Ranchers weigh options on replacement heifers amid historic high prices

COLLEGE STATION – When it comes to replacement heifers in beef cattle operations, producers are faced with a dilemma: Raise them, buy them or sell them and “take the money and run,” said a Texas A&M AgriLife Extension Service economist.

It’s becoming an all too familiar situation among Texas ranchers, said Stan Bevers, an AgriLife Extension economist at Vernon who recently presented a study at the Texas A&M Beef Cattle Short Course.

“We looked at what the market is right now for replacement heifers,” he said. “We were targeting heavy bred heifers, and they were anywhere from $1,650 to $2,300 a head. The second number was what it was costing the rancher to raise them themselves.

When it comes to replacement heifers in beef cattle operations, producers are faced with a dilemma: Raise them, buy them or sell them and “take the money and run.”

“One operation we tracked were heifers weaned in 2010 and 2011, what those heifers were and what their accumulated expenses were over the two years to the point where they were heavy bred. Their expenses totaled $1,100 to $1,400 a head. That ranch was pretty efficient and did a good job of reducing their expenses.”

Bevers said since this ranch was located in Oklahoma, one would need to add $300-$400 a head to that for Texas ranchers and regional market prices to develop replacement heifers.

“That comes out to $1,400 to $1,800 to develop replacement heifers in Texas,” Bevers said.

He said if you look at the current market price, it shows it’s cheaper to “raise them yourself if you are a pretty efficient, cost-reducing type operator.”

“The final number we looked at is if I have to pay much over market cost for them or if I choose to raise a heifer on my own, what is she going to return me over her life?” he said. “We started with a two-year-old heifer that’s going to be having her first calf and added eight years to that. That means we’ve gone out 10 years into the future, so now she is 10 years old,and we came up with what I can pay for her, which was $2,301 a head.”

Bevers said that leaves three numbers to consider.

“We know the market is $1,650 to $2,300, and it takes $1,400 to $1,500 to raise her, and now she is worth $2,300 in my herd economically.

“What do you do with those numbers? Well, if nothing else, it illustrates how complex this decision is right now,” he said. “It’s not right or wrong. It’s based on what type of operation you have and your costs. You finally have to decide to pull the trigger and say this is what we are going to have to do.”

Bevers threw in a fourth number – what feedlots are paying for commercial heifers destined for the beef market. Right now, it’s about $1.93 to $2.03 a pound, he said.

“You are talking about a heifer in the 750-pound range that’s worth $1,500 on the market and that’s for beef,” he said. “So, if you don’t keep her as a replacement heifer, you now have a floor price of about $1,500 a head. If you don’t want to take her and put her back in your operation, the feedlot is going to take her for $1,500 and turn her into beef later down the road.”

Longevity and Fertility are Profit Drivers for Cattle Operations

by Clifford Mitchell

Reblogged from Cattle Today

DSC_0094_6x4_72Producers in the 21st century beef industry come better prepared than ever before. Continued education programs and an abundance of online resources help cattlemen stay well informed. Record keeping practices have improved and cattlemen have a good handle on the costs associated with their operation.

Tightening margins have forced producers to further evaluate the management plan, running through many different scenarios to find the best production model. For some this was a real eye-opener, for others it reinforced the approach they were taking to manage the herd for a profit. A genetic base complete with a bundle of traits also played a key role in the success of the operation. Many cattlemen have argued with neighbors and colleagues until they were blue in the face over their point of view; however, most will agree longevity built into the female is a definite advantage for most outfits.

“Every year I can keep a cow it cuts my costs $1,500. Because that’s what it costs to get a female into production,” says James Henderson, Bradley 3 Ranch, LTD, Memphis, Texas.

Photo by Penny Bowie

Photo by Penny Bowie

“Operations have to be profit driven. Fertility is a good trait to have and will lead to a long life on many ranches, but females have to be productive. Make sure cows are able to live in your environment, breed back and do it profitably year after year,” says Dr. Robert Wells, Livestock Consultant, Samuel Roberts Noble Foundation in Ardmore, Oklahoma.

“Longevity is one of the reasons we have Brangus females. A lot of times you wouldn’t know that old cow, is not a six or seven year old, because she’s still milking well and raising a good calf,” says Adam Whitesell, Lockwood, Missouri. This operation maintains 600 to 650 Brangus females and retains ownership of the calf crop most years at Decatur County Feedyard in Oberlin, Kansas.

Cattlemen have been programmed into two schools of thought; either buy or raise the replacements that the operation needs. Costs are associated with each method; another big debate among cattlemen looking for the most profitable answers.

“I know it costs us something to get that heifer into production. I have never put a pencil to actual costs. When it’s time, we select our replacements they go to grass and the cull heifers go to the feedyard,” Whitesell says. “I would think a five-year-old after producing three calves would have paid for herself in our program.”

“The cost of a replacement will vary from one operation to the next depending on if heifers are home-raised or bought. The first thing producers need to do is maximize the salvage value of that cull cow,” Wells says. “Quality replacements, from a known source and bred to good calving ease bulls are costing any where from $1,000 to $1,200 in our current market. Most females, depending on the value of the calf she is producing, should pay for themselves by the time they are four or five years old.”

DSC_0326_72

“Just to break even in our operation a cow has to be six and produced four calves,” Henderson says. “According to my calculations, it costs me $1,500 every time I replace a cow. This includes feed, facilities, pasture, semen and labor. None of these things come without a cost.”

Care and handling of these replacements will bring genetics to the forefront when done right. Management could help these females lead long productive lives just by making the right decisions as they are introduced to the next stage in the production cycle.

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Brangus Association Awards Cattlemen

Five of the most elite cattle producers and Brangus breeders were honored by the International Brangus Breeders Association (IBBA) for their outstanding achievements and their contributions to the Brangus breed as well as the beef cattle industry.

Joe Fuller, Connie Morrow, Martha Morrow, Carly Morrow, and Dr. Tommy Perkins

Joe Fuller, Connie Morrow, Martha Morrow, Carly Morrow, and Dr. Tommy Perkins

The Pioneer Award recognizes an IBBA member, past or present, for his/her service, loyalty and contributions to the Brangus breed. Jerry Morrow served as IBBA’s Executive Vice President from 1980 to 1988 and had an influential role in the association. Several advancements were initiated under his leadership including the first National Junior Brangus Show, first National Brangus Sire Evaluation, first Brangus bull sale at the National Western Livestock Show in Denver, and the first of any breed to have ultrasound enhanced carcass expected progeny difference (EPDs).

Trey Kirkpatrick, David Vaughan, Susan Vaughan, and Dr. Tommy Perkins

Trey Kirkpatrick, David Vaughan, Susan Vaughan, and Dr. Tommy Perkins

David Vaughan also received the Pioneer Award for his influence both domestically and internationally. Vaughan was the owner of Salacoa Valley Farms in Fairmount, Ga., which sold to the Seminole Tribe of Florida. He served the IBBA in several capacities including a term as president in 2007-2008, and he was awarded the Brangus Breeder of the Year award in 2005 for his progressive ideas and successful operation.

Steve Densmore, Dr. Robert Vineyard, and Traci Middleton

Steve Densmore, Dr. Robert Vineyard, and Traci Middleton

Steve Densmore of Bryan, Texas, was one of two recipients of the Breeder of the Year Award. The substantial amount of carcass data the IBBA has received on fed Brangus steers is, in part, due to Densmore’s dedication to the Brangus breed. He has a passionate devotion to the Junior Brangus Association and was the recipient of the Georganne Myers Award in 2011 for his support of the Junior program. Densmore also served on the IBBA Board of Directors from 1997 until 2003 and was elected President in 2002. He was elected to another three-year term from 2010 to 2013, which collectively totals 10 years on the IBBA board.

Tracy Holbert, Penny Coggins, Mike Coggins, and Traci Middleton

Tracy Holbert, Penny Coggins, Mike Coggins, and Traci Middleton

Mike Coggins was another recipient of the Breeder of the Year Award for his progressive ideas and outstanding seedstock operation. Coggins is a truly progressive breeder who produces some of the best genetics with the latest technologies available. Coggins owns Blackwater Cattle Company in Lake Park, Ga., where he oversees a purebred Brangus cattle business along with a diversified agriculture operation. He is very knowledgeable about all sectors of the industry and understands the needs of commercial cattlemen, seedstock producers and consumers alike.

The Commercial Producer of the Year award was presented to Russell Trefney of Weimar, Texas, in recognition of his achievements and success of incorporating Brangus genetics in his commercial cattle operation. A fifth generation cattleman, Trefny found Brangus to be the best breed for his crossbreeding operation in Central Texas in order to maintain a consistent product that resulted in higher quality carcass grades at the harvesting stage, making it more profitable for him to retain ownership through the feedlot.

Don Cox, Jessye Trefny, Michaelanne Trefny, Russell Trefny, Traci Middleton, and Dr. Tommy Perkins,

Don Cox, Jessye Trefny, Michaelanne Trefny, Russell Trefny, Traci Middleton, and Dr. Tommy Perkins

Award recipients were presented their awards Friday, March 7, 2014, by the IBBA in Houston, Texas, at the IBBA annual convention. Award recipients are nominated and selected by the IBBA Awards Committee. Please visit http://www.gobrangus.com for more information.

 

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BIF to Host Genetic Prediction Workshop

MANHATTAN, Kan. [Oct. 28, 2013] – The Beef Improvement Federation (BIF) will host a Genetic Prediction Workshop in Kansas City, Mo., on December 12-13, 2013, at the Holiday Inn KCI Airport and KCI Expo Center, 11728 NW Ambassador Drive.

The conference is designed to give academic, allied industry, breed association staff and cattle producers a forum to learn about and discuss the latest developments in beef cattle genetic evaluation strategies. The implementation of genomics technologies in national cattle evaluation systems will be the focus of discussion.  Speakers will highlight the experiences and current status of technology deployment at several major US breed associations, experiences developing genomic predictions of genetic merit and alternate strategies for computation of genomically enabled EPDs. The conference will also feature discussion of planned modifications to the system used to compute the Across Breed EPD adjustment factors at the US Meat Animal Research Center.

A USDA multi-state project (NCERA-225) focused on implementation and strategies for national beef cattle genetic evaluation will meet prior to the Genetic Prediction Workshop. This meeting will feature station reports and research updates from a number of committee members.

Registration for the BIF Genetic Prediction Workshop is $100 and includes a buffet breakfast, lunch, dinner and breaks during the conference. For NCERA committee members, an additional registration of $25 is required and includes a breakfast and break for this portion of agenda. Attendees must preregister for the events by December 1, 2013. Online registration and full agenda is available at http://www.ksubeef.org in the ‘Upcoming Beef Events’ section.

LODGING: A room block is available through November 8, 2013 at the Holiday Inn KCI Airport. Room rates are $94 plus applicable tax and are available the nights of December 11 and 12.  Conference attendees should call the hotel reservations department directly at 1-800-957-4654 and identify themselves with the NCERA-225 & BIF Genetic Prediction Workshop block.  Reservations made after 11/8/2013 are accepted based on room type and group rate availability.

For more information about the BIF Genetic Prediction Workshop or the NCERA-225 meeting please contact Dr. Bob Weaber at 785-532-1460 or bweaber@k-state.edu or Lois Schreiner at 785-532-1267 or lschrein@ksu.edu.