed costs is the day-to-day tasks such as reducing feed wastage, proper hay storage, not overfeeding cattle and checking for body condition. Attention to the details will help reduce feed costs, Lawrence says.

The IBC has an in-depth section on its Web site to help manage high feed costs. You can find the link at www.beeftoday.com by clicking on the headline "Feed Costs Too High?"

The section offers articles by ISU researchers and Extension specialists on all aspects of cattle production to help lower feed costs, including the "Top 10 Ways to Reduce Feedlot Costs" and "Top 12 Ways to Reduce Cow–Calf Costs."

The IBC section on managing feed costs also offers assessment worksheets for feedlot cost management and for cow winter-feeding costs.

"The worksheets are popular with producers in workshops that our specialists conduct around the state," Lawrence says. "Producers can evaluate their operations and find specific things they need to change to save money."

By going through an assessment checklist and evaluation process, cattle producers can identify and prioritize areas that need improvement, and then develop an action plan to fix problems.

Operate efficiently. The assessment worksheet for feedlots has sections on nutrition and rations, feed delivery and bunk management, feed storage, feed additives, implant systems, records and tracking, budgeting and purchase costs, cattle marketing and improving cattle comfort. Each section has a series of items that are scored. The tallied scores may range from "excellent" to "needs to develop," which helps producers determine the areas that require improvement.

By taking the cow winter-feeding cost assessment, producers can learn whether they fall into the high, average or low-cost production category. For example, the question "What winter grazing options are available?" can be answered with "None" (for a high-cost producer), "Owned stalk fields, hay stubble" (average-cost producer), or "Owned and leased stalk fields, stockpiled hay fields, winter annuals" (low-cost producer).

Once the initial assessment is completed, a producer can print an action plan of goals, performance measurements and essential steps to help meet the objectives. BT

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