The importance of avoiding losses in the cattle industry

MITCHELL, S.D. — In today's strong cattle market, producers can't afford to have losses. “If I think about it as a buyer, my risk has gone up because if I have death loss. It’s costing me more money than it did before,” said Warren Rusche, SDSU extension feedlot management specialist. ADVERTISEMENT With the price of cattle near record highs, a 1% death loss translates to around $30 per head lost across an operation, Rusche said. “Those dollars start to add up,” he said. Rusche said it’s important for producers to do as much as they can to reduce the risks for the calves after weaning. This includes making sure the calves are vaccinated and have the right nutritional inputs. “Have we done everything to build quality in on the front end so that when I get them as a cattle feeder, I have got the best chance I can of making that investment work out?” Rusche asked. For the cattle feeders, they have to think about the best way to take the cattle investment and make sure to also have a chance to make money on the animals. “So there I think it’s also, again, some of that same concepts of managing health care, nutrition, some of those animal husbandry things,” Rusche said. Rusche said in the past, pens have often been built based on what made the most sense for building costs rather than what might be best for the cattle. ADVERTISEMENT “A 250-head pen might have let us get by with a little less cost in terms of waterers, a little less cost in terms of fence and gates per head, but there’s a trade off,” Rusche said. “It’s harder to manage a set of 250 cattle than it is three 80s in terms of health. If it takes me three weeks to fill that big pen, I’d been better off to have filled three smaller pens one week at a time because then I can control my health risk a little bit more.” Raising high quality cattle starts with genetics. “Here in South Dakota, we can almost take that as a given. We’ve got some of the absolute leaders in our industry from a genetic standpoint. And if I think of then what that looks like in terms of our calf crop produced in South Dakota. They’re top-notch,” Rusche said. Rusche encourages cattle producers to talk with both their veterinarians and their cattle buyers to see what matters the most to them. “I want calves that have had at least one round of a modified live vaccine. If they don’t have them, I can’t use them. It doesn’t really matter how cheap they are, because my risk is too much,” he said. “Ten years ago, 15 years ago, when maybe I could have bought that calf for $600, maybe I take a chance. He’s now closer to $3,000 … I can’t take the risk if I don’t think they’re not well prepared.” While cattle value has increased, the vaccine costs have not gone up too much, Rusche said. “It’s some of those kind of small investments that we can make on the ranch that do a better job of helping set our calves up to be successful once they leave the ranch and go into the grow yard or the finisher,” Rusche said. ADVERTISEMENT Minimal use of antibiotics is also good. “Certainly use it when it’s warranted and needed,” Rusche said. It’s getting harder to find good employees who are skilled at raising livestock, which is another reason to have healthy cattle. “If I can set these cattle up to be healthier earlier, I don’t have to put as much pressure on my crew to identify, treat them and keep them alive,” Rusche said. Keeping cattle alive is also important for the beef supply chain. “So there’s an incentive there, too, for us to save as many as we can, not only for our own individual economic profitability, but also just big picture. We can use the beef,” Rusche said. A lot of inputs have increased in cost that directly impact the cattle industry, including fuel prices, cost of living, feed and labor. ADVERTISEMENT “So when I say finally we’re starting to get a return, that truly means finally, because the cow-calf sector has watched all those fixed costs go up and we’re now getting to where we can start catching up and making some headway, assuming the feed supply and everything else allows us to,” Rusche said.