Continuous Calving: Are Economic Incentives Large Enough to Eliminate the Traditional Practice? by D. Doye and M. Popp INTRODUCTION Why, despite expert recommendations to control breeding seasons in cow/calf operations, do roughly half of small- scale producers leave herd sires with cows year-round? cash flow – can sell a calf when cash flow is required income averaging – guaranteed not to sell entire calf crop at potentially lowest seasonal price ease – do not have to maintain separate facilities for herd sires forages – cows naturally select calving interval depending on forage availability flexibility – do not have to wait for next breeding season for open cows Controlled breeding season on the other hand offers: nutrition – ability to match feed to nutrition requirements by stage of lactation culling – improved monitoring of reproductive performance enhances herd genetics over time prices – sale of uniform, larger batch of calves leads to premiums Decision to convert to controlled breeding season takes 4 – 5 years Figure 2. Crude Protein (CP) and Total Digestible Nutrient (TDN) Requirements per Cow based on Seasonal Calving Distribution as Affected by Calving Season Management. PROCEDURES LP in Excel with added Frontline Premium Plus Solver due to size of tableau Linked spreadsheets allow for user interface to conduct sensitivity analyses on key production statistics RESULTS & CONCLUSIONS Initial solution for base case scenario resulted in selection of continuous calving (Table 2) assuming: 85% calving rate for either calving season no price premiums for controlled calving same total labor requirements per cow regardless of calving season Switched from continuous to controlled calving with only a $1/cwt calf price premium for larger, more uniform lots with controlled calving (Table 2) Switched from continuous to controlled calving with only a 1% decline in calving rate for continuous (results not shown) With expected calf price premiums of $3/cwt, controlled calving remains the optimal choice over a range of conditions Sod-seeding pasture had a large positive impact on returns (Table 3) More even seasonal labor distribution (Table 1), failure to calculate calving rate, lack of awareness of potential calf price premiums, and small differences in farm income relative to off-farm income may be why more producers do not control calving Table 1. Base Case Scenario Summary Statistics for Key Variables by Month and Calving Season Management. Table 2. Profit Maximizing Solutions to Model Runs on 40 Acres Bermuda/Fescue and 20 Acres of Sod-seeded Pasture with Equal Total Labor Requirements and Calving Rate but Different Calving Season Management and Calf Price Premiums. Table 3. Profit Maximizing Solutions for Alternative Acreages with 85% Calving Rate, 25% Higher Labor Requirement than Base Case Scenario and $3/cwt Premium for Calves with Controlled Calving Season. Figure 1. Forage Dry Matter (DM) Production, Crude Protein (CP) And Total Digestible Nutrient (TDN) Characteristics for The Two Types Of Pastures Modeled. January CP and TDN Numbers Are A Function Of Stockpiling. JanFebMarAprMayJunJulAugSepOctNovDecYear Base Scenario with Continuous Calving Labor (hrs) Capital Required ($)4,2994,7964,9456,9137,0808,5233,0863,6824,0277,0523,2513,53461,187 Min. DM Required (lbs)25,18322,67225,07424,26325,06024,25225,10825,12424,30525,09024,34925,220295,701 Grazing Consumption Bermuda/fescue (lbs)01,9605,60015,4001,86924,25225,108017,3059,8008, ,694 Sod-seeded (lbs)04,20013,3008,86323, ,1247,0004,2007,0003,50096,374 Mixed hay (lbs bought)25,18316,5126, ,0908,94921,72089,628 Base Scenario with Controlled Breeding Season Labor (hrs) Capital Required ($)4,2494,7075,0146,9517,0868,4973,0293,5943,9076,9003,2513,50360,688 Min. DM Required (lbs)25,31022,67225,10124,29125,10124,29125,101 24,29125,10124,37225,645296,378 Grazing Consumption Bermuda/fescue (lbs)01,9605,60011,05225,1010 5,24117,2919,8008, ,546 Sod-seeded (lbs)04,20013,30013,239024,291019,8607,0004,2007,0003,50096,590 Mixed hay (lbs bought)25,31016,5126, ,1018,97222,14590,241 ContinuousControlled $1/cwt Premium for Controlled Net Returns Before Taxes to Land, Overhead, Own Labor, and Own Capital$6,336$6,118$6,355 Annual Labor Requirements (hours) Owner Hired--- Hay Feeding Requirements (lbs of DM) Mixed Hay (11% CP, 52% TDN, 13% DM) 89,62890,241 Months fedOct-Mar # of Cows Controlled Calving-49 # of Cows Continuous Calving49-- Sales$19,963$19,769$20,007 Expenses$13,627$13,651 Annual Interest Expense$405$408$405 Maximum Monthly Capital Borrowed $8,523$8,497 OBJECTIVES Test if financial performance differs between a spring (defined 90 day season) vs. continuous calving season Conduct sensitivity analyses on: calf price premiums calving rate (annual number of calves sold per cow exposed) and operator labor limitations with changes in operation size DATA Base case scenario was an Arkansas 50-cow operation with these assumptions: similar pasture management of two types of pastures (Figure 1) for both controlled and continuous calving calving distributions and associated cow nutrition requirements (Figure 2) two types of hay (mixed and high quality) and feed supplements could be purchased labor and operating capital requirements adjusted by calving distribution hired labor available if requirements exceeded 100 hours/month 35% grazing efficiency and 70% harvest efficiency for forage utilization long-term, average, seasonally adjusted, nominal Arkansas steer and heifer prices hauling and marketing charges on per head basis to allow proper modeling of calf price premiums cow replacement and capital investment constant across continuous vs. controlled calving Table 1 summarizes key statistics for the base case scenario with different calving seasons 40 acres Bermuda/ Fescue and 20 acres Sod- seeded 60 acres Bermuda/ Fescue 30 acres Bermuda/ Fescue and 30 acres Sod- seeded 80 acres Bermuda / Fescue and 40 acres Sod- seeded Net Returns Before Taxes to Land, Overhead, Own Labor, and Own Capital$6,769$4,786$7,694$11,939 Annual Labor Requirements Owner (hrs) Hired (hrs) Hay Feeding Requirements (lbs of DM) High Quality (14% CP, 62% TDN, 11% DM) 90,24189,02591,495180,482 Months fedOct- March Oct- March Oct- March # of Cows Controlled Calving # of Cows Continuous Calving---- Sales$20,481$17,465$21,990$40,963 Expenses$13,713$12,679$14,295$29,024 Annual Interest Expense$406$380$420$843 Max. Monthly Capital Borrowed $8,497$8,097$8,697$17,712