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Creep-feeding economics: Does it pay?

Danielle Schlegel for Progressive Cattleman Published on 24 April 2017
Creep feeding does it provide a return on your investment

Regardless of where the markets are at, considering the economic impact of incorporating a creep feed into your management might be the difference between getting ahead and leaving money on the table.

While creep feeding might not be feasible for every producer, it is often worth a consideration even when the markets are in despair.

Creep feeding is defined as early usage of grain feed for nursing calves, without accessing the feed to dams. Ultimately, the decision to incorporate creep feeding comes down to a value-versus-cost analysis, and how much gains are seen at weaning compared to calves not creep fed, Dr. Ki Fanning, consulting ruminant nutritionist with Great Plains Livestock Consulting Inc., notes.

“If a producer knows what the weaning weights look like both with and without creep feed, it makes that decision much easier,” Fanning says.

Certainly, determining the differences in weaning weight can, and often will, add some time and labor to a producer’s plate. The information gleaned from side-by-side comparisons can aid not only in critical evaluations of breeding programs, but also in determining a value-to-cost ratio in utilizing creep feeds.

“Everyone is looking to maximize return on investment. If you are able to weigh your calves individually, you will see a wide range of average daily gain (ADG) within the herd,” Leon Watson, CEO of beef cattle consultant group, Cattle Connections LLC, summarizes.

“I realize this is an increase in labor; however, by identifying those cows that are producing calves that lower our daily gain averages, we might need to consider replacing them with heifers from our higher ADG producers. We [as beef producers] base our standard of living on selling total pounds minus total expenses."

"Our goal should be developing a calf which hits the ground with tremendous vigor, a cow which provides adequate nutrition for that calf and a calf that optimizes its genetic potential of growth and development.”

Utilizing creep should not be approached as a stand-alone management strategy, but rather as a supplement to others.

“Whether the market is low or high, we want to stimulate the calf to grow and develop and reach a target weight as quickly as possible,” Watson says. “With this being said, creep feeding is another management tool we can use in taking advantage of the heterosis or genetic potential created from our breeding program.”

Without a doubt, there is an added cost associated with implementation of creep feeding in a ranching system, including the upfront cost of the feeders, additional labor and time spend checking feeders, as well as keeping fresh feed in them and the input cost of the feed itself.

Even after the value is considered, the cost of the feed alone is also a big factor in the equation given that other expenses are not a factor in this equation.

“Depending on the type of ration being used, creep feed can cost from 13 cents per pound [some custom rations] to 22 cents per pound. If it’s taking an average of 4 pounds of feed to get 1 pound of gain [on smaller calves], the breakeven cost would be between 52 to 88 cents,” Watson says. “I feel that calf prices would need to get below this cost before it would not pay to add the extra pounds through creep feeding the calves.”

Value and quality feeds

Most feedstuffs follow the price of corn, so if corn goes up, typically the byproduct markets will go up as well. Increased feed prices will result in an overall increased cost of creep feeds. Pelleted creep tends to be a more popular choice, but is not always the most cost-effective option, Fanning notes.

“Meal-type creep feeds are usually less expensive than pelleted feeds. Many producers [I work with] are getting along just fine on meal,” Fanning says. “One big advantage to meal creep is that you can see what is in the product a bit easier than with pelleted creep, but it often requires a bit more bunk management than pellets.”

Meal creep is often easier to come by and is easier to customize the formula than with pelleted feed that is mass-produced.

Fanning also points out that producers often overlook manufacturing their own creep feed. While it may not be feasible for all producers, many can use their own crops nearby or on hand to develop a lower-cost creep.

“It can really save producers a lot of money,” Fanning says. “Depending on how a producer prices his own corn, the price can generally come out to around $140 to $160 with dried distillers grains (DDGs) and trace mineral packages added.”

Mineral prices are much less volatile than grain and corn markets, making it a bit easier to calculate the cost of self-manufacturing YOY. Fanning offers up some requirements for any creep feed regardless of manufacturing approach.

“Creep feeds should consist of a protein, energy source, vitamins and trace mineral packages, and ionophores if needed. Too much starch such as corn will hurt fiber digestibility, so creep feeds with a small amount of corn is ideal,” Fanning says.

“You want to complement grass digestibility rather than work against it with corn. Using highly digestible fiber sources such as DDGs, soybean hulls, gluten pellets [and] wheat middlings are all good options.”

It’s not always feasible

As Dr. Glynn Tonsor, associate professor of agricultural economics at Kansas State University, also notes, evaluating available tools online such as Beef Basis to estimate projected market prices can assist in determining a value-versus-cost ratio for each unique management situation.

Even if the value outweighs the input costs of incorporating creep feeding into an operation, however, other factors can impede the implementation of such management strategies.

“If a producer is selling calves straight off the mother, it may make sense to creep feed, but if you plan to background or send calves off to a feeder, there might be some different considerations in the amount of creep fed,” Fanning says.

“It makes sense to expose calves to some sort of feed other than the mother’s milk [before weaning],” but how the calves are marketed should be a big consideration in this equation that can directly impact the necessity for creep.

Not only is there added potential for producing fleshy calves that are adverse to certain markets and ultimately risk a price discount, other management protocols could also interfere with implementing creep feeding such as evaluating overall milk production in first-calf heifers, and, as Watson says, it is “practically impossible with companion grazers such as sheep or goats.”

While many cow-calf producers are a stone’s throw away from various resources and thus can easily utilize resources such as consultants to develop a ration that can meet the needs of a producer’s calf crop at a lower price per pound (for example), not all producers are located close enough to appropriate commodities to absorb the cost in freight.

Certainly, some positive equity in an operation is helpful to any producer when looking to implement creep-feeding systems from scratch or transition into a customized ration, but for some, very remote pastures, the cost and time spent managing might significantly outweigh the value.

Final thoughts

“The best way for cow-calf producers to change from a high- to low-cost operation is to reduce the amount of depreciation annually,” Fanning offers. “I don’t think it makes sense to leave money on the table regardless of how much equity you have in your operation.

Whether you have strong or weak equity, I would approach the economic investment and considerations of creep feeding the same.”

As for producers in a feasible position to incorporate creep into pre-weaning management strategies, Watson is a strong proponent even when markets are bleak. In his life-long tenure in the industry, his observations of creep-fed calves show both steers and heifers often weigh around 100 pounds heavier than non-creep-fed calves at weaning.

“An increased average daily gain, calves that are bunk broke and knowing how to eat, less stress on the calves at weaning, reduced pressure on pasture forages, heavier and healthier calves at weaning, facilitates fall calving, improves calf uniformity – all contribute to selling more pounds in the end,” Watson says.

No matter the approach, there is a cost associated, but the value gained over the cost should be the deciding economic factor for any producer contemplating creep- versus non-creep-fed calf crops.

“Ultimately, the price-weight slide drives the core revenue side impacts,” Tonsor concludes. “Producers need to compare the expected increase in revenue related to increased cost.”  end mark

PHOTO: Whether or not creep feeding can provide a return on investment should be considered on a case-by-case basis. Staff photo.

Danielle Schlegel
  • Danielle Schlegel

  • Freelance Author
  • Whitewood, South Dakota
  • Email Danielle Schlegel

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