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Economic Tools to Evaluate Culling Decisions for Breeding Cattle and Replacements

Larry L. Falconer and, David Anderson (November, 2011)

Summary

The extreme drought in South Texas in 2011 forced producers to make tough choices about how to handle their investments in breeding cattle. Producers faced similar situations in the spring and summer of 1996. However, market conditions and expectations of future prices were much different then. In the spring of 1996 cattle prices were at their lowest since the mid-1970s, and grain and forage prices were high and set to move higher. What has not changed are the economic and financial analysis tools for making sound buying or selling decisions for breeding cattle. Deciding whether to keep or sell a cow, to keep a heifer for replacement, or to sell the potential replacement depends on that animal’s future value in your herd compared to its current market value.