Consider Investments in Efficiency with Extra Cattle Income

Source Livestock Marketing Information Center
Chart 1 Source Livestock Marketing Information Center

Most cattlemen have a slight grin on their faces these days. Cattle have been selling for record prices this summer. What is causing this major increase in prices? Primarily there are two key factors: fewer cattle, and cheaper feed. Chart 2 below shows the drastic decline in the national cattle inventory. A good portion of this herd reduction is due to the long-term drought in the central plains and other areas of the country. For the past several years ranchers in drought zones have been forced into cow herd reduction. There just was not enough grass to support the number of cows that were traditionally grazed, and a good number of the cows sold went to slaughter.

Source:  Livestock Marketing Information Center
Chart 2 Source: Livestock Marketing Information Center

Anyone who has watched commodity markets in the farming business knows high prices are temporary. With every drop in national inventory, a price increase follows. It is simple supply and demand economics, as can be seen in Chart 3 below. Generally, herd expansion follows to take advantage of the higher prices and higher profits. But unlike most crop commodities, it takes years to rebuild a national cow herd. With fewer cattle nationwide, prices should remain strong, unless a complicating factor such as high feed prices, or reduced consumption holds the prices down.

Source LMIC
Chart 3. Source LMIC

This year, the major improvement in cattle prices also relates to a bumper crop of corn last year, and predictions of an excellent crop this year. The corn market is dealing with the opposite situation from the cattle market. Chart 4 below shows the rapid decline in corn prices, following better growing conditions in the corn belt in 2013, and the expectations of an even larger supply of corn after harvest this year. USDA recently updated their estimates for the 2014 corn crop and is expecting a 14 million bushel harvest in the US. Corn prices affect the prices of other feeds, so expectations, based on USDA reports, are for even cheaper feed prices in the year ahead.

Corn Prices 8-14
Chart 4. Source USDA AMS

It will take several years to begin to rebuild the national cow herd. While feed prices have been known to fluctuate, the best estimates available suggest cow-calf producers should continue to remain profitable for the next few years. Higher cattle prices have naturally affected retail beef prices. So far, consumers have not drastically reduced beef purchases, but every cattlemen worries that people will back off of beef consumption, as prices move higher. Barring some major changes in beef demand or feed prices, however, the cattle market should remain strong for the near future.

The key question for cattle ranchers to consider is, “How to reinvest the extra income from the good years to remain profitable over the long haul when prices come back down?”

  1. Enjoy the extra income a little.

    Many farms are diversified with multiple crops and income sources, so for many farms the extra cattle income will simply be lifting the farm income, while other commodities are lower this year. Even so, take the time and a few dollars to celebrate with family the blessings of an excellent cattle market.

  2. Pay Off Debt

    Certainly debt is an integral part of most farming businesses. Having some extra dollars may provide an opportunity to reduce the interest load on the farm. Leaner times will return, so lowering debt could be the best investment to farm profits in the long run.

  3. Improve Resources of the Operation

If there are funds available to reinvest in the cattle operation, the following are some ideas worth considering. The main idea is to improve the productivity and efficiency of the operation with the extra income that may not be available in future years.

    • Cowpens

      Stress on cattle can be greatly reduced with calmer, smoother cattle handling. Most years there is not enough income for overhauling cowpens, so patchwork is constantly required. For many operations some extra income this year, and next, might provide the ability to make improvements that pay off for years to come. Think about where cattle are the most difficult to handle, where things break frequently, and what improvements could be made for work that might begin during the cooler months ahead. Cattle that are have less stress in the cowpens loose less weight and earn more money for the operation every time a group goes to market.

    • Pastures

      Pasture renovation is another large expense that can also provide more feed for the herd for years to come. This might be the year to look over your fields and select one that is below par for renovation. Fall is the best time to kill grasses and grass weeds like centipede. Plus if you kill it in the next month or so, you could even plant winter grazing and then follow with Bahia late next Spring or in early summer. If the existing grass is healthy but perennial weeds like blackberry briars are the problem, fall is also an excellent time of the year to control them. Whether it is completely starting over or simply doing some expensive weed control, making an investment in improving pastures can pay dividends for years to come.

    • Genetics through Timed AI

      One of the practices that has truly benefited the NFREC beef herd and many others around the country is the use of Synchronization and Timed Artificial Insemination (TAI). In his article, An Economic Evaluation of Estrous Synchronization and Fixed-Time Artificial Insemination in Suckled Beef Cows, Dr. Cliff Lamb explains the results of a Timed AI research trial on a number of large herds that resulted in a $49 per cow return on investment, as compared to those in a traditional natural breeding system. Even if there is not enough extra income to invest in synchronization and AI of the entire herd, the heifers and the very top cows can be bred early in the season to some of the best bulls in the country with this system. The improvement in genetic performance from AI will last for generations within a herd.

    • Cross-Fences

      Grazing management is a key aspect of pasture management. Investing in cross fencing can make pastures more productive for years to come. Providing more rest for the pasture grasses due to a better herd rotation system, could mean less purchased feed is required, or stocking rates could be increased to some degree. It might also reduce weed problems, because with additional rest the perennial grasses can do a better job choking out the competition. Cross-fencing is an approved practice in the NRCS EQIP Program which provides approximately a 50% cost share to approved conservation practices. Utilizing the EQIP program can make the extra cattle income go even further and allow ranchers a key tool to better manage pastures for years to come.

    • Hay or Bulk Feed Barn

      Barns are a considerable investment, that will require more than one year’s extra income. However, feed is a major portion of the annual carrying costs for a cow herd. Hay is expensive to grow, harvest, and feed. Very few investments of the magnitude of annual hay crop are left to weather and deteriorate in the field with 20-30% storage losses. The book Forage Livestock Quotes & Concepts has a great quote: “Some folks pay for a barn they have never built”. The point of the quote is that if you don’t store hay in a barn, then you are losing both dry matter and nutrients from the hay with every rainfall. While bulk feed is not required for cattle ranching, many have found significant cost savings from buying feed by the truckload. The challenge is dry storage and the ability to handle the feed once offloaded from the truck. So whether a barn is built for hay, feed storage, or both this could be an investment that improves the efficiency of an operation.

    • Cattle ID and Record Software

      Some of the best advice shared by successful ranchers is to make the investment in individual animal identification. Once each animal has individual identification, you have to develop a record system to evaluate the performance of each animal. There are some excellent computer programs available on the market that can sort herds based on age and performance. It will be challenging to improve the efficiency of a herd without knowing which individuals in the herd are the most productive. If you are not interested in computers, there is a free Florida Ranch Record Book you can download that provides sheets for individual cow records. Investing in a production record system will certainly assist with improving the efficiency of a cow herd for years to come.

Investments to Be Cautious Of

There are some investments that should be made very cautiously. Large purchases that cannot be paid off immediately could add a financial burden to the ranch, when prices do fall again.

  1. Buying Additional Cattle

    It is only natural to consider herd expansion during high markets, but remember the wise old adage of investment. “Sell high and buy low.” All indicators are that cattle prices will remain high for at least another year and perhaps more, but young cattle purchased in today’s market will have years ahead with lower returns. A bred two-year old should have at least 6-8 years of productive life in the herd, so keep that in mind if you decide to shop for cattle. Recently weaned replacement heifers are worth what bred heifers sold for just a few years ago. Keeping more of your own heifers would be a lower risk investment than purchasing bred 2-year old heifers from someone else.

  2. Buying Expensive Equipment

    A new (or new-to–you) pickup truck or tractor may be a good investment, but adding more debt to the farm could be crippling several years from now, when cattle prices begin to fall. Do your budgeting with more conservative figures than today’s market, before making that purchasing decision. Be careful of equipment that would be nice to have versus equipment that can actually make the operation more efficient. It might be nice to have your own hay equipment, but if you are not going to bale enough hay to gain a return on the investment, it could be challenging for a small herd to pay for it.

The main point is to take some time considering how to invest your extra cattle income over the next few years. The decisions you make now could affect the long-term profitability of your herd.



Posted: August 22, 2014

Category: Agriculture
Tags: Beef Cattle, Cattle Economics, Economics, General Agriculture, Livestock, Panhandle Agriculture


September 8, 2021

Hey. Cuz. ,!,, I’m the son of. Earl. He’s the son of. Clyde. His mother was. Lillie. Cross. Over. In. Gretna. Bro Ed. Ted & Jack. Farm. On. ! Johnny D. Conrad!,,

Doug Mayo

April 23, 2021

Yes. Satsumas are naturally alternate bearing trees with a large crop one year and a reduced crop the next. With adequate fertilization, the trees produce more uniform crops. The tree will also drop off fruit to compensate for poor fertility. The goal is to provide nutrition just prior to flowering, after fruit development, and again after the fruit begins to fill. So, the goal is to ensure the tree has adequate nutrition in the spring and early summer.

Greg Mc Innis
April 22, 2021

Hello you all its your old friend Greg Mc Innis from Louisiana. I see that the peanut farming worked out for you all. Im very happy for you all. You look like a farmer... Were is Loyd at? And how is he? Tell him i said hello. You all are looking good for your age. Here's my # 985 817 0890 please call me. Truley Greg....

April 19, 2021

what about the yield of the Satsuma Tree which is given fertilizer is it getting better?

Doug Mayo

January 13, 2021

I have seen sonic mole repellent stakes for sale online, but am not sure how well they work on pocket gophers? I have not seen any research for using these devices on moles either. One issue that I would see with this type of repellent is that pocket gophers have a long series of tunnels that can be modified, abandoned or closed off.

Joseph Lyons
January 11, 2021

Are their sonic pocket gopher repulsive tools

Doug Mayo

December 22, 2020

Thank You Sally. I appreciate that.

Sally Waxgiser
December 20, 2020

Congratulations to all of this year's Awardees, would be Awardees and to those that tirelessly work behind their scenes. And I give a special thanks to those that work with and help guide them and our county to perform so well. That includes you, Doug!

Matt Lollar
September 11, 2020

Hi Kristy, If you suspect your shrubs of having bacterial galls, I would recommend that you cut the affected branches back below the location of the galls (maybe an inch or so below). As for your other questions, I suggest you contact your local Extension Office. Here's a link to a map of Extension Office throughout the state. Your local office will also be able to help you with identification of the galls. Matt

Shaylee Packer
September 11, 2020

As you mentioned, when buying a bull, it is important to know what you want from the bull. My brother is wanting to start his own herd, and needs a bull to breed and start the direction of the breed for his herd. I will have to share this article with him, and see if it helps him select the right one for him.

Franklin White
September 3, 2020

Thanks for explaining how having cattle can produce more income that you can then use to reduce your interest load on your farm. I think a lot of new farmers ignore this and mainly stick to crops at first. I'll tell my brother to do the opposite and to invest in cattle as soon as possible after he buys the farmland he wants.

Kristy G
August 24, 2020

Hello, I have 3 Loropetalum and 2 ligustrum that have either phytoplasmus Or pseudomonas savastanoi they are both around 7 years old and I am trying really hard to save them. I also have 2 sapling loquats that are still in a pot that are showing signs of leaf curl and the leaves are stunted in growth. I have heard that using antibiotics help and using prevention after for prevention of them getting it again. I think my oak trees have the phytoplasmus because a few of my 15 trees have what they call witches broom growth. They tower over my 3 acre property. I am fairly new to all of this and considered myself a casual gardener until my shrubs started getting sick. I would like to eventually have a food forest but I would like to understand and get this disease under control before I subject more plants. Can you please help. Zone 9a

July 29, 2020

Thank you for this video, Larry. Not surprised that you have used your time so well to help others. I appreciate the Master Gardner program. I call Carl for help often. During this virus, we Emil each other. From your post, there seems to be more l can reap/harvest from your program and l will. Congratulation; You are a star. Barbara and Wayne

Sharon McRoy
July 29, 2020

Very nice video, with great information! I especially appreciated the idea of combining edibles (herbs) with ornamental plants. The result is an attractive and appealing planting, which is also functional. Great job, Muriel!

Sharon McRoy
July 29, 2020

Very nice video, with interesting information. I especially appreciated the idea of combining edibles, such as herbs, with ornamental plants. It is more attractive and appealing, while being functional. Great job, Muriel!

Melissa Moore
July 28, 2020

Great job Muriel

Doug Mayo

March 2, 2020

Contact your local County Extension Office and talk to the Agriculture Agent. In Florida we also have county foresters, but I am not sure about Minnesota? Your local Agent would know.

Rachel Frampton
February 27, 2020

My dad owns a portion of land in the forest where he grows trees for timbers. He's planning to sell them off this month, and I think you're right, he should seek help fro a professional Forster first because as you've mentioned they consist all of the right equipment and expertise. I wonder where we can find a forestry consulting service here in Minnesota.
January 6, 2020

Just like your washer, your dryer is another essential appliance that helps you save so much time each week. Your dryer works hard every time you turn it on which is why some parts might need to be replaced every now and then. When this is the case, remember to always call a trained professional rather than attempting risky DIY repairs.

Doug Mayo

September 23, 2019

The dried material is toxic, but is of less risk than the fresh materials. Here is a UT publication to view: This is a direct quote from that publication: "All plant parts are toxic, especially the flowering structures. Dried plants in hay can be toxic, but the greatest risk is associated with consumption of fresh plant material, especially if flowers and fruit are present."

Doug Mayo

September 23, 2019

Thanks Carl. I fixed it, but even after folks leave their name remains on the articles. They were the author.

Henry Smith
September 22, 2019

If I mow Perilla Mint how long do I need to leave cattle off of the pasture. If mowed does it still have toxicity and if so how long. Thanks Henry Smith

Carl Strohmenger
September 13, 2019

Hi Doug, I notice that Matt Lollar is still on the Jackson County Blog page as Hort agent and Stephanie Herzog is not listed as FCS agent, although several articles on the blog are authored by her. Perhaps these corrections could be made. - Carl Strohmenger

July 2, 2019

hanks for sharing this great post. I always ask for warranty and return policy for the product.

Logan Boatwright

January 23, 2019

Hi Lyla, I'm thrilled you are interested in horticulture! You are not limited. This area of agriculture has a variety of career paths to choose from! One can choose to work in production such as operating a greenhouse, landscaping service, vegetable farming, or orchard production. Others may choose landscape design and maintenance, or marketing of horticultural products. Then you have applied research to help further our knowledge of plants and pests, teaching, crop inspection, and many more fields. There is a continuous growing demand of horticulture services. However, increasing agriculture mechanization and efficiency of managing a farm means that there will probably be less need for workers to complete tasks that machines can do. Do not let that discourage you from majoring in horticulture. As far as jobs in Jackson County, I am not 100% sure. Hurricane Michael caused very significant damage to many businesses. Only time will tell how those businesses faired. I hope my answer was helpful! Please ask anymore questions that come to mind or stop by the UF/IFAS Jackson County Extension office on 2741 Penn. Ave. You can reach us at 850-482-9620.

Lyla Allen
January 6, 2019

Hello! My name is Lyla and I was wondering what the outlook is for horticulture jobs in Jackson county within the next few years. I currently go to USF, however they do not offer horticulture options and was planning on transferring eventually. Just wondering what types of horticulture jobs may be up and coming? Thank you so much!!

eli setiawan
December 20, 2018

Thank you for telling me the original link of this article, I will write on my blog along with the original reference source

Logan Boatwright

December 13, 2018

Hi Karen, UF/IFAS has research planned to grow hemp in spring 2019 with a possible field day in the fall.

Karen Schoen
December 13, 2018

Welcome: The farm Bill is about to pass which means Hemp will become legal to grow. Hemp is a huge cash crop and from what I have been reading not hard to grow. Can you have a class on growing hemp?

Roxanne Spear
November 7, 2018

Places for people to reach out for Equine and small AG assistance for hay and feed we are located at the Jefferson County AG Extension facility. supply located at Jefferson County AG Extension and also South Port, Supplies located at Jefferson County AG Extension Facility. We still have volunteers running donated supplies to those effected by the Hurricane.

Cricket Moore
November 2, 2018

As Warren's Sign Language Interpreter for several year, I can vouch for how special he truly is. Love u Warren

Matt Lollar
September 12, 2018

Hi Barbara. Yes, digging the infected plants up and sterilizing your tools is the best protocol to help prevent the spread of the disease.

August 3, 2018

If I just dig them up and use bleach on the pruning tool and shovel will this benprotwction for my other plants

Anthony Smith
August 1, 2018

I need to identify a mature ficus. I'm not sure which type it is because the leaves are very similar. Can someone help? Tony Smith

Doug Mayo

May 15, 2018

This chart is a product of the USDA Research Center in Nebraska. I doubt they would have an issue with translation, but it is not mine to provide approval. Here is the link to the original publications with the authors contact information included:

eli setiawan
May 4, 2018

wow good info, Can I translate in Indonesian? and I uploaded it on my blog ?

February 22, 2018

Thanks for sharing this great post. I always ask for warranty and return policy for the product.

Carol Schoepf
September 8, 2016

Matt, I have a redbud tree that developed big nodules on the trunk. Do you have any idea what would cause this.?

robert turner
September 3, 2016

Mr. Mayo: Would you give me a call when you have a minute. Thank you, Robert Turner The County Record Blountstown, FL

Doug Mayo

August 22, 2016

With cattle pens there is nothing that can't be customized, but the "Bud Box" design is based around cattle movement around the handler. I think what you describe could work, if the double alley connected to a corner of the pen, rather than a funnel in the center. The basic concept is that instead of allowing cattle to move forward by themselves, the handler only loads the pen with the number the alley can hold, and controls their flow into the double alley standing in the pen with them. The handler serves as the sweep tub.

Steve Wurtz
August 17, 2016

Is it possible building a Bud Box coming up from behind the double alley instead of from the side?

July 26, 2016

Thank you. We appreciate your help very much.

Doug Mayo

July 25, 2016

Perilla mint can be controlled with several common herbicides, labeled for pasture use. GrazonNext, Milestone, and Weedmaster will provide good control of Perilla Mint. None of these products have grazing restrictions, so technically you can treat with the animals in the pasture. There are haying restrictions of 7 days for GrazonNext and Milestone, and 37 days for weedmaster. The labels do not mention dogs and cats. I would suggest keeping all animals out of a pasture the day the herbicide is applied, but once it has dried, there should not be a problem.

July 25, 2016

This mint weed has taken over our pasture. Please recommend a poison that will kill it but safe for goats, dogs, cats. Thank you for your help. Sent from my iPadThis knot weed has taken over our pastures.

Doug Mayo

June 24, 2016

The skin to repare her face came from his rear end... Mother-in-law kisses that skin...

June 24, 2016

OK, I do not get the joke....

Robert A. Stoker
May 23, 2016

Enjoyed the article. Herbicides by all forms of positive

May 9, 2016

Good one. I can use these in school visits.

Doug Mayo

May 7, 2016

I like that one too. Thanks

May 6, 2016

What do you call a cow with two legs? Lean beef !

Sam Lincoln
April 24, 2016

Mr. Mayo, Enjoyed the article. When spraying hard to kill invasive weeds (cogon grass) or briars, I generally have better luck with an MSO than a non-ionic. I was glad to see the line about the homemade surfactants. Sometimes technology really does work better and this is one of those cases. Sam Lincoln Pasture Solutions LLC Milton, FL

Doug Mayo

April 23, 2016

I agree. You may kill out some spots, but won't lose the whole stand.

Tim Tucker
April 22, 2016

Mr. Mayo , Nice article. Thanks I plan to try this approach in my clover pastures. Maybe I can save part of my stand of clover and kill some weeds. Thanks again, Tim Tucker Uriah AL

Matthew Orwat
March 28, 2016

I've seen it for sale at the various big garden centers, as well as online and small nurseries. I'd check with local nurseries in your area to determine if they can get it in with their next supply of plants.

Andrea Schnapp
March 24, 2016

Where can I find this for purchase?
March 7, 2016

Never underestimated people ability.

Vicki Fuqua
January 25, 2016

That was a good one Doug!

M Frost
January 9, 2016

25" on the south side of Lake Iamonia....

January 9, 2016

Could this be an even better system for spring calving cows since their nutritional needs are lower during this time? Sounds like these cows were in good shape going in (since they "lost weight, but maintained 5-6 body condition scores"). Would spring calvers might be able to start thinner or live on lesser quality grass? Also could be a gap filler before the winter grazing we always plan to come by Thanksgiving but frequently isn'ready until New Year's, arrives.

Doug Mayo

June 29, 2015

I am glad you enjoyed it. Quite a teachable moment.

sue wiley
June 26, 2015

mr. mayo., i must say that is a very very bright story. good laugh and good results. wonderful. sue wiley

Doug Mayo

June 22, 2015

Todd Dailey, a Facebook follower from Ocala shared the link to the Jerry Clower audio version of this classic story:

Victor Alvarado
October 31, 2014

Do you have data for the current year? I heard that for the current year the price decreased tendency ceased and that prices stabilized and I some cases start to increased.

Doug Mayo

July 25, 2014

Sure. It was a great event, and I know the Cattlemen would like to share the success of their event.

Barbara Bird
July 25, 2014

Hey Doug, Can I reprint the article on Jackson County Cattlemen's Tour in The Florida Cattleman & Livestock Journal? Could you email the article and photos to me? Thanks, Barbara

Doug Mayo

May 15, 2014

It is USDA that surveys a random sample of farmers from each county. They do this annually, but not necessarily with the same farmers each time. Typically farm leases are for more than one year at a time, but a single may have multiple farms they lease. These leases are typically negotiated between the farmer and landowner, so having an third party determine averages for the area can be a good starting point for negotiations.

Sophia Liam
May 15, 2014

It's pretty cool to see how much the prices vary per location. Question for you, how often do farmers need to survey their land? Does it need to happen every few years, every time the lease changes hands? Thanks! Sophia Liam |

Doug Mayo

April 21, 2014

Pensacola is the cheapest bahiagrass seed on the market. Tifton 9 is an improved Pensacola type, but it is almost impossible to get certified Tifton 9 seed anymore. There are so many acres of Tifton 9 out there now that the price is not that much more for Tifton 9. Argentine is always higher than Pensacola, because there are simply fewer seed heads and fewer pounds of seed harvested per acre. Riata and TifQuik are patented cultivars still, with limited seed available that you must buy directly from the company that owns the rights to the cultivar. If price is a key factor in seed purchase, I would suggest Tifton 9 since it is an improved cultivar that is widely availabe from a number of seed suppliers.

PB Smallwood
April 18, 2014

Can you comment on the price of the various alternatives? Specifically the difference between the Pensacola and the Tifton would be of interest. I just ordered and paid for a bag of Tifton 9 and was delivered a bag of Pensacola.

Doug Mayo

December 16, 2013

This article deals with vaccinations for serious horse diseases. I don't know of any other alternatives to prevent these diseases. There are natural, old school treatments for pests, such as crop rotation and cultivation. Commercial farming depends on thoroughly tested, specialized chemicals for pest control, because they offer the most consistent control for the money spent. You don't always have to use chemicals, but there are many troublesome pests that very difficult to manage without them.

Clay Robertson
December 14, 2013

Why isn't more emphasis placed on "natural" remedies to weeds, weed seeds and pests? I've been researching steam sterilization of soils because I personally have an allergic predisposition to chemical concoctions and avoid inhalation, ingestion or physical contact with ANY chemical treatment. There are perfectly viable and natural alternatives to chemicals.

Tim Tucker
September 7, 2013

Nice article. I always said when you shipped cattle out west it was like some of them blew out of trailer on the way. However I did like you chart and info detailing what I thought. Please keep my old pal Herman out of trouble. Take care and again nice article. Tim Tucker Uriah AL

Mary Veitch
August 24, 2013

What were the land values prior to 2004, the year of major hurricanes and land values 2005-2009? My thinking is that in those 5 years values increased and now we are seeing values returning to previous average values.

Doug Mayo

August 15, 2013

The best advice I can give you is to visit your local USDA Farm Service Agency (FSA), and talk to their loan agent. There are special funds for New and Beginning Farmers, but I think mostly they are low interest loans.

Donn Flyingeagle
August 13, 2013

Need a small 10 ac. farm to grow produce and to raise rabbits for meat ? Need an Agriculture grant to help in purchase of said farm . have 70 years of expertise of raising rabbits and making the most money . My son has ten years in growing produce for the table and to sell . Between the both of us we have the expertise to make the farm grow .

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