Bred Heifer Pricing ?

[Stocker Steve]

You wild thang. My limit was U$S 800 and I still bought a bunch in December. But like Forest, I kept my Apple stock.

 

[Aaron]

You wild thang. My limit was U$S 800 and I still bought a bunch in December. But like Forest, I kept my Apple stock.

And they were top end heifers? I am not talking the bottom 3rd of peoples herds that they pass off as 'breds' because they threw a mongrel stag with them.

 

[Stocker Steve]

They were when I got done. Calm, shiny, red and black, averaging 941#. The typical sort here is to leave one loser in each group. I brought those back to the next sale and factored a $55 @ discount into my cost. We'll see what the calves look like.

Bud wrote once that it was easier to find good sell buy trades with calves compared to bred cows. He felt there were too many amateur buyers driving bred prices.

 

[1982vett]

Any special train wreck, or just a general lack of optimism?

w

Dead calf...plus's a possibility you lose the heifer too.

 

[Stocker Steve]

I get the possibility of the train wreak heifer discount, but it seems to vary by area. Many of the small operators here will not buy a heifer. I think the western BTOs may have someone sleeping in the calving barn.

 

[1982vett]

Yeah....seems their is always a cowboy willing to buy the young batshit crazy cow too....and not necessary at a discount.

 

[Stocker Steve]

Yeah....seems their is always a cowboy willing to buy the young batshit crazy cow too....and not necessary at a discount.

Had a black one of those in the mix. Looked good till it was time to work them. Then she started testing the corral panels. Got her in the head gate and she kept lunging forward to get me. Took a while to get her loaded...

 

[MO-Ruminants]

How would Bud have reckoned the value of bred heifers against bred cows (the salebarn type, 1 bid over kill price)

 

[Stocker Steve]

Bud was a keep it simple kind of a guy, and he was not on the zero cow depreciation band wagon.

My recollection was that to compare bred trades he allowed $100/yr in depreciation, adjusted for cull weight, and adjusted for cost to calving. So a typical "good trade' was selling an older cow, and buying back a younger one for similar money, but not necessarily a heifer.

I have the sell old buy younger down. Estimating cow longevity can be hard, and I am still working on the planned profit part.

Bud did not believe in forecasting. Bud used the current cull market price in his calculations. Most speculators use some seasonal price adjustment. Guys who bought older bred cows for 47 cents last fall have made a nice paper profit. Bud admitted his sell buy system worked more often on calves than cows. Too many emotional cow bidders. :nod:

 

[SBMF 2015]

It seems like someone is always willing to pay more than they pencil for.
Our local sale barn (Fairview Sale barn Fairview, IL) has a bred cow sale every first Tuesday of the month. On 2-4-2020 they had some really nice baldie hfrs that weighed over 1,200, due to calve 1st of March $1,400. There were thirty of them sold in groups of 5.
Two hundred some bred cows, most to start calving before April. Every thing got started at scale price, and most brought within $150 of mrkt price.
Everyone is short on cash, and there are just to many good cows to choose from for anything to bring a premium.

 

[Stocker Steve]

How would Bud have reckoned the value of bred heifers against bred cows (the salebarn type, 1 bid over kill price)

I would be comfortable expecting an average of 2 calves out of them. One an done would be conservative. So $100 for one calfs depreciation.
Unproven heifers are a tough call. I would be comfortable expecting an average of 3 calves out of them. So $300 for 3 calves of depreciation.
Assume the same calving date. Lighter heifer would still eat less feed to calving - - assume $50 cost to calving savings.
Only a 300-100+50=$150 gross price difference before you adjust for cull weight.
So at 50 cents per pound cull price the purchase by the pound cow could be a better buy than the heifer if she was less 150/.50=300 pounds heavier.
Seems like we often overpay for heifers based on this calculation. Speculators would say that the heifer could be worth more than current cull price after 3 calves. That would depend on ability to forecast the cattle price cycle and great bred back. Getting pretty deep now...
I think the sad fact is bred heifers only make money during a portion of the cattle price cycle.

 

[Dave]

I have often thought about buying bred heifers when I could get them at a discount price. Calf them out and raise the calf. Then sell them the following year as 3 year olds for more money than originally purchased. I knew a guy years ago who kept and bred all his heifers. Made the decision on which to keep based on how good of a job they did raising their first calf. Sold the rest as bred 3 year olds. Always makes me wonder when I see a large group of 3 year old cows selling.

 

[Stocker Steve]

Second calvers are hard to sell here. Seems to be different in the west.

Had a Swede on CT a while back who bred all his heifers, then short weaned and finished the ones he did not want. ND did some similar work in the past. I asked them why they dropped it - - said it was too difficult to get numbers. The 30 month rule could also be an issue now.

 

[tom4018]

Local angus sale yesterday sold 10 commercial bred heifers for a average of $2010 each. I didn't go but knowing their program they were more than liky fall calving. If some what's I see the price then again with current feeder prices I don't.

 

[Dave]

Second calvers are hard to sell here. Seems to be different in the west.

Had a Swede on CT a while back who bred all his heifers, then short weaned and finished the ones he did not want. ND did some similar work in the past. I asked them why they dropped it - - said it was too difficult to get numbers. The 30 month rule could also be an issue now.

Guy I went to college with did that breed them all, short wean, and finish program. The 30 month rule caused him to quit it.

 

[Stocker Steve]

We cull hard before and after calving. :cowboy: So we have a couple of that kind per year as freezer beef. Helps to keep development cost down if you can upsell the culls.

 

[Dave]

We cull hard before and after calving. :cowboy: So we have a couple of that kind per year as freezer beef. Helps to keep development cost down if you can upsell the culls.

He was breeding 200 heifers and keeping around 40 of them. That makes for too many for freezer beef. On a smaller scale the 30 month rules doesn't effect that producer. A 32-36 month old one calf cow who has been fed should actually make some real good beef.

 

[Stocker Steve]

We don't have enough heiferettes to fill a pen. Could work towards it though.

 

[Stocker Steve]

Local dairy replacement heifers are down another $200. About $500 to $1000 per head unless fancy.

Bred beef prices seem to lag feeder prices. What are you seeing now?