Costs and returns of June and March calving systems were compared at four production phases. Financial costs of the June system were lowest, due primarily to lower costs of producing a weaned calf. Post-weaning financial and economic costs at each phase were nearly identical. Selling June-born steer calves at January weaning would double net returns compared to selling March-born steer calves at October weaning due to lower costs and higher market prices. Net returns for June-born steer calves retained beyond weaning are highest if calves are retained as yearlings and finished. Calves finished as calf-feds provided the highest net returns for the March calving system

Adams, Don C.

Carriker, Gordon

Clark, Dick

Sandberg, Russ

English

DigitalCommons@University of Nebraska

University of Nebraska - Lincoln DigitalCommons@University of Nebraska - Lincoln Nebraska Beef Cattle Reports Animal Science Department January 2001 June versus March Calving for the Nebraska Sandhills: Economic Comparisons Gordon Carriker University of Nebraska-Lincoln Dick Clark University of Nebraska-Lincoln Don C. Adams University of Nebraska-Lincoln, dadams1@unl.edu Russ Sandberg University of Nebraska-Lincoln Follow this and additional works at: https://digitalcommons.unl.edu/animalscinbcr  Part of the Animal Sciences Commons Carriker, Gordon; Clark, Dick; Adams, Don C.; and Sandberg, Russ, "June versus March Calving for the Nebraska Sandhills: Economic Comparisons" (2001). Nebraska Beef Cattle Reports. 287. https://digitalcommons.unl.edu/animalscinbcr/287 This Article is brought to you for free and open access by the Animal Science Department at DigitalCommons@University of Nebraska - Lincoln. It has been accepted for inclusion in Nebraska Beef Cattle Reports by an authorized administrator of DigitalCommons@University of Nebraska - Lincoln. 2001 Nebraska Beef Report — Page 10June versus March Calving for the NebraskaSandhills: Economic Comparisonsbudgets for each system and comparethe net returns at several productionphases in the two systems. We hypoth-esized that the June system costs wouldbe lower and net returns higher thanthose for the March system.ProcedureFinancial cost budgets were devel-oped for each system through weaning.Economic and financial cost budgetswere then developed for each produc-tion phase after weaning. Budgets werebased on the 4-year (1995-1998) aver-age resource use during each phase and1998 input prices. All budgets includecosts for harvesting hay and purchasedfeed, grazing (fence and water mainte-nance, livestock checking, etc.), labor,operating interest, management, over-head and heifer replacement. The bud-gets do not include charges for land,property taxes, insurance, or buildings.Ownership costs for hay harvesting andfeeding equipment, but not other equip-ment, are included. Based on otherresearch at GSL it was determined thatthe same land base (about 90% uplandand 10% subirrigated meadows) couldsupport equivalent numbers of cows yeararound for either system. Therefore, landcharges and taxes would be the same.The March calving system would use themeadows for hay production while theJune calving system would use them forsummer and some spring and fall graz-ing . The economic costs for all phasesbeyond weaning reflect the opportunitycosts of growing the steer calf during aproduction phase by also including thevalue of the incoming animal as if it waspurchased at market. Valuing the steercalf at the beginning of each phase ofproduction permits each phase to beevaluated independently, as if each phasewas an independent enterprise. Thefinancial costs reflect the accumulatedcash costs of growing the steer calfthrough a particular production phase.Annual net returns budgets weredeveloped using the cost budgets,average annual steer weights at the endof each production phase, and 1992through 1998 real (deflated marketprices) prices received at western-Nebraska and eastern-Wyoming auc-tions. Potential selling strategies for thecalf crops were determined based on thevarious production phases. The eco-nomic net returns at each productionphase are calculated as the differencebetween gross revenue per calf and theopportunity cost of growing the calf andreflect the ability of each productionphase to generate a return on invest-ment, i.e., make profit. The financial netreturns are calculated as the differencebetween gross revenue per calf and theaccumulated costs of growing the calfand reflect the ability of each productionphase to generate a cash flow.The major costs for a weaned calf arethose necessary to support the cowenterprise. As indicated, only budgetsfor financial costs were calculatedthrough weaning. The hay cost, $40/t,was based on budget estimates forharvesting ($30/t) and feeding ($10/t)excluding labor. These costs includedownership costs for interest and depre-ciation on the equipment. Labor costsincluded in the budgets were based onactual labor for feeding and calving asrecorded by the University staff at GSL.We charged labor at the rate of $7.50/hrexcept calving labor which was chargedat time and a half since we believe calv-ing to require more skilled labor andoften occurs at night. No other labor wasincluded in cow budgets since weassumed that other labor would be simi-lar between systems. Purchased feedssuch as protein supplement and salt andGordon CarrikerDick ClarkDon AdamsRuss Sandberg1A June calving system extendedgrazing, reduced feed costs, reducedlabor inputs and had higher netreturns than a March calving sys-tem.SummaryCosts and returns of June and Marchcalving systems were compared at fourproduction phases. Financial costs ofthe June system were lowest, due pri-marily to lower costs of producing aweaned calf. Post-weaning financialand economic costs at each phase werenearly identical. Selling June-born steercalves at January weaning woulddouble net returns compared to sellingMarch-born steer calves at Octoberweaning due to lower costs and highermarket prices. Net returns for June-born steer calves retained beyondweaning are highest if calves areretained as yearlings and finished.Calves finished as calf-feds providedthe highest net returns for the Marchcalving system.IntroductionInput requirements for the June sys-tem are lower at some phases than thosefor the March system as described in theprevious article, “June versus MarchCalving for the Nebraska Sandhills: Pro-duction Traits.” The objectives of thisresearch were to: 1) develop cost bud-gets for each system and compare thecosts at several production phases in thetwo systems; and 2) develop net returnsPage 11 — 2001 Nebraska Beef Reportmineral were charged at actual costsbased on 1998 prices. Interest on thevalue of cows and bulls was charged at7.5%. Following Standardized Perfor-mance Analysis guidelines, replacementheifer costs were estimated from the netcost to produce a weaned calf. We usedan initial selection rate of 20% of theheifer calves with 16% of these heifersending up in the cow herd. We did notinclude the additional costs to take theheifer from calf to cow status. Based onpreliminary research, it appears the firstcalf heifers can be developed for similarcosts in the two systems. Costs for ensur-ing that the first calf heifer is bred for thesecond calf may be higher for the Junesystem, but research is incomplete atthis time. It is not likely that costs for thesecond calf will be different enoughbetween the two systems to alter theconclusions of this paper. Each cowcost budget was credited with cullincome for sale of cull cows, bulls andheifers minus death loss. We assumedthe same cull weight of 1,100 pounds forboth (March and June) cow herds. Cullprices varied from year to year andbetween systems since culls are usuallyavailable at different times of the year inthe two systems. Grazing costs wereestimated at $4/cow/month whengrazing upland and $6/cow/monthwhile grazing meadow. These are finan-cial costs only and cover such items asrepair and upkeep on fence and waterand operating costs for checking cattle.To properly graze meadows, more fenc-ing and water is required than withupland. The costs do not include thevalue of the forage. Animal health wasnot greatly different between the twosystems; however, we did include $15/cow veterinary and medicine costs inboth systems.Costs beyond weaning were based onthe actual feeds fed and feeding labor.Grass for June-born calves that weresummered on grass the second summerwas charged at the rate of $0.50/hd/day.This cost is intended to cover the costs ofrenting additional grass where the land-lord checks the calves and takes care ofall pasture and water management.Feedlot costs were actual charges fromthe University feedlot near Mead, Neb.,which included a $0.30/hd/day yardagecharge. The costs were based on 1998ration ingredient cost plus $1/cwt truck-ing charge to and from the feedlot.ResultsThe economic and financial cost bud-gets are summarized in Table 1. Throughweaning the costs for both the economicand financial budgets were treated thesame since there is no opportunity costof an incoming animal at weaning. Thecost of producing a June-born weanedcalf was $74 to $79 lower per calf thanthe cost of producing a March-bornweaned calf due to reduced harvestedforage and feeding and calving laborexpenses. The additional financial coststo grow a steer calf past weaning werenearly the same for both the June- andMarch-born calf fed systems; therefore,the financial cost advantage remainedwith the June system through the feed-lot. However, the post-wean economiccosts for the March born, calf-feds wereslightly lower into the feedlot comparedto June born calves bred on meadow($404/hd versus $417/hd) and slightlyhigher than June born calves bred onrange (Table 2). The economic andfinancial costs for June-born yearlingsreflect the higher incoming animalvalues as well as the higher costs offinishing the calves as yearlings.The economic and financial netreturns to the March- and June-bornsystems are summarized in Table 2.When evaluating the economic netTable 1. Average annual costs for March-born calf-fed and June-born calf-fed and yearlingsteers.JuneMarch Calf-fed YearlingProduction phase Calf-fed Range Meadow Range MeadowEconomic costs/steer calfaCow cost/calf weaned $252 $173 $178 $173 $178Calf costs: wean to on grass or feedlot $404 $397 $417 $466 $487Yearling costs: on grass to feedlot — — — $543 $559Feedlot costs $653 $666 $671 $751 $751Financial costs/steer calfaCow cost/calf weaned $252 $173 $178 $173 $178Calf costs: wean to on grass or feedlot $294 $219 $225 $283 $289Yearling steer costs: wean to feedlot — — — $382 $389Feedlot costs: wean to slaughter $580 $505 $511 $636 $643aEconomic costs include the opportunity cost of the incoming animal, i.e., the value of the animal pricedat market. Financial costs include the accumulated costs of producing the animal.Table 2. Average annual net returns for March-born calf-fed and June-born calf-fed and yearlingsteers.JuneMarch Calf-fed YearlingProduction phase Calf-fed Range Meadow Range MeadowEconomic net returns/steer calfCalving to weaning $86 $151 $161 $151 $161Weaning to on grass ($36) ($20) ($34) ($28) ($32)On grass to in feedlot — — — ($45) ($62)In feedlot to slaughter $27 ($38) ($45) $20 $34Financial net returns/steer calfCalving to weaning $86 $151 $161 $151 $161Weaning to on grass $74 $158 $158 $156 $165On grass to in feedlot — — — $115 $108In feedlot to slaughter $100 $124 $117 $135 $141(Continued on next page)2001 Nebraska Beef Report — Page 12returns, a negative value for a phase ofproduction indicates that phase wouldnot stand alone as an enterprise withoutbeing subsidized by earlier or laterphases. The phase does not generate aprofit. Similarly, a negative financial netreturn, though not experienced, wouldindicate that growing a steer calf to aproduction phase would not generate apositive cash flow. Selling a June-bornweaned calf in January from either therange- or meadow-bred treatments pro-vided $65 to $75 more net returns, onaverage, than a March-born weaned calfsold in September/October. This differ-ence is due to two effects. First, it costless to produce a June-born calf. Sec-ond, the price received for June borncalves sold in January averaged nearly$10/cwt higher (real prices) comparedto the price received for the March-borncalf sold in September/October. Theprice differential is a real effect of chang-ing systems and must be considered ifchanges such as this are contemplated byany producer. It comes from a typicallyhigher seasonal price in January com-pared to September/October and the factthat the June-born calves are lighter sothe price slide also gives these calves aprice advantage. The net effect is that thegross sale value received for a June-borncalf sold in January is about the same asa March-born calf sold in the Septem-ber/October time frame. The post-weaneconomic net returns indicate the Junesystem is only profitable if the weanedcalf is finished as a yearling and theMarch system is profitable if the weanedcalf is finished in the feedlot. From thefinancial (cash flow) standpoint, the Junesystem always generated higher netreturns than the March system. Thegreatest financial net returns were for theJune-born yearling prior to beingput on grass.1Gordon Carriker, former research analyst;Dick Clark, professor, Agricultural Economics;Don Adams, professor, Animal Science; RussSandburg, research technologist; West CentralResearch and Extension Center, North Platte.June Versus March Calving for the NebraskaSandhills: Economic Risk AnalysisGordon CarrikerDick ClarkDon AdamsRuss Sandberg1A June calving system can bemore profitable than a March calv-ing system without increasingeconomic risk.SummaryPrice risk analysis of economic andfinancial net returns from June andMarch calving systems was used to rankand identify preferred production/salestrategies according to risk preferencesof producers. Analysis of economic netreturns identified selling a June-bornsteer at weaning from the breeding onmeadow (meadow-bred) treatment aspreferred strategy regardless of riskpreferences. Post-weaning, selling aJune-born finished yearling steer fromthe meadow-bred treatment was rankedhighest. Analysis of financial netreturns identified selling a June-bornyearling steer from the meadow-bredtreatment prior to summer grazing aspreferred for all but those strongly riskaverse; selling a June-born steer fromthe meadow-bred treatment at weaningranked second.IntroductionProduction agriculture is subject toseveral sources of economic risk: outputprice, yield, and input and cost. A simplecomparison of average net returns fromalternative production strategies over-looks risk. Comparison of the June-born calving system to the traditionalMarch-born calving system also shouldinclude an evaluation of the economicrisks involved. The objectives of thisresearch were to: 1) identify the riskefficient (preferred) set of productionstrategies in the two calving systemsbased on the economic and financial netreturns; and 2) rank the production stagesin order of risk preference based on theeconomic and financial net returns dis-tributions. We hypothesized that theproduction stages in the June systemwould be preferred over the samestages in the March system.ProcedureEconomic and financial net returnsdistributions were generated for eachproduction stage for both the March andJune calving systems using averageinput levels and animal weights, 1998input costs and real (inflation adjusted)prices received from 1992 through 1998.Thus, the variation in net returnsreported here is due strictly to variationin cattle prices. Economic net returnsindicate the ability of an individual stageof production to generate an economicprofit, i.e., the ability to stand alone as aseparate enterprise without being sub-sidized by an earlier or later productionstage. Financial net returns indicatewhether producing to a stage of produc-tion will generate a positive cash flow.The 15 numbered sales strategies (Table1) correspond with the stages of produc-tion and the alternative systems. Forexample, number 7 refers to selling a

June versus March Calving for the Nebraska Sandhills: Economic Comparisons

UNL | Libraries

University of Nebraska - Lincoln 
DigitalCommons@University of Nebraska - Lincoln 
Nebraska Beef Cattle Reports Animal Science Department 
January 2001 
June versus March Calving for the Nebraska Sandhills: Economic 
Comparisons 
Gordon Carriker 
University of Nebraska-Lincoln 
Dick Clark 
University of Nebraska-Lincoln 
Don C. Adams 
University of Nebraska-Lincoln, dadams1@unl.edu 
Russ Sandberg 
University of Nebraska-Lincoln 
Follow this and additional works at: https://digitalcommons.unl.edu/animalscinbcr 
 Part of the Animal Sciences Commons 
Carriker, Gordon; Clark, Dick; Adams, Don C.; and Sandberg, Russ, "June versus March Calving for the 
Nebraska Sandhills: Economic Comparisons" (2001). Nebraska Beef Cattle Reports. 287. 
https://digitalcommons.unl.edu/animalscinbcr/287 
This Article is brought to you for free and open access by the Animal Science Department at 
DigitalCommons@University of Nebraska - Lincoln. It has been accepted for inclusion in Nebraska Beef Cattle 
Reports by an authorized administrator of DigitalCommons@University of Nebraska - Lincoln. 
2001 Nebraska Beef Report — Page 10
June versus March Calving for the Nebraska
Sandhills: Economic Comparisons
budgets for each system and compare
the net returns at several production
phases in the two systems. We hypoth-
esized that the June system costs would
be lower and net returns higher than
those for the March system.
Procedure
Financial cost budgets were devel-
oped for each system through weaning.
Economic and financial cost budgets
were then developed for each produc-
tion phase after weaning. Budgets were
based on the 4-year (1995-1998) aver-
age resource use during each phase and
1998 input prices. All budgets include
costs for harvesting hay and purchased
feed, grazing (fence and water mainte-
nance, livestock checking, etc.), labor,
operating interest, management, over-
head and heifer replacement. The bud-
gets do not include charges for land,
property taxes, insurance, or buildings.
Ownership costs for hay harvesting and
feeding equipment, but not other equip-
ment, are included. Based on other
research at GSL it was determined that
the same land base (about 90% upland
and 10% subirrigated meadows) could
support equivalent numbers of cows year
around for either system. Therefore, land
charges and taxes would be the same.
The March calving system would use the
meadows for hay production while the
June calving system would use them for
summer and some spring and fall graz-
ing . The economic costs for all phases
beyond weaning reflect the opportunity
costs of growing the steer calf during a
production phase by also including the
value of the incoming animal as if it was
purchased at market. Valuing the steer
calf at the beginning of each phase of
production permits each phase to be
evaluated independently, as if each phase
was an independent enterprise. The
financial costs reflect the accumulated
cash costs of growing the steer calf
through a particular production phase.
Annual net returns budgets were
developed using the cost budgets,
average annual steer weights at the end
of each production phase, and 1992
through 1998 real (deflated market
prices) prices received at western-
Nebraska and eastern-Wyoming auc-
tions. Potential selling strategies for the
calf crops were determined based on the
various production phases. The eco-
nomic net returns at each production
phase are calculated as the difference
between gross revenue per calf and the
opportunity cost of growing the calf and
reflect the ability of each production
phase to generate a return on invest-
ment, i.e., make profit. The financial net
returns are calculated as the difference
between gross revenue per calf and the
accumulated costs of growing the calf
and reflect the ability of each production
phase to generate a cash flow.
The major costs for a weaned calf are
those necessary to support the cow
enterprise. As indicated, only budgets
for financial costs were calculated
through weaning. The hay cost, $40/t,
was based on budget estimates for
harvesting ($30/t) and feeding ($10/t)
excluding labor. These costs included
ownership costs for interest and depre-
ciation on the equipment. Labor costs
included in the budgets were based on
actual labor for feeding and calving as
recorded by the University staff at GSL.
We charged labor at the rate of $7.50/hr
except calving labor which was charged
at time and a half since we believe calv-
ing to require more skilled labor and
often occurs at night. No other labor was
included in cow budgets since we
assumed that other labor would be simi-
lar between systems. Purchased feeds
such as protein supplement and salt and
Gordon Carriker
Dick Clark
Don Adams
Russ Sandberg1
A June calving system extended
grazing, reduced feed costs, reduced
labor inputs and had higher net
returns than a March calving sys-
tem.
Summary
Costs and returns of June and March
calving systems were compared at four
production phases. Financial costs of
the June system were lowest, due pri-
marily to lower costs of producing a
weaned calf. Post-weaning financial
and economic costs at each phase were
nearly identical. Selling June-born steer
calves at January weaning would
double net returns compared to selling
March-born steer calves at October
weaning due to lower costs and higher
market prices. Net returns for June-
born steer calves retained beyond
weaning are highest if calves are
retained as yearlings and finished.
Calves finished as calf-feds provided
the highest net returns for the March
calving system.
Introduction
Input requirements for the June sys-
tem are lower at some phases than those
for the March system as described in the
previous article, “June versus March
Calving for the Nebraska Sandhills: Pro-
duction Traits.” The objectives of this
research were to: 1) develop cost bud-
gets for each system and compare the
costs at several production phases in the
two systems; and 2) develop net returns
Page 11 — 2001 Nebraska Beef Report
mineral were charged at actual costs
based on 1998 prices. Interest on the
value of cows and bulls was charged at
7.5%. Following Standardized Perfor-
mance Analysis guidelines, replacement
heifer costs were estimated from the net
cost to produce a weaned calf. We used
an initial selection rate of 20% of the
heifer calves with 16% of these heifers
ending up in the cow herd. We did not
include the additional costs to take the
heifer from calf to cow status. Based on
preliminary research, it appears the first
calf heifers can be developed for similar
costs in the two systems. Costs for ensur-
ing that the first calf heifer is bred for the
second calf may be higher for the June
system, but research is incomplete at
this time. It is not likely that costs for the
second calf will be different enough
between the two systems to alter the
conclusions of this paper. Each cow
cost budget was credited with cull
income for sale of cull cows, bulls and
heifers minus death loss. We assumed
the same cull weight of 1,100 pounds for
both (March and June) cow herds. Cull
prices varied from year to year and
between systems since culls are usually
available at different times of the year in
the two systems. Grazing costs were
estimated at $4/cow/month when
grazing upland and $6/cow/month
while grazing meadow. These are finan-
cial costs only and cover such items as
repair and upkeep on fence and water
and operating costs for checking cattle.
To properly graze meadows, more fenc-
ing and water is required than with
upland. The costs do not include the
value of the forage. Animal health was
not greatly different between the two
systems; however, we did include $15/
cow veterinary and medicine costs in
both systems.
Costs beyond weaning were based on
the actual feeds fed and feeding labor.
Grass for June-born calves that were
summered on grass the second summer
was charged at the rate of $0.50/hd/day.
This cost is intended to cover the costs of
renting additional grass where the land-
lord checks the calves and takes care of
all pasture and water management.
Feedlot costs were actual charges from
the University feedlot near Mead, Neb.,
which included a $0.30/hd/day yardage
charge. The costs were based on 1998
ration ingredient cost plus $1/cwt truck-
ing charge to and from the feedlot.
Results
The economic and financial cost bud-
gets are summarized in Table 1. Through
weaning the costs for both the economic
and financial budgets were treated the
same since there is no opportunity cost
of an incoming animal at weaning. The
cost of producing a June-born weaned
calf was $74 to $79 lower per calf than
the cost of producing a March-born
weaned calf due to reduced harvested
forage and feeding and calving labor
expenses. The additional financial costs
to grow a steer calf past weaning were
nearly the same for both the June- and
March-born calf fed systems; therefore,
the financial cost advantage remained
with the June system through the feed-
lot. However, the post-wean economic
costs for the March born, calf-feds were
slightly lower into the feedlot compared
to June born calves bred on meadow
($404/hd versus $417/hd) and slightly
higher than June born calves bred on
range (Table 2). The economic and
financial costs for June-born yearlings
reflect the higher incoming animal
values as well as the higher costs of
finishing the calves as yearlings.
The economic and financial net
returns to the March- and June-born
systems are summarized in Table 2.
When evaluating the economic net
Table 1. Average annual costs for March-born calf-fed and June-born calf-fed and yearling
steers.
June
March Calf-fed Yearling
Production phase Calf-fed Range Meadow Range Meadow
Economic costs/steer calfa
Cow cost/calf weaned $252 $173 $178 $173 $178
Calf costs: wean to on grass or feedlot $404 $397 $417 $466 $487
Yearling costs: on grass to feedlot — — — $543 $559
Feedlot costs $653 $666 $671 $751 $751
Financial costs/steer calfa
Cow cost/calf weaned $252 $173 $178 $173 $178
Calf costs: wean to on grass or feedlot $294 $219 $225 $283 $289
Yearling steer costs: wean to feedlot — — — $382 $389
Feedlot costs: wean to slaughter $580 $505 $511 $636 $643
aEconomic costs include the opportunity cost of the incoming animal, i.e., the value of the animal priced
at market. Financial costs include the accumulated costs of producing the animal.
Table 2. Average annual net returns for March-born calf-fed and June-born calf-fed and yearling
steers.
June
March Calf-fed Yearling
Production phase Calf-fed Range Meadow Range Meadow
Economic net returns/steer calf
Calving to weaning $86 $151 $161 $151 $161
Weaning to on grass ($36) ($20) ($34) ($28) ($32)
On grass to in feedlot — — — ($45) ($62)
In feedlot to slaughter $27 ($38) ($45) $20 $34
Financial net returns/steer calf
Calving to weaning $86 $151 $161 $151 $161
Weaning to on grass $74 $158 $158 $156 $165
On grass to in feedlot — — — $115 $108
In feedlot to slaughter $100 $124 $117 $135 $141
(Continued on next page)
2001 Nebraska Beef Report — Page 12
returns, a negative value for a phase of
production indicates that phase would
not stand alone as an enterprise without
being subsidized by earlier or later
phases. The phase does not generate a
profit. Similarly, a negative financial net
return, though not experienced, would
indicate that growing a steer calf to a
production phase would not generate a
positive cash flow. Selling a June-born
weaned calf in January from either the
range- or meadow-bred treatments pro-
vided $65 to $75 more net returns, on
average, than a March-born weaned calf
sold in September/October. This differ-
ence is due to two effects. First, it cost
less to produce a June-born calf. Sec-
ond, the price received for June born
calves sold in January averaged nearly
$10/cwt higher (real prices) compared
to the price received for the March-born
calf sold in September/October. The
price differential is a real effect of chang-
ing systems and must be considered if
changes such as this are contemplated by
any producer. It comes from a typically
higher seasonal price in January com-
pared to September/October and the fact
that the June-born calves are lighter so
the price slide also gives these calves a
price advantage. The net effect is that the
gross sale value received for a June-born
calf sold in January is about the same as
a March-born calf sold in the Septem-
ber/October time frame. The post-wean
economic net returns indicate the June
system is only profitable if the weaned
calf is finished as a yearling and the
March system is profitable if the weaned
calf is finished in the feedlot. From the
financial (cash flow) standpoint, the June
system always generated higher net
returns than the March system. The
greatest financial net returns were for the
June-born yearling prior to being
put on grass.
1Gordon Carriker, former research analyst;
Dick Clark, professor, Agricultural Economics;
Don Adams, professor, Animal Science; Russ
Sandburg, research technologist; West Central
Research and Extension Center, North Platte.
June Versus March Calving for the Nebraska
Sandhills: Economic Risk Analysis
Gordon Carriker
Dick Clark
Don Adams
Russ Sandberg1
A June calving system can be
more profitable than a March calv-
ing system without increasing
economic risk.
Summary
Price risk analysis of economic and
financial net returns from June and
March calving systems was used to rank
and identify preferred production/sale
strategies according to risk preferences
of producers. Analysis of economic net
returns identified selling a June-born
steer at weaning from the breeding on
meadow (meadow-bred) treatment as
preferred strategy regardless of risk
preferences. Post-weaning, selling a
June-born finished yearling steer from
the meadow-bred treatment was ranked
highest. Analysis of financial net
returns identified selling a June-born
yearling steer from the meadow-bred
treatment prior to summer grazing as
preferred for all but those strongly risk
averse; selling a June-born steer from
the meadow-bred treatment at weaning
ranked second.
Introduction
Production agriculture is subject to
several sources of economic risk: output
price, yield, and input and cost. A simple
comparison of average net returns from
alternative production strategies over-
looks risk. Comparison of the June-
born calving system to the traditional
March-born calving system also should
include an evaluation of the economic
risks involved. The objectives of this
research were to: 1) identify the risk
efficient (preferred) set of production
strategies in the two calving systems
based on the economic and financial net
returns; and 2) rank the production stages
in order of risk preference based on the
economic and financial net returns dis-
tributions. We hypothesized that the
production stages in the June system
would be preferred over the same
stages in the March system.
Procedure
Economic and financial net returns
distributions were generated for each
production stage for both the March and
June calving systems using average
input levels and animal weights, 1998
input costs and real (inflation adjusted)
prices received from 1992 through 1998.
Thus, the variation in net returns
reported here is due strictly to variation
in cattle prices. Economic net returns
indicate the ability of an individual stage
of production to generate an economic
profit, i.e., the ability to stand alone as a
separate enterprise without being sub-
sidized by an earlier or later production
stage. Financial net returns indicate
whether producing to a stage of produc-
tion will generate a positive cash flow.
The 15 numbered sales strategies (Table
1) correspond with the stages of produc-
tion and the alternative systems. For
example, number 7 refers to selling a


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June versus March Calving for the Nebraska Sandhills: Economic Comparisons

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