Here we go again! Number one 500 pound steer calves are bringing $100 cwt and producers are paying $950 for quality bred heifers. Whether producers are paying too much is beside the point. These $950 bred heifers are priced on today's calf market. It is too bad that she isn't going to wean a calf this year. Maybe next year's calf market will be as high or higher, but then again... Before you decide to increase your cow herd with a $950 bred heifer ask yourself the following questions.
"At what level does the calf market need to be to justify paying this much for a bred heifer?" "How long do I expect the calf market to stay at this level?" In order for this heifer to be a paying proposition, the calf market had better stay where it is for at least four to five years. Please realize this time period is over half the cow's productive life. Remember the cattle price cycle? History repeats itself, especially in this business.
In my opinion, the real secret to making this expensive bred heifer an economically viable enterprise is to get her bred back with her second calf. I may be preaching to the choir, but I see too many of us managing our first calf heifers just like we do our mature cows. My father told me many things while I was growing up. One that I remember is "You can never starve a dollar out of a cow." I will add "She is not supposed to be on welfare, either. Take care of her and demand that she pay her own way."
Now, let's talk about that $500 steer calf that you are going to wean this fall. What are you going to do with him? Your answer is "Well, sell him, of course, and take the money to the bank to cover up some of the blood (losses) that occurred during '93, '94, '95 and '96."
Let's back up. You're at the sale barn, your calves have sold for what you think is a ridiculously high price and you're at the pay out window feeling better than you have in years. Ask yourself the following questions.
"How much money does the party that bought my calves plan to lose?" Keep in mind that the party purchasing your calves has more money invested in them than the amount you received (about $25 a head for order buyer and sale barn commission and freight). Could you have done with your calves what the purchaser is going to do with them? If you don't know what they are going to do with your calves, ask them.
"Is there something I could have done to cause my calves to bring more money?" Of all the questions in this article, this is the easiest to answer. For the vast majority of readers, the answer is "Yes". The answer actually started 18 months earlier when your bull and your cow got together. Do you have the right ones? Between then and now, what type of animal health program do you have? What is your forage management program? Have you managed your forage and your calves to retain ownership of them through a 45-day back-grounding phase in order to economically gain weight, control shrink and market them in what is normally a time of higher prices? Have you considered holding them on winter pasture until January or February when a higher feeder cattle market usually occurs? Got just a few cows? Co-mingle your calves with those of your neighbors and put them on winter pasture.
The questions asked in this article can be seen as stumbling blocks or stepping stones. So, get a Big Chief Tablet and a No. 2 yellow pencil. Find out what will work for you and what won't. Can't find yours? Give me a call. I carry mine everywhere I go.
I realize that you may have read this article looking for answers. Unfortunately, there are very few answers that fit everyone without some sort of customization; however, there are many questions that we should ask ourselves, even in the best of times, especially in the best of times.