Backgrounding Calves
By Heather Smith Thomas
Backgrounding simply means growing calves bigger (after weaning) before they go into a finishing program. Some producers hold their calves to sell later as yearlings, and some buy light calves in the spring to put on grass in a stocker program and grow to a larger weight. Some put weaned calves into a confinement program and feed a growing ration until they are ready to go to a finishing facility. The calves might be on pasture with a supplement or in a confinement program on a growing ration—about 90 to 100 days of backgrounding.
This year things are a bit different, with high prices for calves and high cost of feed in many regions. Dr. Ron Gill, Texas A & M, Agrilife Extension, says that if you are buying calves to background, you have to look hard at pricing—in terms of what the calves are bringing today and what you might expect them to bring when you sell them.
“In our area the cost of feed is so high that you need to carefully calculate the cost of gain and value of gain. Right now, the value of gain is borderline regarding whether you can make money doing this. It may be different if these are your own calves that you are keeping and feeding and looking farther down the road to what those carcasses might be worth. There are many things to consider,” he says.
Having your own calves and accessible feed sources may work out better than if you are trying to buy calves and buy feed that must be hauled very far. “Buying calves right now is a gamble,” says Gill.
“I think there is a lot of risk involved, especially when calves are worth so much right off the cow or after weaning. When they are worth that much it’s harder to talk yourself into keeping them. Even if calves are not preconditioned, they are bringing pretty good money this year, but there is still about a $10-$12 premium in some areas for the 45-60 day weaned calves.”
It’s important to identify your end target. “If you will be selling them directly as beef or you are part of a supply chain you want to keep cattle in, or keep cattle coming to, this may change the picture a little—to maintain those relationships,” he says. Each producer’s situation is a little different; you have to figure out what will work for you.
“There is no blanket advice that can be given. There are many tough decisions—whether to keep calves longer, or keep heifers. It might be good to keep them longer, in terms of inventory, but you don’t know if things will change next year and whether there will be pasture. Some people are restocking now, but that’s a gamble, too. Many people got burned the last time they tried to keep heifers and background them through winter to sell as bred heifers or ready to breed,” says Gill. And there’s no crystal ball in terms of what the weather will be.
“A lot will depend on available feed resources. If you will be purchasing calves and backgrounding them, you’ll need to find calves you can purchase somewhat under the average market price. Then your margins might be a little better when you get them straightened out and on feed. Success with this will often depend on what you value those cattle in at or what you actually purchase them for—and their health.”
If the calves are coming out of drought areas and might be stressed, they may not have strong immunities. You don’t want a health wreck. “Any time calves are this high priced, the risk of one of them dying takes away all the profit. We’ve seen a higher incidence of respiratory disease in calves over the last few years, even in good years. I think genetics play a role in this. You want to know as much as possible about the cattle. In general, the more straight-bred they are, the more likely they are to get sick. A good crossbred animal has more vigor, performance, and immunity,” he says.
“These are things to think about when buying calves, to have as little risk as possible. If you are backgrounding, maybe you can find someone who has weaned their calves for 45 to 60 days and you can just take them and go.
That would be the safest bet,” says Gill.
“Like any margin business, do your budgets realistically. Don’t underestimate health issues or overestimate performance. It might pay to look at some of the pricing mechanisms—maybe locking in a certain price—to eliminate a big loss.”
Probably the value of calves coming out of a backgrounding program and into the finishing yards will be pretty high, but we don’t know. It always pays to do some number crunching, though some people just keep backgrounding calves because that’s what they’ve always done. “This happens a lot in most segments of the beef industry; you might make a little money two years and then lose it all over the next three! It just seems there is more risk this year, because of instability of the market (regarding cost of feed as well as cattle). If you can limit or mitigate the effect of those unknowns it probably pays to keep doing what you know how to do, in terms of backgrounding, whether doing custom backgrounding or backgrounding your own calves,” says Gill.
Feed sources are important; it helps to have local supplies rather than something that must be hauled a long distance. “With the cost of fuel, if you have to haul very far it’s tough!” he says.
If you are not in a persistent drought and can produce your own hay (or buy local hay reasonably priced) and have a consistent forage source, feeding cattle is more feasible. “There are still a lot of byproducts like gluten and distillers grains available for mixing rations, so the main thing would be access and trucking.”
Backgrounding In Missouri
Neal and Linda Niendick and son Ben own a feedlot and backgrounding business near Wellington, Missouri, When Ben came home from college in 2016 they added onto the operation to be able to background more calves.
“We do a lot of custom feeding and own a few of the cattle ourselves,” says Ben. “Calves usually come to us weighing between 600 and 650 pounds and we feed them for 150 or more days, to get them up to about 850 and sometimes 900 pounds—ready to go out west to get finished.”
There are very few finishing facilities in Missouri; most calves go to feedlots in western Kansas and some to Nebraska. Conditions in Missouri aren’t ideal for finishing cattle because weather is hot and humid in summer and muddy in winter. “Another disadvantage is that we are farther from the processing plants. This might change in the future, to where there could be more finishing opportunities here,” he says.
Missouri produces a lot of cattle (it is usually second or third in the nation for cow-calf numbers) and most calves are backgrounded before being sent to finishing yards. “Many of the calves we get come from sale barns, but some of our customers send calves off their farms and retain ownership. Some customers send calves they buy at the sale barns,” says Ben.
He and his dad usually feed about 1500 calves, with numbers fluctuating depending on time of year. The facility is strictly a confinement situation. “In our area there’s not much pasture; it’s all crop land. We run a few cows on some grass, but we only have 25 acres of pasture,” he explains.
Their facility is close to several sale barns, and there are many cow-calf producers in this area. “Being close to Kansas is an advantage, too. The sale barns here have good runs every week. There is a great supply of cattle; we don’t have any trouble keeping our pens full.”
When calves arrive, many of them are ready for another round of vaccinations. “We usually process them upon arrival. One of the things we did when I got back from college and became more active in the operation was to improve our working facility so we could handle calves as easily and smoothly as possible,” he says. They are coming from a variety of places and most of them are stressed already, so it’s important to not add more stress.
“We assess their condition. Some just came off grass or were weaned recently and may not know how to eat from a bunk. We determine what kind of ration to start them on,” Ben says.
Those calves go into pens close to the barn for the first week or two so they can be closely monitored for any signs of illness. “We keep a close eye on them, especially when it’s hot, and also in the winter; our winters can be pretty rough on them,” he says.
The calves are generally started on a high-roughage diet, and gradually bumped up to grower rations, gaining about 2 ½ pounds per day. “We don’t want to get them too fleshy until they reach the right frame size. We want them to just keep growing, without getting fat, so they can put on weight when they go west for finishing,” Ben explains.
With custom feeding, the rations may vary. Every customer is a little different regarding the goal for their cattle, and what they want them to gain. “We customize the ration for each group,” Ben says.
The farm grows all the feed necessary; the only things purchased are minerals and feed additives. “We can chop our own feed and do it at the right time, at the right stage of maturity,” Ben says. “We also combine our own corn, and have a roller mill, and don’t have to buy any corn. We work closely with a nutritionist from Great Plains Livestock Consulting in eastern Nebraska.” The cattle are always on harvested feed, since their backgrounding operation has no pasture for calves.
In winter the biggest challenge is keeping pens clean and minimizing mud. “We don’t want the cattle lying in mud, so we’ve built mounds in each pen so they can get up off the wettest ground,” Ben says.
In summer they put up shades. Studies have shown a 30-degree difference in ground temperature underneath the shade versus out in the sun. “As soon as we put up shades, the cattle use them; even the new arrivals figure it out pretty quick. We provide about 10 square feet of shade per head,” Ben says. This takes a lot of pressure off the water; they don’t need to drink quite as much, and they stay in the shade—and are not grouped around the waterers all the time. It’s important to have plenty of water space per head, with good capacity.