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Replacement cow prices rise on tighter supplies

Progressive Dairy Editor Dave Natzke Published on 01 August 2022

Strong milk prices and tighter supplies of cows and heifers pushed U.S. average prices for dairy replacements to their highest level in six years, according to latest quarterly estimates from the USDA. Meanwhile, cull cow prices ended the first half of 2022 at the highest point since September 2015.

Replacement cow prices highest since July 2016

U.S. replacement dairy cow prices averaged $1,710 per head in July 2022, up $140 (9%) from April 2022 and $330 (24%) more than July 2021. Although it’s the highest quarterly average since July 2016, July 2022’s average price was still 19% per head less than the last peak of $2,120 per head in October 2014.

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The USDA estimates are based on quarterly surveys (January, April, July and October) of dairy farmers in 24 major dairy states, as well as an annual survey (February) in all states. The prices reflect those paid or received for cows that have had at least one calf and are sold for replacement purposes, not as cull cows. The report does not summarize auction market prices.

Compared to the previous quarter, average replacement cow prices were up in 22 of 24 major dairy states tracked by the USDA (Table 1). The largest quarterly increases were in California, up $310, and South Dakota, up $300 per head. Only New Mexico saw a small decline from the previous quarter, down $50 per head, and the average price in Oregon was unchanged.

replacement dairy cow prices

Compared to a year earlier, July 2022 replacement cow prices were up $400 or more in California, South Dakota, Vermont, Iowa, Pennsylvania and Indiana. In comparison, prices were down $100 in New Mexico, where cow numbers continue to drop.

Progressive Dairy’s Cattle Market Watch tracks dairy heifer prices from about 20 auction markets throughout the U.S., with price summaries updated about every two weeks. The listings cover top and medium springers, shortbred and open heifers, and heifer calves. In most of those markets, prices for all classes of Holstein replacement heifers have been mixed in recent weeks.

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Market cow prices strongest in seven years

Meanwhile, U.S. prices received for cull cows (beef and dairy, combined) averaged $90.20 per hundredweight (cwt) in June, up $3.50 from May and the highest monthly average since September 2015. Through the first half of 2022, cull cow prices have averaged $83.20 per cwt, also a seven-year high.

Semiannual dairy cow and heifer survey

The USDA’s monthly Milk Production reports indicate cow numbers have been growing over the first half of 2022. Despite that growth, the USDA’s semiannual cattle survey reflected a smaller number of dairy cows and replacement heifers to start the second half of 2022 compared to a year ago.

As of July 1, 2022, the USDA estimated the number of dairy cows calving in the past year at 9.45 million head, down about 50,000 from July 1, 2021. Dairy replacement heifers weighing more than 500 pounds were estimated at 3.75 million on July 1, 2022, also down 50,000 head from a year earlier.

The semiannual USDA survey covers both beef and dairy cattle operations. Unlike the January report, the July data does not provide estimates for individual states.  end mark

Dave Natzke
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