Health Track pays dividends, year after year
By Daniel Schafer

There have been stories circulating the ag press recently about how to figure out if pre-conditioning is profitable on your operation. Don’t waste your time doing the calculations. It not only pays, it consistently pays, and the MFA Health Track program has the data to prove it.

Since 2002, MFA Health Track has been collecting sales data at sales with a critical mass (more than 700 head) of Health Track cattle selling at various locations on a single day. From 2002 through 2005, producers enrolled in the Health Track program and selling calves at such sales saw a steady rise in the total revenue received for both their steers and heifers, followed by a moderate drop in 2006 and 2007. The revenue per head reached a peak of $778.48 and $692.90 for steers and heifers respectively in 2005, which corresponds to the smallest supply of feeder cattle reported by USDA in over 25 years at just over 27.5 million head.

Describing why programs that verify source, age and process, University of Missouri agricultural economist Joe Parcell said “Value-added feeder cattle will net higher producer returns from a preconditioning program when feeder cattle supplies are large because feed yard buyers can be more selective with their cattle buying choices.” Based on this typical economic relationship between profitability of value-added cattle such as Health Track calves and commodity cattle such as feeder calves without any history, you might figure that profitability for the steps needed to achieve “value-added” status the lowest between 2004 and 2005 (when we had a low supply of feeder cattle). And you might expect profitability to start rising following the increasing supply of feeder calves in subsequent years. Cow/calf profitability from participating in Health Track versus selling calves at weaning was scheduled to hit its lowest point in 2004 at $28.68 per head for both steers and heifers. Profit started to rebound in the following years. The only aberration was in the fall of 2006, when the price of corn unexpectedly jumped from $1.91 per bushel in mid August to $3.58 per bushel by the end of November, which, according to the Missouri Department of Agriculture’s weekly price reports, resulted in a $23.22 per hundredweight drop in the price of 650-pound steers. Despite the corn and feeder calf market volatility in 2006, Health Track calves that sold in sales with a critical mass still yielded an average profit of $6.20 per head.

If you are a big-picture kind of person the chart below shows that since 2002 Health Track cattle have yielded an average profit from $35 to $40 per head. Since 2000, over 285,000 cattle have worn Health Track tags. That corresponds to over one billion dollars in added value that cow/calf producers have been able to capture by participating in Health Track.

All of this is no news to Mike John, third generation rancher in north-central Missouri and director of the MFA Health Track program. “The cow-calf industry has the ability to add cost-effective weight gain to their cattle more efficiently than any other segment of the industry,” he said.

As director of the MFA Health Track program, John often gets the question of whether Health Track calves will receive a premium. “There are a lot of factors that go into determining selling price and thus whether there is a ‘premium.’

“The all-too-common mistake many producers make when evaluating whether participating in Health Track is a wise decision is to only consider the dollars per hundredweight. But price per pound is only part of the equation that plays into profitability,” John added. “The abilities of Health Track cattle to stay healthy, gain in excess of 2 pounds per head per day during the 45 days post weaning and to minimize shrink are the main factors that have made these calves profitable year in and year out,” said John.

Those healthy calves are what separate Health Track from other pre-conditioning programs in the industry. Health Track producers are required to collect any treatments to their cattle that are due to injury or illness during the 45-day post-weaning period. On nearly 225,000, calves those treatment rates have been 1.92 percent with a death loss rate of 0.1 percent.

And that’s one reason we’ve adopted the slogan “We’ve Got You Covered.”

For additional information, including sale dates and MFA Health Track program details, visit: www.mfahealthtrack.net

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