RFD Livestock Report 10-9-26 Corey Geiger Co Bank Economist-Opportunity in the Dairy Industry

If you're in dairy, five years ago, cull cows and the calves they had were about 5% of revenue.

Now we have this, what I call 1961, 1951, and 1941 effect in the countryside.

1961, we have the lowest beef cow numbers in the country.

1951, the lowest livestock numbers, so that's beef and dairy combined.

And this year, we have the lowest calf crop since 1941.

What that tells me is for dairy farmers that are maybe have retired from dairy farming but have, wanna be in the business for a while in agriculture, the beef opportunity has some long-term legs here because even if we start retaining heifers, beef heifers, that, uh, inventory numbers aren't gonna climb for two to three years at a, at a minimum here.

So not only is demand strong from the consumer market, but, uh, supply constraints are raising the price of those animals.

Specifically, five years ago, a beef on dairy calf from a Holstein cow or a Jersey cow would've brought about $200.

That number peaked in May at 2,000.

Now, it's since dropped off to 12 to 1,300, but there's still 8 to $900 of profit.

So that's, uh, one opportunity that some are taking advantage of.

And in fact, my wife and I even have a cow-calf herd these days that have s- been doing well.

If you're in dairy, five years ago, cull cows and the calves they had were about 5% of revenue.

Now we have this, what I call 1961, 1951, and 1941 effect in the countryside.

1961, we have the lowest beef cow numbers in the country.

1951, the lowest livestock numbers, so that's beef and dairy combined.

And this year, we have the lowest calf crop since 1941.

What that tells me is for dairy farmers that are maybe have retired from dairy farming but have, wanna be in the business for a while in agriculture, the beef opportunity has some long-term legs here because even if we start retaining heifers, beef heifers, that, uh, inventory numbers aren't gonna climb for two to three years at a, at a minimum here.

So not only is demand strong from the consumer market, but, uh, supply constraints are raising the price of those animals.

Specifically, five years ago, a beef on dairy calf from a Holstein cow or a Jersey cow would've brought about $200.

That number peaked in May at 2,000.

Now, it's since dropped off to 12 to 1,300, but there's still 8 to $900 of profit.

So that's, uh, one opportunity that some are taking advantage of.

And in fact, my wife and I even have a cow-calf herd these days that have s- been doing well.