Dairy replacements to remain tight this year

Dairy farm revenue continues to shift due to strong demand for beef and a historic run on beef prices. Five short years ago, calf and cull cow sales contributed roughly 5% to total dairy farm revenue. By 2025, that number pushed to 20% on some dairy farms with dairy-beef calves leading the cattle sales category and cull dairy cows representing a close second.

This expanding revenue stream has pushed dairy cow numbers to a 34-year high at 9.665 million head this June, according to USDA data. Under traditional market conditions, one would think the U.S. dairy herd would be flush with heifers. However, that isn’t the case, as dairy replacements have plunged to the lowest levels since 1978.

The growth in the U.S. dairy herd has largely resulted from the fact that marginal cows, which would traditionally be culled, are now carrying precious cargo in their uterus – a dairy-beef calf that can fetch upwards of $2,000 at birth. In many cases, these marginal cows are making a portion of the U.S. dairy herd look more like a beef cow-calf operation.

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Corey Geiger

hoards.com