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Preg-Checking in a Drought Year with High Cull Cow Prices
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In the dynamic world of cattle production, producers constantly face challenges that test their resilience. One such challenge for many beef producers this year is drought and higher feed costs. When water becomes scarce, pastures are stressed and the costs of maintaining a herd can surge.
In drought conditions, every mouth to feed counts. Producers may be forced to reduce their herd size to sustain the remaining animals. In such situations, making well-informed decisions is critical for the economic viability of an operation. By preg-checking and identifying open cows, producers can choose to cull those open cows early, reduce the herd’s overall feed requirements and minimize additional costs associated with keeping the open animals.
Below are a few different preg-checking examples. Producers are encouraged to use the BCRC Economics of Pregnancy Testing Calculator to work through their own scenarios.
The costs and benefits of preg-checking are affected by market volatility, production costs, animal performance and environmental conditions, and they are different for every beef cattle producer.
Preg-check and sell open cows
The higher the winter feed costs, the more favourable it becomes to preg-check and cull cows in the fall,particularly for producers facing feed shortages and larger purchased feed expenses.
Beef cattle producers can calculate the value of pregnancy detection for their farms with the BCRC’s online Economics of Pregnancy Testing Calculator.
Advanced Model (recommended) – This version allows producers to enter custom data for their herd including cost of production, average daily gain, length of winter-feeding period, herd open rate and vet cost to more accurately calculate the net gain or loss of preg-checking.
Basic Model – This version uses default values for herd management data such as length of winter-feeding period, average daily gain, vet cost for preg-checking and open rate. Overwintering cost of production may be selected based on different management systems. Due to on-farm variation, producers looking for customized information can use the advanced model.
Default cost of production figures are available for four management systems in the basic model: drylot ($2.89/head/day), swathed barley in part of winter feeding ($2.67/head/day), bale grazing ($2.56/head/day) and standing corn grazing ($2.75/head/day). These values have been recently updated based on data sourced from the Canadian Cow-calf Cost of Production Network.
Keep in mind that production costs can vary significantly, even within the same management system. Producers are encouraged to leverage the advanced model to input their own specific data for optimal accuracy.
Assuming the average daily cost to maintain a cow is at $2.50/cow/day and the winter-feeding period is 160 days, the savings from culling an open cow in the fall after preg-checking total $400/cow, compared to maintaining her for the winter.
Cow prices typically rise 5% from September to March (10-year average). In mid-September 2023, Alberta D2 cow prices averaged $1.44/lb, making the projected price for March 2024 around $1.51/lb.
The model assumes the initial cow weight is at 1,298 lbs, which has been rounded up to 1,300 lbs for this example. Assuming the cow gains 0.5/lb/day during the 160-day winter-feeding period with body weight increases 80 lbs, from 1,300 lbs to about 1,380 lbs, the market value of this cow would increase from $1,869 to $2,085/head, or a $216 increase as a result of seasonally higher prices and heavier weight.
By culling in September instead of March, there would be a potential forgone revenue of $216 per cow. However, considering the $400/cow feed cost savings from culling open cows early, the net gain from preg-checking and culling in the fall is still $184 per open cow compared to not preg-checking and feeding through the winter.
For a 100-head cow herd with an 8% open rate and a $5/head cost to preg-check, the overall gain from preg-checking is $10 per cow across the herd.
For a higher-cost producer with $3/cow/day feed cost during the winter, the estimated benefit of preg-checking is more significant at $16/cow or $1,613.33 for the whole herd.
Preg-check and feed open cows separately
Beef producers who are less impacted by drought or producers with sufficient feed could consider another strategy: preg-check and feed open cows as a separate group for future marketing. By feeding the groups separately, producers can place the open cows on a high-energy ration for additional weight gain.
With record high cull cow prices, the increased value for cull cows during the feeding period could make overwintering a financially attractive option, as every additional pound is worth more.
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In this example, assume open cows were separated from the bred cows and receive a higher-energy ration until March, with a targeted average daily gain of 1.5 lbs/day at a cost of $2.50/cow/day. The value of the open cow rises from $1,869 in September to $2,350/head in March, accounting for both the seasonal price increase and the additional weight gain. This translates to a $265 increase per open cow compared to not preg-checking and culling in the spring.
For a 100-head cow herd with an 8% open rate, implementing pregnancy checks and separate feeding would yield a profit of $14 per cow across the entire herd, compared to not preg-checking and selling in the spring.
However, for a higher-cost producer at $3/cow/day to feed this open cow group, the profit for feeding them separately dropped to $7/cow for the overall herd. As for a lower productive group with an average daily gain at 1 lb/cow/day, the profit would drop to $4/cow.
While there are compelling economic arguments for pregnancy detection in the fall, there are also benefits of having your veterinarian visit your farm to preg-check, which supports an active veterinary-client-patient relationship (VCPR). Preg-checking may also present an opportunity for producers to vaccinate or perform other tasks. As well, there may be herd health risks to running open cows alongside bred cows for the winter.
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Value in September based on 1,298 lbs at $1.44/lb
Value in March based on 1,378 lbs at $1.51/lb
Value in March after separately fed cow in March based 1,553 lbs at $1.51/lb
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Values based on cost of $2.50/cow/day
Bottom line
In a drought year with elevated wintering costs, preg-checking may be a smart economic strategy for producers. Using practices such as identifying and culling open cows early, optimizing nutrition and capitalizing on high cull cow prices, producers can navigate through the challenging time.
Just like any other marketing strategy, there is no one-size-fit-all approach. It is crucial that producers explore different options and adapt the plan according to market situations to find a strategy that aligns with their production systems.
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