Calves and heifers are an important part of the farm since they are the future of the operation in more than one way. Calves are the first place kids learn how to be responsible and care for animals.
While replacement heifers are a very important part of the future of your operation, they can also be a very expensive part.
Knowing your cost of production and need for replacements can help determine how many heifers you need on the operation and which of three areas your heifer raising falls into a money pit, breakeven, or a profitable genetic endeavor.
The average farm has a 33 percent cull cow rate, meaning a 200-cow dairy needs to freshen 66 heifers each year. This would leave 50 heifers for the average dairy to either sell or expand the milking herd.
Staying profitable
If you are good at raising high-quality heifers, you can sell them profitably to other farms. The problem is heifers are only selling for an average of $1,700 dollars, and this does not always cover the cost to raise the heifer.
A survey from Wisconsin found that the average cost to raise a heifer was $2,105. There was a large variation between farms with the majority falling between $1,400 and $2,800.
Figuring out where your farm falls on the heifer-raising scale could greatly affect your bottom line.
If you are selling heifers for $1,700 and the cost to raise them is $2,100 without even including the newborn calf value, your 200-cow dairy would be losing $20,000 on your extra heifers. The numbers will look even worse if you are culling cows just to make room for your extra heifers.
Mature cows produce nearly 20 percent more milk/lactation than fresh heifers, have already recouped their rearing costs, and some may have higher genetic value than the heifer that would replace her.
Looking at costs
With that in mind, the first step is to look at what your farm’s costs are to raise a heifer from newborn until weaning. The average cost to raise a calf is $375 with a cost ranging from $215 to $908.
Part of the difference in this range is the number of days calves are fed milk, ranging from 46 to 84 days.
Another difference in calf raising costs is the type of milk fed. Many of the low-cost producers were feeding pasteurized waste milk, at a cost of $5 a hundredweight, while the highest cost producers fed milk replacer.
The other major difference was the cost of labor and management, including unpaid labor. The average was 10 hours spent raising each calf or feeding 14 calves per hour per feeding.
The least profitable farms spent 19 hours raising each calf. While decreasing labor cost is important, you need to make sure that reductions in labor do not increase other costs, such as veterinary expenses or death losses.
The next period is from weaning to calving. The average cost to raise a heifer during this time is $1,583 with most farms falling between $914 and $2,254. There are many places where costs vary while raising heifers.
The biggest variables are the cost of feed, labor and housing. Bedding costs are also highly variable by housing type comparing free stalls, bedded pack, and pastures.
The largest variation was in feed cost, which varied by feeds used and by-products available. Many rations use a double crop forage, which is an excellent option, but you need to calculate the actual cost of that feed ingredient not just call it a free feed.
Operating cost
While you might not have a land charge, all other costs exist fertilizer, seed, herbicide, planting, and harvest. Labor and management showed the next largest variance at 12.8 hours average per year per heifer with some operations as high as 62 hours and others as low as 2.2 hours.
If your cost of heifer production is more than what you can sell heifers for, other options need to be considered. Alternatives include raising only the heifers you need as replacements, selling all young stock and buying replacements, utilizing a custom heifer grower, or streamlining your own heifer enterprise.
Genomics of the calf along with production and health history of the parents can be good tools to determine which heifers are the best to keep and improve your herd. Replacement costs constitute the second largest cost on most dairy farms-manage yours to enhance the future of your dairy.
