HISTORIC NOTE

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not reflect current scientific knowledge
or recommendations. These texts
represent the historic publishing
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site maintained by the Florida
Cooperative Extension Service.

Copyright 2005, Board of Trustees, University
of Florida

March 1984

Bulletin 198

Beef Production Practil

That Pay- South and

Central Florida
James Simpson, William Kunkle,
Robert Sand and Gene Cope

Im. 1%

c- C,-
-r~L~

*
rr

If

Florida Cooperative Extension Service / Institute of Food and Agricultural Sciences / University of Florida / John T. Woeste, Dean

OVERVIEW

This bulletin presents an economic analysis of four beef cattle management practices: heavy culling,
parasite control, a vaccination program and implanting calves with growth stimulants. An analysis of the
impact from being a good, average or low producer is also provided. The figures are relevant for most south
and central Florida operations, but conditions vary considerably between areas and management situations.
Thus, even though the estimates are based on as much information as possible, few published studies were
available to draw on so individuals may want to make estimates for their own units. For this reason, the
assumptions and calculations used, although sometimes cumbersome, are provided.
The computations provided in Parts II and III indicate that parasite control and vaccination have such a
high net return that all producers should carry out these programs. It is strongly advised that each producer
develop a plan with his or her local veterinarian as some practices, such as fluke control, may not be neces-
sary in particular situations, while others may be recommended.
The prices used reflect conditions prevailing in the fall of 1983. Note that even with these relatively low
prices, both parasite control and vaccination still provide high returns. In general, net benefits will increase
in direct relationship with cattle price increases. For example, if prices increased 25 percent, net benefits
from parasite control and vaccination would also increase 25 percent. Over time, costs would also increase
somewhat as well.
Implanting calves with growth stimulants provides almost as much return as parasite control and vacc;na-
tions: S5 or $6 for each dollar invested in just 70 days (using fall, 1983 prices). Again, the return would
increase proportionally with calf price increases: if the prices increased 25 percent, net benefits would, too.
The benefits described from implants are averages and will fluctuate given different situations. Differences
between non-implanted calves may be difficult to detect visually, so producers beginning this practice may
want to work with their county agent to set up experiments, and also to obtain information about correct
procedures used in implanting.
The impact of producing at a high, average or low level or, alternatively, in adoption of recommended
practices, is given in Part V. Space is provided for individuals to assign their own weights to the various
factors and prices. From these simple calculations, relatively accurate estimates can be made of the impact
from a variety of management practices. Producers are urged to utilize the Florida Beef Production Hand-
book (Florida Cooperative Extension Service, 1983) as a guide.

*Professor of Livestock Marketing Development, Food and Resource Economics Department; Assistant Professor and
Extension Beef Specialist, Animal Science Department, Associate Professor and Extension Beef Specialist, Animal Science
Department; and Associate Professor and Extension Veterinarian, College of Veterinary Medicine, respectively, IFAS,
University of Florida, Gainesville.

TABLE OF CONTENTS

Page

OVERVIEW ........................................... ............. Inside Cover

LIST OF TABLES ............................ ................. .. 4

PART I ECONOMIC EVALUATION OF CULLING STRATEGIES ............. 7

PART II ECONOMIC EVALUATION OF CONTROLLING PARASITES .......... 19

PART III ECONOMIC EVALUATION OF VACCINATION PROGRAMS .......... 29

PART IV ECONOMIC EVALUATION OF IMPLANTS ....................... 39

PART V PROJECTED PRODUCTION COEFFICIENTS, INPUT
COSTS AND RETURNS FOR THE GOOD, AVERAGE
AND LOW BEEF PRODUCER ................................. 47
REFERENCES ................................... ... ................ 54

LIST OF TABLES

Table Page

1.1 Cattle inventory, South or Central Florida 100 cow
operation ..... *........... .......................... ... 8

1.2 Estimated costs and returns for a 100 cow South or
Central Florida cow-calf operation, usual versus
heavy culling, 1983 ................. ..... ...... ....... 10

1.3 Impact of increasing cattle prices on usual versus heavy
culling profitability....................... ....... ..... 15

2.1 Length of consequences from cattle parasites in South
and Central Florida .............. ... .. ........... .... 2G

2.2 Cattle parasite treatment determination, recommended
treatments, cost per treatment and annual cost per
cow unit, South and Central Florida, 1983 ............... 21

2.3 Estimated net benefits from recommended parasite control
procedures in percentage and weight terms, South and
Central Florida, 1983 ....... .. .... ........ ............. 23

2.4 Estimated financial benefits from parasite control
procedures in South and Central Florida, 1983 ........... 25

2.5 Benefit risk-cost ratios per cow unit for various
parasite treatments, South and Central Florida, 1983 .... 27

3.1 Short-term and long-term benefits from vaccinating
cattle in South and Central Florida ..................... 32

3.2 Estimated cost per head for vaccinating against six
major diseases in South and Central Florida, 1983 ....... 33

3.3 Estimated physical losses from diseases in South and
Central Florida cattle herds ........................... 34

3.4 Estimated income lost per cow unit from diseases in
South and Central Florida cattle herds, 1983 ............ 35

3.5 Benefit risk-cost ratios per cow unit from six beef
cattle diseases, South and Central Florida, 1983 ........ 36

4.1 Growth promoting implants for beef cattle ............... 40

Table Page

4.2 Classes of cattle for which implants have been approved 40

4.3 Effect of Ralgro implants on daily gains of
suckling calves in Florida .............................. 42

4.4 Results of three trials comparing Compudose and Ralgro
implants in suckling calves in Florida, 1983 ............ 43

4.5 Effects of Ralgro implants on daily gains of
yearling steers in Florida ............................. 44

4.6 Effect of Synovex implants on gains of yearling cattle
grazing Bermuda and Bahia pastures In Florida .......... 44

4.7 Economic benefits from implanting suckling calves,
South and Central Florida, 1983 ........................ 45

5.1 Production practices and projected levels of production
for South and Central Florida beef producers ............ 48

5.2 Projected cash production costs and returns for South
and Central Florida ranches at three levels of
performance, 1983 ........................................ 50

5.3 Impact of increasing cattle prices on being a Good,
Average or Low producer ................................. 52

PART I. ECONOMIC EVALUATION OF CULLING STRATEGIES

Heavy culling of open and low producing cows is an often discussed,

but seldom analyzed cattle production strategy for improving a calf crop

and expanding current cash flow. The purpose of this section is to show

a method by which producers can evaluate the costs and benefits from

this practice. Naturally, every operation is different so space is

provided in the budget for comparisons on your ranch. However, the

data, while synthesized for a typical rather than actual ranch, are

realistic for Central and South Florida in 1983 and do provide guide-

lines about the feasibility of heavy culling.

This section is based on a 100 cow enterprise budget that is di-

vided into two parts. The first depicts an operation, called the usual

practice, in which 9 cows, 3 heifers and 1 bull are culled each year,

and a 75 percent calf crop is attained. The second operation is one in

which heavy culling of cows is practiced and there is greater retention

of sound heifers. Heavy culling is practiced at weaning, and cows are

pregnancy tested with the result that an 85 percent calf crop is

achieved. In both the usual and heavy culling alternatives it is as-

sumed that heifers are bred at two to calve at three years of age. The

operation has 100 acres of fertilized Bahia grass. There is 400 acres

of native range, but none of this is fertilized. The cattle inventory

for both the usual and heavy culling alternatives is summarized in Table

1.1.

Table 1.1. Cattle inventory, South or Central Florida 100 cow
operation

Usual Practice Improved Practice
Total Total
Type Animal animal Animal animal
animal Number units units Number units units

Mature cows 100 1.0 100 100 1.0 100

Bulls 5 1.5 8 5 1.5 8

Yearling heifers 13 0.7 9 26 0.7 18

Two year heifers 10 1.0 10 20 1.0 20

Total 128 127 151 146

Percent increase
in inventory 18 15

Usual Practice

In the usual operation no hay is fed to cows as they are assumed to

graze native range when Bahia grass is not available. But, hay is fed

to the yearling and 2 year old heifers. A molasses-based supplement is

fed to all cows for 90 days from about January 1 to about March 31, and

to heifers for 135 days.

Total basic production costs are $12,409 (Table 1.2). When income

from sale of 9 cows (culling rate is 10 percent but one cow is assumed

to die), one bull and 3 cull yearling replacement heifers are subtract-

ed, net basic production costs are $7,781. This calculation is needed

so that cost per pound of calf can be estimated.

The next step is to calculate other costs, some of which, like

taxes, are actual cash expenses while others such as depreciation are

non-cash expenses. Labor could be either a cash or non-cash cost depen-

ding on whether it is hired or if a wage is paid to the ranch owner. A

charge is also made for management. A charge for land is based on a

rental value of $40 per cow unit.

Income from sale of 62 calves weighing a total of 25,550 pounds,

and using fall 1983 prices, is $13,735. Net income above net basic

production costs is $5,954 while a loss of $7,621 is experienced when

all costs are included. The impact of different prices is presented

later.

Breakeven price, or alternatively the cost of production, on calves

is $0.30 per pound if only the net basic production costs are considered

($7,781 25,550 lbs.), and $0.84 when all costs are taken into account.

The actual cost of production on cash expenses will lie between these

Table 1.2. Estimated costs and returns for a 100 cow South or Central Florida cow-calf operation, usual versus heavy culling, 1983

Usual culling, 10 percent of cowsa Heavy culling, 20 percent of cowsb
Total Total
cost or Your cost or Your
Item Quantity Price income operation Quantity income operation

------Dollars ----Dollars

Basic production costs
Fertilizer (10-10-10),
250 lbs/ac., 100 ac.
Nitrogen, 40 Ibs/ac.,
100 ac.
Lime 1/5 ton/ac., 100 ac.

12.5 tons 132/ton 1,650

4,0001bs
20 tons

Hay
Cows
Yearling heifers, 10 13 heif. =
lbs/day, 100 days 6.5 tons
Two year heifers, 10 10 heif. =
lbs/day, 100 days 5.0 tons
Liquid supplement (molasses)
(16 % protein)
Cows and bulls, 105 animals =
6 lbs/day, 90 days 56,700/lbs
Yearling and 2 year 23 heifers =
heifers, 3 lbs/day, 9,315 lbs.
135 days
Salt and mineral,
$6/cow unit
Vet and medicine,
$10/cow unit
Maintenance, fuel, repairs
Replacement bull

0.26/lb
18/ton

65/ton

65/ton

1,040
360

300 lbs/ac = 15.0 tons

60 lbs/ac. = 6,000 lbs.
1/5 ton = 20/tons

0
423 10 lbs/day 26 heif.=
13.0 tons

0.06/lb 3,402

0.06/lb 559

600

1,000

10 lbs/day 20 heif. -
10.0 tons

105 animals = 56,700/lbs

46 heifers = 18,630 lbs

Increase 15%

$14/cow unitc

-1,750
- 1,000

1,980

1,560
360

0
845

650

3,402

1,118

690

1,400

1,750
1,000

Table 1.2. (Continued)

Usual culling, 10 percent of cowsa leavy culling, 20 percent of cowsb
Total Total
cost or Your cost or Your
Item Quantity Price income operation Quantity income operation

----Dollars---

------Dollars-

Other

TOTAL
Less sale of culls
Cows, 950 lbs 9 head=8,550 lbed
Bulls, 1,500 lbs 1 head=l,500 lbs
Yearling heifers, 3 head=2,400 lbs
800 lbs
Total
TOTAL, net basic production
costs
Other costs
Interest or opportunity
costs on basic production
costs (equiv. 8 mos)
Overhead/depr. int. on inv.,
taxes, ins.
Labor, 5 hr/cow at $4.00/hr
Management, 1/7 time,
$21,000/year
Land charge, $40 per cow unit

TOTAL
TOTAL, all net costs

0.35/lb
0.45/lb
0.40/lb

300

12,409

2,993
675
960

4,628
7,781

300

15,055

19 head=18,050 lbsd 6,318
1 head=1,500 lbs 675
6 head=4,800 lbs 1,920

8,913
6,142

13% 1,075

1,305

3,500

3,500

2,000
3,000

4,000

13,575
21,356

Increase 10 percent 2,200
3,000

4,000

14,005
20,147

Table 1.2. (Continued)

Usual culling, 10 percent of cowsa Heavy culling, 20 percent of cowsb
Total Total
cost or Your cost or Your
Item Quantity Price income operation Item Quantity income operation

----Dollars- -- Dollars--
Income, calves
Steers from cows 34 at 435 lbs ea. 14,790 lbs 0.57 8,430 34 14,790 lbs 8,430
Steers from heifers 4 at 390 Ibs ea. 1,560 Ibs 0.57 889 8 3,120 lbs 1,778
Heifers from cows 20 at 390 lbs ea. 7,800 lbs 0.48 3,744 13 5,070 lbs 2,434
Heifers from heifers 4 at 350 lbs ea. 1,400 lbs 0.48 672 4 1,400 Ibs 672

TOTAL 62 25,550 Ibs 13,735 59 24,380 lbs 13,314
Net Income
Above net basic pro- 5,954 7,172
duction costs
Above all cost -7,621 -6,833
Breakeven price of calves
or production cost
Above net basic pro- 0.30 0.25
duction costs
Above all costs 0.84 0.83

aUsual practice assumes 75 percent calf crop.
bHeavy culling assumes 85 percent calf crop.
cIncludes $3.00/cow unit for pregnancy testing and $1.00/cow unit for costs of additional heifers.
dDeath loss is 1 percent.
cost divided by pounds sold.

two extremes depending on the amount of money borrowed, labor hired,

etc. It also depends on the extent to which opportunity costs are taken

into account.

Heavy Culling

The heavy culling alternative requires a substantial increase in

inputs since it is assumed that no additional land is available, yet

inventory must increase 15 percent from keeping additional heifers as

shown in Table 1.1. The first assumption is that an additional 50

pounds of fertilizer is used per acre. Also, a 50 percent increase in

nitrogen (to 60 lbs. per acre) is budgeted. Also more hay, liquid

supplement, and salt and minerals are needed for those heifers. The vet

charge is increased by $4.00 per cow unit to account for pregnancy

testing and additional costs of the heifers.

Total basic production costs under the heavy culling alternative

increases about 21 percent, to $15,055. But, since there are 19 cows

culled annually rather than 9, and 6 yearling heifers are sold rather

than 3, income from sale of culls nearly doubles. As a result, net

basic production costs under the heavy culling alternative actually

decline 21 percent to $6,142 from the usual practice.

Other costs such as interest, depreciation and management increase

only slightly when heavy culling is practiced, to $14,005. Total net

costs under the heavy culling alternative are $20,147, or $1,209 less

than the usual practice. However, income from calves is reduced under

the heavy culling alternative to $13,314 since only 59 rather than 62

calves are sold due to the greater need for replacement heifers.

The Bottom Line at 1983 Prices

The reduced income from sale of calves is more than compensated for

by increased sale of cull animals. As a result, net income above basic

production costs increases $1,218, or 20 percent, from $5,954 under the

usual practice, to $7,172 when heavy culling takes place. On a total

cost basis, the loss of $7,621 suffered in the usual practice is reduced

to $6,833 with heavy culling, an 11 percent reduction.

The product of dividing net basic production costs by pounds of

calves sold yields a basic production cost of $0.30 per pound for the

usual practice and $0.25 per pound when heavy culling takes place. The

breakeven price which has to be received to cover all costs is $0.84 and

$0.83 for the two alternatives.

Effects of Price Changes

The relatively low prices used in the analysis are for fall 1983.

An analysis is now carried out to determine the extent to which the

relationships change with higher pices. A review of price differentials

(Simpson and Alderman, 1983) indicates that if 400-500 lb. steer calves

were to sell at $0.80 per pound, then prices for the other related

classes of cattle would be:

385 lb. heifers $0.64
Yearling heifers $0.55
Cull cows $0.48
Cull bulls $0.57

The results, presented in Table 1.3 show that the heavy culling

alternative provides an additional $2,762 of net income over the usual

system (a 22 percent increase) when net basic production costs only are

taken into account. When the analysis is made based on all costs, the

Table 1.3.

Impact of increasing cattle prices on usual versus heavy
culling profitability, South and Central Floridaa

Culling alternative
Item Usual Heavy

_------------ $----------

12,409

Basic production costs

Less sale of culls
Cows
Bulls
Yearling heifers
Total
Net basic production costs
Total other costs
Total, all net costs

Income, calves
Steers from cows
Steers from heifers
Heifers from cows
Heifers from heifers
Total

15,055

4,104
855
1,320
6,279
6,130
139575
19,705

11,832
1,248
4,992
896
18,968

8,664
855
2,640
12,159
2,896
146005
16,901

11,832
2,496
3,245
896
18,469

Net income

Above net basic production costs
Above all costs

12,838
-737

15,600
1,568

aAs an example of the way income for the heavy culling alternative is
determined, income of cows is the product of selling 18,052 lbs. (Table
1.2) times $0.48 (see text).

difference is $2,305 in favor of culling. In effect, when steer prices

go up from the $0.57 per pound recorded in 1983 to $0.80, net income

above basic production costs about doubles and a similar expansion of

benefits is realized for all costs. The results show, then, that the

practice is advantageous when cattle prices are low, and becomes

increasingly profitable as cattle prices increase.

Summary of Advantages and Disadvantages

Advantages of Heavy Culling

1) Cows are eliminated that would not have a calf the following
year.

2) A younger cow herd with more production potential is developed.

3) A more productive cow herd is developed; one that produces a
higher percent calf crop and more pounds of calf to sell.

4) Tax advantages are possible since breeding cattle which are
raised on the operation, are over 24 months of age and then
sold, are taxed as capital gain income (i.e. 40 percent is
taxed as real income) rather than as 100 percent real income.

5) Opportunities for expanded use of other production practices
are opened up.

Disadvantages of Heavy Culling

1) A higher level of nutrition is required for developing heifers.
This means more supplemental feed.

2) There will be a greater percentage of first calf heifers which
may have lower conception rates, especially if nutrition levels
are too low.

3) First calf heifers and younger cows generally wean lighter
calves, offsetting some of the genetic advantages if better
bulls are used.

4) A higher level of management is required.

The heavy culling alternative carries with it the implication that

culling must include criteria besides just age and/or injury. This

means production data have to be taken into account and that bulls with

greater genetic potential than the cows must be used. It is recommended

that producers considering a heavy culling alternative work through

their county agents and livestock specialists to develop a complete

ranch plan.

PART II. ECONOMIC EVALUATION OF CONTROLLING PARASITES

Parasite control is a production practice in which it is difficult

to estimate benefits. This section presents a guide which South and

Central Florida producers can use in arriving at their own costs and

benefits and, as well, provides estimates for a "typical" operation.

Introduction

Cattle parasites are divided into two classifications, internal and

external. The major internal parasites in South and Central Florida are

liver flukes, intestinal worms and grubs (Meyerholz and Bradley, 1977).

The principal external ones, at least those which have potential for

being economically controlled, are horn flies and lice.

Liver flukes, intestinal worms and horn flies have both short (one

year or less) and long-term (more than one year) debilitating effects on

cattle (Table 2.1). Grubs and lice, on the other hand, have mainly

short-term effects.

Estimation of Treatment Costs

A summary of the way in which treatments are determined is provided

in Table 2.2. Liver flukes, for example, should only be treated in

areas known to have flukes (Meyerholz and Bradley, 1977). Grubs, on the

other hand, are found and should be treated all over Florida.

Table 2.1. Length of consequences from cattle
Central Florida

parasites in South and

Type of Short-Terma Long-Termb
Parasite Mature Replacement Calves Mature Replacement

Internal
Liver flukes X X -- X X

Intestinal Worms X X X X X

Grubs X X -- X X

External
Horn files X X X X X

Lice X X X X X

aShort = One year or less.
bLong = One year or more.

Table 2.2. Cattle parasite treatment determination, recommended treatments, cost per treatment and annual cost per cow unit, South and Central Florida,
1983

Type of Recommended treatments Cost per treatment Annual Cost
parasite Treatment determination Mature Replacement Calves Mature Replacement Calves Mature Replacement Calves

Dollars per Head
Internal
Liver flukes Fluke-only areas 1/yr 1/yr 2.50 1.80 2.50 1.80
Intestinal wormsa
High nutrition 0/yr 1/yr 0 0.00 1.80 0.00 1.80
Medium nutrition 1/yr 2/yr 0 2.50 1.80 2.50 3.60 -
Low nutrition 2/yr 2/yr 1 2.50 1.80 1.20 5.00 3.60 1.20
Grubs All Florida 1/yr 1/yr 0.60 0.50 0.60 0.50 -
External
Horn flies
Sprayc 50 or more flies/animal 6/yr 6/yr 0.29 0.29 1.74 1.74 -
Dust bagsd 50 or more flies/animal 8 mo/yr 8 mo/yr 1.24 1.24 1.24 1.24 -
Ear tags 50 or more flies/animal 2/an/yr 2/an/yr 1.50 1.50 3.00 3.00 -
Licee Presence of lice 2/yr 2/yr 0.32 0.32 0.64 0.64 -

aFluke treatments also control most intestinal worms. No additional labor charge assumed.
bOther methods such as pour-on's or back rubbers are also used.
CSprayer costs $500 and lasts 5 years = $100 year and, with 1,000 cows, = $0.10 cow/year = $0.02 per treatment. Labor cost is $250 for 1,000 cows per
treatment and 4 treatments in addition to 2 regular workings = $1,000 for 1,000 cows = $1.00 per cow per year = $0.17 per treatment. Materials cost is
$0.10 per cow per treatment.
dDust bags. One pound of dust per head per season. The kits cost $26.50 and have 12.5 lbs. of dust. Additional dust costs $17.00 for 50 pounds. The
cost of the kit and dust is $1.04 per head. Also, cost of $0.20 per cow per year for fence and all associated labor.
eHas no labor charge as cattle can be sprayed along with other activities.

Multiplication of the cost per treatment times the recommended

number of treatments for each type of parasite yields the annual cost

for each of the three classes of cattle analyzed; mature cows and bulls,

replacement heifers, and calves. Recommended treatments and associated

costs for intestinal worms vary with animals on a high, medium and low

plane of nutrition. Three control methods for horn flies are eval-

uated. Costs include a charge for additional labor, when applicable, as

well as materials and equipment.

Estimation of Net Benefits

Benefits from parasite control are very difficult to quantify due

to a multitude of physiological interactions, numerous combinations of

associated disease or health conditions, and various geographical/cli-

matic conditions. Consequently, well documented data and the benefits

from control of the various parasites simply are not available. Given

this, estimates used in this bulletin were based on an informal survey

of several production and veterinary specialists. The estimates were

divided into two levels, low and high, with the expectation being that

the actual benefits will fall within those limits. In all cases, an

effort was made to be conservative in the estimation procedure.

Potential benefits are derived from a reduction in death loss, a

reduction in weight loss, increased calf crop, or a combination of

them. It was estimated, for example, that mature cow death loss in

areas infested with liver flukes can be reduced by 2 to 4 percent with

the recommended treatments (Table 2.3). Another way of saying this is

that liver flukes account for about 2-4 percent death loss in mature

cows and treatment is assumed to stop these losses. Flukes are also

Table 2.3. Estimated net benefits from recommended parasite control
procedures in percentage and weight terms, South and
Central Florida, 1983

Matures
High Low

Replacements
High Low

Calves
High Low

----Net Reduction Death Loss, Percent----

Internal
Liver Flukes
Intestinal worms
High nutrition
Medium nutrition
Low nutrition
Grubs
External
Horn flies
Lice

Internal
Liver flukes
Intestinal worms
High nutrition
Medium nutrition
Low nutrition
Grubs
External
Horn flies
Lice

Internal
Liver flukes
Intestinal worms
High nutrition
Medium nutrition
Low nutrition
Grubs

4 2

4 2

0 0

-----------Weight Loss, Pounds------------

100 40 100

10 0

--Reproductive Loss, Calf Crop, Percent--

12 6

12 6

External
Horn flies 8 4 8 4 -- -
Lice 5 2 5 2 -

Source: Compiled from estimates by several production and veterinary
specialists, University of Florida.

Type of
parasite

estimated to cause cows to lose about 40-100 pounds, a loss that is

realized when they are sold as culls. In addition, mature cows in liver

fluke areas have at least a 6-12 percent reduction in calf crop if they

are not treated.

An economic benefit, in dollars per cow unit, is calculated for

each of the three benefit categories by multiplying the various produc-

tion loss estimates by the appropriate values. For example, multiplying

the high level in death loss from flukes for mature cows of four percent

times the projected value of $333.00 per cow ( a 950 pound cow at $0.35

per pound) gives $13.32 as the annual loss (Table 2.4). Weight loss is

calculated by multiplying the weight loss times value per pound times

culling rate which is assumed to be 10 percent for cows and 3 percent

for heifers. For example, the high estimation of weight loss per cow of

100 pounds times $0.35 per pound = $35.00 per cow. That, times 10

percent is $3.50.

Reproductive loss is calculated by multiplying the average value

per calf of $235.00 (412 pound calf at $0.57 per pound) times the repro-

ductive loss in percent, adjusted for a herd composition of 90 percent

for mature cows and 10 percent replacements. As an example, the high

estimate of losses from flukes in mature cows is 12 percent times

$235.00 = $28.20. That coefficient times 0.90 = $25.38.

Benefit/Risk Cost Ratios

Analyses of net benefits from production practices typically have

the annual cost subtracted from the annual benefits to calculate the net

benefit per unit. However, because the benefits, although reasonable

and defensible, are somewhat speculative, this approach is not taken.

Table 2.4. Estimated financial benefits from parasite control
procedures in South and Central Florida, 1983

Type of Maturesa Replacementsb Calvesc
parasite High Low High Low High Low

---------------Dollars per cow unit---------------

Death Lossd

Internal
Liver flukes
Intestinal worms
High nutrition
Medium nutrition
Low nutrition
Grubs
External
Horn flies
Lice

Internal
Liver flukes
Intestinal worms
High nutrition
Medium nutrition
Low nutrition
Grubs

13.32 6.66

0
6.66
16.65
0

0
0
6.66
0

3.50 1.40

0.70
1.40
2.10
0.70

0
.53
1.05
0.35

3.31 1.66

0
1.66
4.14
0

0
0
1.66
0

Weight Losse

1.35 0.54

0.27
0.54
0.81
0.27

0
0.20
0.41
0.13

External
Horn flies
Lice

1.75 0.70
1.05 0.35

0.68 0.27
0.41 0.13

Reproductive Lossf

10.26 3.42
6.84 3.42

Internal
Liver flukes
Intestinal worms
High nutrition
Medium nutrition
Low nutrition
Grubs
External
Horn flies
Lice

25.38 12.69

0
12.35
25.38
4.23

0
6.35
12.69
0

16.92 8.46
10.58 4.23

2.82 1.41

0
1.41
2.82
0.47

0
0.71
1.41
0

1.88 .94
1.18 .47

a950 lb. cows at $0.35 per pound = $333.00
b800 lbs. at $0.45 per pound = $360.00
c412 lbs. at $.057 per pound = $235.00
d$360.00 times percent loss times fraction of herd. For example,
$360.00 times 0.04 times 0.23 = $3.31. Assumes 0.23 replacement
heifers, 0.75 calves and 0.05 bull per cow unit.
e10 percent cows culled and 3 percent heifers culled. Also for calves
assume 0.6 calves sold per cow.
Average value per calf ($235.00) times reproductive loss in percent,
times 90 percent for matures and 10 percent for replacement heifers (to
account for ratio of cows to heifers).
25

0 0

0
0
3.53
0

3.42

3.42
6.84
17.10
0

0

0
3.42
8.55
0

3.42

Rather, the benefits are considered as potential losses in income. In

other words, the calculated benefits can be thought of as opportunity

losses, or potential income that is foregone from not carrying out the

practice.

The various dollar benefits for the three categories; mature

animals, heifers, and calves for each of the three areas of potential

loss are summed in Table 2.5 to arrive at an annual potential income

loss. This is done for both the high and low levels. Then, the sum of

the potential income loss is divided by the cost to arrive at a benefit

risk-cost ratio. High ratios Indicate more potential benefit or, alter-

natively, the potential risk if the practice is not followed.

The term benefit risk-cost ratio is used because a more common

term, benefit-cost ratio, cannot be properly applied here since it is

used in project analysis and carries with it the connotation that dis-

counted (long-term) net benefits are divided by discounted costs. In

addition standard use assumes some initial major capital investment is

made.

The high, or largest probable ratio for controlling flukes in

mature cows and heifers in fluke areas is 16.4 to 1, while the low side

is 8.0 to 1. This means that even the most conservative estimate in

this analysis places risk at 8 times more than costs. Thus, considering

the high incidence of fluke infestation, this practice will usually

return much more than the costs. Alternatively, the benefits are high

relative to cost.

The results of treating cows and heifers for intestinal worms

definitively shows that the poorer the nutrition level, the more benefit

from treating for worms. Thus, in years when feed is short, special

Table 2.5. Benefit risk-cost ratios per cow unit for various parasite
treatments, South and Central Florida, 1983
;r---- ------1-**-- -- ------*-l,1 ----r. ---
Annual potential Benefit
Type of Annual income loss risk-cost ratio
parasite costa High Low High Low

-------------Dollars per cow unit----------------

Internal
Liver Flukes 3.04 49.68 24.36 16.4:1 8.0:1
Intestinal worms
High nutrition 0.41 4.39 0.00 10.7:1
Medium nutrition 4.36 30.86 11.21 7.1:1 2.6:1
Low nutrition 6.98 72.53 32.43 10.4:1 4.6:1
Flukes and wormsc
High nutrition 6.08 54.07 24.36 8.9:1 4.0:1
Medium nutrition 6.08 80.54 35.57 13.2:1 5.9:1
Low nutrition 6.08 112.21 56.79 20.1:1 9.3:1
Grubs 0.75 5.67 0.48 7.6:1 0.6:1
External
Horn flies
Spray 2.23 31.49 13.79 14.1:1 6.2:1
Dust bags 1.59 31.49 13.79 19.8:1 8.7:1
Ear tags 3.84 31.49 13.79 8.2:1 3.6:1
Lice 0.82 20.06 8.60 24.5:1 10.5:1

aAll costs are in $/cow unit.

A cow unit is 1.05 mature animals (to

account for bulls), 0.23 replacement heifers (1 and 2 year heifers) and
0.75 calves. For example, taking data from Table 2.2, liver flukes only
are $2.50 times 1.05 = $2.63 plus $1.80 times 0.23 = $0.41 totaling
$3.04.
bBenefits are from Table 2.4 by summing death, weight and reproductive
loss for matures, replacements and calves. For example, $13.32 + $3.31
+ $3.50 + $1.35 + 25.38 + $2.82 = $49.68 as the high annual potential
income loss from liver flukes.
cControl of worms as well as flukes is obtained when Albendazol is used.

care should be taken to carry out a good worming program. Likewise,

cattle on poor quality pasture should be systematically wormed to obtain

the highest possible benefits.

Cattle in fluke areas can be treated with Albendazol (and various

other products will soon appear on the market) and intestinal worms can

be controlled with the same treatment. Consequently, in fluke areas,

the net benefits are the product of summing the ones for flukes along

with those for worms. The ratio for cattle on a low level of nutrition

is estimated to fall between 10.4:1 and 4.6:1. Similar ratios are found

for other parasites.

Discussion

The calculations clearly demonstrate the substantial benefits to be

derived from parasite control. Individual ranchers will feel that some

of the costs and benefits should be modified to fit their own situation,

but it is unlikely that the general conclusions and relative magnitude

of the benefit/risk cost ratios will change.

No attempt has been made to sum the annual costs and potential

benefits due to the wide range of situations. However, the results show

that net benefits are quite large. For example, if cattle on a low

plane of nutrition just have intestinal worms, horn flies, and lice

controlled, the potential net benefits range from $45.43 to $114.69 per

cow unit. On a 100 cow operation this would mean an additional $4,543-

$11,469 of income--and this could be the difference between surviving in

the cattle business during the 1980s and being forced out of business.

PART III ECONOMIC EVALUATION OF VACCINATION PROGRAMS

The net benefits of vaccination programs are difficult to calcu-

late, especially since many of the losses from diseases are not diag-

nosed. For example, most producers have a calf or cow die occasionally,

but never discover the cause. Also, a few cows are open each year in

all herds, but the extent to which this is due to diseases is difficult

or impossible to determine. There is reason to believe that vaccination

for diseases should be viewed as an insurance program as it is unlikely

that all diseases will occur in a year or a lifetime, but the economic

losses from an outbreak may be so large that they should be accounted

for through some annual "premium."

A summary of the benefits, costs and potential losses from several

common diseases are summarized in this section. Considerable judgment

is required to determine reasonable losses from disease as published

data are not available. The estimates are based on input from veteri-

narians, livestock specialists and many conversations with cattlemen

over the past few years. The prevalence of disease varies in different

areas of Florida, and consequently each rancher is encouraged to consult

his or her veterinarian to develop a health program.

Six Major Diseases

There are six major diseases in Florida for which effective vac-

cines are available; leptospirosis, vibriosis, redwater, brucellosis,

clostridia, and IBR.

Leptospirosis is widespread in Florida. For example, a recent

study of cull cows at a Florida packing plant showed approximately one-

third had the disease (White, Sulzer and Engel, 1982). The main losses

are abortions in the cows during the last trimester of pregnancy (White

and Sulzer, 1982). In addition, it will acutely infect calves causing a

reduction in weight, and also cause a few deaths (White and Meyerholz,

1975).

Vibriosis is responsible for termination of pregnancy in the first

1-3 months (Meyerholz and White, 1974). A Florida survey showed that 15

percent of the state's cow herd was infected with the disease. Cows

will rebreed after resorption of the fetus if bulls are still with them

but there is, nevertheless, a lower pregnancy rate and also lower calf

weights due to later calving dates.

Redwater is usually manifested in cows infected with flukes. It

mainly manifests itself through short-term effects (Meyerholz, 1971).

Brucellosis infection causes abortions, but cows will usually

reproduce normally thereafter. If not controlled, it can infect 50

percent of a herd causing the loss of one calf during the life of the

cow (Cope, Meyerholz, Nicoletti, 1981).

Clostridial diseases including blackleg, malignant edema, and over-

eating disease (Types C and D) can result in calf and replacement heifer

deaths (Meyerholz, 1976).

IBR can cause respiratory disease in calves and, while it is not a

widespread problem under range conditions, can lead to abortion in

heifers and cows.

Cost and Benefit Calculation

The benefits from vaccinating cattle in South and Central Florida

can be divided into two parts, short and long-term (Table 3.1). Short-

term is defined as up to one year while long-term is more than one year.

The estimated annual cost per head for vaccinating against the six

major diseases given in Table 3.2, varies according to the type animal.

The costs for leptospirosis and vibriosis are shown separately; however,

several combination vaccines are available for less than $0.85 per head.

The estimated losses from each disease are categorized as death

loss, weight loss, and reduced calf crop (Table 3.3). An estimate of

reasonable losses for each disease was made at two levels, called high

and low. These represent a composite from several sources of the normal

range of loss expected from each disease in South Florida.

The economic losses on a per cow unit basis are calculated in Table

3.4 again under the categories death loss, weight loss and reduced calf

crop. Each entry is the product of multiplying the various physical

losses given in Table 3.3 by the various cattle prices in the footnotes.

The Bottom Line

A summary of annual vaccination cost, income loss and risk-cost

ratios is shown in Table 3.5. All values are calculated on a cow unit

basis. Total annual cost for all vaccinations is $3.14/cow unit exclud-

ing labor and handling facilities costs.

The average benefit risk-cost ratio when all diseases are consider-

ed together is estimated to fall between 15 and 34. This means that the

risk a producer runs for not investing in the annual vaccination program

Short-term and long-term benefits
in South and Central Florida

from vaccinating cattle

Short-term Long-term
Vaccine Mature Replacements Calves Mature Replacements

Cows
Leptospirosisa X X X
Vibriosis X X
Redwater X X -

Calves
Brucellosis X X

Clostridiab X X
IBR X X X

aIncludes all 5 serotypes of leptospirosis
bIncludes blackleg (Clostridium chauvoei), malignant edema (Septicum),

overeating disease (perfringens), novyi, and sordelli.

Table 3.1

Table 3.2 Estimated cost per head for vaccinating against six major diseases in South and Central Florida, 1983

Condition of Recommended treatment Cost/treatmenta Annual cost
Disease vaccination Mature Heifers Calves Mature Heifers Calves Mature Heifers Calves

Leptospirosis All cows & 1/yr 1/yr 1/yr .50 .50 .50 .50 .50 .50
bulls
Vibriosis All cows & 1/yr 1/yr .35 .35 .35 .35
bull
Redwater Fluke areas 2/yr 2/yr .15 .15 .30 .30
Brucellosis All heifers 1/yr N.C.b N.C.b
Clostridia All calves 1/yr 1/yr .60 .60 .60 .60
IBR Heifers and 1/yr 1/yr .70 .70 .70 .70
calves

aCost for drugs only, assumes
bBrucellosis program will pay

cattle handled for other purposes
for calfhood vaccination

Table 3.3 Estimated physical losses from diseases in South and South
Central Florida cattle herdsa

Mature Replacements Calves
Disease High Low High Low High Low

Death Loss, percent

Leptospirosis 0 0 0 0 2 0
Vibriosis 0 0 0 0 0 0
Redwater 4 2 6 3 0 0
Brucellosis 0 0 0 0 0 0
Clostridia 0 0 3 1 5 2
IBR 0 0 0 0 2 0

Weight Loss, per head, Ibs

Leptospirosis 0 0 0 0 10 5
Vibriosis 0 0 0 0 20 10
Redwater 0 0 0 0 0 0
Brucellosis 0 0 0 0 0 0
Clostridia 0 0 0 0 0 0
IBRb 0 0 0 0 10 5

Reduced Calf Crop, percent

Leptospirosis 6 3 6 3 -
Vibriosis 10 5 10 5 -
Redwater 0 0 0 0 -
Brucellosis 4 2 20 10 -
Clostridia 0 0 0 0 -
IBR 2 0 4 0 -

aThe losses from each disease were estimated at high and low levels from
consultation with several veterinarians, livestock specialists and
ranchers. Actual losses will probably fall between high and low
levels. The estimates are on a herd basis.
bBased on 20 percent of calves in a herd being infected. Thus, one
infected calf would lose between 25 and 50 pounds.

Table 3.4

Estimated income lost per cow unit from diseases in South
and Central Florida cattle herds, 1983a

Matureb Replacementsc Calvesd
Disease High Low High Low High Low

---------------------- Dollars-------------------

Leptospirosis
Vibriosis
Redwater
Brucellosis
Clostridia
IBR

Leptospirosis
Vibriosis
Redwater
Brucellosis
Clostridia
IBRb

Leptospirosis
Vibriosis
Redwater
Brucellosis
Clostridia
IBR

0
0
13.32
0
0
0

0
0
0
0
0
0

12.69
21.15
0
8.46
0
4.23

0
0
6.66
0
0
0

0
0
0
0
0
0

6.35
10.58
0
4.23
0
0

Death Losse
0 0
0 0
4.97 2.48
0 0
2.48 0.83
0 0

Weight Lossf
0 0
0 0
0 0
0 0
0 0
0 0

Reduced Calf Cropg
1.41 0.71
2.35 1.18
0 0
4.70 2.35
0 0
0.94 0

aCalculated from losses shown in Table 3.3.
b950 Ib cows at $0.35/lb = $333.

c800 lb replacements at $0.45/lb = $360.
d412 Ib calves at $0.57/lb = $235.
eAssumes 0.23 replacements and 0.75 calves for each cow unit.

fIncome lost at sale of animals, 0.1 cows culled and 0.03 heifers culled
and 0.6 calves sold/cow unit each year.
gAverage value/calf of $235 times reproductive loss in percent. Assumes
90 percent of calves weaned from mature cows and 10 percent from
replacements.

3.52
0
0
0
8.81
3.52

3.42
6.84
0
0
0
5.70

0
0
0
0
3.52
0

1.71
3.42
0
0
0
2.85

Table 3.5

Benefit risk-cost ratios per cow unit from six beef cattle
diseases, South and Central Florida, 1983a

Annual Estimated lossc Benefit
vaccination of income risk-cost ratio
Disease cost High Low High Low

----------- Dollars ------------

Leptospirosis 1.02 21.04 8.77 21 8
Vibriosis .45 30.34 15.18 67 34
Redwater .38 18.29 9.14 48 24
Brucellosis .00 13.16 6.58 -
Clostridia .60 11.29 4.35 18 7
IBR .69 14.39 2.85 21 4

Total 3.14 108.51 46.87 34 15

aSummarized from Tables 3.2 and 3.4.
bAll costs are $/cow unit, where a cow unit is 1.05 mature animals, 0.23
replacement heifers (1 year and 2 year old heifers) and 0.75 calves.
cTotal income loss for deaths, weight loss and lower calf crop in the
mature cows and bulls, replacement heifers and calves is added
together.
dLoss of income divided by cost of vaccination.

is between $15 and $34 of benefits for each $1 of input. However, since

all diseases will not likely be experienced simultaneously, benefits in

any one year will be less, but still positive and on the order of $5-10

for each $1 invested.

Discussion

The probability of contracting all diseases in any one year is very

low. But, considering the prevalence of these diseases, the probability

of having an outbreak or continuing problems of 1 or 2 of the diseases

each year, is quite high. The annual vaccination cost is less than the

low estimate of income loss for any of the diseases. But, most impor-

tant, vaccination provides insurance against major disease outbreaks.

Furthermore, this is one of the few insurance programs in which the

premium is repaid with interest each year in at least a 5-10 fold re-

turn.

PART IV. ECONOMIC EVALUATION OF IMPLANTS

The use of growth stimulating implants in beef cattle has been a

recommended practice for many years since they are relatively inexpen-

sive, easy to use, and generally yield a high return on investment.

But, despite wide publicity in farm and beef cattle oriented newspapers

and magazines, surveys indicate that only 15 to 35 percent of cattlemen

in the cow/calf business take advantage of the improvement in production

efficiency they offer. Further study of survey data suggests that the

small herd owner (less than 50 head) is in the group which most neglects

utilization of this technology.

Use of Implants

All of the products currently on the market for the primary purpose

of promoting growth are designed to be implanted under the skin, either

on the back of the ear, or at the base of the ear. The intracellular

fluids circulating in this area pick up the active ingredient as it is

released from the implant and distribute it throughout the circulatory

system. Care must be taken to read instructions on the label to insure

that the proper site is chosen.

At present, there are four basic types of implants available (Table

4.1) which vary according to the classes of cattle for which they are

approved by the FDA (Table 4.2). Growth promoting implants were on the

market during the 1960s, with most emphasis on using them in feedlot

Table 4.1. Growth promoting implants for beef cattle

Pre-slaughter Effective
Trade name(s) Active ingredient withdrawal time lifespan

-Days-

Compudose Estradiol 17B None 200
Synovex S Progesterone +
Steer-oid Estradiol None 100(60-150)

Testosterone +
Synovex H Estradiol None 100(60-150)

Ralgro Zeranol 65 days 100(60-150)

Table 4.2 Classes of cattle for which implants have been approved

Implant
Class Ralgro Synovex or Steroid Compudose

Suckling calves Yes No Yesh
Growing cattle Yes Yesa Yesb
Feedlot steers Yes Yes Yes
Feedlot heifers Yes Yes No

Breeding stock No No No

a400 lb. or larger steers or heifers.
bSteers only.

cattle. In the mid 1970s attention shifted to the benefits of using

them in suckling calves, as well as in cattle being grown-out on pasture

prior to being placed in the feedlot. The results of several on-ranch

demonstrations conducted in Florida are summarized in Table 4.3 4.7.

The Bottom Line

Table 4.8 contains an economic analysis of implanting. An estimate

of 20 extra pounds marketed from the use of one implant, and 40 pounds

from implanting twice, have been used. The use of the averages in Table

4.3 would be 27 and 41 pounds for one and two implants, respectively.

Although there are several implants available, it appears that the

one chosen is not the critical decision as long as it has been approved

for the age, sex and weight animal on which it is to be used. Rather,

the most important decision is to implant. There are very few oppor-

tunities when a cattleman can invest $1-$3 and get a $5 or $6 return per

dollar invested in just 70 to 200 days.

A few demonstrations have indicated that implanting was not benefi-

cial, but this was due to a wide variety of nutritional and other condi-

tions. Thus, individuals considering adoption of the technique may want

to work with county agents to set up suitable trials for their own

operations.

Table 4.3. Effects of Ralgro implants on daily gains of suckling calves in Florida

Total Average daily gain by Additional gain by
Length number number of times implanted number of implants
County of study calves Control One Two One Two

-days- Pounds
Polk 168 64 Steers 1.80 1.85 1.97 8 29
Levy 111 19 Steers 1.14 1.24 11 -
Okaloosa 92 10 Steers 1.92 2.23 -29
Okaloosa 92 10 Heifers 1.66 1.84 17 -
Okeechobee 157 36 Steers 1.44 2.04 2.14 94 110
Hendry (#4) 1977 209 68 Steers 1.99 2.03 2.11 8 25
Hendry (#5) 1977 210 44 Steers 1.98 2.14 34
Hendry (4) 1978 213 44 Steers 2.01 2.10 2.11 19 21
Hendry (5) 1978 216 55 Steers 2.00 2.14 2.13 30 28

Average 163 39 Steers 1.77 1.98 2.10 27 41

a36 mg.

bCounty in which cooperating ranch was located.

Table 4.4

Results of three trials comparing Compudose and Ralgro implants in suckling calves in
Florida, 1983

Number of
calves per Length of Average daily gain Additional gain per calf
County treatment Study Control Compudose Ralgro Compudose Ralgro

-days- --------------------------Pound------------------------
Brevard 16 135 2.11 2.21 2.30 14 26
Polk 29 147 1.94 2.10 2.03a 23 14

Average 23 141 2.03 2.16 2.17 19 20

aReimplanted midway through the trial.

Table 4.5 Effect of Ralgro implants on daily gains of yearling steers in Florida

Total Additional gain by
Type trial Length number Average daily gain number of implants
and location of study calves Control One Twob One Two

-days-- Pound----
Polk (pasture) 117 152 1.57 1.79 26.0 -
Suwannee (pasture) 190 52 1.10 1.30 38.0
Suwannee (feedlot) 190 47 1.60 1.79 1.90 36.0 57.0

Average 167 84 1.42 1.79 1.60 31.0 48.0

a36 mg implant

bReimplanted at 90 to 100 days.

Table 4.6 Effect of Synovexa implants on gains of yearling cattle grazing Bermuda and Bahia
pastures in Florida

Length Total number Average Daily Gain by Treatment Additional
Sex of study of calves Control Implant gain

--days-- ----------------------Pounds-----------------------
Steers 89 72 0.76 0.93 15

Heifers 89 16 1.16 1.43 24

aSynovex S = 200 mg. progesterone + 20 mg. estradiol.
Synovex H = 200 mg. testosterone + 20 mg. estradiol.

Table 4.7 Economic benefits from implanting suckling calves, South and
Central Florida, 1983

Item Return per calf

----Dollars----
One Implant
20 lbs. per calf @ $0.55t 11.00

1 implant @ $1.25 each -1.25

1/30 of 1/10 implant gun @ $19 -.06

1/60 labor @ $4./hr. -.07

Net return to management $9.62

Implant Twice

40 Ibs. per calf (400 lbs.) @ $0.55 22.00

2 implants @ $1.25 each -2.50

Implant gun @ $19 -.12

2/60 labor @ $4./hr. -.14

Return to capitol, management land 19.24

PART V. PROJECTED PRODUCTION COEFFICIENTS, INPUT COSTS
AND RETURNS FOR THE GOOD, AVERAGE AND LOW BEEF PRODUCER

Several production practices including heavy culling, a parasite

control program, a vaccination program, and implanting have been out-

lined in previous parts. The costs and benefits have been summarized

and several management practices have shown high potential returns.

However, the task remains to analyze these and a few other practices

together and estimate the increases in production and net income from

them as a whole.

Practices that Increase Calf Crop, Weaning Weight and Sale Price

Three levels of production that represent a range in production

practices found on Florida beef cattle ranches are shown in Table 5.1.

A producer with a high level of performance, one which is termed "Good,"

should be able to wean an 88 percent calf crop, and have an average sale

weight of 475 pounds for the calves sold each year. This level of

production is attainable and exceeded by the better Florida producers.

The "Average" performance level is similar to the calf crop percent and

sale weight found in a survey of producers in the Central Florida

area. The "Low" performance level is representative of the beef pro-

ducer that is only using limited inputs, and few of the practices out-

lined in the earlier parts.

The effect of each practice on calf crop and weaning weight is

shown separately. It can be noted that the 6 percent improvement in

Table 5.1. Production practices and projected levels of production for South
and Central Florida beef producers

Performance Level
Items Good Average Low Yours

Assumptions
Calf crop weaned, percent 88 74 55

Weaning weights, Ibs 475 410 330
Weaning weight/cow, lbs 418 303 182
Income/cow, $/hd 238 161 98

Production Practices Increasing Calf Crop Percent
Base level 55% 55% 55%
Vaccinations +6 +3 +0
Parasite control +6 +5 +0
Pregnancy testing +9 +5 +0
Supplemental feed +6 +3 +0
Crossbreeding +4 +2 +0
Bull breeding soundness +2 +1 +0
Total 88% 74% 55%
Production Practices Increasing Weaning Weight
Base level 330 lbs 330 Ibs 330 lbs
Vaccinations +10 +0 +0
Parasite control +40 +25 +0
Supplemental feed +20 +10 +0
Crossbreedingc +35 +25 +0
Implantingc +40 +20 +0
Total 475 Ibs 410 lbs 330 lbs
Production Practices Increasing Sale Price
Base price $0.50/lb $0.50/lb $0.54/lb
Castration and dehorning +2 +1 +0
Group marketing +2 +1 +0
Medium frame, no hump +3 +1 +0
Sale price $0.57/lb $0.53/lb $0.54/lb

aThese are estimated contributions of several production practices at different
levels of production for a beef cattle operation utilizing native range and im-
proved pasture.
pregnancy testing may reduce the response to vaccinations, parasite control,
and supplemental feed since the cows that were open due to disease, parasites
or nutrition will be eliminated from the herd by pregnancy testing.
CThe benefits from implanting and crossbreeding will not be fully realized
unless the nutrition level is good, and the cattle are not severely
parasitized.

calf crop shown for both the parasite control and vaccination programs

is lower than the total for percent calf crop lost if all parasites or

diseases are totaled from the practices outlined in sections II and

III. This is because a herd of cattle is unlikely to experience all

problems simultaneously and, even if several diseases or parasites were

present together, if one cow were open because of one, two or three

different diseases or parasites, that cow would still only be open once

in any given year. The practice of pregnancy testing also tends to

eliminate cows that would have been open due to disease, parasites, poor

nutrition, etc.

The net contribution of each practice is estimated for percent calf

crop and weaning weight. However, it should be recognized these are

only projections and the relative importance of each practice will vary

from ranch to ranch. Also, practices such as crossbreeding and implant-

ing are dependent on a situation where cattle are receiving adequate

nutrition to allow the calves to grow faster. Under conditions of very

low nutrition or heavy parasitism, the benefits from crossbreeding and

implanting will be much lower. Base price for the "Good" and "Average"

producer is lower than for the "Low" producer because heavier weight

calves were selling in fall, 1983 for less per pound even if they were

higher quality.

Economic Benefits

Economic benefits and costs are provided in Table 5.2. The income

per cow is calculated by multiplying weaning weight times calf crop to

obtain weaning weight per cow (475 lbs x 0.88 = 418 Ibs per cow). This

number, times average sale price, provides the income per cow (418 x

Table 5.2 Projected cash production costs and returns for South and
Central Florida ranches at three levels of performance, 1983a

Performance Level

Item Goodb Average Low

Lime and fertilizer
Hay
Liquid supplement
Salt and mineral
Maintenance, fuel and repairs
Vaccines
Parasite control
Pregnancy testing
Bull breeding soundness evaluation
Implants
Corral facilities and hired labor
Crossbreedingc
Total cash cost

Income (see Table 5.1)

Net above cash costs

---------------Dollars--------------

38.00 30.00 25.00
15.00 7.50 -
45.00 40.00 20.00
7.00 6.00 6.00
10.00 10.00 8.00
3.00 1.00 -
11.50 5.00
3.00 -
1.50
3.00 1.50 -
12.00 6.00 3.00
6.00 3.00 -
155.00 110.00 62.00

238.00

83.00

161.00

51.00

98.00

36.00

aSee Part I for further details on system and assumed input costs.
bCulling of open cows requires more heifer replacements and additional
fertilizer, hay and liquid supplement.
cCrossbreeding requires extra fencing and added labor to maintain breed
groups.
dExcludes the added income generated from higher value of culled females
over value of the feeder calf, a benefit which would cover part of the
extra feed and fertilizer costs.

$0.57 = $238 per cow). Income increases from $98 per cow for the low

producer to $238 per cow for the good producer. However, this $140

increase in income requires a $93 increase in inputs.

The added cost of vaccines, parasite control, pregnancy testing,

breeding soundness evaluation, implants and added corral facilities and

labor cost amount to $31 of the increased costs. The largest portion of

the increased costs is due to fertilizer, hay and molasses-based supple-

ment required to develop the extra heifers needed to replace open cows

that were culled. A portion of the additional costs of developing the

replacements is recovered from the extra value of the culled cows ($15-

20 per cow unit). It may be a better economic alternative on some

ranches to reduce stocking rate by retaining fewer mature cows to pro-

vide forage for the extra heifers and avoid the added costs of the extra

fertilizer.

The Bottom Line

Net return over cash costs increases from $36 per cow unit for the

low producer, to $83 per cow unit for the good producer, a net benefit

which would be increased by an additional $15-20 if the value of culled

females was also considered.

An important point is that even though cattle producers will espec-

ially want to give close attention to the net benefits from improved

higher level management practices just to survive when cattle prices are

low, a greater payoff is obtained when cattle prices improve. If a

price of $0.80 per pound for 400-500 lb steer calves is assumed, then

benefits from being a Good producer are even higher as shown in Table

5.3. At that price level net income is $217, 154 and 102 for the three

Table 5.3 Impact of increasing cattle prices on being a Good, Average
or Low producer

Performance Level

Item Good Average Low Yours

--------Cents per pound--------

Base price 80 82 90
Castration and dehorning +2 +1 0
Group marketing +3 +2 0
Medium frame, no hump +4 +2 0
Sale price 89 87 90

-----------------Pounds-----------------

Weaning weight 418 303 182

----------Dollars per cow-unit---------

Income 372 264 164
Costs 155 110 62
Net income 217 154 102

levels respectively. The general rule is: The higher cattle prices,

the more net benefit from added use of purchased inputs and manage-

ment. This is because there are more total pounds of beef sold each

year.

It must be noted that the data used in this bulletin, and this last

part in particular, are for illustrative purposes. Each operator should

make his or her own estimates of both costs and benefits--and amount of

added management required.

REFERENCES

Cope, G. E., Myerholz, G. W., and P. Nicoletti. Bovine Brucellosis

Vaccination VI-30, Florida Cooperative Extension Service, 1981.

Florida Cooperative Extension Service. The Florida Beef Production

Handbook. University of Florida, Gainesville, 1983.

Myerholz, G. W. Redwater Disease of Cattle Fact Sheet 14, Florida

Cooperative Extension Service, 1971.

._ Blackleg and Malignant Edema of Cattle VM 9, Florida

Cooperative Extension Service, 1976.

Myerholz, G. W. and R. E. Bradley, Sr. Liver Flukes in Cattle VM-31,

Florida Cooperative Extension Service, 1977.

_. Internal Parasitism of Cattle VM-9, Florida Cooperative

Extension Service, 1977.

Myerholz, G. W. and F. White. Vibriosis in Cattle VM-16, Florida

Cooperative Extension Service, 1974.

Sand, Robert. "New Implants and Update on Fly Control." Proceedings,

32nd Annual Beef Cattle Short Course. Gainesville, Florida, May 4-

6, 1983.

Simpson, James R. and Rom Alderman. "Project Your Cattle Prices Using

Differentials." The Florida Cattleman Vol. 47, No. 11, August

1983, pp. 40-41.

White, F., and G. W. Myerholz. Leptospirosis in Cattle and Swine VM-24,

Florida Cooperative Extension Service, 1975.

White, F. H., K. R. Sulzer, and R. W. Engel. "Isolations of Leptospira

interrogans serovars hardjo balcancia, and pomona from cattle at

slaughter." American Journal of Veterinary Research 43(1982):1172-

1173.

White, F. and K. R. Sulzer. "Hebdomadis Serogroup Leptospirosis in

Florida Cattle." Proceedings, 86th Meeting of the United States

Animal Health Association, 1982, pp. 209-215.

This publication was promulgated at a cost of $1977, or 66 cents per copy, to inform Florida cattlemen about
the economics of selected production practices for central and south Florida. 5-3M-84

COOPERATIVE EXTENSION SERVICE, UNIVERSITY OF FLORIDA, INSTITUTE OF FOOD AND AGRICULTURAL
SCIENCES, K. R. Tefertiller, director, in cooperation with the United States Department of Agriculture, publishes this infor-
mation to further the purpose of the May 8 and June 30, 1914 Acts of Congress; and is authorized to provide research, educa-
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