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Should I Sell My Calves or Feed Them Out?

Beef cow/calf producers often raise that question — but before it can be answered several other questions must be addressed. How much do your calves weigh? What would they bring if you sold them now? Are they ready to go to a feedlot or should you background them? Do you have feed supplies available or will you need to purchase most of the feed? Will you feed them on the farm or will you send them to a custom feedlot? What rates of gain and feed efficiencies do you expect? When will the animals finish? What is the price outlook for when they're finished? Answering these questions provides the framework for making the decision on whether to sell or feed your calves.

Do the math! Build a budget based upon how you might feed your calves and how you expect them to perform. Calculate costs and estimate returns. Budgets can be prepared as cost per head, cost per cwt. or by cost of gain. All are acceptable, but all budget items should be calculated the same. For example, some items will likely need to be converted from cost per cwt. to cost per head if you choose to budget by the head.

An example budget is shown in Figure 1. This budget assumes you have steer calves weighing about 600 pounds that could be sold or sent to a custom feedlot and fed to 1200 pounds. One method of estimating expected returns is to use the live cattle futures price for the contract month nearest to the expected finish date. This represents a selling price that could be "locked in" with a hedge.

Figure 1. Feeding Budget — Example
Income:
1200 lb. steer @ $69/cwt.		$828.00
Feed Cost:
Corn, 52 bushel @ $2.60/bushel	$135.20
Soybean Meal, 290 pounds @ $200/ton	29.00
Salt & Mineral	5.63
Hay, 365 pounds @ $60/ton	10.95
Total Feed	$180.78
Yardage, 180 days @ $.28/day	50.40
Death loss (2%)	15.56
Health and processing	10.00
Transportation	20.00
Interest (9%)	34.00
Cost per head:		$310.74
Return per head 600-pound steer		$517.26
Break-even value per cwt.		$86.21
In this example, costs and return are calculated on a per head basis. The estimated feeding costs of $310.74 are subtracted from the $828.00 expected income from the finished steer. This leaves a value of $517.26 per head for the 600-pound calf or $86.21 per cwt. If the steer can be sold for more than $86.21, then the answer is sell it! If the expected selling price is less than $86.21, feed it!

Feed costs and efficiency are much easier to calculate if you have your own production and financial records from previous groups of cattle. If you don't have records, feed costs can be estimated using standard rations (MU Guide 2066, "Rations for Growing and Finishing Beef Cattle" provides ration information). These rations, along with current feed prices and expected feeding efficiency allow feed costs to be estimated.

Other costs need to be included. Some feedlots charge yardage, others mark up feed. Death loss, health costs, processing costs, interest and transportation to the feedlot need to be calculated. If calves are fed on the farm, different cost items must be determined. Instead of yardage, you would have machinery and feed preparation costs, utilities, repairs, maintenance, insurance, etc.

If the numbers are close and you decide to feed, consider protecting some of the risks. Selling price can be hedged by selling futures or buying put options. Feed prices can be protected with advance purchases, contracts for later delivery, long futures hedges or buying call options.

Author: Melvin Brees, Farm Management Specialist

Starter Fertilizer for No-till Corn in Central Missouri

Background
Starter fertilizer applied at planting has usually increased early season crop growth in research trials, but this has only occasionally translated into a yield advantage. Most starter fertilizer trials have been conducted in tilled cropping systems. Recent trials from other states are giving results that make the use of starter fertilizer look like an economically sound practice in no-till systems.

Dave Mengel at Purdue University found a yield response to starter in 8 of 11 no-till site-years, but only in 1 of 11 conventional-till site-years. These experiments were paired so that weather and soils were the same for both tillage systems. This yield response was primarily due to the N component of the starter. Indiana is now recommending starter in no-till situations, but not when tillage is used.

Starter fertilizer experiments in no-till corn conducted by Bob Hoeft and associates at the University of Illinois from 1993 to 1995 frequently demonstrated substantial yield responses to starter N. No-till corn and sorghum in Kansas have frequently responded to both N and P in starter, and 30 lb. N/acre out-yielded 10 lb. N/acre in starter.

Missouri Experiments
These favorable results with starter for no-till corn in states adjacent to Missouri prompted the research reported here. Based on the Illinois and Kansas experiments, it was possible to focus in on a few specific treatments of interest and evaluate them in on-farm replicated strip trials. The core treatments are:

1. No starter
2. Typical low-N, high-P starter
3. Like (2) but boost the N rate
4. N-only starter

Experiments in 1997 were planted on the Earl Borgman farm, Lafayette County, on May 5 and the Richard and Jack Elliott farm, Morgan County, on May 6. These farmers are no-tillers who are set up with dry starter fertilizer attachments set to place fertilizer approximately 2-3" to the side of and 2" below the seed. They normally make their entire P & K application through the planter.

Targeted and actual starter fertilizer rates are given in this table. Targeted rates were used to set the gears on the starter fertilizer auger (and were in part dependent on the gear settings available). Actual rates were determined by weighing the fertilizer in the hoppers before and after planting the plot and dividing by the acreage planted.

Two treatments were used in the Elliot experiment in addition to the core treatments. These were Elliott's normal starter plus 5 gallons/acre of 10-34-0 solution in-furrow, and Elliott's normal starter plus starch. Researchers in Idaho have reported yield gains from using row-placed starch for wheat.

All starters in both experiments increased yield far more than enough to pay for the starter, attachments, and planting time costs associated with starter. There were no statistically significant differences in yield between any two starter treatments. Nitrogen alone was able to produce maximum yields and was the most economical starter material.

All starters increased ear length and, therefore, number of kernels/ear in the Elliott experiment but not in the Borgman experiment. Plants in the Elliott experiment responded to starter by producing more kernels/row. Starter fertilizer increased kernels/row by 15% on average, and increased yield by 23%. The increase in ear length can therefore explain most of the yield increase, with the rest probably due to larger kernels or better pollination. In the Borgman experiment, these two factors (larger kernels, better pollination) must have been the main source of the yield increases, as there were no significant differences between treatments in the number of kernels/ear.

Acknowledgement: We would like to acknowledge support for this research from the Missouri Agricultural Experiment Station

Authors: Peter Scharf and Tom Anderson, MU Agronomy Extension

Implant Helps Lambs — Timing Critical

Cattle producers in this country regularly utilize growth promoting implants during both the backgrounding and feedlot phases of beef production. Implants for suckling calves are available but used with less frequency. In the sheep industry, implanting feedlot lambs with RalgroŽ (a zeranol compound) to improve growth rate is an accepted practice. However, implanting during the other phases of lamb production is less common.

In 1996/97 MU experiments, lambs were implanted with RalgroŽ at different ages to determine the effect of implant timing on growth. All the lambs in the experiment were less than 14 days of age at the beginning of the trial (day 0). Lambs which received three implants — implanted at days 0, 45 and 90 of the trial — did not respond to the treatment. Waiting until day 45 (about 60 days of age) to begin implanting the lambs increased the lamb's growth rate.

Average daily gain was 14% higher for lambs implated at day 90 of the trial and 17% more for lambs implanted on days 45 and 90 when compared to lambs which received implants beginning at day 0.

Lambs raised in the Midwest are typically implanted as they enter the feedlot at 90-120 days of age. This trial indicates that implanting earlier in the production system would allow producers who sell feeder lambs to put a heavier lamb on the market without keeping them longer. RalgroŽ implants cost about 75 cents per lamb and improved growth rate and feed efficiency make the implant well worth the money, but the lamb's age at initial implanting is critical for a good response.

The RalgroŽ implant can cause faster bone maturation in lambs. In this MU trial, both the bone mineral density and bone mineral content were greater in treated lambs when compared to lambs which did not receive any implant at all. This increased bone mineralization or bone "maturity" in implanted animals can pose a problem in older lambs.
Bone "maturity" is used by the meat industry to determine whether the meat is graded "lamb" or "mutton". Mutton receives a big price discount. This usually is not a problem in the Midwest, because most of the lambs are young at slaughter. But in the West, where range lambs can be 150 days old when turned into the feedlot, an implant at that time could cause a carcass to be graded as "mutton".

Author: Joe Marks, Source:  Kyle Rozeboom, Contact:  Mark Stewart, Livestock Specialist

The Missouri "Show-Me-Select" Heifer Program Changes Requirements for 1998

Health requirements and sire birth weight EPD's have changed since last year and four additional sales have been added.

The ownership, health and EPD requirements can be found on the Internet at http://outreach.missouri.edu/callaway/heifer.htm, or you can request a copy from your local extension office.

State Coordinator — David Patterson, Department of Animal Sciences, UMC

Horse Production Class

Extension Teaching and the UMC Animal Science Department are offering Horse Production, on Tuesday and Thursday evenings 6:00 - 8:50 p.m. beginning June 9th and concluding on July 30th.

This course will be at the MU-Columbia campus and will earn students three college credits. Topics covered in lectures and laboratory sessions will include information on breeding, nutritional management, health practices, hoof care and genetics.

Undergraduate tuition and fees for this class are $438.06.

For additional information, contact: Juanita Smarr, Extension Teaching, 103 Whitten Hall, Columbia, MO 65211, (573) 884-1544

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