As fall calving season wraps, many producers avoid the cost of carrying less-productive cows over the winter months by culling the herd. It's a sensible thing to do, but it's also traditionally the time of year when the cull market is at its lowest. What are the options this year?
Start with a herd assessment. Glenn Selk, Oklahoma State University emeritus Extension animal scientist, stresses this should be a well-informed. Cull cows represent about 20% of the gross income for any commercial cow operation these days.
"Ranchers need to make certain cow culling is done properly and profitably," he says. "Selling cull cows when they will return the most income to the rancher requires knowledge about cull cow health and body condition. Proper cow culling will reduce the chance a cow carcass is condemned at the packing plant and becomes a money drain for the entire beef industry."
MAKE A SMART ASSESSMENT
Decide whether or not to cull, based not just on the projected availability of cheap winter feed and space (although these are key consideration) but also on the individual animal's pluses and minuses for the business as a whole.
1. AGE. First, think about longevity. Selk points out data from large ranches in Florida indicates cows are consistent rebreeders through about 8 years of age, with the most consistent decline after the 10-year mark. "Start to watch for reasons to cull a cow at about age 8," he says. "By the time she is 10, look at her very closely and consider culling. As she reaches her 12th year, plan to cull her before she has health problems, or is in very poor body condition."
Selk adds it's also important to look at older cows' mouths, to be sure they are sound and able to harvest the forage needed to maintain body condition and stay strong enough to reproduce.
2. CANCER EYE. Eye health is a key area to assess, and it can be one of the more common causes of condemned beef carcasses. Eye tumors often start as small pinkish growths in the eye. Also, be on the lookout for cows with heavy wart infestations around the eye socket.
3. FEET AND LEGS. Cows with feet and/or leg issues should be considered early for culling. If culling soon after injury, make sure to follow required withdrawal time post treatment.
4. BAD UDDERS. Quality of udders impacts a cow's productivity and should be part of the cull-assessment. An OSU study found cows with one or two dry quarters had calves with severely reduced weaning weights (50-60 pounds). This is also a heritable trait. Also consider whether udders are "large, funnel-shaped" and/or have weak suspension. Select against these faults to improve the cow herd over time.
5. BODY CONDITION. The smart move is to cull a cow long before she is in poor body condition. Thin cows will have much lower salvage value, and they will often decline further in transit. Their inability to remain standing for long periods can lead to bruising, excessive carcass trim, increased condemnations and even death.
6. TEMPERAMENT. Just cull those wild cattle, it will make it easier on everyone.
7. OPEN COWS. Unless you've got a good reason not to, cull open cows or those that don't fit your calving season.
CULL COW MARKET
Once the herd has been assessed for culls, what are analysts saying about pricing and market windows?
Tanner Aherin, CattleFax analyst, says there's a lot of data to help producer's focus in on what have generally been the best times to sell cull cows.
Over the last 20 years, average utility prices for cull cows averaged a 20% break from the January through August high, to the fall low. The last 5 of those years, the drop has been closer to the 25% mark. The cull market has not dipped below $50/cwt since 2010.
Many years, retaining ownership on cull cows until February pays dividends for producers. This year Aherin says he still sees risk ahead, but adds there are a couple of factors on the horizon that may be more supportive of this market.
"We could get below $50 per hundredweight, but there are a couple of factors more supportive to the market, and prices may not have to get that cheap," he says. "Dairy margins are improving, so there may not be as many of them on the market. Also, if that Tyson plant comes back on line in the next two months it will open up more space for cows and bulls."
That said, he adds the next 6 to 8 weeks are where he sees the biggest risk ahead, based on seasonal patterns.
"We look back over 39 years of data, and three-fourths of the time you add value to cows if you wait. I think that will still be the case this year, although it might not be as significant as it has been in years' past. But it is likely there will be at least modest profitability in retaining cull cows until later in the winter or early spring."
Like Selk, Aherin stresses this decision has to be individually assessed, operation by operation.
"Look at your input costs. Can you add weight economically? Do you have cheap feed needed to add weight? That is the biggest consideration. Also look at whether you have room to winter her for the next few months," those are the two key questions.
Victoria G. Myers can be reached at Vicki.Myers@dtn.com
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