“The Value of a Pound”
by Chris Reinhardt, feedlot specialist
What’s another pound of calf worth at sale time? Is it simply the same as the value per pound of the calf, or is it more complicated than that?
This is actually quite important in order to make good decisions going into weaning time regarding any value-added management programs we may want to implement. Preconditioning for at least 45 days can add substantial weight to calves. Implanting calves either during the suckling phase or during preconditioning and backgrounding also will make calves heavier and affect their sale price per pound.
The slide is there for a reason. Heavier calves are less efficient, on average, with all else being equal. So heavier calves bring a slightly lower price per pound than lighter calves.
If we assume that 500 lb calves will be worth $2.50 per lb, and then apply a 15 cent per pound slide for each one hundred pounds heavier from the 500 lb base, we can easily calculate the value of added weight. Now let’s do some simple math.
The 500 lb calf is worth $1,250 (500 lb × $2.50/lb). If we add 100 lb during preconditioning and backgrounding, and there is a 15 cent per pound slide, then the 600 lb calf is worth $1,410 (600 lb × $2.35/lb). Subtract the new gross value from the original gross value ($1,410 – $1,250) = $160 which is the value of the 100 pounds of added weight; or, $160 ÷ 100 lbs = $1.60 per pound of the added weight.
That’s still good money, but a fair bit less than simply looking at the price per pound at the auction market. More importantly, $1.60 per added pound will likely make upcoming management decisions, which will give you more pounds to sell this fall, profitable decisions and profitable pounds.
