By Rayford Pullen

The math is a little scary in the cattle business right now. I don’t know exactly what your calves are bringing, but let’s assume in the neighborhood of $800 and that you can produce that calf at an annual cost of $500 for a net income of $300/head.

Compared to a year ago, our profit has probably been cut in half and compared to two years ago, it has been cut by two thirds. All the while our cost of production hasn’t changed too much, while our cost of living has probably increased. While it didn’t take us long to adjust to the higher prices we were receiving for our calves, adjusting to the two thirds reduction will be tougher.

We hear a lot about selling our calves as preconditioned or natural or both. The fact of the matter is that unless you are selling truck load lots of calves, you are probably whistling in the wind unless you are using a sale facility or marketing agency that will comingle calves and then sell them in truck load lots.

With the average herd size in the 50 head range, the majority of the producers are at the mercy of the buyers at the sale barn the day they sell and that is whether or not they have been vaccinated and weaned.

The beef business is huge and your small lot of calves will be comingled with many others and lose their identity as soon as they are loaded on a truck with calves representing five or 10 other ranches.
So what are we to do when the market deals us a bad hand? About the only thing I can control to any extent at all is my cost associated with producing calves, my weaning weights and quality.

To read more pick up a copy of the November 2016 NTFR issue.