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Dairy farmers innovate and 'beef up' to stay viable

Dairy farmers innovate and 'beef up' to stay viable
With the beef bonanza 'busted,' dairy farmers are digging into their cow genes to shore up margins.

You know dairying times are tough when wayward bull calves start showing up at the farm gates of larger commercial dairy farms. It’s already happening in isolated cases.

Trevor Amen, puts it graphically: “Milk producers are being slugged with a 1-2 punch of soft milk prices and slashed cattle prices.” Despite the cattle collapse, producers are innovating to improve efficiencies and remain viable, reports this CoBank economist.

MIXED GENES: Jersey and Jersey-beef crosses fill this calf-growing facility in Pennsylvania.

Until early this year, dairy producers were partially insulated from the painful milk price plummet with record-high beef cattle prices that carried into bull calf and cull cow prices. But the beef bonanza is over. Calf and slaughter cow prices have retreated to historical averages — down roughly 90% and 40%, respectively, from their 2015 highs, he adds. Gone is the incremental revenue that once contributed up to a third of cow value. Now, calf and cull cow sales are less than 10% of margins.

3 ways to adapt and stay viable 

More aggressive culling. The U.S. dairy herd is now the youngest it has ever been, points out Amen. That’s one reason for the rising herd and per-cow productivity.

Greater use of genetic tools. Use of sexed semen reduces bull calf numbers. Genomic testing identifies elite females to breed for greater milk production. Genomic testing also identifies second-tier females to crossbred with beef sire traits.

Beef feedlot alliances. Crossbreeding for specific beef traits plus preconditioning and grower programs sought by feedyards are boosting dairy-beef bull and steer calf premiums via higher-quality beef traits.

A video synopsis of the report, “Dairies Use Genetics to Manage Through Beef Price Decline” can be found on CoBank’s YouTube Channel.

For more dairy-beef genetic information, click on these webpages:
ABS Dairy InFocus (Beef x Dairy) Genetic Management System
Genex Rapid Growth Adding Value to Dairy With Beef
Select Sires Breeding to Feeding Program

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