The factors affecting profitability fall into two categories: those that are under the producer’s control, and those that are not. Profitable cattle ranching, though, is a possibility, with a mixture of skill and luck. These numbers still relate to cattle producers spending a minority of time raising their animals, which means a smaller margin of error in things that improve profitability.
Those with fewer than 50 cows averaged only 28.6% of their time in caring for the operation, whereas 47.3% of those with farms up to 100 cows did. Fewer cows correlate to spending less time on beef production. Just under half, 45.6%, of all beef cows came from farms with fewer than 100 cattle. To make up for these rising overhead costs, the rancher must do everything possible to improve the profitability per animal. The real factor behind rising costs for cattle ranchers has appeared in overhead expenditures, which more than doubled from $387.24 in 1996 to $812.22 in 2018. That year, though, overhead budgets, including pasture maintenance costs, were lower, bringing the total to just a dollar below 2018’s total, $1,375.63. For example, in 2014, the operating costs per cow reached a high of $628.47 per head. While operating expenses have slightly increased overall since 1996, in some years, the price tag was much higher. Operating costs factored into this maintenance price per animal were graze feed, fed feed, purchased feed, harvested feed, vet bills, medicine, bedding, marketing, lube, fuel, electricity, repairs and interest on costs.Ĭosts of raising cattle are not stagnant. Adding the overhead costs of running a ranch, the total rises to $1,374.45 per head. The average cost of maintaining cattle from 2008 through 2018 was $562.23 per head. The USDA Economic Research Service collates data for various farm products across the country. When an operation is small, though, every dollar spent must be an investment in the overall cattle production. It is possible to turn a profit from raising beef cattle, but producers need to provide everything for the animals until their sale. Ranchers who want to know how to improve the profitability of cow-calf operations must understand how many factors play into the costs and earnings of this endeavor.
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