To be certain, cattle sales can be a broad category in this financial data set. The Farm Credit East data includes cull cows, beef-on-dairy calves, and other cattle sales. In addition, the data set also tracks milk receipts, crop sales, government payments, and other sales.
Influence of beef-on-dairy in financial data
Despite the surge of beef-on-dairy animals in the supply chain over the past few years, these calves continue to hold tremendous value and sell for over $800 to $1,000 a head. Recent auction data from Pennsylvania even reported over $1,600 a head for a day old, crossbred calf. These prices help translate a larger income stream for dairy farmers who are breeding more of their herds to beef semen.
Although this data doesn’t break down each individual cattle category as it relates to cows, heifers, or calves, it is clear beef-on-dairy calves are influencing profitability. As dairy farmers have pulled back on dairy cow culling by over 600,000 head since September 2023, those cows can produce more value by making a beef-on-dairy calf rather than heading to the beef packer themselves.
The beef-on-dairy crystal ball shines bright
Considering the exceptional demand for beef and the three-year life cycle from conception to harvest at a slaughter plant, the need for more beef production will not slow down any time soon. This market reality will help maintain high cattle prices for beef and dairy cattle entering the beef supply chain. The long-term trend for beef-on-dairy appears positive and stable as dairy producers work to diversify their businesses away from only milk and cull cow sales as the primary sources of income.
