A Calculator for Marginal Calf Weight Values

It is important that cattle producers know the cost of adding gain to cattle and the marginal value of that gain. These costs and values are often similar from year to year. But when the grain market or the finished cattle market changes, the cost and value of gain will change. When grain prices are low, feedlot cost of gain is low and light cattle have greater value, making the marginal value of calf gain on pasture relatively low.  When grain prices are high, feedlot cost of gain is high and heavy cattle are valued more since they need less grain to finish in the feedlot.  This means that the marginal value of gain on pasture is  greater than when grain is cheap. What is Marginal Value? According to the Business Dictionary:  It is the incremental value that is achieved through additional output. Figuring marginal value tells us if the investments we make in supplements, pasture management, pasture weaning and backgrounding are resulting in better prices for the calves we're selling It is a good practice to calculate these values each year to see what they are and how profitable current management will be or if management needs to be changed to keep in step with the markets.  Ideally, we adjust what we're doing based on what the market is demanding in terms of calf weights. Here's how. The marginal value of calf weight gain is based on the price slide between weight breaks of cattle being sold. The marginal value of calf gain is a little cumbersome

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7 thoughts on “A Calculator for Marginal Calf Weight Values

  1. This does not take into consideration the sliding calf price scale. In my Canadian presentation last week the sliding scale, cow size, milk and cattle numbers on the same acres was my central theme. Went over very well. I will be expanding on this.

    1. This isn’t about that larger picture, Chip. This is just a little calculator to help folks think about the price on that very sliding calf price scale you’re talking about.

    2. Kathy did a good job covering this.
      As Chip said the user needs to know the starting weight, have an end weight goal and know the management and impact on animal gain (a budget with all the costs and impact on animal gain). Then knowing the price for different weight animals (price slide) the marginal value can be calculated and then using the identified costs the net income can be calculated for the animals when they reach the goal weight. A good manager will then put the actual numbers into the budget as a closeout report for decision making in the future.

  2. Without starting weights and a description of management it and an ending goal it cannot be judged.

    1. No, this assumes that you have animals of a certain weight and you’re looking at the market to see what it’s offering. If you know how much it costs to put on additional weight, and you know what the price is for the two different weights, you can decide if you should spend the money to put additional weight on calves.

  3. I am confused. Normal, but still. Are these purchased light calves being grown in a pen? Or fed on grass? Creep feeding calves on the cow?

    Without more information, this is telling me very little.

    1. I don’t think this has to do with how they’re being raised, Chip. My take on this is that it’s a way to decide if you’re going to keep on feeding them. The cost of pasture may be less than actual feed, but knowing your marginal values let’s you decide when to sell them for hopefully the best price.

      But I could be confused too! 🙂

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