Feed costs are often one of the larger costs in cattle operations whether it is home grown or purchased. Often the largest direct cost. I think most people recognize the primary disadvantage of high feed costs: it costs a lot!
But high cost feed can cost us more than once. High feed cost obviously make it more expensive to winter cows, increase our cost of gain on calves, and increase the cost of “shrinkage.” When we pass these higher costs on through to our replacement heifers, they impact our cow herd depreciation for years to come.
On many ranches, livestock depreciation is an even bigger expense. Depreciation is one of the things we put onto a cow’s back that she carries with her as she tries to do her job. Cows aren’t great pack animals: they work better with fewer encumbrances. Lower feed costs save us in the short run and in the long-term. Do you want your cows to pack your stuff around or raise a calf?
Where do high feed costs come from that lead to high livestock depreciation costs? Funny enough, it often comes from high depreciation on expensive machinery that isn’t doing enough work. A $150,000 swather depreciates approximately the same amount every year, whether you cut 100, 1,000, or 10,000 tons per year. Same for the baler. You will save some money by using older equipment, but you’re often giving a good chunk of it back in repairs and maintenance. But you don’t save money by using the same equipment less. This is why custom farmers often have a big cost advantage: they divide high equipment costs by high volume. The depreciation per ton is 10x lower on my $150,000 swather if I cut 5,000 tons instead of 500. You may not like the idea of hiring a custom farmer, maybe you want to become one. If you don’t want to be a custom farmer, maybe you should find a way to get the cows to cut the hay. I know some that will do it for free and my neighbors will pay for it.
Ever seen a cow saddled up with gear at hunting camp? Probably not. Like I said, not great pack animals.