Profitability on Irish suckler farms is driven by striking the correct balance between maximising the output per cow while at the same time controlling costs per cow.

When we talk about high output per cow, optimal herd fertility, achieving targeted calf growth rates and high calf quality are the principal factors of importance.

Suckler production is a low-margin business, and suckler cows are expensive to maintain. For a herd to be profitable, it is important that cows are productive and fit for purpose. Even among the best and most efficient operators in the suckler sector, profitability remains low, with increasing costs eroding the rise in beef price.

The high annual cost of keeping a suckler cow is the main cost in suckler-to-weaning systems, and this topic has come under intense spotlight for producers over the last year, given mounting issues like the fodder crisis, uncertainty regarding Single Farm Payments, and concerns surrounding the profitability of the beef sector as a whole.

For suckled calf producers looking to improve margins, knowing the inputs costs associated with keeping a suckler cow is critical. In reality, despite the influence this has on profit margins it’s a baromerter that is rarely cited by farmers.

In fact, in the recent Irish Farmers Journal Suckler Survey, 206 suckler producers from various regions across the country were surveyed. Those surveyed revealed that there is a wide variation in the on-farm estimates of the annual cost of maintaining a suckler cow, with an average cost estimated at €500. Some 36.2% of farmers estimate the maintenance cost to be less than €500 while less than 24% estimated the cost to be €600 or more. Nearly 10% of farmers surveyed had no idea of the annual cost of keeping a suckler cow.

Winter requirements

The provision of feed, particularly during the indoor winter period, is the largest variable cost in suckler beef production. Nearly 80% of the total annual feed costs associated with carrying the cow are incurred during the indoor housing period.

When focusing on the cow component, data from Teagasc shows that the cow herd accounts for approximately 85% and 50% or greater of total feed costs in suckler calf-to-weanling and calf-to-beef systems, respectively. Since about 70% of the total feed consumed by sucklers goes towards maintenance requirements, this means that cow maintenance costs (non-productive purposes) are a considerable proportion of the total feed costs of beef production systems.

Additionally, maintenance requirement of a cow is directly proportional to the cow’s mature liveweight. Larger, heavier breed types have an increased maintenance requirement and therefore higher winter feed costs. It is useful to compare the feed inputs of two continental crossed cows, one at 600kg and the other at 700kg. Over a typical five-month winter, the 600kg cow will have a silage requirement of 6t while 700kg cow will have a silage requirement of 7.2t or an extra 1.2t of silage – at €30/t, this equates to an extra feed cost of €35/cow.

So, the benefits gained from a good beef calf must outweigh any additional feed costs incurred.

Cost of suckler cows

Table 1. Shows the current costs of keeping a spring-calving suckler cow using analysis from Teagasc beef systems economic model.

Calculations were based on a full system analysis of a spring-born calf to weaning enterprise.

Data were standardised for to a typical production year (November to November), to include a full winter-housing period of five months followed by a 200-day grazing season. A starting turnout date of 1 April was targeted and it was assumed that the farm operated to a high level of technical efficiency.

The analysis shows at current input prices a total cost of €552 is required to maintain the suckler cow – excluding the weanling calf. When weanling costs such as grazing, concentrate (creep-feeding of 2kg/day for six weeks) and health are fully factored in, the overall cost was €635.

Both of these calculations exclude land charges (as it’s assumed that the land is owned by the farmers). However, in the case where the land is rented, an extra charge of €147 can be added per cow. In this scenario and to truly evaluate the opportunity cost accruing to land, the overall cost of keeping a suckler cow and calf to the weanling stage rises to €782.

For a spring-calving system, variable cost amounted to €432, with cow feeding costs accounting for approximately €310, the largest proportion.

Veterinary costs included a pre-calving scour vaccine, dosing treatment and pneumonia vaccine for the weanling, in total €38.

A standard AI cost of €38 per cow was taken. This was chosen as the preferred option due to stock-bull costs – variations in purchase price, herd size, cull value and longevity.

With a 20% replacement rate, replacement costs of €32 per cow were estimated based on current value. Cull value is estimated at €1,330 (350 kg carcase at €3.80/kg), an in-calf heifer costs €1,450, leaving a €160 as the net replacement cost – equating to €32/cow/year.

Commenting on the analysis, Dr Paul Crossan of Teagasc Grange said that to fully explore profitability, suckler farmers have to address and monitor cow cost with particular focus on winter feed. He said options to reduce the winter feed cost revolve around exploiting the full potential of grazed grass in the system. Cost-saving approaches include shortening the indoor period through extended grazing or early turnout but Crossan acknowledged that these are dictated by soil type and weather conditions.

While it is difficult to reduce cow feed cost dramatically, Paul encouraged farmers to monitor cow condition and feed to a target condition score. These approaches offer a definite scope to reduce feed cost while maintaing fertility.

He says farmers should aim “to build fat reserves at grass when feed is cheap and utilise these fat reserves in the winter when feed costs have increased”.

Besides reducing input cost, increasing output per cow is also a way of diluting production costs. Breeding high-quality animals from proven productive cows and utilising physical data as a means to identify poorly performing cows as potential culls.