Heifers at UT East Tennessee Research and Education Center Little River Unit
Many producers are expected to grow their cattle herds over the next few years to take advantage of expected high prices. Photo courtesy UT AgResearch.
 


Many producers in the cow-calf business are considering growing their cattle herds to take advantage of the high cattle prices expected over the next few years. University of Tennessee Extension agricultural economist Andrew Griffith said growing the herd size can take a number of forms such as keeping cows another year, retaining and developing home-raised heifers or purchasing bred heifers. “There are risks associated with each method of growing your herd, but there are also benefits,” he said. Griffith outlined the risks versus rewards.

“First, keeping a mature cow an extra year when you would normally cull and market that cow can carry a significant amount of risk,” he said. “These older cows tend to be less productive. The focus should be on the decision to develop or purchase heifers,” he said.

“When deciding whether to develop or purchase bred heifers, one factor to consider is disease control and biosecurity when introducing animals from outside the herd,” Griffith said. The cattle expert also pointed out that genetic selection is also a consideration when comparing current herd genetics to genetics of heifers available for purchase. “It is important to produce or purchase replacement heifers that fit the environment and fit the present herd from the standpoint of size, disposition, maternal characteristics, etc.,” he said.

Griffith added that the time to locate replacements or time and resources such as land, management and facilities that need to be devoted to developing replacements must also be a consideration prior to searching for replacements.

Finally, Griffith noted that despite the possible price rewards down the road, retaining and developing heifers now can be an expensive proposition. “Given current feeder cattle prices, input prices and a 15 percent cull rate of developed heifers, the cash cost of developing a heifer can easily range from $1,550 to $1,700 per head,” he estimated. “If fixed costs are added to this total then the total cost per head will increase, but the magnitude of the increase is dependent on the number of heifers being developed. The more heifers developed at one time, then the lower the total average cost of development.”  The economist further noted that developing heifers requires land and labor resources. “If a producer were to have heifers custom developed or if the producer purchased bred heifers, then there is the possibility that more cows could be carried on the operation,” he said.

The decision to purchase or to retain and develop heifers is an involved decision that can have long-lasting effects related to herd viability. Griffith’s suggestions are not all inclusive. For more details, producers should contact their local county UT Extension agent or visit the UT Department of Animal Science and Agricultural and Resource Economics websites: http://animalscience.ag.utk.edu/ and http://economics.ag.utk.edu/

UT Extension provides a gateway to the University of Tennessee as the outreach unit of the UT Institute of Agriculture. With an office in every Tennessee county, UT Extension delivers educational programs and research-based information to citizens throughout the state. In cooperation with Tennessee State University, UT Extension works with farmers, families, youth and communities to improve lives by addressing problems and issues at the local, state and national levels.

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Contact:

Andrew P. Griffith, Department of Agricultural and Resource Economics, 865-974-7480, agriff14@utk.edu


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