Stocker/FeedlotExample
Dr. Randy Harp
Land Cost
$60 per acre (custom farming)
$20 per acre (lease)
Total = $80 per acre
Purchasing of Calves
360 # @ $1.05 = $378/calf
Processing costs/head = $20
Wormer
Implant
Hay/feed
Ear tags
Antibiotics
Etc.
Purchasing of Calves cont.
Death loss = $7.50 (2 % of 378#)
Interest = $19 (10%of 380 X ½ year)
Total cost per head = $504.50
Includes purchase and processing cost
Total cost – cost of the calf =
$504.5 - $378 =
cost of production = $126.5
Cost of Gain
Cost of production /Total pounds of gain
Pounds of gain = 150 days on pasture X 2.0 lbsof gain per day = 300 pounds
$126.5/300 = $0.422
42.2 cents per lb = cost of gain
Break Even
Total cost/sale weight = Break Even
Beginning weight + total gain = projectedending weight or pay weight
360+300= 660
660 x .98 (2% shrink) = 647 (sale weight)
504.50/647 = $77.98 cwt or $0.78 per lb
Profit per head
647 (sale weight) x $0.90 = $582.30(projected pay price)
$582.30 - $504.50 = $77.80 per head
If I had 500 head (death loss of 2%) = 490
$77.80 x 490 = $38,122 profit
What did we leave out???????
Feedlot Example
Purchase 700# calves @ $0.90 per lb
700 x 3% shrink = 679 x $0.90 = $611.10
Processing and feedlot expenses = $350medical, receiving, transportation,death loss interest, feed, yardage, etc.
Purchase + costs = $630 + $350 = $980
Feedlot Example cont.
Break Even = $980/final weight
$980/1204 = $81.40 / cwt or $0.81 per lb
Cost of gain = total cost/ total gain
$350/504 = $69.44/cwt or $0.70 per lb
Assume 3.5 lb per day ADG
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