Cow-Calf Cost of Production
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The cost of herd replacement accounts for about 10% of total cow-calf cost of production (based on the 2013-17 average). It is the third largest cost component for a cow-calf operation, following winter feed (37%) and pasture (24%). Because replacement heifers represent a major cost for cow-calf producers, choosing a herd replacement strategy has important implications on cow-calf profitability. While many producers raise replacement heifers on farm, buying replacement heifers could cost less depending on the production cost of the operation and current market situations.
Costs of Raising Replacement Heifers
The main costs of developing a replacement heifer include winter feed, opportunity cost of the heifer, and breeding costs. These are all impacted by reproductive efficiency.
Winter feed costs. Hay and barley prices are both higher in 2018 due to dry conditions and reduced supplies, increasing the cost of raising replacement heifers. In June 2018, Alberta hay price at $130/ton was 13% higher than last year, and Lethbridge barley was $245/tonne in July, up 23% from last year. Winter feeding costs in Alberta for 2018-19 are projected to be 9% higher than last year, on a per cow basis. Continue reading