The used cow market

Good ranchers regularly cull their cow herd, taking out the older, less productive cows and replacing them with some of the best females held back from their latest calf crop. This is the approved, recommended method for keeping a strong, profitable cow herd.

The best ranchers are mercenary: if a cow fails to breed one year, or loses her calf prior to birth, she is gone. Tragically, ranchers fall in love with certain of their cows and give them a second chance. The cost of carrying an open cow for a year, with no calf born to sell and offset the cost, negates such a soft-hearted decision.

Most cows are productive for 8 or 9 calves in their life. It is not cost effective to baby them along beyond this point, and almost always better to have a younger, more vital cowherd. All it takes is one drought, storm disaster or sickness plague, and the younger the cow herd, the better you weather it.

Cows do have salvage value, which it is very much in the rancher's interest to maximize. They'll bring more when you cull them at a younger age and they're fleshier. Skinny, old cows bring less per pound than ones that are in better shape. There are people who buy so-called "short term cows," planning on only getting one calf out of them, so if you cull them when they still have a calf raising possibility, they'll bring a better price than they will for slaughter.

Other buyers will take cows that are still in decent shape, and feed them on corn stalks or some other cheap feed for a month or two and make a profit on the gain. This is an equally mercenary proposition, because only a limited amount of added weight will bring back more money than the cost of the feed. Old cows are less efficient converters of feed to pounds than young steers or heifers.

Most of the ground beef served at fast food restaurants like McDonald's, the school lunch program and other government feeding programs is from culled cows, either beef or dairy. So is the imported grinding beef they use to fill out the nation's hamburger supply, when the U.S. doesn't produce enough on its own.

There is more to this business than meets the eye.