It’s decision time in relation to the 2023 born bulls on Tullamore Farm. The Irish Farmers Journal beef and sheep demonstration farm has operated an under-16-month bull beef system for the last six years slaughtering bulls at 15 to 16 months in May and June each year.

The bull beef system was seen as the most profitable system to operate on the farm with high levels of performance.

Over the last number of years, we have been able to achieve high lifetime growth rates on the bulls of over 1.3kg day. Weight gains during the ad-lib phase of feeding generally went between 1.5kg and 1.7kg/day.

Average carcase weight for the last number of years has been coming in around 385kg. The farm has been trying to increase this further in recent years by increasing the carcase weight sub index of the bulls that are used in the herd but it’s been a slow one to progress.

In terms of grading, bulls have averaged an R+U- for the last number of years coming in with a fat score of three, so carcases were fully within spec for factories.

The bull beef system suited the cow type which pushed on weanling weights and meant a lower proportion of liveweight gain came from concentrate feed. It’s a high meal input system with typically between 1.4 and 1.6 tonnes of feed going into each bull during its lifetime.

The 16-month system generally suited the beef price cycle where supplies were tight and price generally trended upwards.

Finishing all the male animals on the farm over a number of years meant that comparisons could be made each year without depending on the variables of a live market.

It also brought a degree of transparency to the project. The system ticks a lot of boxes in terms of lowering average slaughter and, in turn, the carbon footprint of beef produced on the farm.

Farm manager Shaun Diver has also been very positive about the bull beef system. He said: “I like the idea of the bulls and it’s a system that worked very well on the farm. There’s something nice about seeing animals move on and the bulls really turned inside out when they went on to the ad-lib feeding.”

Last year’s bulls

While the bull beef system ticks a lot of boxes for the farm, there is one box it isn’t ticking and that’s profit. This was no more evident than in 2023 where the same decision point was met in February 2023.

“Last year, we decided to finish the bulls based on a rising beef price and doing a budget on costs and potential gains of going the whole way to 16 months. The finishing route was chosen but that turned out to be the wrong decision in 2023 and the bulls would have been better sold at 12 months of age as opposed to finishing in 2023.

“Beef price went from €5.55/kg at the beginning of February 2023 to €5.25/kg by the time the 2022-born bulls were being sold.

“We gambled on a price rise and it didn’t work out. There’s as saying that goes: ‘Fool me once, shame on you; fool me twice, shame on me’ and that’s currently playing in the back of our minds as we make the decision to sell or feed on with this year’s bulls.

The day of the small-scale beef finisher is numbered

“Every year since we have started, we have approached processors to look for a price before we start the expensive ad-lib feeding phase but every year we’ve been given the same standard answer: “We don’t issue price contracts to finishers.”

The day of the small-scale beef finisher is numbered. Bigger feedlot feeders can hammer out a price deal and also have a stronger hand when it comes to purchasing inputs.

It’s a little sad that the family farm finisher is being squeezed out but I guess economics of scale take over and factories have shown a growing desire to deal with larger finishers in the last few years.

There was 415,500 head of cattle slaughtered out of controlled finishing units, many of them factory-aligned feedlots in 2023 up from 263,000 head in 2017.

In terms of making a decision, one of the first things is to do a budget. A lot of the inputs we have a good handle on. The big unknown is beef price so we have to take a punt on where that will be come June 2024.

Revenue

Table 1 outlines the costs and possible revenue from finishing the bulls in 2024. It will take €700/head to finish the bulls from now until June. We have 40 bulls, so that’s €28,000 we will need to cashflow the finishing operation over the next few months.

If the bulls currently made €3/kg, which isn’t by any means at the top of the market, that means our bulls are worth somewhere around €1,350/head at the moment.

So, we can currently cash in on the bulls at €54,000 or spend another €28,000 to make a potential €1,320 on the 40 bulls. If we are unlucky enough to lose a bull, we are in negative territory very quickly. A 10c/kg shift in weanling price means a +/- €45/head difference. A 10c/kg shift on beef price means a €38.50/head difference either way.

We’d be interested to get your views on whether we should sell or feed on the 2023-born bulls on Tullamore Farm. Email your views to beefnews@ farmersjournal.ie. The decision will be made over the next week.