Beef Cow Cost of Production Calculator

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Beef Cow Cost of Production Calculator Powered By Docstoc
					Beef Cow Cost of Production Calculator
This calculator is designed to assist producers in determining their annual cost of production for their cowcalf herd. It provides an assessment of feed costs, the cost and return to produce a lb of calf, based on either the number of calves produced (accrual basis) or the number of calves actually sold (cash basis), the profit (loss) per lb of calf produced, per cow and on a herd basis. The calculator can evaluate past performance, as well as projecting ahead. It allows you to look at “What if” scenarios, whether they are feed costs or value of calves. Just overwrite the blue numbers on the sample cost of production calculator.

Producers need to input their cow information, days on stored feed, pasture and aftermath grazing. Days on stored feed, pasture and aftermath grazing must add to 365 days (1 year) or a warning will appear. Yardage is a cost per head per day and includes hydro, telephone, taxes, insurance, bedding, manure removal, housing and equipment repairs attributable to the cow-calf herd. Interest is only on operating loans and does not include long term loans. The calculator can evaluate past performance, as well as projecting ahead. It allows you to look at “What if” scenarios, whether they are feed costs or value of calves. Just overwrite the blue numbers on the sample cost of production calculator. The bred replacements section requires you to input the number of bred females purchased for replacements and/or the number of bred females raised on farm and an average cost/value. Only include replacements entering the herd that will calve and/or wean a calf in the year you are assessing/forecasting. The value of the raised replacements will be used in the total costs when looking at costs on an accrural basis. The calf information section allows you to project your returns on your calf crop. You fill in the number marketed and retained, their average weight and sale price or average value. The livestock sales section allows you to track other income other than weaned calves that is attributable to the cow herd. Enter the number of cull cows and bulls sold as well as any cattle sold for breeding purposes and their average value.

The Income from Cow Herd section summarizes the cash income for the year and includes calves sold, cull animals and breeding stock sold.

The Cow Costs section examines your variables costs which include health and vet, breeding, yardage, feed costs and amount fed. Yardage is a cost per head per day and includes hydro, telephone, taxes, insurance, bedding, manure removal, housing and equipment repairs attributable to the cow-calf herd. Interest is only on operating loans and does not include long term loans. The heifer development cost is the cost per heifer to raise your own replacements on an annual basis. This value is used in determining cash costs on an annual basis. The Feed Requirements Section allows you to enter the feed fed to the cow herd on an annual basis, only include the feed fed to the cows that have the potential to calve in the year you are assessing. Enter your feed costs per tonne and the lbs fed per head per day of each feed fed. This will calculate your stored feed costs based on the number of days entered at the top of the page. To ensure your feed values entered are realistic, dry matter offered is calculated and compared to the potential dry matter intake based on the body weight of your cows. If the dry matter offered is less than 2.1% or greater than 2.7% of body weight a warning will appear and you need to reassess your feed fed. Enter your pasture costs and aftermath grazing costs as dollars per day. The number of days will be transferred from the top of the page. This information will calculate the annual feed costs per cow.

The Returns section provides the analysis of the information entered. There are two columns: Calves Produced looks at the total production of the cow herd for the year and includes the total weight and value of calves produced, both sold and retained. In this column retained calves are valued and considered "sold" to a separate enterprise (i.e. bull development, heifer development, backgrounding), therefore the cow herd is credited for the total production and value of all weaned calves for that year. Raised replacements entering the herd as bred heifers are "purchased" by the cow herd at fair market value and included in the cow herd costs. Calves Sold includes only actual cash costs and returns for the year. Only the calves marketed are included and the total cow costs are adjusted to include the annual heifer development cost for each raised replacement entering the herd instead of the full market value for raised replacements. This column allows you to assess your returns for the year on a cash in and out basis to determine if the cow herd is generating the required cash flow to meet debt servicing requirements. Remember the information provided by the calculator is only as accurate as the information you enter. Budget Developed by: Joanne Handley, Beef Cattle Program Lead Nancy Noecker, Beef Cow-Calf Specialist John Molenhuis, Business Analysis and Cost of Production Program Lead For more information contact: Agricultural Information Contact Centre 1-877-424-1300 ag.info@omaf.gov.on.ca www.omaf.gov.on.ca

$$$ Beef Cow Cost of Production Calculator $$$
Cow Information # of Cows Average Cow Weight (lbs) Days on Stored Feed Days on Pasture Aftermath Grazing (Days) Calf Information # of calves Marketed Sale Weight (lbs) Sale Price ($/lb) Calf Return # of Calves Retained Average Weaning Weight (lbs) Average Value ($/lb) Total Value of Retained Calves 50 1,400 210 155 0 Bred Replacements # Purchased Cost ($/hd) # Raised Value of Raised Replacement $ $ 2 800 5 800

$ $

41 600 0.90 22,140 7 540 1.00 3,780

Livestock Sales # Of Cull Cows Value of Cull Cows ($/hd) # sold for Breeding
Value of Animals sold for breeding($/hd)

$ $

5 210 2 800 $/Cow 443 21 32 496 $/Cow 277 116 25 30 30 53 10 112 653 Herd Income $ 22,140 $ 1,050 $ 1,600 $ 24,790 Herd Cost 13,864.91 5,812.50 1,250.00 1,500.00 1,500.00 2,625.00 500.00 5,600.00 32,652.41

$ $

Income from Cow Herd Calves Sold Cull Cows Sold Breeding Stock Sold Total Cash Income Cow Herd Costs Winter Feed Cost Pasture Cost Health & Vet. Expenses ($/hd) Breeding ($/hd) Marketing/Trucking ($/hd) Yardage Interest Replacements Total Cow Costs lbs. per Head/Day 36.0 0.03 Number of Days 155 0 Winter Feed Cost Pasture Cost Total Feed Cost

$ $ $ $

Cow Costs Feed Cost Health & Vet. Expenses ($/hd) Breeding ($/hd) Marketing/Trucking ($/hd) * Yardage ($/hd/day) Interest on Operating ($/hd)
Heifer Development Cost ($/heifer/yr)

$ $ $ $ $ $ $

394 25 30 30 0.25 10 400

$ $ $ $ $ $ $ $ $

$ $ $ $ $ $ $ $ $

Feed Requirements Hay Haylage Corn Silage Dry Corn Beef Supplement Salt & Mineral Other Pasture Aftermath Grazing % DM Intake (2.5% of body wt) Actual DM Offered

$ $ $ $ $ $ $ $ $

$/tonne 80 30 145 400 480 $/day 0.75 0.20 35.00 32.43

$ $ $ $ $ $ $ $ $ $ $ $

275 2 116 277.30 116.25 394

Percent DM 90 45 35 86 90 100

Go to Risk Analysis Section

Returns** Cost to Produce a lb of Calf Return/lb of Calf Profit (Loss) per lb of Calf Profit (Loss) per Cow Profit (Loss) for the herd

Calves Produced $ 1.15 $ 1.01 $ (0.14) $ (81.65) $ (4,082.41)

Calves Sold 1.25 1.01 $ (0.24) $ (117.25) $ (5,862.41)

* Yardage is hydro, telephone, taxes & insurance, bedding, manure removal, housing, equip. repairs **Returns: Calves Produced includes all calves produced by the herd, both sold and retained. The value of the retained calves is included in the calculation of the return/lb of calf. Raised replacements are included in the Cow Herd Costs at fair market value. Calves Sold includes only actual cash costs and returns. Only the calves marketed are counted and the total cow costs are adjusted to include an annual heifer development cost instead of the full market value for raised replacements.

Numbers in Blue can be edited/changed for individual producers
Budget Developed by: Joanne Handley, Beef Cattle Program Lead Nancy Noecker, Beef Cow-Calf Specialist John Molenhuis, Business Analysis and Cost of Production Program Lead For more information contact: Agricultural Information Contact Centre 1-877-424-1300 ag.info@omaf.gov.on.ca www.gov.on.ca/omaf

Risk Analysis
Expected returns are subject to the risk of fluctuations in both the revenue and expenses. Sale prices and costs of production (COP) are the key risk variables in the cow calf enterprise. Increases in prices received and decreases in your COP will have positive impacts on your net return. Conversely, market price decreases and increases in your COP will have a negative impact on your net return. The expected sale price you entered and the and cost of production that you calculated in the cow-calf calculator are displayed below on the left. You can assess the impact of increases or decreases in sale prices and COP on you net return/lb of calf produced, by using the boxes on the right to enter various numbers to represent the percentage amounts that the sale prices and COP could vary by. The results are displayed in the table below. Expected values: (from Calculator) Expected Sale price Expected Cost per lb of calf produced

$ $

$ / lb 0.90 1.15 $

Key Cow-calf Risk Variables: Sale price ranges around the Expected Sale Price Cost per lb of calf produced ranges around the Expected Cost

+/- % 10% 10%

Expected Net Return per lb of calf produced Interpreting the Table:

(0.14)

The expected Net return per lb of calf produced is based on the information you entered in the calculator and is in the highlighted box in the center of the table. The boxes around the expected return indicate the change in your net return per lb of calf produced based on the possible range (ex. + or - 10%) you entered for the key variables. Line up the various columns and the rows to determine the impact on the Net return per lb of calf produced for each combination. What has more impact on net return for your operation? A change in price or a change in costs?

Net Return per lb of calf produced Cost per lb of calf produced Below Expected Above 10% 10% 0.05 (0.07) (0.18) (0.03) (0.14) (0.26) (0.11) (0.22) (0.34)

Sale Price Above Expected Below

10% 10%


				
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