The relative value of breeding cows

By: James Mitchell, University of Arkansas

Many analysts expect the cattle industry to increase its cattle herd size in 2025. This will only be confirmed with the release of the January 2026 cattle herd size report. As herd expansion begins, replacement heifers and breeding cows become increasingly valuable. As expected, replacement heifer and breeding cow prices correlate with beef cattle prices.
Cows that are open but otherwise healthy can enter two marketing channels: cull cows or breeder cows. In most cases, cows leaving a cow-calf operation are sold as open cull cows. However, cyclical livestock and supply dynamics lead to scenarios where the value of breeder cows exceeds the value of open cull cows due to herd expansion.
The orange line in the figure is the price of a 75-80% cull cow sold in Joplin, MO. Cull cows roughly correspond to a cow with a body condition score of 7-8, which is open but in good condition. The green line in the figure is the price of a 4-9 month old cow sold in Joplin, MO. The blue line is the price of a bred cow compared to a cull cow. A price ratio of less than one means a cow is worth more than an open cull cow. A price ratio of more than one means the value of the bred cow dominates the value of the cull cow.
The figure shows that both cull cow and breeding cow prices are increasing. Cull cow prices are increasing due to lower cattle slaughter in 2024 and lower numbers of cull cows. Breeding cow prices have increased as some farms are moving to increase their herd sizes. An increase in the price ratio means that breeding cow prices have increased faster. This increase in the ratio is a function of what stage of the cattle cycle the industry is in.

The markets

There is a tendency for calf prices to experience a summer slump in May and June, and that may be partially true. In the Southern Plains, prices for 500-600 pound steers have declined 7 percent over the past two weeks. On the other hand, beef cattle prices rise seasonally through the summer before peaking in August. In the Southern Plains, prices for 700-800 pound steers have held steady at $260 per hundredweight over the past three weeks. Prime beef box prices rose 1 percent last week and are 13 percent above last year’s prices.

Grazing conditions