How to budget & buy up this bull season Amanda Radke

How to budget & buy up this bull season

Balancing the priorities you seek in a herd bull with the price point you want to spend takes a little homework. Use these resources to help you plan ahead this bull buying season.

A few weeks ago, I wrote a blog urging commercial cattlemen to calculate the cost per calf when investing in new herd sires. The popular article drummed up several follow-up questions from readers. Considering my family is packing the trailer today to head to a consignment show and sale with a couple of bulls, I thought now would be an appropriate time to revisit the discussion of things to think about when selecting a new herd bull or group of herd bulls.

In case you missed it, check out the original blog post here.

According to James M. McGrann, Texas A&M University professor and Extension specialist emeritus, “Purchasing herd bulls is an investment that is expected to pay out over three to five years. The ownership costs (depreciation, death loss and interest cost) are an annual cost spread over females serviced and calves produced during the bull’s productive life. Depreciation is the purchased cost minus salvage value. Salvage value or cull bull net sales value is a substantial portion of bull initial purchase cost, reducing bull depreciation.”

While cattlemen may shy away from a higher priced bull, McGrann explains that the investment isn’t “that costly” when you break down the numbers.

He says, “The investment in a higher priced bull that can contribute to improved production of more market acceptable calves and better weaning weight for the cow-calf producer is not that costly when numbers are put into perspective for calves sired and as a percent of the breeding cows total annual cost.”

McGrann developed an Excel spreadsheet, which I failed to link to in my previous post on this subject, which allows producers to input the purchase cost, estimated salvage value and economic life of the bull. Interest, grazing, feed and veterinary costs are also included in the spreadsheet.

To access the spreadsheet, click here. Under Beef Cattle Decision Aids, scroll down to C. Cow-Calf Budgeting. Item two is listed as “Herd Bull Investment and Cost Analysis.” There you can find both a PDF description of the tool and an Excel spreadsheet where you can input your own data.

So now that you’ve calculated the budget you have to spend on a herd sire investment, it’s time to select the bulls you like based on other performance parameters.

Rod Geppert, for the Angus Beef Bulletin EXTRA, recently penned a column about choosing your priorities when purchasing a herd bull. His list includes calving ease, carcass merit and values, milk and visual appraisal.

Of course, there’s a balance between your budget and your bull wish list, but Geppert says there are some opportunities this year to buy up, if you will.

Geppert writes, “Lower prices in the cattle market aren’t all bad. They also mean opportunities for you to purchase high-quality genetics at a lower cost to the operation. Price is not indicative of quality or an indicator of the best bull or bulls at an offering. The best bull to meet your goals for your operation could be later in the sale, and you can find him if you do your homework.”

Read Geppert’s priority list and tips for making informed and quick decisions at an auction sale by clicking here.

The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Penton Agriculture.

TAGS: Cow-Calf
Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish