The Cattle Business - Vaccinate Against Grass Fever

Livestock Update, April 2002

Bill R. McKinnon, Extension Animal Scientist, Marketing, VA Tech

Okay, it finally rained. The grass has begun to green. We have seen some of the early symptoms of "grass fever" outbreaks in various regions of the state. Symptoms include $110/cwt. 4-weight steers and $100/cwt. 550 pound steers. We should expect to see advanced symptoms before the outbreak subsides. The recent rains should help fuel the seasonal outbreak.

Historically, grazing lightweight cattle on Virginia pastures has offered some of the highest returns available to good managers with access to high quality pastures. As the overall level of performance of our cow/calf operators has improved, the supply of lighter stocker cattle available in the spring continues to get smaller each year. Many larger stocker operators have decided to avoid some of the spring rush by putting together their cattle either in the previous fall or in late winter. Operators who stockpile these cattle need to make sure their wintering programs do not just warehouse the cattle and add costs per pound to the cattle that make them just as expensive as the spring purchases.

The tables below demonstrate the impact of purchase price and summer weight gains on stocker breakeven sale price this fall. Excessive enthusiasm this spring (grass fever) will put a lot of pressure on the sale price needed this fall to return some modest margins to labor, management, and risk.

450 Pound Steers

Purchased Price $/Cwt.	$95	$100	$105	$110	$115
Purchase Cost/Head	$428	$450	$473	$495	$518
Interest and 1% Death Loss	$20	$21	$22	$24	$25
Pasture, vet & med, minerals, hauling, mktg. etc.	$65	$65	$65	$65	$65
Total Costs	$513	$536	$560	$584	$607

Sale Price Needed to Net $30 per Head

Gain	Sale Weight
250	700	$77.57	$80.86	$84.29	$87.71	$91.00
275	725	$74.90	$78.07	$81.38	$84.69	$87.86
300	750	$72.40	$75.47	$78.67	$81.87	$84.93
325	775	$70.06	$73.03	$76.13	$79.23	$82.19
350	800	$67.88	$70.75	$73.75	$76.75	$79.63

Many operators like to consider grazing 5-weight steers. There are typically larger supplies of the heavier cattle and fewer of them left their mothers' sides the morning of the sale. The heavier cattle will require a higher initial investment and need slightly more pasture per head.

550 Pound Steers

Purchased Price $/Cwt.	$90	$92.50	$95	$97.50	$100
Purchase Cost/Head	$495	$509	$522	$536	$550
Interest and 1% Death Loss	$24	$24	$25	$25	$26
Pasture, vet & med, minerals, hauling, mktg. etc.	$69	$69	$69	$69	$69
Total Costs	$588	$602	$616	$631	$645

Sale Price Needed to Net $30 per Head

Gain	Sale Weight
250	800	$77.25	$79.00	$80.75	$82.63	$84.38
275	825	$74.91	$76.61	$78.30	$80.12	$81.82
300	850	$72.71	$74.35	$76.00	$77.76	$79.41
325	875	$70.63	$72.23	$73.83	$75.54	$77.14
350	900	$68.67	$70.22	$71.78	$73.44	$75.00

Some stocker operators have found a niche by grazing heifers. These operators typically have better fences or fewer neighbors with wandering bulls. Heifer grazers who can put together load lots of guaranteed open heifers have reaped substantial premiums over in-barn sale of commingled females.

450 Pound Heifers

Purchased Price $/Cwt.	$95	$100	$105	$110	$115
Purchase Cost/Head	$428	$450	$473	$495	$518
Interest and 1% Death Loss	$20	$21	$22	$24	$25
Pasture, vet & med, minerals, hauling, mktg. etc.	$65	$65	$65	$65	$65
Total Costs	$513	$536	$560	$584	$607

Sale Price Needed to Net $30 per Head

Gain	Sale Weight
250	700	$77.57	$80.86	$84.29	$87.71	$91.00
275	725	$74.90	$78.07	$81.38	$84.69	$87.86
300	750	$72.40	$75.47	$78.67	$81.87	$84.93
325	775	$70.06	$73.03	$76.13	$79.23	$82.19
350	800	$67.88	$70.75	$73.75	$76.75	$79.63

The severe reverse margin suffered when purchasing light weight cattle in the spring presents the largest single cost to the spring stocker cattle operator. The term reverse margin refers to the fact that the weight purchased is sold at a lower price per pound at sale time. A 550 pound steer purchased at $100/cwt. and sold at 850 pounds for $80 must first recover $110 a head in reverse margin. This reverse margin demands that the stocker cattle operator put on lots of pounds very cheaply.

Once the cattle are purchased, the operator only has two avenues to impact profitability - cost effective weight gains and excellent marketing. Pushing for more pounds of cheap gain on pasture is critical to stocker cattle profit. Given the current price structure, the operator who can only achieve 250 pounds of gain on stocker steers until September needs roughly $10-$11/cwt. more at sale time than the neighbor who puts on 350 pounds of gain. A similar relationship exists for heifers.

Certainly pasture quality and management can impact gain per head. Keeping ample amounts of forage available and in a vegetative state in crucial to high rates of gain per head. It is gain per head that is critical to stocker cattle profit. Maximizing pounds of gain per acre has little to do with profit. It is the pounds that we add to the cattle that market the forage.

Another issue critical to stocker cattle gains is the use of a growth promotant implant. Implants simply represent the cheapest, most reliable method to obtain an additional 25 pounds of gain.

Planning a strategic deworming program in the stocker cattle enterprise can mean an additional 20- 40+ pounds of gain over the traditional single deworming at turn-out tactic. Use of some of the newer deworming products with persistent activity can facilitate keeping cattle and pasture parasite loads relatively low well into late spring and early summer with only one additional cattle handling. For those operators who do not want to gather cattle for an additional deworming treatment, the use of the dewormer, fenbendazole (Safe-guard) in block or mineral mix can be another component of a strategic deworming program.

If a producer's forages and management will not allow him to put on more than 250 pounds of gain in 150 day grazing period, he needs to drastically crank up management or change cattle enterprises. The stocker cattle business is a competitive enterprise with neighbors aggressively competing for cattle and grazing boundaries. The operator who cannot compete on cattle gains will also not be able to pay as much for limited supplies of stocker cattle.

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