When you put economic parameters to EPDs with today’s prices and feed costs, there should be more price spread on bulls than there actually is.
I received several emails last week questioning my comments about the increased value of genetics and whether one can justify the record prices we’re seeing for bulls. So, I spent some time looking at the numbers between bulls with very solid EPD profiles and comparing them to breed average bulls.
As much for simplicity as anything else, I assumed that a bull would sire 100 calves over its lifetime.
There are a lot of other traits like feed efficiency that also become significant. But ignoring all of them and assuming nothing more than the easily quantified traits, and assuming that all 100 calves are marketed, the value of the above-average bull compared to the average of a particular breed is over $7,500.
Trying to be even more conservative, let’s assume you only realize half that value. The bottom line is that if someone tried to give you an average bull, you still would be better off paying over $3,500 for that better-than-average bull.
In reality, when you try to put economic parameters to EPDs with today’s prices and feed costs, the better argument is that there should be more price spread on bulls than there actually is. As is the case with the commercial marketplace, it appears the higher-priced bulls are actually under-valued, while the lower-priced animals are overvalued.