Cull Cow Marketing Decisions
Fall weather brings many changes to the cattle operation, one of them being pregnancy testing and the subsequent removal of open, thin, lame or poor temperament cows from the herd.
Markets for Slaughter Cows
The 2018 slaughter cow market has been impacted by the large supply of beef in storage and an increase in cow slaughter volume compared to a year earlier. The South Dakota 2018 slaughter cow prices have been at or below 2017’s average monthly prices (Figure 1). The Livestock Marketing Information Center (LMIC) 2018 average through September for breaker grade cows was $65.05, 4.3 percent lower than a year earlier.
While August is historically the high for slaughter cow prices, producers can use the seasonal price index to visualize the seasonality in the slaughter cow market (Figure 2).
While the seasonality indicates profit, in the form of higher prices per hundred weight, may be realized by delaying sales, not every cull cow should be held and placed on feed for a later sale date. Characteristics of cows that should NOT be held include:
- Cows in a Body Condition Score (BCS) of 5 or higher. One reason to keep the cow on feed is to increase the BCS thus increasing muscle mass, the fat layer and total pounds available for sale. Cows that are already in good condition will not gain additional pounds in an efficient manner and will likely eat more in feed than the return to feeding them.
- Cows that are unsound or injured. These animals should be sold direct to a packer. Animals must be ambulatory and a direct sale reduces further injury. If a cow has been treated with any antibiotics ensure all withdrawal periods have been reached prior to any sales.
- Cows that are unhealthy. These cows offer a whole set of management challenges to the operation. Unhealthy cows may not gain efficiently and thus may not improve the profitability of the operation through feeding. However, cows that have received medication with any antibiotics need to be monitored to ensure they are not sold before withdrawal periods are reached.
Feed Cost Options
There are many feeding options for cull cows. As corn fields are harvested, grazing aftermath acres becomes one of the available options. Depending on the weather, cows may be able to graze these acres until the desired market date for limited feed cost and labor requirements.
Cows can also be placed in a feedlot system and receive a balanced ration designed to maximize average daily gain and encourage the development of white fat. Cows placed in a feeding system will take more bunk space than other cattle, so ensure adequate bunk space is available for this option.
Table 1 compares three options available to a producer. Option A is to sell a thin, healthy, 1200 pound cow in November. Options B and C include feeding the cow until February 1 using two different protocols. Option B utilizes grazing corn stalks with supplement and Option C includes a balanced ration and yardage to add even more weight and target a white fat market premium.
Producers that accurately identify cows that have the ability to gain weight when put on feed have the opportunity to increase the profitability of their operation. However, accurate ration costs, creation of a marketing plan and timeline, adherence to the plan and the markets behaving in the expected manner will all effect the profit received.
Source: Heather Gessner, iGrow