How many cows will we actually need? With each subsequent cattle cycle, we need fewer cows than we did before. Today, we are producing more pounds of beef from fewer animals than ever before. So, we don’t need as many cows.

If La Niña occurs, will there be enough moisture for pastures? Beef producers depend on Mother Nature to provide the moisture needed to grow forage. Ten years ago, the last cattle cycle saw a shift in weather patterns, bringing an end to sustained drought throughout cow country. Improving weather made it possible for producers to expand the herd rapidly. Today, we continue to hear analysts discussing “lingering drought issues” as one obstacle in expansion’s way. Meteorologists continue to warn of a high likelihood ENSO-neutral conditions may give way to La Niña conditions.

What’s the breakeven cost to produce a 500-pound calf? Record cattle prices don’t always mean record profits. Compare the cost of anything a cattle producer uses today to what it cost 10 years ago in the previous cattle cycle. Cattle prices are indeed higher, but they need to be. Do you know what your breakeven cost is? It’s worth spending a little time with your records to check. You might be surprised.

Do you want to start herd expansion at this stage of your life? The recent 2022 Census of Agriculture revealed 38% of farmers are already 65 or older. How many in this category are anxious to add to their workload and begin expanding the herd? They’ve been around long enough and seen enough cattle cycles to know high prices generally don’t last long. Will they be content to stay steady and make a few more deposits to their savings account? I have a feeling we may see structural shifts in our industry based on who chooses to expand and who doesn’t.

Will the labor shortage problem be solved? It is not easy today to hire dependable farmworkers needed for a beef herd expansion. Low unemployment and shifts in the labor force since the COVID-19 pandemic make it harder and harder to find good help. I wonder what impact this will have on the expansion of our industry, and especially for those aging producers discussed above.

How much does interest expense add to the cost of buying cattle or land? It’s been a long time since most producers were really concerned about the cost of money in their operation. But today, if someone wants to borrow money to expand, it has a real impact on the breakeven of the enterprise.

Will you be able to find or afford land? As you drive through the countryside, how many of you catch yourself saying, “I used to bale hay in that field, and now it has a dozen houses”? In my area, a few years of strong crop prices tugged more acres out of grass and into corn and soybeans. Once that happens, it’s rare to see those acres go back to grass. Whether it’s competing with row crops or housing developments, the reality is a producer looking to grow their operation is finding it harder to buy or rent acres to expand. And if they do find it, what will it cost to purchase? Land values are becoming a big issue for cattle producers.

How good is your memory? The market correction between 2015 and 2016 was so quick and painful that I wonder if it left a stronger imprint on our minds than previous cattle cycles. Today’s producers are more cautious and may wait to see if higher prices stick around before expanding.