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Cow herd investment opportunities during a period of prosperity
Record high cattle prices coupled with abundant supplies of relatively inexpensive feed and forage have contributed to prosperity for most Midwestern beef cattle operations. Prosperity provides the opportunity to pay down debt and make operational improvements in preparation for more challenging financial times. Ideally herd investments should provide for short and long term returns by reducing costs, increasing productivity or enhancing efficiency. Debt service offers the immediate opportunity to reduce interest cost while increasing management decision flexibility. Handling facility investments can improve genetic, reproductive, health, and nutritional management in addition to reducing operator and cattle stress at processing. Implementation of nearly every cattle management decision begins at the handling facility. Genetic improvements will prepare cow herds to increase performance, expand market options or enhance efficiency. Even with recent technology improvements, the selection of superior genetics still requires scales and sorting capabilities. With handling facility investments producers may expand reproductive management to narrow calving window, increase AI use or diagnose non-productive cows offering labor and nutrient efficiency savings. Preventative health management should focus on reducing calving and weaning losses. Herd health management using a scale equipped handling facility ensures accurate antimicrobial and anthelmintic dosing, reducing drug costs, enhancing animal performance and protecting product efficacy. Cow nutrient demand grouping represents a management opportunity to optimize supplement cost relative to production efficiency. Developing facilities to enable nutrient need determination while expanding the ability to sort and house these groups prepares herds to weather higher feed and forage prices. Facilities designed to minimize weaning stress while providing short-term feeding infrastructure expands market opportunities while reducing shrink. Midwest pasture acres are increasingly viewed as potential row crop acres suggesting investments increasing carrying capacity or harvest efficiency prepare operations for future land use challenges. Pasture improvements increasing forage yield, nutritional quality, weed competition and anti-quality factors offer long term investment for an increasingly shrinking resource. Investments to reduce forage losses during harvest, storage and feeding represent an opportunity to reduce hay acres and forage cost. Numerous investment opportunities exist to improve the cow herd, short and long term returns on these investments are dependent on current productivity and future resource limitations. With increasing competition for land, resource investments designed to reduce cost, increase productivity or enhance efficiency when evaluated on a per acre basis offer the greatest opportunity to maintain profitability.
Keywords: Beef cattle, Efficiency, Profitability