This is a guest post by Huiting Huang, Research Analyst at Canfax Research Services.

Severe drought, high feed costs and limited feed availability in 2021 forced many producers to liquidate a portion of their cow herd. One of the consequences of a smaller herd is the higher cost per cow as overheads are spread over fewer animals. Therefore, when feed is available and pasture quality and quality allow, rebuilding the herd is desired in order to efficiently utilize available resources (such as land, labour, facilities and machinery) and to minimize equity loss.

With various drought conditions across the country, producers are likely to have different plans and timelines for herd rebuilding. Some might be planning to rebuild in 2022 if the drought abates, but those who are in a prolonged drought may need more time for pastures to recover.

Recovering from drought is a challenging period and requires strategic decision-making with considerations of the trade-offs of different rebuilding options from the economic, animal performance and land productivity perspectives.

To better understand the different rebuilding options, Canfax Research Services conducted an analysis focusing on the potential economic trade-offs of rebuilding with homegrown heifers or purchased breeding stock. Continue reading →