Have Your Cows Repaid their Debts?

Managing a successful dairy farm in today's economy continues to be a challenge. With current commodity prices and inflation pinching everyone's pockets, those in the dairy industry are also feeling the strain. With soaring costs of just about everything, many farm owners have been forced to take a hard look into every aspect of their business to cut costs. However, cutting costs in one area will always impact some outcome of the farming operation. Therefore, these decisions must be made very carefully, with anticipated outcomes in mind. One management aspect that should be considered is your herd turnover rate. How long do your cows remain in the herd? What is your age at first calving? How many replacements do you have on hand? These questions are all interrelated and can lead to profits or losses that can impact the financial success of your dairy operation.

To determine a herd turnover rate, the percent of cows culled in a herd needs to be taken into consideration. Those culled should include both economic and biological culling decisions. Economic culling means selling cows for dairy purposes such as low milk production while biological culling is a more forceable decision that must be made due to injury, reproductive issues, illness, or death. In a critical review published in 2021 focusing on dairy cow longevity in high milk-producing countries, it was shown that the most common reason for culling of first and second lactation cows was reproduction issues. Death was the most common reason for third and greater lactation cows. First lactation animals were more likely to be culled in the initial third of the lactation due to low milk production while second lactation animals were culled due to the incidence of metabolic and other diseases (Dallago et al., 2021). The 2018 USDA/NAHMS Health and Management Practices on U.S. Dairy Operations reported the average cull rate for the Northeastern U.S. was 31.4% plus a 6.2% cow death rate, a total of 37.6% cows permanently removed from herds per year. This cull rate was similar to the DRMS report for 2,570 Pennsylvania herds indicating an average cull rate of 37.2% which includes cow deaths.

The herd turnover for a dairy can then be determined by taking the total number of cows (milking and dry) that have been culled over 12 months divided by the average population of cows at risk (milking and dry) during that same 12-month period. In the last decade, many commercial dairy herds had turnover levels of 35 to 40%, at times reaching 45 to 50%, compared with historical levels of 25 to 30% (Overton & Dhuyvetter, 2020). Herd turnover rates can also be indicative of the current position of your dairy, whether the goal is to maintain the current herd size or try to grow. Cull rates are often the measurable figures showing the growth of farms, but it is obvious how these two numbers are directly related. When cull rates and turnover rates are high, this can severely affect the longevity of dairy cows in the herd.

In a 2006 study published in the Journal of Dairy Science, survival rates and productive herd life were examined for 13.8 million US dairy cows that calved from January 1, 1980, through March 2, 2005. The study showed that dairy cattle in the United States that first calved since 1980 had an average lifespan of about 2 years and 8 months (Hare et al., 2006). A more recent article by De Vries showed the average productive lifespan of cows to be between 2.5 and 4 years in most developed dairy countries. When taking a 24-month average age at first calving (AFC), this brings their total lifespan from birth to death between 4.5 to 6 years (De Vries & Marcondes, 2020). This short lifespan is nowhere near the normal life expectancy of 20 years for a dairy cow, an age that is very rarely observed on modern dairy operations. This short lifespan of cows has been recognized as a problem for decades. An article published back in 1959 urged farmers to realize the increased profits that would result from long productive life in the milking herd and overall, the dairy industry was suffering serious economic loss because the productive life of most dairy cows was much shorter than it should be (Snook, 1959). Although this problem has been known for decades, the productive life of dairy cows continues to be an area of concern.

This average lifespan of dairy cows can also be correlated to the number of lactations that a cow completes while in the dairy herd. The number of lactations that dairy cows complete is extremely important to the financial health of the operation. In a study published in 2020, it was found that dairy cows become profitable in their third lactation due to high costs associated with the early life non-productive stage (De Vries & Marcondes, 2020). With the increased heifer rearing costs, it may even take into later lactations for cows to cover those costs. The following table uses updated figures to illustrate the profitability of heifers that remain in the herd for multiple lactations. Using these prices, heifers are not turning a profit for farms until they are in their third lactation. More importantly to note is the increased profits that result from keeping that heifer into later lactations.

With these increased profits into later lactations, we need to examine why cows leave the herd at such a young age. Short longevity indicates that animals are not expressing their maximum potential for productivity and profitability, since dairy cows become profitable in their third lactation due to high costs associated with the early life non-productive stage (Dallago et al., 2021). Data currently being collected by members of the Penn State Dairy Team have found the cost to raise heifers has been increasing. The average cost to raise a heifer from birth to freshening is $2,235, with the average ranging from $1,863 to $2,489. Organic herds are seeing slightly different numbers with an average of $2,149 with a range of $1,782 to $2,673. With increased feed costs, it is easy to see why these averages have been increasing. The higher rearing costs are the reason why it is taking until the third lactation for heifers to pay back their debt to the farm. Therefore, with shortened productive life of cows, many animals in the herd are not even covering their rearing costs before they are culled from the herd.

Other areas to consider are age at first calving (AFC) and the number of heifer calves being raised on the farm. An increased AFC is often negatively correlated to productive life. Heifers that are older at first calving are at a higher risk of being culled than those calving at intermediate ages (Hare et al., 2006). If a farm's AFC is higher than recommended, this can ultimately lead to higher herd turnover rates. Adult cow herd turnover is the key driver behind the number of heifers needed to calve; however, mortality, disease, fertility, and elective culling losses throughout the heifer-raising period determine the total number of heifers that must be retained and raised to meet anticipated needs. Raising all heifer calves on a farm through calving simply because they were born there and disregarding true replacement needs results in the premature culling of otherwise productive cows to make room in the herd, an action that results in a higher-than-optimal herd turnover and economic losses (Overton & Dhuyvetter, 2020). There are tools available through Penn State Extension to help determine the number of heifers a farm will need to raise based on the goals of their farm which could reduce unnecessary raising costs.

When taking a critical look into the productive life of a herd, the current cull rate plays a key role. Farm owners and managers should evaluate their culling decisions to determine when cows are leaving the herd and for what reasons. Are we culling simply to replace with younger, more genetically superior animals? Are cows leaving due to injuries that can be prevented with facility or management improvements? In dairy herds with improved management, culling is highly reflective of economic factors such as milk price, replacement price, and cull cow values, as well as other important drivers such as genetic improvement, reproductive performance, and heifer availability (Overton & Dhuyvetter, 2020). When it comes down to it, the profitability of the farm is what drives decisions; however, taking the productive life into consideration when making these decisions and realizing when those cows are most profitable to your operation should not be overlooked.

References: 

Dallago, G. M., Wade, K. M., Cue, R. I., McClure, J. T., Lacroix, R., Pellerin, D., & Vasseur, E. (2021). Keeping dairy cows for longer: A critical literature review on dairy cow longevity in high milk-producing countries. Animals, 11(3), 808.

De Vries, A., & Marcondes, M. I. (2020). Overview of factors affecting productive lifespan of dairy cows. Animal, 14(S1), s155-s164.

Hare, E., Norman, H. D., & Wright, J. R. (2006). Survival rates and productive herd life of dairy cattle in the United States. Journal of dairy science, 89(9), 3713-3720.

Overton, M. W., & Dhuyvetter, K. C. (2020). Symposium review: An abundance of replacement heifers: What is the economic impact of raising more than are needed? Journal of dairy science, 103(4), 3828-3837.

Snook, L. C. (1959). The importance of long productive life in dairy cows. Journal of the Department of Agriculture, Western Australia, Series 3, 8(6), 703-706.

USDA/HAHMS Health and Management Practices on U.S. Dairy Operations 2014. USDA, February 2018, Report 3.