February 2023 Hereford World
The voice of the American Hereford Association | February 2023
Rethink, Renew and Reshape
Building back from drought offers individuals and the industry a unique opportunity. by Wes Ishmael
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ooner than later, hopefully, cow-calf producers will have enough moisture in the ground and enough feed on the horizon to begin rebuilding herds stripped to the core by the current long-term drought. If they do, how producers go about it will drive how high prices go and for how long. It could also change the complexion of individual herds and the industry. Some lessons from the past apply, as do some cautions. Perhaps, the primary caution is as obvious as it will be tempting: high prices. “Grass turns green, streams run, ponds fill, and we lose our minds,” says Rick Machen, the Paul C. Genho Endowed Chair in Ranch Management at the King Ranch Institute for Ranch Management (KRIRM), Kingsville, Texas. He remembers the last historic price surge in 2014-15, which was also the result of a cow herd depleted by widespread, longterm drought. Five-weight calves bringing well beyond $200 per
hundredweight (cwt.) was a common sight. For a brief period, they brought $300 cwt. and a little more. “People were paying more for commercial females than they could ever hope to pencil out. Prices returned to normal more quickly than many anticipated,” Machen says. Economic pain associated with purchase decisions lingered longer. “Those high-priced heifers are going to be on your depreciation schedule for five years. That’s a real cost they burden you with,” Machen says. Stan Bevers, Vernon, Texas, a ranch consultant and Professor and Extension Economist Emeritus with Texas A&M University remembers those same pricey heifers. “Half of them were gone from the herd in the first three years, and depreciation went through the roof. Everyone and their dog started selling bred heifers, and the quality declined. It would have continued on page 16...