For those considering growing their beef cattle herd, quick wins and day-to-day details may be extremely tempting to pursue. But like most things in life, it’s important to look well beyond the immediate. Expansion may have different meanings for different operations. For some, it might mean more numbers, but for others, it could manifest as reshaping sustainability, assessing market changes, managing available resources or something different altogether.
The 3 P’s
For Kenny Burdine, livestock specialist and extension professor in agricultural economics at the University of Kentucky, three “P’s” must fall into place for numerical expansion: profit, pasture and patience.
Profits boil down to an expectation that the calf market will remain high enough to justify a long-term investment in breeding stock.
For pasture, the weather must be cooperative, meaning delivering enough forage during the growing season and providing adequate hay supplies for winter feeding.
Burdine says the patience “P” is often a tough sell.
“We need to be willing to trade dollars today for dollars in the future,” he says. “We have high heifer values now, so someone looking to expand will sell fewer heifers at these high prices in exchange for having more calves to sell down the road.”
Create a plan based on costs and data
Burdine explains some fixed costs will be unchanged if a producer runs more cows, and some will go up. Adding numbers to an existing forage base means fewer grazing days coinciding with more winter feeding days, adding expenses.
“Think strategically; how much do we want to grow the herd, and how quickly should it occur?” he asks. “True expansion takes years. Should we purchase bred heifers? If we grow our own, short-term cash flow is relinquished.”
Burdine urges producers to compare the costs of the two strategies. Developing heifers will likely appear less expensive on paper, but it’s key to remember that retaining heifer calves for breeding will take two years to produce a calf, while buying bred females will deliver the next year.
“Additionally, if we hold back 30 heifers, they won’t all become cows. Some we won’t like, and some won’t get bred,” he says. “We need to push the pencil to see what makes the most sense.”
Take a long-term approach
Julia Herman, a beef cattle specialist veterinarian with the National Cattlemen's Beef Association (NCBA), encourages producers to look beyond the next breeding cycle, as many added females will become fixtures in the herd and impact future management decisions.
“Do we have the pasture, feedstuffs and human resources for more animals?” she asks. “Much of their health connects with our husbandry practices, so we must ensure we’re taking care of things like handling, nutrition and supporting them throughout their development. The way we manage this will determine how they produce for the rest of their life.”
From an environmental standpoint, some areas are experiencing drought, while others have excess forage.
“Many rely on the calf crop to finance other parts of a farm,” she says. “Heifer retention will reduce these funds, so evaluate the entire operation for viability. Should we retain or buy heifers now with prices at all-time highs? It’s a complicated decision.”
Tie health to the farm’s business model
Herman stresses that health is a major contributor to the decision-making process.
“Healthier animals make a better product,” she says. “Husbandry, stockmanship, nutrition, biosecurity, environmental conditions, conception, backgrounding and finishing are all basic everyday principles, and the better we do them, the better it is for the animal.”
On the other side of the equation, expansion is a large component of the farm’s business model.
“If we push too hard and retain too many females, we might not be able to keep those everyday principles going,” Herman emphasizes. “Long-term, it may not be as profitable or as productive. Health is the entire picture, not just treating the sick; it’s all the prevention strategies to support their immunity and well-being. It’s improving welfare for them to live their best life.”
Avoid tunnel vision on only the numbers
Burdine believes expansion doesn’t always equal added animal units but may appear as herd upgrades and improvements.
“Rather than expanding the numbers, it might mean using the increased income to be more efficient, lower their cost of production, sell into higher-value markets or improve genetics,” he says. “Maybe they could modify the facility to process, wean, rotationally graze or manage water sources better. Make investments to recoup added value from forage and lower dependence on winter feed expenses. Pay down some debt, build up working capital, lower dependence on lines of credit and solidify a risk management buffer. It’s an incredible opportunity with today’s unprecedented calf prices.”
Research an informed starting point
Herman suggests those considering expansion consult regional experts such as extension staff and veterinarians, as they hold valuable knowledge about local environments, pastures and feedstuffs.
“Seek advice beyond our own operations,” she says. “Not everyone can travel far to buy animals, so it’s important to determine what type of cattle best fit our environment and collaborate with external sources to identify where to source them.”
Should we retain or purchase heifers?
“Maybe the time has come for more creativity in our answers,” Herman says. “What does it look like for a state, a region, an area or a neighborhood? Could multiple producers come together in this effort? Could they drylot females as a large group? Could they share costs? The entire industry is trying to put its finger on the pulse of expansion, but maybe more regional creativity is needed. Ultimately, it comes down to what we’re comfortable with.”
“Be strategic in our thought processes and assess every factor we can think of,” Burdine adds. “Ensure expansion, no matter what that looks like, is the best way to utilize what is an incredible calf market right now.”
Herman stresses that no one-size-fits-all answers exist.
“It’s the beauty of the industry,” she says. “We’re so diverse across North America with the types of cattle we’re producing and our products. They all provide opportunity but also flexibility to make the best decisions for our operations.”
