March 2021 Cattle Feeding Projections
March feedlot projections show mostly positive gains with the support of the live cattle board. Feed prices seem to be stabilized but that seems like a tarnished way to express that high priced feedstuffs haven’t moved much. Volatility in all commodity markets continue, from high usage ingredients down to trace minerals. As we continue to run down this road, while it is helpful for the live cattle board to provide support, it certainly shouldn’t be the only thing we depend upon to make money or breakeven.
Understanding how your ingredient dry matters impact total dry matter intake (DMI) and ultimately your feed conversion will help you understand why your cost of gains are either increasing or decreasing. We often talk about making sure you understand why it’s important to test feedstuffs for not only moisture, but energy and protein, especially when both of these ingredients are currently expensive, but it has never been more apparent than when looking at the last few turns of closeouts.
Dry matter intake impacts feed conversion. If our DMI is overexaggerated, i.e. they are actually eating dryer feedstuffs (or our feed delivery driver overshoots the bunk and puts a bunch on the ground that they don’t actually consume) and our DMI is actually higher than what we have documented, our feed conversion value will also be off, as feed conversion is a reflection of total pounds consumed per head divided by average daily gain (ADG). So again, F:G, DM basis = (DMI/ADG). If they are eating 24 lbs. of DM, and gaining 3.2 lb. ADG, their F:G would be 7.5. But if their actual consumption was only 21 lbs. of DM (remember overshooting the bunk?), and gaining 3.2 lb. ADG, their F:G would be 6.5. A gross over estimate of over a full lb. of feed conversion, which costs us a lot of money in today’s market (let alone wasted feed). Looking at the projections that were just ran, that 1 lb. of feed conversion costs $0.10/lb. of gain. It doesn’t seem like a lot there, but when you add it to the bottom line, it’s the difference of about $77.00/hd. Closing out that group is going to show higher feed intake, which costs more itself, but also results in more feed interest being charged as well. So it’s not just an overage of feed being charged out, but also the extras: days on feed, yardage, interest, etc. Perhaps you see that a simple feed test, or even better the purchase of a Koster tester to test dry matters at the feedlot are a sound investment, especially as competition to raise cattle should focus to the north as our COG, while high, are still trending lower than our southern cattle raisers. These simple acts make a very large economic impact.
Another item to focus on is the Holstein market. With the amount of Holstein cross cattle being harvested, Holstein contracts have changed. One of the major Holstein packers has reduced their basis to $-8.00 for all months except April. While this certainly helps, and is reflected on the Holstein projections attached, the carcass grid system has also changed. Please make sure you understand the new carcass contract when selling straight Holsteins on this system. Please be sure to discuss this with your packer and your Form-A-Feed Nutrition and Production Specialist.
We look forward to more sunshine filled days and discussions on how we can continue to help you improve your COG.