AmericanCowman.com - Dedicated to America's family cattle operations.

Most Recent

About Harlan Hughes

A North Dakota State University professor emeritus, Harlan Hughes writes "Market Advisor," a monthly column in BEEF magazine, and he makes presentations at many state, regional and national beef industry events. He retired as the NDSU Extension livestock economist in 2000 and now lives in Laramie, WY.

Contact Prof. Hughes at 701/238-9607 or e-mail Harlan: harlan.hughes@gte.net.

Heifer economics part 3


         Subscribe in NewsGator Online   Subscribe in Bloglines

  • Increased percent calf crop from crossbreeding.

    It appears that “black-on-black” breeding programs are moving ranchers further away from crossbreeding. This general trend concerns me because it imposes a huge hidden economic cost on the ranching sector.

    Research suggests three production performance advantages from the heterosis provided by crossbred cows over purebred cows:

    1. 12% more pounds weaned per cow exposed,

    2. 10% more weaned calves per females exposed, and

    3. a two-year added lifetime production from crossbred cows (see Table 1).

    When I add a 10% gain in percent calf crop to my heifer-development models, I generate a 17.5% increase in the economic value of replacement heifers. That gets my attention!

  • Increased lifetime longevity from crossbred heifers.

    Research suggests crossbred cows have two years longer lifetime productivity. Research also shows the lifetime annual percentage of cows remaining in the herd remains higher for crossbred females, something also borne out in the North Dakota's CHAPS Data. When I plug these two longevity factors into my economic models, I gain a 6% increase in the economic value of replacement heifers during the emerging biofuels era.

  • Increased weaning weights from crossbred heifers.

    Research data suggests a 12% increase in weaning weight from crossbred cows. I calculated that a 10% increase in weaning weights would generate a 6% increase in net cash income per cow. (Part of the increased weaning weight was offset by reduced calf prices.) When I plugged this into my economic models, I generated another 5% increase in the economic value of developed heifers.

  • Economic summary of crossbreeding.

    Each of three crossbreeding production improvements was evaluated using USDA's Planning Prices for the emerging biofuels era. Though not shown on the table, a straightbred-developed replacement heifer has a lifetime economic value of $868 (earning a 7% rate of return on the initial development costs). When I added in a two-year increase in longevity, a 10% increase in percent calf crop, and 10% increase in weaning weights, I generated a $1,157 lifetime economic value for a developed crossbred replacement heifer (Table 2). This is a 33% increase in the lifetime economic value of crossbred developed heifers over straightbred-developed heifers.

Harlan Hughes is a North Dakota State University professor emeritus. He lives in Laramie, WY. Reach him at 701-238-9607 or harlan.hughes@gte.net.

Table 1. Suggested production advantages from heterosis
Purebred Crossbred Difference
Pregnancy (%) 91 96 5% Advantage
Pregnancy to weaning Live calf (%) 92.5 96.5 4% Advantage
Calves/cow exposed (%) 84.2 92.6 10.1% (92.6/84.2)
Weaning weight (lbs.) 525 525 0
Plus (lbs.) 0 18 3.5% maternal boost
Plus (lbs.) 0 45 8.5% direct boost
Total weaning weight advantage 525 lbs. 588 lbs. 63 lbs.
Source: Leachman of Colorado “No Better Bull Seminar,” Feb. 8, 2007 Internet seminar

Table 2. Projected economic value of a crossbred heifer in the emerging biofuels era
1 calf 2 calves 3 calves 4 calves 5 calves 6 calves 7 calves 8 calves 9 calves Open 3rd year
Value of cull cows Year Net income Net income Net income Net income Net income Net income Net income Net income Net income Net income
$55 2006
$51 2007 $121 $121 $121 $121 $121 $121 $121 $121 $121 $121
$48 2008 $0 $110 $110 $110 $110 $110 $110 $110 $110 -$275
$46 2009 $0 $0 $162 $162 $162 $162 $162 $162 $162 $162
$44 2010 $0 $0 $0 $186 $186 $186 $186 $186 $186 $186
$42 2011 $0 $0 $0 $0 $254 $254 $254 $254 $254 $254
$41 2012 $0 $0 $0 $0 $0 $206 $206 $206 $206 $206
$41 2013 $0 $0 $0 $0 $0 $0 $171 $171 $171 $171
$42 2014 xxxxx xxxxx xxxxx xxxxx xxxxx xxxxx xxxxx $177 $177 xxxxx
$44 2015 xxxxx xxxxx xxxxx xxxxx xxxxx xxxxx xxxxx $0 $95 xxxxx
Value of cull cow $612 $576 $552 $528 $504 $492 $492 $504 $528 $492
Interest discount rate 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0%
Total undiscounted net income $733 $807 $945 $1,107 $1,337 $1,531 $1,702 $1,891 $2,010 $1,316
Beef cow worth $685 $713 $792 $886 $1,024 $1,130 $1,343 $1,304 $1,350 $878
Cow age 2 3 4 5 6 7 8 9 10 8
Purchase (100 head/year) 2007 2008 2009 2010 2011 2012 2013 2014 2013
Save rate 90% 92% 95% 97% 97% 99% 97% 96% 96%
Remaining number 90 83 79 77 75 74 72 69 66 66
Head cuIIed 10 7 4 2 2 1 2 3 3 34
Market value $6,851 $4,989 $3,168 $1,773 $2,048 $1,130 $2,687 $3,913 $89,096 $115,654
Calculated LEV for a preg-checked crossbred heifer $1,157

Get Copyright Clearance Want to use this article? Click here for options!
© 2009 Penton Media Inc.

Browse Back Issues

BQS: View Details and Register Online!

American Cowman

www.AmericanCowman.com

Latest Jobs

Marketplace Ads

  • Hubbard Feeds, Inc

    Give us a call at (800)535-2428 to see if we can benefit your operation.

  • Hubbard Feeds, Inc

    Download free tools, sign-up for newsletters, browse nutrition products.

  • Your ad Here!

    Advertise your business here! Find out how.

  • Ag Maps for sale

    Ag Maps for Sale!

  • Livestock Markets

    The Place To Source Your Cattle and Horses.

Resources

  • Western Art Prints
  • Beef Quality Summit
  • 2007 Fencing Guide
  • 2008 Feed Composition Tables
  • Cattlemen's Calendar
  • Biosecurity
  • 2009 Alliance Yellow Pages
  • Estate Planning
  • Calf Health
  • RFID Suppliers
  • State of the Industry
  • Free Product Info
  • National Stocker Survey
  • Lets talk ag logo
  • National Stocker Survey