On the chance I will learn something new, I have a few comments on your numbers. First, the price of hay being $85/ton looks to be high unless it is real premium hay, that is, excellent feed ratings when tested. Second, the calves are not costing the full $1002 you calculate in feed. The cows still remain as they are not depreciated to zero. This only occurs if they die. The residual value of the cows, sold later as butcher cows may be as low as $20/cwt to as high as $40/cwt. The cows therefore put $1040 to $2080 back into your bottom line to offset the $1002. Of course you then have to subtract back out the original purchase price of the cow. With proper accounting I believe you will find a better breakeven point then you are presenting. |