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Cost per pound of gain: A better measure for calf investment

Alyssa Dietrich for Progressive Dairy Published on 19 November 2019
calf feeding bottle

When making decisions on feed and management for calves and heifers, it’s easy to choose the cheapest option. However, we need to view these costs as an investment and think about how the decisions we make now will affect future outcomes.

How do you decide which feed to buy?

Consider how you make feed purchasing decisions for your lactating herd. Do you buy feed at the lowest cost per ton without considering how your cows will perform on it? Of course not. Hopefully you are working with a nutritionist to find the feed that will help you be most profitable, looking at component efficiency, optimal income over feed cost, feed cost per hundredweight (cwt) and more. 

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Now consider how you choose which feeds you’ll purchase for your calves. Many producers are still only looking at the cost per ton or cost per bag. Are you one of them? If so, why do you make feed purchasing decisions for cows differently than how you make those decisions for calves? A low cost per ton still means nothing if it doesn’t get you the results you need. I think the answer is simple. Cows make milk, so you can figure out exactly how much money your cows are making you. Calves and heifers aren’t making any milk yet, so it’s not as easy to put a value on their performance. However, that doesn’t mean that you can’t measure their performance.

You can measure your heifer “outputs” by tracking their growth. The closer they stay to your target growth curve, the sooner you can breed them and have them ready to calve at the right size for your herd. Heifers should be at 95% mature bodyweight immediately before calving to ensure they are not diverting nutrients away from milk production to keep growing in their first lactation.

There is a value for every pound your heifers gain. So, in order to get the best return on your investment, you should be looking at your cost per pound of gain when deciding on a feeding program. 

Reducing your cost per pound of gain

When you are only focusing on costs per ton or costs per head per day, you’re missing performance – a big part of the whole picture. A very common strategy is to keep feed costs low by feeding low rates of milk or milk replacer to calves. Let’s look at a couple of examples with calves at a high or low average daily gain to help explain this. Many farms still feed about 1.25 pounds per head per day of 20:20 milk replacer to calves. This equates to about 4 quarts per day. At this rate, for a 110-pound calf, you can only expect to gain 0.65 pound per day. If we use a cost of $65 for a 50-pound bag of milk replacer, you will pay $1.63 in milk replacer per head per day. If the calves are gaining 0.65 pound per day, your milk replacer costs per pound of gain is $2.50. 

However, as soon as any challenge or stress, such as disease or weather, reaches that calf, your average daily gain will decrease because the calf needs more energy to cover maintenance requirements. If it’s 32°F outside, you will have no room for growth because all the energy from the milk replacer will be used to keep the calf alive. At this point, you are getting no “output” or performance from your calves because every nutrient you feed is just money spent to keep them alive another day. 

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Think about these maintenance requirements as fixed costs. Your calves need a certain amount of milk replacer to simply live and breathe. Feeding additional milk replacer will result in more growth and actually decrease your cost per pound of gain. Here’s how: Let’s say you feed twice as much powder (2.5 pounds per day) of a 24:18 milk replacer. That will result in up to 2.07 pounds of gain per day given thermoneutral conditions and no additional stressors. At $70 per bag, your total cost of milk replacer per day would be $3.50, more than double what your daily costs would be in the lower gain scenario. However, your cost per pound of gain would be significantly lower at $1.69. 

Of course, there will be a point of diminishing returns, and these two examples are set up to make the point about cost of gain. Feeding excessive milk or milk replacer to the point calves stop eating and waste it will increase your cost per pound of gain. Additionally, overfeeding certain nutrients and limiting others can be a waste of money, especially when it comes to amino acids. You should work with your nutritionist or calf and heifer specialist to identify which calf nutrition programs will result in a low cost per pound of gain, while still reaching your calf operation growth benchmarks. 

Feed cost is not the only thing to consider when you’re trying to reduce your cost per pound of gain. Proper management and excellent health are essential to efficient calf and heifer growth. Reducing stressors like overcrowding, cold and heat stress, poor air quality, etc. will result in more growth and dilute your cost per pound of gain. Treatment costs, especially injectable treatments, can greatly increase your cost per pound of gain. There are many strategies to use in order to prevent disease like feeding more good quality colostrum, feeding more nutrients early in life, investing in better facilities, improving bedding, etc. Putting new protocols in place to prevent disease may require more upfront costs, but if they are effective in reducing treatment rates and mortality rates, it’s likely that they will be justified by the money saved.

Changing your mindset

When bringing up the topic of reducing cost per pound of gain, I often get resistance because most dairies do not have calf scales or have a way to weigh calves safely and quickly. Like any other expense related to your calf and heifer program, a calf scale is an investment. It can help you identify bottlenecks and inefficiencies in your program, and hopefully you are able to fix them and save money. If you’ve never looked into purchasing a calf scale, you actually may be surprised at how affordable they are.

If you’re still not convinced, try weight taping your animals. This is extremely affordable, and definitely more accurate than just eyeballing it. Try making weight taping a routine part of other times that you handle animals, like at weaning or vaccinating. Also, take advantage of the times you move heifers on a trailer; if a truck scale is available to you, weigh the lot of heifers and determine the average weight. If you cannot measure something, it can be hard to manage it, and having some data is better than no data.

The first step in developing a more efficient calf and heifer program is to identify where your program is today. It’s difficult to add weighing calves and heifers to your list of things to do. However, it will show you whether your heifers are meeting target growth rates and will help you determine your cost per pound of gain. From there, you can work toward meeting your growth goals while reducing your cost per pound of gain.  end mark

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Alyssa Dietrich
  • Alyssa Dietrich

  • Calf and Heifer Specialist
  • Cargill
  • Email Alyssa Dietrich

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