There’s good news, bad news, and even worse news for cattle producers this winter.
The good news is that there’s plenty of cheap feed grains in the market right now — but producers will need those savings to offset poor-quality feed (the bad news) and part of the sharp drop in calf prices (the even worse news).
“We can complain about calf prices, but there’s nothing we can do about that,” said Barry Yaremcio, a beef and forage specialist with Alberta Agriculture and Forestry.
“But we can manage these animals to optimize their performance and get as much out of them as we can.”
Late-season rainfalls have led to a lot of “oddball feedstuffs” this winter, Yaremcio said at a Battle River Research Group herd-management seminar last month.
“What we’re finding with the feed test results I’ve seen so far this year is that feed quality is down,” he said. “The quality isn’t going to be the same this year as it was last year, so feed testing is critical. We can’t start to balance the rations without it, and if you don’t have a sound nutritional program, it can affect your bottom line very dramatically.”
But in the 2014 Western Canadian Cow-Calf Survey, only 47 per cent of beef producers test their feed each winter.
“This year, it’s critically important that we do that,” said Yaremcio. “How do you formulate a ration if you don’t have good information?”
Cows in good condition don’t need “all that extra energy or protein,” he said. Producers can get away with feeding cows half hay and half straw, depending on the quality.
“That’s where your feed testing comes in. If I can cut my hay cost by half and replace it with straw, I’m knocking 32 cents a day off my feeding costs,” said Yaremcio. “Use your feed availability to your advantage. Feed the cheaper stuff or the poorer quality when demands are down and save your good feeds for last.”
But good-quality feed may be harder to come by this winter. For an average alfalfa grass hay, protein levels have dropped from around 14 per cent to around 10 per cent, and fibre levels are between five to 10 per cent higher, which will affect energy content.
“It’s a little bit worse this year than what we typically see,” said Yaremcio.
This year, a lot of hay was put up wet and, as a result, wasn’t cured properly, he said.
“The bales are already sagging and you can smell that it’s very, very sweet. If you pull the hay out and it’s nice and brown, that’s been heat damaged,” he said.
“Depending on the age of the hay, how many times you turned it, and how much weather damage you got on it, there are some times when you’re going to need to feed some supplemental energy.
“That’s one way you can mitigate the 40 or 50 per cent drop in calf prices that we’re seeing.”
But the late-season moisture also hit some grain crops hard — particularly barley that was planted late and didn’t make malt — so producers could see up to 50 cents a bushel discounts on feed barley at the elevator.
“You don’t have to buy that high-quality barley. Buy the off-grade stuff and take advantage of some of these situations,” said Yaremcio. “If you’ve got neighbours who have barley that’s 16 to 18 per cent moisture and you can get a deal to purchase it from them, feed that.
“That’s an easy way to save some money.”
But even with a surfeit of feed grains, wheat, triticale, and rye have some “limitations” because of the higher risk of acidosis. And you may want to skip the oats this year unless the price is right, he added.
“When you look at it on an energy and protein basis, you need about $1.60 a bushel difference in purchase price to make oats economical to feed,” said Yaremcio. “Right now we’re looking at about 50 to 60 cents a bushel difference between barley and oats. Barley is your better deal.”
Do the math
A lot of producers are tempted to feed their calves straight hay all winter to save some money, rather than supplementing their diets with grain. But that’s a mistake in the long run, said Yaremcio.
Say you’re feeding 150 calves for 160 days, and you want an average two pounds daily gain, he said.
“If you’re feeding only hay, your average daily gain will be limited to roughly 1.2 to 1.3 pounds a day. If you add one per cent of their body weight in barley — 5.5 pounds of barley for 550-pound calves — that will increase their gains to two pounds a day.”
And that’s where you’ll see cost savings in the long run, he said. Feeding straight hay will cost around $0.67 per head per day — or around $16,080 total. At mid-November calf prices, you stand to make around $189,210. Minus feed costs, your net income would be around $173,130.
If you reduce your hay and add 5.5 pounds of barley, your daily feed costs go up to $0.84 per head per day — $20,160 total. But because your average daily gain is higher, you can sell those calves for around $212,712. Minus feed costs, your net income would be around $192,555 — nearly $130 per calf or $20,000 more total.
While the drop in quality for winter feedstuffs will make overwintering cattle tricky this year, producers can “find ways to cut their input costs.”
“For every dollar that you can reduce your winter feeding costs, the overall profitability of your operation increases by $2.48,” said Yaremcio.
“You have to take what you’ve got, but how do you modify things this year to make up for those environmental problems? What are the little things we can do that aren’t going to cost us an arm and a leg?”
And the little things can make a big difference to your bottom line, he added.
“Pay attention to the details and save yourself some money,” he said. “If you try to take some shortcuts and do things half-assed, it’s going to cost you in the long run.”