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That's why actual damage done differs depending on talents, food buffs, some ailment debuffs and so on.
Pick with -% encumbrance is usually taken with similar talents to mitigate movement penalty for being overburdened. With proper build it effectively removes carrying weight restriction allowing you to haul heavy stuff almost unhindered.
Knife is usually picked for basic wound debuff resistance - so you don't need to carry bandages around when dealing with wolves - quite helpful in snow biome for example.
I use it only when I go into a cave(which is ASAP)... then I make sure to get 2 platinum nodes before anything else. Go to a second cave if need be. Then 3 or 4 copper, and all the rest iron. When I'm full, I head back and use those mats to get myself a platinum pick. In the meantime I work on building up from wood to concrete(skip stone building) using the workshop pick to get stone until it breaks. Then store it until mission end when I make sure to have it with me when I leave.
This way I essentially skip the iron and steel tool phase... as well as skipping the thatch and stone building phases.
This assumes I'm building a base that I don't carry with me.
Eventually I'll grind enough exotics and ren to get the high-end tools which help me advance that much faster, but I'll probably still stick with platinum tools because I prefer to use the first 40 titanium for the hunting rifle.