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12-Feb-2020
2020 Western Canada Feedlot
Management School
Preconditioning – Does
it Pay?
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Animal Health
Mexico
SAVS
IAM/PEPP
iFHMS/IT
Administration
Research
Feeds & Feeding
Professional Consultants
Accounting
LAC
Feedlot Health Management Services
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Outline
• Introduction
• Literature Review of the Benefits
• Discussion
• Economic Modeling
• Summary
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Introduction
• Originated from a meeting held at Oklahoma
State University in September of 1967
attended by approximately 200 animal
scientists and veterinarians.
– Discuss and encourage standardized
management of calves prior to weaning and
shipment.
• Concept of “preconditioning” beef calves has
been discussed, debated, tried, and tested
since the late 1960’s.
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Introduction
• Management strategies prior to and around
the time of weaning to improve the calf’s
immune system and to minimize stress.
– Decrease morbidity and mortality associated
with BRD
– Improve feedlot performance
– Reduce treatment costs
– Improve beef quality
– Add value to the entire beef production system
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Introduction
• Preconditioning may involve:
– Vaccination against known viral and bacterial
pathogens associated with BRD
– Temporal separation of stressful events (weaning,
castration, dehorning, etc.)
– Acclimatization to feedlot conditions (bunks,
water troughs, feedlot diets)
• Specific definition varies and is not well
defined.
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Egosurfing
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Egosurfing
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Egosurfing - Preconditioning
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Preconditioning on the Web
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Preconditioning on the Web
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Preconditioning on the Web
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Literature Review - Economics
• Estimates of the potential positive economic
benefits of preconditioning:– Cravey (1996) $55.93 to $60.72 net benefit
– Roeber and Umberger (2002) $46.83 to $49.54 net return
– Dhuyvetter et al. (2005) $40.00 to $60.00 benefit and
premiums likely to increase as the quality and integrity of
programs increase
– Feuz (2007) $23.50 per animal advantage
– Thrift and Thrift (2011) net profit to cow-calf producers ranging
from -$89.92 to $53.71 per preconditioned calf
– Hilton (2015) summarizing a 11 year Indiana study –
preconditioning generally produced $80.17 profit
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Literature Review - Adoption
• With these positive estimates of net returns,
why is it then that the adoption of
preconditioning by the beef industry has
been so painfully slow?
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Literature Review - Adoption
• Accurate estimates of the percentage calves
preconditioned in the US and Canada are
difficult to find.
– Superior Livestock estimated that in 2007 25% to
50% of their sales were preconditioned calves.
– USDA NAHMS in 2007-08 reported that 49.8% of
cow calf producers sold calves immediately at
weaning.
• Does this mean that 50.2% are preconditioned?
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Literature Review - Adoption
• Accurate estimates of the percentage calves
preconditioned in the US and Canada are
difficult to find.
– Canfax reported that in 2014 – 9% of cow-calf
producers in Western Canada preconditioned
their calves.
– Taken together, the best available estimates
indicate that the majority of calves in North
America are not preconditioned.
– WHY ??
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Literature Review – Health Benefits
• Many reports of the subsequent health
benefits of preconditioned calves:
– Cole (1985)
– Cravey (1996)
– Roeber and Umberger (2001)
– Macartney et al.(2003)
– Lalman and Mourer (2005)
– Pritchard and Mendez (1990)
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Literature Review – Health Benefits
• Cole (1985)
“preconditioned calves had an approximately 6
percentage point reduction in morbidity associated
with BRD (20.4% vs. 26.5%) and a 0.7% percentage
point reduction in mortality (0.74% vs.1.44%) as
compared to non-preconditioned calves”
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Literature Review – Health Benefits
• Cravey (1996)
“preconditioned calves had a lower treatment cost
($13.74 vs $30.66) and a lower death rate (0.5% vs.
2.6%) as compared to non-preconditioned calves”
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Literature Review – Health Benefits
• Roeber and Umberger (2001)
“Reductions in morbidity (35% vs. 77%) and
mortality (1.1% vs. 11.4%) in preconditioned calves
versus non-preconditioned calves”
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Literature Review – Health Benefits
• Macartney et al. (2003)
“Subsequent feedlot morbidity in preconditioned
calves, vaccinated calves, and conventional calves
was 3.9%, 13.7%, and 20.2%, respectively”
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Literature Review – Health Benefits
• Lalman and Mourer (2005)
“Reductions in morbidity (7% vs. 29%) and
mortality (0.1% vs. 3.0%) in preconditioned calves
versus non-preconditioned calves”
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Literature Review – Health Benefits
• Pritchard and Mendez (1990)
“Reported very little differences in morbidity
between treatment groups in their study where
calves from the same ranch were randomly
assigned to preconditioned or non-preconditioned
(21% vs 19% Exp.1 and 45% vs. 47% Exp.2)”
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Literature Review – Health Benefits
• Interpretation of studies reporting on the
benefits of preconditioning are difficult due
to confounding factors:
– Source
– “Definition” of preconditioning
– Lack/inappropriate statistical analyses
– Lack of blinding or masking
– Differences in marketing (direct vs. auction)
– Morbidity and mortality on the cow-calf
operation is often not reported
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Literature Review –Performance Benefits
• Mixed reports of the subsequent feedlot
performance benefits of preconditioned
calves:
– Karren et al. (1986)
– Cravey (1996)
– Roeber et al. (2001)
– Pritchard and Mendez (1990)
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Literature Review – Performance Benefits
• Karren et al. (1986)
ADG of preconditioned calves was
• 1.10 lb/d on Farm 1 and 0.18 lb/d on Farm 2 in year
one
• similar on Farm 1 in year two,
• 0.46 lb/d to 0.57 lb/d on Farm 2 greater in year two
than “regular calves” during the preconditioning
period
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Literature Review – Performance Benefits
• Cravey (1996)
“ADG of preconditioned calves was 2.88 lb/d vs.
2.59 lb/d for non-preconditioned calves”
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Literature Review – Performance Benefits
• Roeber et al. (2001)
“Inferior subsequent feedlot ADG in
preconditioned calves (3.55 lb/d vs. 3.73 lb/d) as
compared to non-preconditioned calves”
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Literature Review – Performance Benefits
• Pritchard and Mendez (1990)
“similar ADG of (3.02 lb/d vs. 3.06 lb/d) but inferior
Feed:Gain (6.44 vs. 6.24) for preconditioned calves
vs. non-preconditioned calves”
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Literature Review – Performance Benefits
• What effect do differences in weighing
conditions or shrink have on these reported
feedlot performance numbers?
• How do veterinarians and producers
interpret these mixed results?
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Literature Review – Preconditioning Premiums
• Reported premiums paid for preconditioned calves vary as well.
– Superior Livestock reported a increase in premiums from $0.25/cwt in 1994 to $12.06/cwt in 2012.
– Schippner et al. (1989) reported preconditioning premiums in Canada of $0.53/cwt to $6.88/cwt between the years 1980 to 1987.
– Carlberg et al. (2013) reported a $5.88/cwt to $7.97cwt premium for preconditioned calves at two aution markets in Alberta
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Literature Review – Preconditioning Premiums
• How are confounding factors accounted for in
the determination of preconditioning
premiums?
– Source
– Group size
– “Definition” of preconditioning
– Perceived “quality” of calves
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Discussion
• What can veterinarians and producers
conclude about preconditioning from
reviewing the literature?
– It works?
– It doesn’t work?
– It pays?
– It doesn’t pay?
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Economic Modelling
• Ultimate decision to precondition calves
needs to be modelled for each operation
– Price risk variables
• market price at weaning, market price at the time of
sale, preconditioning premiums, price slide,
seasonality of market prices, overall trend in the
market
– Production risk variables
• cost of feed, bedding, yardage (labour), induction,
treatment, and mortality
• ADG, DM:G, length of preconditioning period
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Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
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Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
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Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
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Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
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Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
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Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
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*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
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$0.0862/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
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$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
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$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM)
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$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM) $0.81/d
![Page 47: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/47.jpg)
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
![Page 48: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/48.jpg)
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
$0.51/d
![Page 49: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/49.jpg)
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
$0.51/d
![Page 50: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/50.jpg)
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
$0.51/d
![Page 51: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/51.jpg)
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
$0.51/d
![Page 52: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/52.jpg)
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
$0.51/d
$1.32/day
![Page 53: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/53.jpg)
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
$0.51/d
$1.32/day
![Page 54: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/54.jpg)
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
$0.0862/lb (DM)
$0.1149/lb (DM)
*Assumed DM: Hay = 87%;
Barley = 87%
9.4/lb/d (DM)
4.44/lb/d (DM)
$0.81/d
$0.51/d
$1.32/day
![Page 55: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/55.jpg)
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG
Total Production Costs
![Page 56: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/56.jpg)
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG
Total Production Costs
![Page 57: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/57.jpg)
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG
Total Production Costs $130.70
![Page 58: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/58.jpg)
Variables
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG $1.09
Total Production Costs $130.70
![Page 59: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/59.jpg)
Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG $1.09
Total Production Costs $130.70
Net Revenue of Preconditioning
![Page 60: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/60.jpg)
Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG $1.09
Total Production Costs $130.70
Net Revenue of Preconditioning
![Page 61: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/61.jpg)
Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG $1.09
Total Production Costs $130.70
Net Revenue of Preconditioning $58.90
![Page 62: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/62.jpg)
Variables
Weaning Weight lb. 500
Market Price at Weaning $/lb. $2.20
Calf Value at Weaning $1,100.00
End of Preconditioning Weight lb. 620
Market Price at Sale $/lb. $2.08
Preconditioning Premium $/lb. $0.05
Market Decline $/lb. -$0.05
Price Slide $/lb. -$0.0010
Value of Preconditioned Calf $1,289.60
ADG lb./d 2.00
Preconditioning Period (days) 60
Hay lb./d (as fed) 10.8
Barley lb./day (as fed) 5.10
Hay Price $/ton (as fed) $150.00
Barley Price $/ton (as fed) $200.00
Dry Matter Intake:Gain 6.92
Total Feed Costs $79.20
Feed Cost of Gain (COG) $0.66
Yardage $0.50/hd/d $30.00
Vaccinations, Implants, Deworming $10.00
Therapeutic Costs $3.00
Bedding $3.00
Mortality Cost (0.5% Death loss) $5.50
Total COG $1.09
Total Production Costs $130.70
Net Revenue of Preconditioning $58.90
![Page 63: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/63.jpg)
Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 560 620 680
Market Price at Sale $/lb. $2.14 $2.08 $2.02
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.05 -$0.05 -$0.05
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,198.40 $1,289.60 $1,373.60
ADG lb./d 1.00 2.00 3.00
Preconditioning Period (days) 60 60 60
Hay lb./d (as fed) 14.5 10.8 3.1
Barley lb./day (as fed) 0.00 5.10 12.40
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 12.62 6.92 4.50
Total Feed Costs $65.25 $79.20 $88.35
Feed Cost of Gain (COG) $1.09 $0.66 $0.49
Yardage $0.50/hd/d $30.00 $30.00 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.95 $1.09 $0.78
Total Production Costs $116.75 $130.70 $139.85
Net Revenue of Preconditioning $58.90
![Page 64: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/64.jpg)
Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 560 620 680
Market Price at Sale $/lb. $2.14 $2.08 $2.02
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.05 -$0.05 -$0.05
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,198.40 $1,289.60 $1,373.60
ADG lb./d 1.00 2.00 3.00
Preconditioning Period (days) 60 60 60
Hay lb./d (as fed) 14.5 10.8 3.1
Barley lb./day (as fed) 0.00 5.10 12.40
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 12.62 6.92 4.50
Total Feed Costs $65.25 $79.20 $88.35
Feed Cost of Gain (COG) $1.09 $0.66 $0.49
Yardage $0.50/hd/d $30.00 $30.00 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.95 $1.09 $0.78
Total Production Costs $116.75 $130.70 $139.85
Net Revenue of Preconditioning $58.90
![Page 65: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/65.jpg)
Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 560 620 680
Market Price at Sale $/lb. $2.14 $2.08 $2.02
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.05 -$0.05 -$0.05
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,198.40 $1,289.60 $1,373.60
ADG lb./d 1.00 2.00 3.00
Preconditioning Period (days) 60 60 60
Hay lb./d (as fed) 14.5 10.8 3.1
Barley lb./day (as fed) 0.00 5.10 12.40
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 12.62 6.92 4.50
Total Feed Costs $65.25 $79.20 $88.35
Feed Cost of Gain (COG) $1.09 $0.66 $0.49
Yardage $0.50/hd/d $30.00 $30.00 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.95 $1.09 $0.78
Total Production Costs $116.75 $130.70 $139.85
Net Revenue of Preconditioning -$18.35 $58.90 $133.75
![Page 66: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/66.jpg)
Average Daily Gain Sensitivity Analysis
-$50
$0
$50
$100
$150
$200
$250
0.00 1.00 2.00 3.00
Ne
t R
ev
en
ue
of
Pre
con
dit
ion
ing
($
/hd
)
Average Daily Gain (lbs/day)
![Page 67: Preconditioning –Does it Pay? · –Lalman and Mourer (2005) –Pritchard and Mendez (1990) Literature Review –Health Benefits •Cole (1985) “preconditioned calves had an approximately](https://reader033.vdocuments.mx/reader033/viewer/2022050414/5f8aa0d8139865320505c936/html5/thumbnails/67.jpg)
Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 530 590 620
Market Price at Sale $/lb. $2.17 $2.11 $2.08
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.05 -$0.05 -$0.05
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,150.10 $1,244.90 $1,289.60
ADG lb./d 2.00 2.00 2.00
Preconditioning Period (days) 15 45 60
Hay lb./d (as fed) 10.8 10.8 10.8
Barley lb./day (as fed) 5.10 5.10 5.10
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 6.92 6.92 6.92
Total Feed Costs $19.80 $59.40 $79.20
Feed Cost of Gain (COG) $0.66 $0.66 $0.66
Yardage $0.50/hd/d $7.50 $22.50 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.63 $1.15 $1.09
Total Production Costs $48.80 $103.40 $130.70
Net Revenue of Preconditioning
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Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 530 590 620
Market Price at Sale $/lb. $2.17 $2.11 $2.08
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.05 -$0.05 -$0.05
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,150.10 $1,244.90 $1,289.60
ADG lb./d 2.00 2.00 2.00
Preconditioning Period (days) 15 45 60
Hay lb./d (as fed) 10.8 10.8 10.8
Barley lb./day (as fed) 5.10 5.10 5.10
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 6.92 6.92 6.92
Total Feed Costs $19.80 $59.40 $79.20
Feed Cost of Gain (COG) $0.66 $0.66 $0.66
Yardage $0.50/hd/d $7.50 $22.50 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.63 $1.15 $1.09
Total Production Costs $48.80 $103.40 $130.70
Net Revenue of Preconditioning
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Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 530 590 620
Market Price at Sale $/lb. $2.17 $2.11 $2.08
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.05 -$0.05 -$0.05
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,150.10 $1,244.90 $1,289.60
ADG lb./d 2.00 2.00 2.00
Preconditioning Period (days) 15 45 60
Hay lb./d (as fed) 10.8 10.8 10.8
Barley lb./day (as fed) 5.10 5.10 5.10
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 6.92 6.92 6.92
Total Feed Costs $19.80 $59.40 $79.20
Feed Cost of Gain (COG) $0.66 $0.66 $0.66
Yardage $0.50/hd/d $7.50 $22.50 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.63 $1.15 $1.09
Total Production Costs $48.80 $103.40 $130.70
Net Revenue of Preconditioning $1.30 $41.50 $58.90
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Preconditioning DOF Sensitivity Analysis
-$50
$0
$50
$100
$150
$200
$250
0 15 30 45 60
Ne
t R
ev
en
ue
of
Pre
con
dit
ion
ing
($
/hd
)
Preconditioning DOF
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Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 620 620 620
Market Price at Sale $/lb. $1.93 $2.13 $2.33
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.20 $0.00 $0.20
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,196.60 $1,320.60 $1,444.60
ADG lb./d 2.00 2.00 2.00
Preconditioning Period (days) 60 60 60
Hay lb./d (as fed) 10.8 10.8 10.8
Barley lb./day (as fed) 5.10 5.10 5.10
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 6.92 6.92 6.92
Total Feed Costs $79.20 $79.20 $79.20
Feed Cost of Gain (COG) $0.66 $0.66 $0.66
Yardage $0.50/hd/d $30.00 $30.00 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.09 $1.09 $1.09
Total Production Costs $130.70 $130.70 $130.70
Net Revenue of Preconditioning
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Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 620 620 620
Market Price at Sale $/lb. $1.93 $2.13 $2.33
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.20 $0.00 $0.20
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,196.60 $1,320.60 $1,444.60
ADG lb./d 2.00 2.00 2.00
Preconditioning Period (days) 60 60 60
Hay lb./d (as fed) 10.8 10.8 10.8
Barley lb./day (as fed) 5.10 5.10 5.10
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 6.92 6.92 6.92
Total Feed Costs $79.20 $79.20 $79.20
Feed Cost of Gain (COG) $0.66 $0.66 $0.66
Yardage $0.50/hd/d $30.00 $30.00 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.09 $1.09 $1.09
Total Production Costs $130.70 $130.70 $130.70
Net Revenue of Preconditioning -$34.10 $89.90 $213.90
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Market Decline Sensitivity Analysis
-$50
$0
$50
$100
$150
$200
$250
-$0.20 -$0.10 $0.00 $0.10 $0.20
Ne
t R
ev
en
ue
of
Pre
con
dit
ion
ing
($
/hd
)
Market Decline ($/lb)
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Net Revenue of Preconditioning
• Affected by many factors
– Average Daily Gain and Feed Conversion
– Days on Feed
– Market Change
– Others
• Dry Matter Costs
• Yardage
• Pharma Costs
• Mortality Costs
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Egosurfing - Preconditioning
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Variables Scenario 1 Scenario 2 Scenario 3
Weaning Weight lb. 500 500 500
Market Price at Weaning $/lb. $2.20 $2.20 $2.20
Calf Value at Weaning $1,100.00 $1,100.00 $1,100.00
End of Preconditioning Weight lb. 560 620 680
Market Price at Sale $/lb. $2.14 $2.08 $2.02
Preconditioning Premium $/lb. $0.05 $0.05 $0.05
Market Decline $/lb. -$0.05 -$0.05 -$0.05
Price Slide $/lb. -$0.0010 -$0.0010 -$0.0010
Value of Preconditioned Calf $1,198.40 $1,289.60 $1,373.60
ADG lb./d 1.00 2.00 3.00
Preconditioning Period (days) 60 60 60
Hay lb./d (as fed) 14.5 10.8 3.1
Barley lb./day (as fed) 0.00 5.10 12.40
Hay Price $/ton (as fed) $150.00 $150.00 $150.00
Barley Price $/ton (as fed) $200.00 $200.00 $200.00
Dry Matter Intake:Gain 12.62 6.92 4.50
Total Feed Costs $65.25 $79.20 $88.35
Feed Cost of Gain (COG) $1.09 $0.66 $0.49
Yardage $0.50/hd/d $30.00 $30.00 $30.00
Vaccinations, Implants, Deworming $10.00 $10.00 $10.00
Therapeutic Costs $3.00 $3.00 $3.00
Bedding $3.00 $3.00 $3.00
Mortality Cost (0.5% Death loss) $5.50 $5.50 $5.50
Total COG $1.95 $1.09 $0.78
Total Production Costs $116.75 $130.70 $139.85
Net Revenue of Preconditioning -$18.35 $58.90 $133.75
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Ultimate decision to precondition calves needs
to be modelled for each operation
Price risk variables
market price at weaning, market price at the time of
sale, preconditioning premiums, price slide,
seasonality of market prices, overall trend in the
market
Production risk variables
cost of feed, bedding, yardage (labour), induction,
treatment, and mortality
ADG, DM:G, length of preconditioning period