Having the right replacement heifers is important for the long-term profitability of any ranch. It is necessary to be able to rotate the breeding stock out to improve the overall genetic gene pool. Also, cows will get to a point where they will be too old to breed anymore. When this happens you will need to have new stock ready to take their place.
When it comes to having replacement heifers there are 2 ways you can go: buy or raise them. Most producers tend to raise their own but buying them can also be an option. When it comes to deciding which to go with, like with any option, it is important to weigh the pros and cons to determine which is best for your situation.
Selecting the most economical source for your replacement heifers is of vital importance to you. There is no point in going with an option that will only cost you more money in the long run. One of the first things that you will need to do is look at your current facilities. Here are some things that you can look at when deciding on either to buy or raise:
Factors to consider
No matter which way you end up choosing there are some factors to consider in your decision
- Money available
- you will need to look at the money that you have available for any purchases. This can be money that you have in the bank. Also any potential loans (though may not be the best choice) you may be able to get
- Feed costs
- As with any option where you are increasing the number of cattle that will be in your place you need to decide if you can even afford to feed them. Understanding your feed costs is vital when facing drought conditions like we are currently dealing with.
- Labor availability
- You will need to decide if you even have the manpower to handle any new cattle in your place. This can be either with increased feeding or simply hauling them to your place. Naturally, raising replacement heifers will be more labor-intensive for you than just buying them.
- Cattle prices
- This kind of goes hand in hand with the money available part of this list. However, it deserves to have its own section here. When making a decision on either buying or raising you will need to look at if you can even afford the price to pay for them. When looking at the costs you will need to look at the total costs (feed, vaccines, etc.) not just the initial market costs.
- Reproductive rates
- You will want to also look at the potential reproductive rates of any replacement heifers. One way to do this is to look at their mother’s performance to gauge her potential.
Raising Replacement heifers
Now that we have gone over some things that you should consider when making this decision we can now go over the pros and cons of either choice. Let us begin with the raising option:
Advantages
The first advantage is that you will have more control over certain factors that are going into your herd. This can include things like the overall improvement of genetics in your cow herd.
Since you will be raising them from birth you will also be able to know all diseases that your heifers have been exposed to. This will be important so that your cows won’t run the risk of getting some disease that could severely cripple your operation.
Another advantage is that it can cost less to raise them over buying them. It is for this reason that most people tend to raise them. While this may not be true for every operation it could be for what you are needing.
Disadvantages
A disadvantage of raising replacement heifers is that it is more of a long-term investment than just buying what you need. Looking at the productivity cycle of cattle it can be at least 2 years before you start to see any return on the feed or other costs it took to raise them. Since it is a longer investment it is harder to make any adjustments based on any changing market conditions.
Buying replacement heifers
And now let us look at the advantages and disadvantages of buying your replacement heifers.
Advantages
Since you will not be raising them from birth it can free up resources that would normally be needed to raise them to do other things. This can be of benefit for smaller types of operations that do not have a large number of resources at their disposal.
Another advantage is that you can control how many replacement heifers you will have, You can expand or decrease the size of your potential herd in less time in response to conditions. This can be used to take advantage of either good grass growth or possibly drought conditions.
Disadvantages
Depending on how the market is looking it can cost more to buy rather than raise the heifers that you will need. This will mean that you will need to pay attention to how prices currently are. Also, you will need to keep an eye on what the futures market could also look like.
Making the decision
As I mentioned several times before in other posts there is never a ‘one-size-fits-all” answer when it comes to cattle operations. What you will need to do is to look at all of the factors that are available and make the decision that works best for you.
The things that you will need to look at are your budget, your overall goals, and even the cattle market itself. Now I will say that when you look at your budget it will be in your best interest to look at what it actually is and not what you hope it is. When making a decision on something that can affect your place for years to come it is not a good idea to look at things through an “idealized world” type of mindset. You will need to look at this as an investment, so make a wise choice here.
If you are looking for ideas on how to make a decision on this subject Iowa state has a couple of spreadsheets examples that can give you some ideas. They have examples for if you are wanting to buy and ones if you are wanting to raise your replacement heifers.
Crunching the numbers
When looking at the numbers you will want to look at the most probable scenarios that are most likely to occur during heifer development. Once you have an idea of what the net return will be you can then weigh it against the potential risk that you may face with the option you choose.
There are some variables that will be hard for you to predict but they are still important. These things are for you to try to predict in order to make an informed financial decision. Things like the sale price of heifer calves, feed costs, and production performance of purchased vs raised heifers. Now as far as feed costs are concerned if you end up purchasing a lot throughout the year you may be able to lock in prices. This can be done for the contract year but it is more of an option for larger operations.
Though you may not be able to accurately predict some of these prices you can get a fairly accurate guess. This is where paying attention to the overall trend and even your own intuition can come into play. If you are not sure I would recommend visiting your local beef extension specialist. A feed nutritionist, as well as your local veterinarian, are also good options. Other local ranchers that you may know can also be valuable resources.
If you are wanting to read more about how to develop your heifers I went over that in a previous post “Heifer Development 101”.
