One question that arises every year for cattle producers is what to do with weaned heifers. Should they be retained or sold at weaning? Retaining heifers or buying replacements are both costly ways to build and expand a herd. Therefore, it is important to select females that will be dependable, consistent, and longevous. Investing in the solid foundation of a herd is important for long-term profitability.
Each year, it is worth putting pencil to paper to see which option would be more economical. If the cost of developing a bred heifer is lower than the purchase price of a bred heifer, then a potential profitable investment has been made and vice versa. See the Ask IFAS publication FE1153, The Economics of Raising Replacement Heifers: Estimating Direct Costs Using the Replacement Heifer Calculator . Other variables should also be considered such as biosecurity risks and the genetics of the herd. Such a decision is based on the goals of each operation with neither option being superior to the other. For the purpose of this blog, the decision to develop heifers and breed them as yearlings will be used in the example.
The Costs of Keeping an Open Heifer
Raising replacement heifers is labor intensive, time consuming, and costly. After investing so much into that heifer, it is expected that she will have a calf by her second birthday. But if she doesn’t, is she still worth keeping after all that has been invested in her? How long would it take for her to pay for herself if she only missed that first year?
The cost to develop heifers in 2024 can be expected to vary from operation to operation. For this example, the cost of $1,817 per heifer will be used. (Visit the Replacement Heifer Cost Estimation Tool under ‘Calculators’ for a further breakdown of these costs). When deciding to keep an open replacement heifer to breed the next year, revenue is foregone (opportunity cost) from selling her as an open replacement (Table 1: year two), and annual costs are incurred from having to “house” her for another year. Using 2024 calf prices, even if she has a calf every year after that first year, it is estimated that it will take seven to eight years for her to pay for the cost of developing her and start returning a profit. Lower calf prices would cause it to potentially take even longer.
There is Value in an Open Cow
This goes for keeping any open cow, not just heifers. If she does not have a calf every 365 days, she is incurring extra costs and not providing a consistent stream of revenue. This will have a long-term negative effect on profit. However, she could still provide a source of revenue that year if sold as a cull cow or even as a replacement depending on her age and body condition. Culling an open heifer or cow could potentially mitigate or ease the loss of not selling a calf from her. A producer should strive to always apply the three “E’s” when trying to make profitable decisions about investing, managing, and marketing: “Is this decision efficient, effective, and economical?”
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