Low calf prices, low feed costs and good grass conditions make hardy arguments for retained ownership. Depending on the market in your area, it could make economic sense to hold on to calves a bit longer this year. The Beef Cattle Research Council’s Preconditioning Calculator is a decision-making tool designed to identify economic opportunities and risks from adding a preconditioning program to traditional management.
The BCRC preconditioning topic page provides an overview on the advantages of preconditioning for animal health. Preconditioned calves may return higher gross revenues because they sell at higher weights. They often have lower cost of gain at the feedlot, improved feed efficiency, require fewer treatments and have lower death loss; for these reasons, preconditioned calves may be sold with an added premium. These higher revenues may however come with added costs.
The disadvantages of preconditioning? It costs more to retain ownership, through added feed and labour. Greater input costs don’t necessarily mean margins will shrink though. The balance of net returns will depend on both the cost of retained ownership as well as the projected price at a later sale date. These are unique to each operation.
Deciding if preconditioning makes economic sense? That’s where the decision-making tool can help. The calculator provides a summary of estimated net returns and projected breakeven price premiums based on your costs for up to three different preconditioning programs. While the length of preconditioning programs can be adjusted in the calculator, typical time periods are 30, 45 or 60 days. The tool has a built-in database going back 10 years for price projection comparisons. Continue reading