Beef on Dairy News

The Balancing Act Behind Beef-on-Dairy Carcass Size

Fri, 29 May 2026 15:57:30 GMT

The beef industry continues pushing cattle to heavier weights, and according to Warren Rusche, extension beef feedlot specialist at South Dakota State University, the reason comes down to economics.

During a Beef-on-Dairy Dialogue webinar presented by I-29 Moo University, Rusche explained that feedyards are adding more pounds because it is one of the few ways to stay profitable with today’s historically high feeder cattle prices. Using USDA data dating back to the 1960s, he pointed out that average carcass weights have increased by roughly 4.5 lbs. per year.

“This is maybe as consistent of a trend in the beef business as any,” he says. “We have continuously increased the size of the carcasses that we’re selling.”

Rusche says the economic incentive behind heavier cattle is straightforward. Feedyards are paying more for calves, and adding extra weight helps spread those costs over additional pounds of beef.

“As we added cattle, as we put cattle on feed and made them heavier and fatter, we made more money. Period,” Rusche says. “That to me in a nutshell is what is driving this.”

Feedyards are Feeding Cattle Longer than Ever

Rusche shared results from a long-term feeding study evaluating Angus, Limousin and Lim-Flex influenced cattle. Steers fed for 270 days reached roughly 1,750 lbs. live weight, with carcasses exceeding 1,000 lbs. While those weights may sound extreme, he says they are becoming increasingly common in commercial feeding systems, especially across the Upper Midwest.

“I talked to a friend of mine when we were going to take these steers out to around 1,700 lbs., and he said, ‘Well, that’s not so terribly big,’” Rusche says. “In today’s feeding world, especially here in the Midwest, it’s really not.”

He says many feedyards have reached the conclusion that heavier cattle simply pencil better financially.

“When I start looking at what feeder cattle are worth today, the only way they make sense is I need to be farther to the right of this chart than to the left,” Rusche says. “If we’re going to be profitable feeding these very valuable cattle coming into the yard, we have to add more weight to them.”

Rusche says beef-on-dairy cattle fit well into the industry’s push for heavier, high-quality carcasses when genetics and management line up correctly. He pointed to one beef-on-dairy carcass used during an Alta Genetics tour stop as an example of the type of product feeders and packers want.

“[The beef-on-dairy ribeye] is an easy ribeye to sell,” Rusche says. “It’s the right size. It’s the right shape. It’s got plenty of marbling.”

He says those cattle work especially well for higher-end foodservice markets looking for consistent steak quality.

“That’s going to find a home on a lot of white tablecloth kind of beef orders,” he says.

Bigger Cattle are Creating New Management Challenges

Although heavier cattle improve revenue potential, Rusche says they also create significant management challenges inside feedyards and packing plants. One concern is simply handling cattle of that size safely.

Transportation and bruising are becoming larger concerns as well. According to data from the National Beef Quality Audit, bruising has increased in recent years. Rusche says only about half of carcasses evaluated in 2022 were free of bruises, compared to roughly three-fourths in 2011.

Larger cattle also place more stress on feet and legs, especially in muddy lots or crowded facilities. Heat stress becomes another concern as cattle get bigger and fatter.

“I worry about some of these very large, heavy black-hided cattle and how well they deal with some of those first few heat events,” he says.

Late-term death loss is another growing challenge, particularly with the value of fed cattle today. Rusche says losing a finished steer late in the feeding period creates a major financial hit after months of feed and labor investment.

“When we lose a $4,300 steer at the very end, that is a painful cost on that closeout,” Rusche says.

Early Calf Care Could Affect Feedlot Performance Months Later

Rusche believes early-life calf management will play a major role in reducing health problems later in the feeding period. During the discussion, Rusche highlighted the importance of strong colostrum management, ventilation and protecting lung health early in life.

“Managing lung health early is critically important,” he says. “If they’re having some challenges at 1,250 or 1,300 lbs., it is not going to get better.”

Researchers are also exploring whether longer forage-based growing periods could help cattle stay sound longer and reduce digestive challenges later in the feeding phase. In one SDSU study involving beef-on-dairy cattle, calves were fed a higher-forage diet for either 28, 56 or 84 days before transitioning into finishing diets.

The cattle fed forage longer were leaner and less efficient, but Rusche says there may still be value in those systems if they reduce death loss.

“If I wanted to make up a $19-a-head deficit, I need to cut death loss at the end by half a percent,” he says. “We’re only talking in a 200-head pen, one animal dying or not dying.”

Rusche also believes the industry may revisit grazing systems or longer backgrounding periods to help cattle build frame before entering high-energy finishing programs.

Beef-on-Dairy Genetics are Becoming More Targeted

Rusche says beef-on-dairy breeding decisions have become far more intentional over the past few years.

“We’ve moved past the era of, ‘Tell me what you have in the tank that’s cheap and black,’” he says.

Instead, producers are focusing more heavily on carcass quality, growth, muscling and market fit when selecting beef sires for dairy cows. Rusche expects Angus genetics will likely remain dominant because of availability and market acceptance, though other breeds and composite systems continue gaining interest.

Despite the challenges tied to larger cattle, Rusche does not expect carcass weights to shrink anytime soon. Tight beef cow numbers and strong beef demand continue pushing the industry toward more production per animal.

“There’s going to be a need to increase carcass weight because we still have really strong beef demand but less numbers of cattle that we have to meet that,” he says.

Still, he emphasized the industry cannot sacrifice eating quality in the pursuit of pounds.

“We cannot go backwards on product quality,” Rusche says. “What’s been helping lift all these boats has been consumer demand.”

As beef-on-dairy cattle continue making up a larger share of the fed cattle supply, decisions around genetics, growth and carcass size will remain under the spotlight. Producers may continue pushing for more pounds and more value per animal, but Rusche believes long-term success still comes back to balancing efficiency with consumer expectations. In a market driven by strong beef demand, producing heavier cattle only works if the eating experience keeps consumers coming back to the meat case.

The Great Right-Sizing: DFA’s Corey Gillins on the Future of U.S. Dairy Consolidation

Fri, 29 May 2026 12:49:17 GMT

According to Corey Gillins, chief milk marketing officer for Dairy Farmers of America (DFA), the dairy industry isn’t just changing — it is right-sizing. In a recent candid conversation, Gillins laid out a roadmap of an industry in the midst of a profound transition. It is a story marked by a sobering decline in the number of farm families, but countered by a resilient surge in efficiency, strategic diversity and a sophisticated approach to risk the industry has never seen before.

The Numbers: A Story of Consolidation and Scale

The shift in DFA’s membership over the last five years tells a stark story of consolidation. In 2021, the largest dairy cooperative in the U.S. represented approximately 6,500 member-owners. Today, that number has tightened to 4,600. Looking ahead, Gillins doesn’t see the trend slowing; he forecasts that within the next five years, the number of member farms will likely fall below 4,000.

However, Gillins is quick to point out this is not a story of a dying industry, but rather a consolidating one. While the number of farmers is decreasing, the cows are simply moving to different barns. Five years ago, the average DFA herd size was 375 cows. Today, it has jumped to surpass 500.

“We’re not losing dairy cows,” Gillins notes. “We’re losing dairy farmers. But those who stay in the business have a tremendous opportunity ahead because global demand for dairy protein is incredibly strong.”

The Beef-on-Dairy Exit Strategy

Perhaps the most fascinating shift Gillins identified is how the beef-on-dairy trend has fundamentally changed the way farmers retire. Historically, exiting the dairy business was often a somber, forced conclusion — a result of running out of equity or running out of steam. Today, high beef prices have turned the exit into a strategic, profitable lifeline.

“I know of several farms that have pivoted to breeding 100% of their cows to beef,” Gillins shares. “Their strategy is simple: ‘I’m going to capture every bit of profit from these high-value black calves, and when I run out of cows, I’ll be done.’”

With both milk cow prices and beef-cross calf prices at historic highs, producers finally have the leverage to write their own plan. Whether they choose to ride the wave a few years longer or sell the herd while the market is peaking, the beef-on-dairy phenomenon has provided a dignified, lucrative exit ramp that didn’t exist a decade ago.

The Geography of Growth: Winners and Sunsets

The rightsizing of the industry isn’t just happening in the ledger books; it’s happening on the map. Gillins points to specific pockets of excitement where processing capacity has unlocked the ability to grow. Michigan and New York have seen a resurgence because new processing plants have created a home for additional milk. Meanwhile, the Texas Panhandle and southwest Kansas continue to be magnets for large-scale production.

Surprisingly, a new frontier is emerging in the Southeast.

“We’re seeing a real desire to grow in southern Georgia and northern Florida,” Gillins says. “That’s a big change from five years ago. Shifts in other agricultural categories are making land and feed more available for dairy in those areas.”

However, the sun is beginning to set on other traditional dairy hubs. New Mexico has seen a significant decline, and California remains a constant challenge. In the Golden State, producers are faced with a combination of regulatory hurdles nd skyrocketing costs. As fluid milk plants remain near urban centers, the cost of moving milk over longer distances is creating a geographic squeeze that is hard to overcome.

The $13,000 Hurdle: Inflation and Labor

Even in growth-friendly areas, two massive roadblocks stand in the way: labor and inflation. Labor remains the undisputed No. 1 concern for producers. The crisis has reached a point where it is actively stifling expansion. Gillins recalls a producer with two large, successful dairies who recently passed on a third location — not because the economics didn’t work, but because he couldn’t guarantee he could find the people to milk the cows.

“Labor is huge,” Gillins says. “Without a reliable pathway for the workers our farmers rely on, growth remains a high-risk gamble.”

Compounding the labor shortage is the staggering cost of modern infrastructure. Pre-COVID, building a new dairy was a significant investment; today, it is a monumental one. Gillins estimates building a green site dairy now costs between $10,000 and $13,000 per head. At those prices, there is zero room for error.

The Shield: Sophisticated Risk Management

Because the stakes are so high, average management is no longer an option. This has led to a revolution in risk management. Ten years ago, a farmer might have hedged their milk price but left their feed costs to the mercy of the market. In 2026, that is a recipe for disaster.

“Many of our members are getting incredibly sophisticated,” Gillins explains. “They aren’t just looking for the cheapest cost; they are looking to eliminate volatility.”

Modern risk management is now a two-sided equation. Producers are using DFA’s risk management teams to lock in margins by hedging both the milk check and the input side — fuel, feed and fertilizer.

“It’s about knowing your costs 12 months down the road,” Gillins says. “If you can lock in a margin that works, you take it. You can’t budget on hope anymore.”

The Bottom Line: Resilience and Honor

Despite the decline in farm numbers and the jarring costs of doing business, Gillins remains bullish on the American dairy farmer. The great rightsizing happening on farms all across the U.S. is creating a leaner, smarter and more efficient industry.

“The diversity of our membership is our strength,” Gillins concludes. “Whether it’s the small Amish and Mennonite farms in the Northeast that ‘hang in there’ through every cycle or the 10,000-cow innovator in the Southwest, there is a place for everyone who is willing to adapt.”

The honeymoon of easy premiums may be over, but the marriage between innovation and grit is stronger than ever. For the modern producer, the message is clear: the industry is getting smaller in numbers, but it is growing in its ability to feed a hungry world with precision and honor.

The Future of Beef-on-Dairy: What Happens When $1,200 Calf Prices Drop?

Thu, 28 May 2026 13:04:31 GMT

Editor’s Note: This is one article in a series that is included in the 2026 Farm Journal’s State of the Dairy Industry report. The full 16-page report will appear in the May/June issues of Dairy Herd Management and Milk Business Quarterly and will be published in this space over the next several weeks. To download the full report for free click here.
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For the last several years, the beef-on-dairy trend has felt like a gift from the heavens. In a world of volatile milk checks and rising input costs, the ability to turn a low-value Jersey or Holstein bull calf into a high-value beef cross was the ultimate easy button for profitability. Producers called it a honeymoon — high premiums, easy sales and a massive boost to the bottom line with very little extra effort.

But our recent deep dive in the Farm Journal State of the Dairy Industry Report illustrates the honeymoon phase has officially ended. We’ve entered the era of beef-on-dairy 2.0, and the rules of the game have changed.

Our data reveals a critical shift is unfolding. The gold rush mentality is being replaced by a calculated, data-driven business strategy. While the total number of producers using beef genetics has dipped slightly, the complexity of the operations that remain is skyrocketing.

Here is how this new era is redefining the dairy-beef landscape:

From Any Black Calf to Data-Backed Value

In the honeymoon phase, as long as the calf was black, it brought a premium. In 2026, the feedlots and packers are getting pickier. The report shows a 5-point increase in the collection of vaccination information since 2025.

Packers no longer just want a crossbred animal; they want a verified animal. Producers are realizing that to maintain their premiums, they must provide a “passport” for every calf — health records, vaccination history and genetic proof.

The Retreat from Vertical Integration

One of the most telling findings in the 2026 report is fewer operators are retaining ownership of the supply chain or selling branded beef products.

A few years ago, the dream was vertical integration — breeding the cow, finishing the steer and selling the steak. The reality of 2026 has set in — finishing cattle and marketing beef is a different business with different risks. Producers are pulling back to what they do best, with the majority now choosing to sell wet cross calves within the first week.

(Farm Journal)

A Strategic Tool for Succession

Interestingly, the report finds producers with beef-on-dairy operations are more likely to have plans to bring in a partner or family member.

This suggests beef-on-dairy has evolved into a succession tool. By diversifying the revenue stream and adding a beef component, older operators are creating a more lucrative and attractive business for the next generation. It’s no longer just about a quick check; it’s about building a multi-generational business model that can withstand extreme market volatility and shrinking margins.

The 50% Threshold

While the hype might suggest every cow is being bred to beef, the data shows a more disciplined approach. Most producers are still breeding less than one-half of their herd to beef. However, over one-quarter of producers plan to increase their beef-on-dairy usage in the next three to five years. This indicates while the honeymoon is over, the marriage is solid. Producers are committed to the strategy, but they are becoming more surgical about which cows get the beef straw.

The New Standard

The perfect storm described by Curtis Bosma with High Ground Dairy has permanently moved the goalposts. As our industry moves into 2026, the average cow is being replaced by a specialized asset. Whether it’s through the $1,200-plus rebate or the data-backed verification required by packers, beef-on-dairy 2.0 is the new standard.

“There are cows in the herd today that might not economically deserve a spot based on their milk production alone,” Bosma says. “But farmers are keeping them because they are pregnant with a black calf. It’s essentially a rebate.”

For the modern producer, the message is clear: the honeymoon might be over, but the marriage between beef and dairy is the strongest pillar of support the industry has in an increasingly uncertain world.

NMPF’s Gregg Doud on the Future of Dairy: Trade Enforcement, Biosecurity and the $11 Billion Boom

Fri, 22 May 2026 17:10:23 GMT

For decades, the narrative of U.S. dairy was defined by survival — a gritty endurance test marked by consolidation and shrinking margins. But today, the hum of the milk parlor is being joined by the roar of a massive industrial renaissance. Across the heartland, a quiet revolution is unfolding as state-of-the-art processing facilities rise from the dirt, fueled by a staggering $11 billion-plus investment in new capacity. This isn’t just an expansion of the status quo; it is the birth of a sophisticated global protein powerhouse. The industry has moved far beyond the kitchen table, evolving from a local commodity into a high-stakes pillar of international food security, ready to feed a world with an insatiable appetite for U.S.-made nutrition.

At the center of this transition is the National Milk Producers Federation (NMPF), led by president and CEO Gregg Doud. With a background as a former chief agricultural negotiator, Doud views the dairy sector through the lens of global trade and industrial policy. He describes this era as a period where the industry is reinventing its economic foundation through innovation, genetic strategy and a newfound cultural relevance.

The $11 Billion Momentum

The most visible evidence of this revolution is the sheer scale of investment in processing. From the Texas Panhandle to the Upper Midwest, the $11 billion infusion into new plants is a bet on the future. These facilities are designed to turn raw milk into high-value powders, proteins and fats that can be shipped anywhere in the world.

“This is a billion-dollar success story that is happening quietly,” Doud notes.

The surge in capacity is a direct response to a fundamental shift in consumption. The industry is moving away from a reliance on fluid milk and toward a diversified portfolio of dairy products. This infrastructure ensures when the global market calls for U.S. dairy, the industry has the pipes in place to deliver.

The TikTok Effect and the Protein Pivot

While infrastructure provides the hardware, consumer trends are providing the software for this growth. One of the most unexpected drivers of the dairy renaissance is what has been dubbed “The TikTok Effect.” In an era where digital trends move at lightning speed, dairy has found a second life among younger demographics. Viral recipes featuring cottage cheese, high-fat butter and Greek yogurt have rehabilitated dairy’s image, positioning it as a superfood for the modern, health-conscious consumer.

The data supports this cultural shift. Domestic consumption of dairy fats and proteins is hitting record highs. However, the growth isn’t limited to the U.S. border. Nearly 18% of all U.S. milk production is now exported. The U.S. dairy farmer has effectively transitioned into a global protein provider, feeding a world that increasingly views dairy as an essential part of a high-protein diet.

The Beef-on-Dairy Paradigm Shift

Innovation isn’t just happening in processing plants; it’s happening in the genetics of the herd. The beef-on-dairy trend has emerged as a critical economic hedge for producers.

This strategic shift provides a secondary revenue stream that helps insulate farms from the traditional volatility of milk prices. It is a sophisticated management of genetics and markets that allows dairy operations to function more like diversified protein businesses. In Doud’s view, this synergy between the dairy and beef sectors is a testament to the industry’s adaptability and its ability to find value in every aspect of the operation.

Trade Enforcement and USMCA

With his background in international trade, Doud is uniquely positioned to guide the industry through an increasingly volatile global landscape. A cornerstone of this strategy is the enforcement of the United States-Mexico-Canada Agreement (USMCA). For the U.S. dairy industry, USMCA is more than just a trade deal; it is a vital framework for market access that requires constant vigilance.

Doud has been vocal about the friction with Canada regarding their dairy obligations, particularly the administration of tariff-rate quotas (TRQs). He highlights this issue has reached the highest levels of government.

“I can tell you from my experience, the U.S. Trade Representative, Jamieson Greer, knows this issue of dairy in Canada very well,” Doud says. “I know the president is aware that there is a big issue with Canada and dairy. This is going to be a really difficult conversation with Canada. I think it’s going to be sorted out at the top, and that’s going to be later on.”

For U.S. producers to thrive, these rules of the road must be followed. Doud’s approach is one of firm diplomacy, ensuring the market access promised in trade agreements translates into actual sales for American farmers.

Biosecurity and the Screwworm Threat

As the industry looks toward global expansion, it also faces emerging biological threats that could jeopardize the progress made in the livestock sector. One of the most pressing concerns on the horizon is the southward threat of the New World screwworm (NWS). This devastating parasite, which was eradicated from the U.S. decades ago, has seen a resurgence in Central America, moving through Panama, Costa Rica and into Nicaragua.

Doud emphasizes the importance of maintaining the flow of commerce even in the face of such a threat. Regarding the potential arrival of the parasite, Doud stated:

“We have to see and work with USDA and APHIS on the protocols, assuming this thing crosses the border with regard to the transportation of cattle, etc. We have a lot of dairy heifers and newly freshened dairy heifers in the Texas Panhandle. I hope that thing doesn’t get that far north, but if it does, we want to make sure that we have the protocols so we can still move these where we need to move them.”

For an industry increasingly reliant on the beef-on-dairy pipeline, the reintroduction of the screwworm would be catastrophic. It threatens animal health, increases production costs and could trigger severe trade restrictions. Doud and the NMPF are working closely with federal authorities to ensure biosecurity measures and eradication efforts in the region are fully funded and prioritized. Protecting the U.S. border from this pest is not just a veterinary issue; it is a vital economic priority for the entire livestock value chain.

Ultimately, the transformation of U.S. dairy is the story of an industry that refused to be left behind. By leaning into its new role as a global protein leader, the sector has effectively decoupled its future from the limitations of the past. The massive infrastructure investments, the strategic genetic shifts and the high-stakes trade diplomacy are all parts of a single, unified engine driving the industry forward. As the quiet revolution continues to gain volume, it is clear U.S. dairy is no longer just responding to the world’s needs — it is shaping them. With a steady hand on the tiller of trade and a watchful eye on biosecurity, the industry is poised to turn this era of investment into a legacy of global dominance.

Replacement Cow Prices Hit Records, Heifer and Beef-on-Dairy Calf Values Stay Strong

Thu, 14 May 2026 16:40:13 GMT

Replacement cattle prices continue running at historically strong levels as dairy producers continue paying premium prices cross the market. From replacement cows to springing heifers and beef-on-dairy calves, values remain well above year-ago levels across much of the country.

Replacement Milk Cow Prices Hit Records

Milk cow prices continued climbing in April 2026, according to the latest USDA estimates. The national average price for milk cows sold for dairy herd replacement reached $3,130 per head, up from $2,980 in January and $2,860 one year earlier.

Several major dairy states posted even stronger numbers. Michigan averaged $3,360 per head, Wisconsin reached $3,320 and Iowa climbed to $3,300. Minnesota, Colorado, Florida and Vermont all landed near $3,200 per head.

State	April 2025	January 2026	April 2026
Arizona	2,900	$,200	3,400
California	2,700	2,800	3,000
Colorado	2,700	3,000	3,200
Florida	2,900	3,100	3,200
Georgia	2,730	2,990	3,090
Idaho	2,850	2,900	3,150
Illinois	2,730	2,930	3,050
Indiana	2,880	3,040	3,080
Iowa	2,960	3,150	3,300
Kansas	2,550	2,900	3,040
Michigan	3,070	3,220	3,360
Minnesota	2,810	3,050	3,200
New Mexico	2,500	2,800	2,950
New York	3,050	3,080	3,130
Ohio	2,930	3,040	3,070
Oregon	2,900	2,900	3,100
Pennsylvania	2,860	2,980	3,040
South Dakota	2,600	2,840	3,000
Texas	2,800	2,850	3,000
Utah	2,600	2,700	3,000
Vermont	2,970	3,100	3,200
Virginia	2,760	2,950	3,090
Washington	2,900	2,750	2,950
Wisconsin	3,130	3,170	3,320
U.S.	2,860	2,860	3,130

The strong market reflects ongoing pressure on replacement supplies. As more dairy producers breed cows to beef genetics, fewer traditional dairy replacements are entering the pipeline, making quality milk cows harder to find.

Heifer Prices Remain Strong

Replacement dairy heifer prices continue to run at historically strong levels, although some markets are beginning to show signs of leveling after the rapid climb seen over the past year. Top quality Holstein springers are regularly bringing between $3,500 and $4,400 per head, with many sales topping the $4,000 mark.

Withee, Wis. - May 6, 2026

Heifer Category	Weight / Type	Price Range ($)
Top Quality Springing Heifers	—	3,500 – 4,400
Common Springing Heifers	—	3,475 and Down
Holstein Short Bred Heifers	—	2,250 – 3,500
Holstein Open Heifers	300# – 500#	1,250 – 2,200
Holstein Open Heifers	500# – 700#	1,500 – 2,375
Holstein Open Heifers	700# – 850#	1,750 – 2,500

Medium quality springers are commonly selling from around $3,000 to $3,500, while short bred heifers continue bringing strong prices depending on quality and stage of pregnancy.

Turlock, Calif. - May 8, 2026

Category	Price Range ($)
Top-Quality Holstein Springers	3,600 – 4,300
Medium-Quality Holstein Springers	2,950 – 3,500

Open Holstein heifers are also selling at levels well above historical averages. Larger heifers nearing breeding age have reached as much as $2,500 per head in recent sales. While some markets have started to level after the sharp run higher over the past year, demand for replacement heifers remains aggressive in many regions.

Pipestone, Minn. - April 16, 2026

Category	Price Range ($)
Top Springing Heifer	4,250
Top 10 Springers	4,250
Top 25 Springers	4,200 – 4,250
Top 50 Springers	4,135 – 4,250
Top 100 Springers	4,100 – 4,250
Top 150 Springers	3,975 – 4,250
Top 200 Springers	3,500 – 4,250

Beef-on-Dairy Calf Prices Continue to Climb

Beef-on-dairy calves continue to generate strong interest from calf growers and feeders, helping support high prices across multiple weight classes. Recent sales showed beef-cross calves bringing between $17 and more than $23 per pound on a liveweight basis.

Cherry Creek, N.Y. - April 22, 2026

Calves	Low Price per lb. ($)	High Price per lb. ($)
Heifer Calves	8.2	10
Grower: Over 92#	13	15.2
Grower: 80# to 92#	13	16.5
Beef-Type Calves	17	23.2

Prices for older beef-on-dairy feeder cattle also remain strong, with several weight groups of heifers and steers bringing solid values in recent sales.

Turlock, Calif. - May 8, 2026

Weight Range (lb.)	Heifers Price Range ($)	Steers Price Range ($)
300 - 399	NO TEST	NO TEST
400 - 499	360.00 - 400.00	375.00 - 400.00
500 - 599	345.00 - 385.00	350.00 - 375.00
600 - 699	NO TEST	NO TEST
700 - 799	NO TEST	NO TEST
800 - 899	235.00 - 297.50	NO TEST

Market Shows No Sign of Easing

Replacement cattle prices are holding at strong levels across milk cows, heifers and beef-on-dairy calves, and most producers are still having to pay up to secure the animals they want. Beef-on-dairy calves remain a bright spot for many dairies, but that same trend keeps pulling more animals out of the dairy replacement pipeline, which adds pressure on heifer availability. With supplies still tight and demand steady across all classes of cattle, there is little indication replacement costs will ease anytime soon.

Beef-on-Dairy Calves May Scour Less than Holsteins, New Research Shows

Mon, 11 May 2026 18:44:36 GMT

Beef-on-dairy calves have long been a solid income stream on many dairies, turning into a steady payout when they leave the farm and move into beef systems. More recently, farmers have also started to notice these calves often require fewer individual health treatments than their purebred counterparts, adding to their overall profitability.

Researchers like Melinda Kovacs, a master’s student at the University of Guelph, have started to take a closer look at how these calves perform early in life, when most health challenges tend to show up. One pattern that keeps surfacing is that crossbred calves tend to have fewer digestive issues than Holsteins, especially scours.

In her work, Kovacs found beef-on-dairy crossbred calves have lower diarrhea rates, fewer days with scours and fewer repeat treatments than Holsteins during the rearing phase.

“Producers were finding that the health of these crossbred calves was improved,” Kovacs explained during a recent “The Dairy Health Blackbelt Podcast” episode. “They were finding less health challenges, or these animals were able to recover from disease a little bit better than the purebred calves.”

Fewer Scours Cases Stand Out

The study followed approximately 640 calves housed at a single calf-rearing facility over about 18 months. Kovacs analyzed records from 446 Holstein calves and 194 beef-on-dairy crossbred calves.

Using twice-daily health scoring, Kovacs and her team monitored diarrhea and respiratory disease while also collecting weekly body weights, milk intake and starter feed intake data.

When she compared the two groups at the conclusion of the study, one health challenge stood out immediately.

“We found that the Holstein calves had a higher incidence of diarrhea compared to the crossbred calves,” Kovacs says. “We also found that translated to fewer days with diarrhea.”

Beef-on-dairy calves_Suanne Blackwell

(Suanne Blackwell)

The same trend appeared when she evaluated severe diarrhea cases.

“This is what we were expecting based on kind of our communication with producers,” Kovacs says. “That the crossbred calves would have less diarrhea in the preweaning or the rearing phase.”

For dairy farmers and calf raisers, fewer scours cases can influence nearly every part of calf performance. Diarrhea remains one of the most expensive calfhood diseases on dairies due to treatment costs, lost growth, labor demands and long-term health setbacks.

Crossbred Calves Needed Fewer Repeat Treatments

Kovacs also examined therapeutic interventions and found another difference between the groups.

“We did find that the Holstein calves had a higher hazard of being treated multiple times for both diarrhea and respiratory disease,” she says.

Respiratory disease rates themselves were similar between breeds, but the need for repeated treatment was higher in Holsteins. That finding could become more important as dairy and calf-rearing operations focus on reducing antibiotic use while still keeping calves healthy and performing well.

“Perhaps there’s a greater ability of these crossbred calves to recover from diseases compared to Holstein calves,” Kovacs adds.

Why Are Beef-on-Dairy Calves More Resilient?

(Farm Journal)

The study wasn’t designed to pin down exactly why the differences are showing up, but Kovacs thinks genetics likely play a role.

“In the dairy industry, we see a lot of inbreeding depression with the Holstein animals,” she says. “And I think perhaps we have some heterosis or hybrid vigor in these crossbred animals.”

Selection pressure may also contribute to the performance gap. Dairy genetics have focused on milk production traits, while beef genetics have emphasized growth and muscling.

“In the dairy industry, we’ve been genetically selecting for obviously higher milk production, whereas in the beef industry, we’ve been selecting for more growth traits,” Kovacs says. “So perhaps these crossbred calves are benefiting from the growth traits compared to the Holstein calves.”

She also found crossbred calves gained weight faster during the rearing phase.

“The crossbred calves did have higher growth rates, so higher average daily gains,” Kovacs says. “They were about [15 lb.] heavier than the Holstein calves when they were finished this rearing phase.”

Differences Continued Through Harvest

Kovacs and her team later expanded the project to follow some calves from birth through harvest at approximately 13 months of age. She wanted to better understand how calfhood health and management influence later feedlot and carcass performance.

Beef_carcasses

“Right now, there’s kind of a big disconnect between all of the different components of the industry, between the dairy farm of origin, the rearing, the feedlot and the abattoir,” Kovacs says.

The performance differences continued beyond the early rearing phase.

“The crossbred calves, I believe, were about [120 to 124 lb.] more in body weight compared to the Holsteins,” Kovacs says. “Which does have significant implications in terms of the cost benefit of these animals.”

She also identified differences in ribeye area and carcass composition, suggesting the advantages weren’t limited to early growth but carried through to how the animals finished at harvest.

More Research Still Needed

Even with the encouraging results, Kovacs says dairy producers should not assume crossbred calves require less attention or lower-quality care.

“With my findings, we see that they’re maybe more resilient or robust,” she says. “But I think those producers still need to be offering the best care to those calves to ensure their success.”

Kovacs adds that much of the existing calf research has historically focused on purebred Holsteins, leaving major knowledge gaps around nutrition and management requirements for beef-on-dairy calves.

“A lot of research that’s been done in the past has focused on purebred Holstein calves,” Kovacs says. “So, we don’t really know if the requirements of these crossbred calves for both maintenance and growth are the same as for a purebred Holstein calf.”

As beef-on-dairy programs continue to expand across the dairy industry, producers are paying closer attention to which calves stay healthier and perform better from start to finish. This research suggests fewer scours cases early in life may be part of the advantage, adding to the overall profitability of beef-on-dairy calves.

For more on beef-on-dairy, read:

The Packer’s Dream: How Beef-on-Dairy is Solving the $2 Billion Consistency Problem

Wed, 22 Apr 2026 13:13:05 GMT

When Brad Kooima of KKV Trading spoke to “AgriTalk” in late January, he described beef-on-dairy as the “gorilla in the room.” But it wasn’t just the volume that caught his attention; it was the control.

“For the first time, you got an integrator that has the ability to control that thing from its birthday and schedule it out 341 days later that we’re going to slaughter that thing,” Kooima said. “Once a dream that the packers chased.”

That dream is now a reality, according to data presented at this year’s High Plains Dairy Conference. For decades, the beef industry has struggled with the fragmented nature of the native cow-calf sector — thousands of small herds with different genetics, different calving seasons and massive variability at the rail.

Ending the War on Variability

Lauren Kimble, manager of ProfitSOURCE Supply Chains for Select Sires, Inc., highlighted the greatest strength of the beef-on-dairy movement is its ability to kill variability.

“I care deeply about consistency ... variability is the enemy,” said Sidney Abbot of OT Feedyard & Research Center, a sentiment echoed throughout the conference.

The data proves why. While the total U.S. fed cattle harvest is a mixed bag of quality, program-specific beef-on-dairy is hitting 40% Prime and 59% Choice. Because these calves are born on dairies that operate like clockwork, they offer the packer something the native beef industry rarely can: Year-round market supply and uniform carcasses.

The Factory Floor of Beef

In the Texas High Plains, where over 25% of the nation’s fed cattle are processed, the shift is undeniable. Data from Laphe LaRoe of Smith Cattle Company shows while native cattle inventories are plummeting, the beef-on-dairy line is climbing.

By 2026, the dairy barn has effectively become the factory floor for the beef industry. Because a dairy cow calves every day of the year, the integrator (the dairy producer) can provide a steady, predictable stream of high-quality protein to the packer every single week. There is no calf crop season. There is only a continuous, scheduled flow.

This isn’t just a marginal gain; it is a fundamental shift in the dairy business model that allows for this factory-like precision. Ken McCarty of McCarty Family Dairy in Kansas says the transition from Holstein bull calves to high-value beef-on-dairy crosses has rewritten their balance sheet. McCarty Family Farms was recognized as the 2025 Milk Business Leader in Technology Award winner for transforming their operation into a high-tech, 20,000-cow operation driven by innovation, data and bold decision-making.

“Bull calf sales went from something that you basically ignored in your budget to something that really today accounts for, depending on the month in the market, somewhere around 50% of our overall revenue,” McCarty says.

When half of a dairy’s revenue is tied to the beef side of the barn, the producer is no longer just a milk man — they are a high-stakes beef integrator with every incentive to meet the packer’s demand for perfection.

Systems Capture Value

As Troy Marshall of the American Angus Association notes: “Genetics create potential. Systems capture value.”

The system is the ability to track a calf from its specific beef-sire breeding date through a standardized calf-raising program, into a professional feedyard, and onto a rail where it hits Certified Angus Beef (CAB) specs with surgical precision.

By 2026, the industry isn’t just selling cattle; it’s selling predictability. For the packer, a beef-on-dairy calf isn’t a gamble — it’s a scheduled delivery of a high-marbling, consistent product that meets the consumer’s demand every time. The gorilla in the room isn’t just big; it’s incredibly disciplined.

What’s Driving a Better Dairy Outlook in the Second Half of 2026

Tue, 21 Apr 2026 19:59:57 GMT

Milk prices started 2026 on a soft note, but the outlook has improved somewhat as the year has progressed. Futures markets now suggest slightly stronger prices later in the year, offering some optimism for dairy margins.

Still, the improvement is measured. Strong protein demand, shifting consumer habits, global trade dynamics and record beef values are all shaping today’s dairy outlook. Those same forces could also introduce volatility over the next year.

“We have a lot better story to tell today than we did a few weeks ago,” says Kathleen Wolfley, market intelligence director with Ever.Ag. “We’re looking at a market today that is significantly higher than where we were trading at the beginning of the year. Class IV prices are around $19 a hundredweight. Class III prices are around $18 a hundredweight average.”

Even with prices looking a bit better, tight budgets and higher costs are still weighing on dairy demand. During a recent Standard Dairy Consultants webinar, Wolfley and Mike North, president of the producer division at Ever.Ag, gave their take on the current economic outlook for dairy.

A Split Consumer Economy

Energy costs are emerging as one of the biggest economic pressures affecting food demand, particularly for middle- and lower-income households.

“Fuel prices are the top item I’ve been watching here in the last few weeks,” Wolfley says. “I’m in New York, so if I pay over $4 a gallon, it pinches a little bit more than it did back in February when gas prices were in the mid-$2 range.”

But when fuel gets more expensive, family budgets feel it in a hurry.

“In our estimation, it’s costing a family $30 to $40 more per week to fill the tank. That’s basically takeout for a family of four,” Wolfley says. “It’s an easy way to cut back, especially in an environment where folks are feeling pinched.”

The result is a split consumer economy.

“You have some consumers, middle-to-lower income, that consistently say, ‘Hey, I am struggling with affordability,’ versus higher-income consumers that are going to feel the pinch of these energy prices a lot less,” Wolfley adds. “They’ve been absorbing the inflation over the last few years and just kind of taking it in stride.”

That uneven spending environment creates uncertainty for dairy demand.

“I’m a bit concerned about domestic demand here in the U.S. and the ability of domestic demand to recover on the backside of all this uncertainty,” Wolfley notes.

Protein Demand Off the Charts

(Stock Photo)

If one theme defines today’s dairy markets, it is protein. Nonfat dry milk, skim milk powder and whey are increasingly tied to demand for high-protein foods and beverages.

“We’re sitting at $2.06 per pound on the CME nonfat dry milk market, Wolfley says. “That’s a really exciting move, especially for those of you that have a lot of Class IV exposure.”

But the story goes beyond price. Milk solids are increasingly moving into higher-value uses.

“There’s solids now going into cheese production or yogurt production, or into ice cream, or even into the fluid bottle that is no longer making its way into the dryers,” she adds.

Ultrafiltered milk and protein beverages are capturing a growing share of milk solids, pulling more wet solids away from traditional drying channels and into high-protein beverage production. At the same time, U.S. powder markets remain tighter than global supplies, creating added competition pressure for exporters.

“It’s really important to consider that the tightness in this nonfat dry milk market is just a U.S. issue,” she says. “In the rest of the world, they’ve got a lot of supply, and they’re making a lot of powder.”

European milk production rose about 5% year-over-year early in 2026, increasing global powder availability. With U.S. powder priced 50¢ to 60¢ above global competitors, export buyers may start looking elsewhere.

“If you’re a buyer in Southeast Asia, why would you go to the U.S. for your nonfat dry milk or your skim milk powder needs when you can buy it cheaper out of New Zealand or the EU?” Wolfley asks.

Mexico, one of the largest buyers of U.S. dairy products, may already be exploring alternatives.

“I think those Mexican buyers are now looking at alternate sources to say, ‘Can I get it cheaper out of the EU even with the freight costs? Can I go to the GDT auction and get supply that helps alleviate some of that price pressure?’” she says.

For U.S. producers, that means the current rally in nonfat prices could face pressure if exports slow.

Butter Markets Swing with Global Trade

(iStock)

Butter markets have already experienced volatility this year.

“Butter prices rallied all the way above $2 a pound to begin the month of March,” Wolfley says. “Fast forward six weeks, and we’re basically back to where we were in early February.”

The early butter rally was largely fueled by strong export demand, with significant volumes moving through the CME spot market and a steady flow of fat heading into international channels.

February butter exports totaled about 22 million lb., with a large share headed to the Middle East. But geopolitical tensions quickly disrupted that trade. As exports slowed, more butter stayed in the domestic market.

“I think that does open up more potential that we’re keeping fat in the domestic market that may have otherwise been earmarked for the international space,” Wolfley says.

Even so, retail demand has been strong.

“Butter has been crushing it. Cheap butter has allowed retailers to promote aggressively. To see the four-week average on butter and butter-blend sales up 10% is pretty astounding,” she notes.

Still, Wolfley cautions the Class IV complex faces potential downside risk if powder markets weaken or exports slow.

Cheese Markets Lean on Exports

Cheese markets tell a similar story of volatility and global competition. Wolfley points to how prices dropped sharply earlier in the year.

“We hit sub-$1.30 cheese in mid-January. Sub-$1.30 cheese is pretty dang cheap, especially when you compare it to the $1.70 to $1.80 price points at the end of October,” she says.

Those low prices encouraged stronger demand.

“Low prices tend to cure low prices,” Wolfley adds. “We’ve seen more advertising in food service, more promotional activity in retail and opportunities in the export market.”

Cheese production continues to climb, with February output up 4% compared to a year earlier. At the same time, exports have helped absorb some of that additional supply and keep the market more balanced.

“We shipped 129 million lbs. of cheese in February, 30% more than last year, a record-high volume,” Wolfley says. “At the same time, we’re importing less.”

Exports have become essential to keeping the market balanced.

“It tells me we have to stay competitive,” Wolfley says. “If we want to move that cheese, and the domestic consumer isn’t saying ‘Hey, I want a bunch more,’ it ultimately comes down to staying competitive versus the European mozzarella market.”

Price gaps between U.S. and European cheese have narrowed recently, reducing the cushion U.S. exporters have relied on to stay competitive in global markets. With that spread tightening, the risk of oversupply in the domestic cheese market increases if export demand softens.

“Without a big splash into the international marketplace, we could find ourselves with a lot of product looking for a home,” Wolfley notes.

GLP-1 Drugs Shift Dairy Demand

(Lori Hays)

Another emerging factor shaping dairy consumption is the rapid rise of GLP-1 medications used for weight loss and diabetes management.

“I joke that you can’t talk about dairy now without talking about GLP-1, because I think it is a really important piece of the puzzle,” Wolfley says. “About 12% of U.S. adults are using it today, compared to 6% in 2024.”

These drugs reduce overall food intake, with users typically consuming about 20% to 30% fewer calories, and that shift is starting to show up in dairy demand, particularly across categories tied to indulgence and higher-calorie foods.

“We’re seeing less pizza consumption because it doesn’t sit well with people’s stomachs on GLP-1. We’re seeing less ice cream consumption,” Wolfley says.

But the change is not entirely negative for dairy. Protein-rich foods are gaining traction.

“We’re seeing more cottage cheese consumption,” Wolfley adds. “There’s a big boom in cottage cheese production and investment because of opportunities to hit high protein needs. There’s also growth in yogurt and whey protein.”

The shift may ultimately move dairy demand away from indulgent products and toward nutrient dense, protein-focused foods.

Milk Production Expands

At the same time demand patterns are shifting, milk production continues to grow.

“We’ve asked for more milk in terms of processing,” Wolfley says. “We’ve added a lot of capacity in a short amount of time here in the U.S. — about $11 billion worth of investment expected between 2025 and 2030 — and producers have responded.”

U.S. milk production rose nearly 3% in February, showing continued strength in output as the year gets underway. Cow numbers are also increasing, up about 211,000 head year over year, signaling ongoing herd expansion across the industry. At the same time, productivity continues to improve.

“Every cow that’s out there is making more milk today than she was last year and the year before that, and she’s making more components,” Wolfley says.

Advances in genetics and feeding strategies are pushing component levels higher across the U.S. dairy herd. As a result, Wolfley has adjusted her production outlook, reflecting stronger-than-expected gains in milk output potential.

“If you’d asked me this question at the beginning of January, I would have said we might see contraction by the end of 2026,” Wolfley says. “I’m singing a little bit of a different tune today. I expect around 1.5% growth in milk production in 2026 compared to 2025.”

Beef-on-Dairy Income Remains Strong

(Wyatt Bechtel)

Strong beef markets have added another layer to the dairy profitability picture. What once served as a modest income source has grown significantly.

“The more crowds of producers I get in front of, the more I hear how important beef revenue is to the operation,” North says. “This went from casual spending money to something that’s much more substantive and really a big part of the overall profitability picture on a dairy.”

Revenue from beef-on-dairy has increased sharply.

“From late 2022, we estimated revenue on a per hundredweight basis of beef to the bottom line of about $1 to $1.50. Today, that number has grown to anywhere between $4.50 to $5,” North says.

Day-old beef-on-dairy calf prices reflect the strength of the market.

“Recently reported numbers coming in from out of the East Coast show $1,700 for a wet calf,” North says. “It seems insane, but the market has been going up for the better part of three and a half years.”

These high prices are sending a strong message to producers, pushing them to take a closer look at how beef-on-dairy plays a role on their operation.

“If you aren’t addressing beef prices in your operation right now, what are you waiting for? These prices are called record prices because we don’t get to touch them very often,” North says.

Managing Risk in a Volatile Environment

Feed markets add another layer of uncertainty. Large U.S. crops could keep pressure on corn prices, but geopolitical events and energy markets continue to create volatility.

For dairy producers, it’s another reminder to keep an eye on risk.

“There are plenty of headwinds that crude oil prices bring into our economy,” North says. “GLP-1s are real. We see big growth as we come through 2026. It’s going to create domestic headwinds for demand that we may not fully understand yet.”

Even with those challenges, the outlook for margins is cautiously optimistic.

“We are cautiously optimistic about margins as we look at the 2026 year,” North notes. “But we cannot overlook managing the risk around strong beef and dairy prices. The bottom line is: manage risk. It’s too volatile to just leave it to chance.”

An Industry in Transition

Taken together, today’s dairy markets reflect an industry in transition. Prices are improving but remain tied closely to global trade. Protein demand continues to reshape product markets. New consumer trends and medications are shifting how dairy is consumed.

At the same time, milk production continues to expand, beef-on-dairy revenue is strengthening farm balance sheets and risk management tools are playing a larger role in protecting margins.

The opportunity for growth remains strong. But in a market like this, North and Wolfley say it comes down to making the most of the good opportunities while keeping a handle on the risks.

The Cost of the Squeeze: Inside the Strategic Shift Reshaping U.S. Dairy

Thu, 16 Apr 2026 14:04:13 GMT

As we pull the curtain back on the first quarter of 2026, the U.S. dairy industry is presenting a paradox that has even the most seasoned market analysts leaning in. On the surface, the numbers look familiar: the national milking herd is growing. But a closer look at milk check components reveals a surprising deceleration.

According to the National Milk Producers Federation (NMPF) Dairy Market Report released on March 30, 2026, “while the milking herd continues to grow, component growth surprisingly decelerated to start 2026, indicating that producers are responding to strong economic incentives from beef-on-dairy but not pushing for maximum milkfat tests with the fall in butter prices.”

This isn’t a fluke of biology; it’s a calculated business pivot. We are witnessing a strategic shift where producers are weighing the cost of the squeeze against the reality of the global market.

The Beef-on-Dairy Influence

The primary driver behind this deceleration is the sheer economic gravity of the beef-on-dairy market. In 2026, the incentive to produce a high-value crossbred calf has, in many cases, outpaced the incentive to push for that extra tenth of a point in milkfat.

Curtis Bosma with HighGround Dairy told “AgriTalk” host Chip Flory earlier this year that there are cows in the herd today that might not economically deserve a spot based on their milk production alone.

“But farmers are keeping them because they are pregnant with a black calf. It’s essentially a rebate that keeps the cow in the stall until that calf arrives,” Bosma says.

Producers are making a sophisticated management choice: If the butterfat market is softening, why invest in high-energy, higher-cost rations required to maintain record-breaking tests? Instead, they are diverting that management focus toward the black ink provided by the beef-cross side of the ledger. It is a vivid example of the margin revolution in action — producers aren’t just chasing production; they are chasing the most efficient path to profitability.

The Not-So-Burdensome Supply

Normally, a growing herd combined with heavy milk production would be a recipe for a market glut and burdensome inventories. Yet, as we move through early 2026, the warehouses aren’t overflowing. While component production remains at record highs, the market feels tight because surging domestic protein demand and robust butterfat exports are rapidly absorbing what is still a historically large volume of milk.

This has created a unique support system for key dairy products:

Nonfat Dry Milk (NFDM): Despite U.S. milk production rising 3.4% in January, NFDM production continued to slide. Extraordinary demand for high-protein products — such as Greek yogurt, cottage cheese, and ultrafiltered milk — is pulling protein away from the dryers. This limited supply is supporting a price rally, though analysts warn U.S. prices are now sharply higher than other major exporters. A convergence in global prices may be necessary to maintain long-term export momentum.
Butter: Even as milkfat tests failed to grow at a normal pace, butter production jumped 6% in January. However, inventories have noticeably tightened (12% lower than January 2025), helping prices rally. Strong export orders have balanced the market, with January exports nearly tripling prior-year levels as buyers prebook deliveries well into 2026.

The Genetic Floor

Despite the current deceleration in components, the long-term potential of the American herd remains at an all-time high. Corey Geiger, lead economist at CoBank, points out 61% of the gain in butterfat over the current era is tied directly to genetics.

“The dairy cow is the most researched animal on Earth,” Geiger shared at the IDFA Dairy Forum earlier this year. “We have more tools in the toolbox to change butterfat levels than ever before, and those genetic gains are permanent.”

The story of early 2026 is one of agility. The industry is proving it can grow its footprint without crashing its own price floor. By responding to the beef-on-dairy incentive and pulling back on expensive nutritional pushes when the market doesn’t reward them, U.S. producers are demonstrating a level of market maturity unseen in previous decades.

The most valuable pound of milk isn’t always the one with the most fat — it’s the one that fits the current economic roadmap.

Beyond the Black Hide: Why Your Beef-on-Dairy Strategy Could Be Costing You $66,000 a Year

Mon, 06 Apr 2026 12:13:56 GMT

For the past several years, the beef-on-dairy revolution has been the single most transformative trend in the dairy industry. What started as a strategy to manage excess heifer inventory has evolved into a sophisticated, multi-billion-dollar supply chain. Although the conversation has shifted, as the novelty has worn off, the boom phase is maturing and a new, more disciplined chapter is beginning.

Moderated by Joe Dalton of the University of Idaho, a panel of industry leaders recently sat down to map out the next chapter in 2026 at the High Plains Dairy Conference in Amarillo, Texas. The message was clear: In the coming year, simply producing a black-hided calf will no longer be enough. Success in 2026 will be defined by genetic verification, supply chain partnerships and a relentless focus on carcass consistency.

The Powerhouse of the High Plains

To understand the scale of this shift, one must look at the geography of the American feedyard. Laphe LaRoe, director of operations for Smith Cattle Company and Chair of the Texas Cattle Feeders Association provided a sobering look at Cattle Feeding Country.

The region encompassing Texas, Oklahoma and New Mexico accounts for more than 25% of the nation’s fed cattle, generating a staggering $22 billion in total economic impact. However, the traditional supply of native beef cattle is under pressure. U.S. cattle inventories have seen a decline of 8.5 million head between 2019 and 2026.

“We are doing more with less,” LaRoe noted, pointing to charts that show beef production holding steady despite plummeting cattle numbers. The gap is being filled by beef-on-dairy. In the Texas High Plains, the inventory of native steers and heifers is trending downward, while the beef-on-dairy line on the graph is climbing aggressively. By the first quarter of 2026, BxD calves are no longer a byproduct — they are a primary component of the feedyard inventory.

The Scarcity Premium Versus Price Dispersion

Lauren Kimble, manager of ProfitSOURCE Supply Chains for Select Sires, Inc., highlighted the current market dynamics. Currently, the industry is enjoying a scarcity supply premium. Because total cattle numbers are so low, almost all cattle are commanding high prices, and the quality spreads — the price difference between a mediocre calf and an elite one — have condensed.

However, Kimble warned this window is closing. As we move through 2026, the outlook points toward increased supply and, more importantly, price dispersion.

“Genetic differentiation may be the key to maintaining optimal market access,” Kimble explained. In a market with more volume, buyers will become more selective. The scarcity premium will be replaced by a quality premium, where calves with verified genetics and known performance will pull away from the mixed genetics pack.

What Beef-on-Dairy Gets Right

The reason the BxD movement has been so successful is rooted in its ability to solve the beef industry’s greatest challenge: variability. Kimble shared data illustrating beef-on-dairy gets it right in three major areas:

Quality and Grade: BxD calves are hitting higher Choice and Prime percentages with strong marbling expression.
Consistency: Unlike the native cow-calf sector, which is fragmented across thousands of small herds, dairy operations provide uniform carcasses, tighter yield/quality distribution and a year-round market supply.
Efficiency: These calves are bred for growth performance that fits the modern packer’s needs.

The data is startling. While the total fed cattle harvest averages roughly 12% Prime and 73% Choice, program-specific beef-on-dairy is hitting 40% Prime and 59% Choice. As Sidney Abbot of OT Feedyard & Research Center famously stated: “I care deeply about consistency … variability is the enemy.”

The Financial Reality: Genetics as Brand Equity

Delbert Hollis, president and founder of CMS Livestock Auction, brought the livestock trading perspective to the stage, and he didn’t mince words about the financial implications of genetic selection.

In an analysis of video sales from January 2025 to February 2026, the price differences were stark. Calves out of Holstein dams vs. non-Holstein dams saw a $26.17/cwt advantage. Angus sires held a $14.27/cwt lead over Limousin and Simmental crosses. Even the NHTC (non-hormone treated cattle) designation added a $10.28/cwt premium.

Another compelling data point was the program advantage. Calves sold under a verified genetic program averaged $1,966.37 per head (standardized to 450 lb.). Calves with no genetic program averaged $1,913.40.

That is a difference of $52.97 per head.

“For a load of 105 head sold, that difference equals $5,562,” Hollis noted. “If you are selling 105 head every month, that is $66,744 left on the table every year by not using tailored program genetics.”

In 2026, genetics are no longer just an expense — they are brand equity.

Hitting a Moving Target

As the industry matures, the targets are moving. Jon D. Robison of JDR Livestock Management Services and Dale Woerner of Texas Tech emphasized the industry is evolving its conversation around red meat yield (RMY).

“We have a system that doesn’t tell us accurately what we should be producing,” Woerner noted, referring to the USDA Yield Grade system introduced in 1965. The next chapter of beef-on-dairy will involve managing hot carcass weight (HCW) and ribeye distribution to hit specific Certified Angus Beef (CAB) specs more accurately.

The mantra for 2026, as quoted by Troy Marshall of the American Angus Association, is: “Genetics create potential. Systems capture value.”

The Next Chapter

The High Plains Dairy Conference panel made it clear the next chapter of beef-on-dairy is about professionalization. The days of “any black bull will do” are over. To thrive in 2026, producers must:

Verify Genetics: Use programs that provide data-backed premiums.
Focus on the Dam: Recognize the Holstein/Jersey base is just as important as the beef sire.
Build Relationships: Partner with feedyards and packers who value consistency over volume.
Capture the Data: Understand the tuition of the past decade has taught us that variability is the most expensive mistake a dairy can make.

As the industry moves forward, beef-on-dairy is no longer just a boom. It is the backbone of a new, more efficient and more profitable American beef supply chain.

The Dairy Margin Revolution: Why You’re Not Just in the Milk Business Anymore

Wed, 01 Apr 2026 16:26:36 GMT

In the 2016 film The Founder, there is a pivotal moment where Ray Kroc is told a hard truth that would change the course of business history: “You’re not in the burger business; you’re in the real estate business.” Most people thought McDonald’s became a global titan by flipping more patties or perfecting the kitchen assembly line. In reality, the breakthrough was a shift in how the business was structured. The burgers created the traffic, but the real estate underneath the golden arches provided the wealth.

For today’s U.S. dairy producer, a similar paradigm shift is underway. Curtis Bosma of HighGround Dairy says the most successful producers are realizing they are no longer in the milk business or the efficiency business. They are in the margin business.

The Metric Trap

For decades, dairy farmers have been taught to optimize a specific set of operational metrics: milk production per cow, butterfat and protein percentages, feed efficiency and pregnancy rates. While these are critical indicators of how a farm operates, Bosma argues none of them actually measure profitability.

“Dairies are not in the efficiency business,” Bosma notes. “Dairies are in the margin business.”

The problem is even if a producer does everything perfectly — hits 100 pounds of milk, maintains a 30% preg rate and keeps the cows healthy — the market can still force a negative financial outcome. Looking at the last 10 years of Income Over Feed Cost (IOFC) data, the volatility is staggering. We have seen margins swing from more than $14.00/cwt to as low as $4.00/cwt. In this environment, Bosma points out even an elite dairy producer must shift their focus from the parlor to the profit-and-loss statement.

The 2026 Landscape: A Surplus of Success?

The current state of the industry is a paradox of high performance and market pressure. The February 2026 USDA Milk Production report showcases the U.S. dairy herd is the largest size since 1993, with an increase of 211,000 head year-over-year.

While this efficiency is a testament to American ingenuity, it creates a heavy load for the market to carry. Nowhere is this more evident than in the cheese sector. December output hit a record 1.238 billion pounds. While exports have been stellar — exceeding 110 million pounds in seven different months of 2025 — the sheer volume of supply is capping the upside. HighGround Dairy projects that without a major fundamental shift, cheese prices will struggle to push past $1.60/lb. in the first half of 2026.

The Year of Protein and the GLP-1 Tailwind

While cheese and butter have faced supply-heavy headwinds, the whey market is telling a different story. We are currently living in “The Year of Protein.”

Demand for Whey Protein Isolate (WPI) and WPC-80 is at record highs, driven by a structural shift in consumer behavior. Interestingly, Bosma points to a GLP-1 tailwind. As weight-loss medications like Ozempic and Mounjaro become more prevalent, users are actively seeking out high-protein, nutrient-dense foods to maintain muscle mass while losing weight. This isn’t a passing fad; it’s a structural change in the American diet that favors dairy components.

However, even this gold rush has a ceiling. As WPI prices climb, lower-income importing nations may pull back, shifting production back to dry whey. For 2026, the expected sweet spot for dry whey is between $0.60 and $0.70/lb.

The Beef-on-Dairy Gold Mine

Perhaps the most significant supplemental income stream for the modern U.S. dairy is beef-on-dairy calves. The U.S. beef cow herd has hit a record low since 1965, sitting at just 27.9 million head. A combination of the 2022 drought, high cattle prices incentivizing liquidation and an aging beef operator demographic has created a massive supply hole.

For dairy producers, this is a strategic gift. Beef revenue per hundredweight of milk has climbed from roughly $1.00 in 2019 to nearly $5.00 in 2026. Feeder cattle futures are trending near $370/cwt.

The elite operator isn’t just treating these calves as a byproduct; they are managing them as a core revenue pillar. By using Livestock Risk Protection (LRP) to floor the value of unborn calves and cull cows, dairies are bulletproofing their bottom line against the inevitable cycles of the milk market.

Feed: The 2025 Surplus Versus The 2026 Risk

On the input side, the 2025 corn crop was the largest ever recorded, yielding 17.021 billion bushels. This has led to ending stocks at their highest levels since 2018, providing some relief on the feed bill.

However, Bosma warns against complacency. As of February 2026, approximately 41% of corn production areas are experiencing some level of drought. While the 2025 surplus provides a buffer, the 2026 crop is far from guaranteed. Similarly, alfalfa hay acres and production have been on a steady decline since 2000, making high-quality forage a persistent challenge for the Western and Midwestern milksheds.

The Elite Operator Mindset: Strategic Versus Operational

To navigate this complexity, Bosma suggests adopting an “Elite Operator Mindset.” This requires a clear division of labor within the farm’s leadership:

Employees Operate: Following established protocols for milking and feeding.
Managers Review Tactics: Adjusting rations and allocating labor to achieve specific, short-term outcomes.
Owners Strategize: This is where the “Margin Business” is won. Owners must focus on long-term, high-impact decisions like risk management, succession planning and capital investment.

“Make better decisions faster,” Bosma advises. “70% certainty is enough — move fast, correct often.”

Ken McCarty of McCarty Family Farms in Kansas says his operation has seen a total transformation in how it views its calf crop.

“It wasn’t that long ago that a bull calf was almost a liability or an afterthought,” he says. “Today, depending on the market, those beef-cross calves can represent nearly 50% of our total calf revenue. It’s no longer a side project; it’s a core pillar of our financial stability that helps us weather the volatility of the milk check.”

Owning Your Financial Position

Finally, the path to clarity and control requires producers to understand who is looking at their financial statements and why.

The Banker wants to know if you can repay the loan (cash flow coverage).
The Accountant wants to know how to reduce the tax bill (depreciation).
The Business Owner (You) must ask: “Am I earning a return on my labor, my land and my capital?”

The tools to manage these margins are more accessible than ever. Dairy Revenue Protection (DRP) and Livestock Risk Protection (LRP) are no longer optional luxuries; they are the “real estate” of the modern dairy.

Reclaim the Legacy

The goal of shifting from an efficiency mindset to a margin mindset isn’t just about the money— it’s about clarity and control. It’s about ensuring the markets do not determine your legacy.

By thinking like an elite operator, understanding the structural shifts in the beef and protein markets and aggressively using risk management tools, producers can bridge the gap between “flipping burgers” and building a durable, scalable empire. The dairy engine may be changing, but the mission remains the same: protecting the land, the cows and the family’s future, one margin at a time.

Beef-on-Dairy Has Come a Long Way, but Hurdles Still Remain

Fri, 27 Mar 2026 19:10:42 GMT

Beef-on-dairy has evolved rapidly in just a few short years. What started as a way to add value to surplus dairy calves has become a major and increasingly refined part of the beef supply.

In a short period of time, the industry has refined genetics, improved calf value and built stronger connections between the dairy and beef sectors. But while adoption has grown rapidly, the system isn’t perfect, and several hurdles still remain.

During an episode of “The Beef Podcast Show,” Dr. Tara Felix from Penn State University discussed some of these challenges.

Disconnected Calf Management

One of the biggest hurdles starts at birth. Many dairy producers sell calves shortly after they’re born, meaning they rarely see the long-term impact of early management decisions.

“The calf is born and then it leaves,” Felix says. “[Dairy producers are] taking that extra money and letting the calf be someone else’s problem.”

That mindset shows how early calf care is often disconnected from how the animal performs later. Some of the most important decisions, such as making sure the calf gets good colostrum, happen in the first few hours of life. But linking those early decisions to final carcass value remains difficult.

“We have very few longitudinal studies, from birth all the way to slaughter, to convince those calf ranches [and dairy producers] that they need to be making a difference,” Felix adds.

A Fragmented Supply Chain

Beef-on-dairy calves typically pass through multiple operations before harvest, creating a system where responsibility and information are often disconnected.

“We send them from the dairy to the wet calf ranch, then to the grower ranch, then to the feedlot, and finally to the packer,” Felix says.

That fragmented structure makes it difficult to track animals from birth to carcass and share performance data across the supply chain.

“There’s a big opportunity to track beef-on-dairy cattle through the whole system, get that information back, and use it to make improvements,” Felix says.

More vertically integrated systems could help close those gaps.

“There are already parts of the beef-on-dairy industry that are becoming what I would call vertically integrated,” Felix says. “They’re the perfect model.”

She believes more of these integrated operations will emerge in the future as the industry looks for ways to connect early management with final performance.

Missing Research on Young Calves

Despite rapid growth in beef-on-dairy, there are still major gaps in research, particularly during the early growth period.

“We know very little about calves between 250 and 450 pounds. I see a huge gap in our knowledge about rumen development, especially for beef-on-dairy calves,” Felix says.

Calves often move quickly from individual hutches into group feeding systems before their rumens are fully developed.

“We take these calves out of the hutch, put some feed in front of them, and expect them to adapt on their own, even though their rumens aren’t fully developed,” Felix says.

Early health events during that time can also affect carcass quality much later.

“These calves can be impacted at 60 days of age with an insult that’s going to ultimately end up messing up their marbling characteristics,” Felix says.

Health Challenges at the Finish Line

Even when cattle reach the feedlot, health issues can still impact value. Liver abscesses remain a persistent concern in some regions, and researchers still don’t fully understand how these infections begin or how long they persist in the animal.

“I think it’s critical to figure out what the heck is causing this issue, and where it’s starting,” Felix says. “These are all things that we really don’t have any idea about.”

The System is Here to Stay

Despite the challenges, the role of beef-on-dairy in the beef supply is unlikely to shrink.

“Beef-on-dairy is here to stay. So, let’s be clear about that,” Felix says.

The next phase will depend on closing knowledge gaps, improving data flow through the supply chain and refining calf management from birth forward. As those hurdles are addressed, the industry will be better positioned to turn a fast-growing concept into a fully optimized production system.

Preweaning Performance Data Emerges for Beef-on-Dairy Calves

Mon, 23 Mar 2026 17:54:47 GMT

Preweaning performance shapes everything that follows, but for beef-on-dairy calves, investigation into that early-life picture has been sparse. While crossbreeding has been evaluated extensively in the feedlot, data from the first weeks of life has lagged behind. A new Journal of Dairy Science study from the University of Guelph helps close that gap, observing the early life performance of crossbred calves compared to Holsteins.

Key findings from the study include:

Crossbred calves demonstrated comparable or improved preweaning growth.
Health outcomes, including morbidity and mortality, were similar between groups.
Crossbred calves had reduced incidence of diarrhea and required fewer respiratory disease retreatments.
No additional management complexity was identified for crossbred calves.

Growth Performance Signals Early Advantages

Crossbred calves showed comparable or improved growth during the preweaning period. Crossbred calves had increased body weights by day 28, and weighed ~7 kg more than Holstein calves by day 84. This is consistent with what would be expected from heterosis, particularly for traits like growth efficiency and robustness.

That shift is notable because most of the economic rationale for crossbreeding has focused on downstream performance. This work suggests those advantages may begin earlier than previously documented.

This pattern is not isolated. In a controlled study of Angus × Holstein calves, crossbreds gained about 0.14 kg/day more than Holsteins and reached higher weaning weights under the same management conditions. Additional work reports similar trends, reinforcing performance differences can emerge during the preweaning period rather than later in production.

From a clinical standpoint, early growth is also a useful indicator of how well calves are handling nutrition, colostrum management and disease pressure. On that front, crossbred calves appear to perform at least as well as Holsteins under typical conditions.

Health Outcomes Show Targeted Advantages

Overall morbidity and mortality were similar between groups; however, important differences emerged in specific disease outcomes. Holstein calves had a higher incidence of diarrhea and were more likely to require repeat treatments for respiratory disease compared with crossbred calves. This pattern suggests that while total disease occurrence was similar, crossbred calves experienced fewer or less persistent clinical events.

These findings do not indicate a need for different protocols, but they do suggest crossbred calves may be less likely to require repeated intervention once disease occurs. This has potential implications for labor and antimicrobial use.

Measures of passive transfer, including serum total protein, were similar between groups, indicating these differences were not driven by variation in colostrum management.

Implications for Veterinary Practice and Calf Value

As beef-on-dairy crossbreeding becomes more common, veterinarians are increasingly involved in guiding how these programs are implemented and evaluated. The growing body of preweaning data provides a more complete foundation for those discussions.

Key implications include:

Crossbred calves can be integrated into existing calf-rearing programs without added health risk
Growth advantages may begin during the preweaning period, not just later in life
Standard health and nutrition protocols remain appropriate across genetic groups
Management fundamentals continue to have the greatest influence on outcomes
Early-life performance should be considered part of the overall value equation in beef-on-dairy systems

Taken together, the evidence points in a consistent direction: beef-on-dairy calves perform as well as, if not better than, Holsteins early in life, without added health risk. As more data emerges, that consistency strengthens confidence these calves can be managed within standard systems while delivering comparable or improved early-life performance.

Lock in Gains: How LRP Can Help Protect Beef-on-Dairy Profits

Wed, 18 Mar 2026 19:20:23 GMT

Record-high beef-on-dairy prices have reshaped the balance sheet for dairy farmers, turning a once-small revenue source into a major part of the bottom line. But without protection, those gains could disappear just as fast, underscoring how quickly momentum can shift in today’s cattle markets.

Experts caution today’s opportunity demands a more deliberate approach.

Mike North, president of the producer division at Ever.Ag, and Will Babler, principal at Atten Babler Risk Management LLC, made two points clear during the Professional Dairy Producers conference:

Beef-on-dairy is now a significant part of a dairy’s financial picture.
Tools like Livestock Risk Protection, or LRP, are critical to protecting those profits, especially at today’s historic highs.

Beef-on-Dairy Income Becomes a Major Revenue Stream

In just a few years, beef-on-dairy revenue has expanded dramatically. Strong demand from feedyards and packers, combined with tight U.S. cattle supplies, has pushed prices for beef-on-dairy calves to levels few producers expected even five years ago. For many farms, those calf checks now add several dollars per hundredweight to the milk check equivalent.

“At the end of 2022, the average dairy was getting paid about a $1 to a $1.50 a hundred in beef revenue,” North says. “Today, that number is north of $5. We’ve tripled that part of the financials. It’s a massive, massive opportunity, and with it a massive growing potential risk.”

Babler described beef as a new pillar supporting dairy profitability.

“We now have this other leg to the stool, whether it be black calves or cull cows,” Babler says. “That also has become a major contributor to our revenue stream.”

But as beef revenue grows, so does exposure to market swings. North and Babler say this makes it a smart time for producers to think about expanding their risk management toolbox . Alongside programs like DMC and DRP for milk, tools such as LRP can help protect beef-on-dairy income, letting producers capture strong markets while buffering against sudden drops.

Are Beef-on-Dairy Calves the New $24 Milk?

For many dairy producers, beef-on-dairy calves have become one of the most valuable animals leaving the farm. Day-old calves have averaged $1,500 in some regions and pushed over $2,000 in others — a price that would have been hard to imagine just a few years ago. North says the current market feels similar to $24 milk.

“What should one do with $24 milk?” he asks. “Walk quietly into the sunset and say, ‘We’ll wait to see if it gets better?’”

With prices sitting at all‑time highs, he says this isn’t the moment to step back.

“We’re talking about all-time records, and you just don’t walk away from those and say, ‘Ah, I’ll check back in next month.’ That’s not how we approach markets like this. You’ve got to go after it,” he says.

Lock in Gains

As attractive as today’s beef-on-dairy calf prices are, North cautions markets at record highs rarely stay there forever. When you’re standing at the top of the mountain, the fall can be just as steep on the way down. That’s why he encourages producers to think carefully about risk management tools like LRP to help guard against sudden market swings.

The federally subsidized insurance program administered by USDA allows producers to establish a price floor while still participating in market rallies, functioning similarly to a put option. Unlike futures contracts, which require fixed contract sizes, LRP policies can be written to cover the actual number of animals in a group rather than standardized futures contract weights.

Babler notes how attractive the program has become in the current market.

“When we look at the tools available, LRP really stands out for cross calves right now,” he says. “There’s a lot of reach in the market, and premiums have collapsed. We’re talking about $30 a head floors.”

Babler explains if prices fall below the level you insured, LRP pays an indemnity equal to that gap. Because the program uses national price indexes rather than individual sale prices, it protects against broad market declines, not differences from one sale barn to another.

Recent changes to the program have also helped increase interest among dairy producers. New coverage options now exist for cull cows and unborn calves, including beef-on-dairy crosses that may be sold shortly after birth.

Subsidy levels have also increased significantly, rising from about 13% in earlier versions of the program to roughly 35% to 55%, depending on the level of coverage selected. Premium payments are now due at the end of the coverage period rather than upfront, which improves cash-flow timing for producers.

These changes have also helped to improve the program’s flexibility. Babler says cattle can now be sold up to 60 days prior to the coverage end date without affecting the policy, compared to the previous 30-day window. Producers may also purchase coverage for animals they have under a valid purchase agreement, as long as possession occurs at least 90 days before coverage ends.

Taken together, those updates have reduced out-of-pocket costs and made LRP more accessible as a risk management tool.

Playing Offense with LRP

North and Babler emphasize LRP isn’t just a defensive strategy. It’s also a way for producers to play offense, capturing opportunities when markets are strong.

“Risk management really has two sides,” Babler says. “You play offense when markets give you opportunities, like we’re seeing in cattle right now, and you lock in the gains. At the same time, you play defense to protect yourself from the downside when things turn. In the past, dairy producers mostly dealt with corn and milk, which often moved in opposite directions. But now there are more markets to work with — milk products, protein, and beef — so there’s a better chance that at least one of them is working in your favor. The goal is to capture those strong markets while still protecting yourself when prices drop.”

While prices are expected to remain strong for now, Babler and North emphasize risk management tools provide a safety net, letting producers play offense when opportunities arise, while still playing defense to protect the gains they’ve worked hard to earn.

High Milk Production Meets a Changing Cattle Market

Tue, 17 Mar 2026 20:54:13 GMT

The USDA is set to release the February Milk Production data later this week. If on trend with 2025 and the first numbers posted from January’s Milk Production, most are expecting another big number, if not continued growth in gallons of production.

High milk production has stressed markets despite efforts to increase value added products. Increased consumer demand here in the United States of some of these products such as protein products and ready-made dairy products has helped. Also, more exports of fluid milk and milk products to countries worldwide has lessened the blow of increased production, however the overload of production hasn’t been an easy hurdle to surpass.

Last week, the USDA released the monthly WASDE report. As expected, milk production was raised from last month, projecting February and March to be 3 billion pounds over the respective month in 2025, which was 5.6 billion pounds over the 2024 data. The balance sheet was not all doom and gloom though, Exports for Fat-Basis were projected to reach 18 billion pounds here in March of 2026. That is an increase of 500 million from the February projections for 2026, 1.3 billion pounds over March of 2025, and an astounding 6.2 billion pounds over 2024.

Expectations for the February Milk Production Report to be released Thursday are in line with the WASDE report, showing a steady increase in production. Much like what we saw all of 2025.

Looking for a reason behind the growing milk production numbers isn’t as simple as more cows equals more milk. Milk cow numbers are high, one of the highest in the last twenty-five years. However, beef cattle numbers are the lowest in 75 years. This has created a unique dynamic where cattle prices are high, but milk prices are low.

The story gets more confusing when you see dairy heifer retention at a near low. When you take all dairy cattle inventory, including calves, you see one of the lowest numbers of all dairy cattle in history. It is easily explained by the dairy dynamic beef we’ve seen since beef prices skyrocketed.

(USDA - Reports)

Beef-on-dairy calves are worth so much, that instead of keeping back a heifer and breeding for quality retention, we are breeding for immediate dispersal of a beef calf. Therefore, milk cow numbers are high, not due to wanting to produce a greater volume of milk, but to squeeze out another year or two of calf production out of a cow that would have previously been culled prior to the cattle value rally.

This sets the dairy industry up for a big problem for years to come as we eventually are forced to cull a large part of the herd and there are very few heifers to take their place. The question is timing of when we will see this impact on production and dairy prices.

Sarah Jungman is a commodity broker with AgMarket.Net and AgDairy, the dairy division of John Stewart & Associates Inc. (JSA). JSA is a full-service commodity brokerage firm based out of St. Joseph, MO. Sarah’s office is located in Winterset, Iowa and she may be reached at 515-272-5799 or through the website www.agmarket.net .

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U.S. Bovine Semen Slipped 4% in 2025, Exports Hit Record $327M

Tue, 17 Mar 2026 19:06:21 GMT

Even with a major export market disappearing early in the year, the U.S. bovine genetics industry proved its resilience in 2025.

New data from the National Association of Animal Breeders (NAAB) , which represents roughly 95% of the U.S. artificial insemination industry, shows total semen sales slipped about 4% in 2025 to just under 66 million units - a decline of 2.9 million compared with 2024, effectively giving back last year’s modest gain. However, the industry offset much of that loss through stronger beef demand, expanded export markets and continued shifts in dairy breeding strategies.

China Closes Doors, Global Markets Evolve

In February 2025, U.S. bovine semen exports to China came to an abrupt standstill after Chinese authorities halted the issuance of required veterinary health certificates, cutting off one of the industry’s key export channels. The disruption stemmed from regulatory and trade tensions, not animal health concerns. Without the certificates, U.S. exporters had to redirect product to other markets.

“While dairy unit exports were down due to the closure of the China market, exports to other countries increased, which significantly reduced the impact of the closure,” says Jay Weiker, president of NAAB.

Even with China offline, robust interest from Europe, Brazil, North Africa and South Asia helped steady the export picture.

“The industry not only stabilized but continued to advance by strengthening long-standing markets and opening new ones,” says NAAB international program director Sophie Eaglen.

The closure of China also reshaped the list of top semen buyers by value. In 2025, the United Kingdom led the rankings, followed by Italy and Mexico. Brazil led in total units imported, followed by Mexico and Russia. Overall, 46 markets imported over $1 million in U.S. semen, accounting for 94% of export units and 95% of export value.

A Down Year for Dairy

The U.S. dairy semen market experienced a substantial decline in 2025, reflecting ongoing shifts in breeding strategies and global market pressures. Total dairy unit sales, including domestic, export and custom-collected units, fell 6% compared to 2024, a loss of roughly 3 million units, bringing the total to 45.8 million.

Despite the overall decline, domestic use showed a slight rebound, increasing 2% to 16.5 million units, or nearly 367,000 additional units. Sexed semen continued to dominate U.S. herds, rising 6% to 10.6 million units and now accounting for 64% of all dairy semen used domestically. Conventional dairy semen declined by 280,000 units, highlighting the continued trend toward precision breeding and genomic selection.

Exports for dairy semen totaled 28.3 million units, down about 2.5 million from 2024. The early-year closure of the China market contributed to the drop, but exports to other countries, particularly across Europe, Brazil, North Africa and South Asia, helped offset much of the lost volume. NAAB says strong international demand for replacement heifers continues to create opportunities for U.S. dairy producers.

Beef Semen Sees a Bump

The beef segment saw modest growth in 2025, reversing a multi-year decline. Total beef semen sales increased by 1%, or roughly 122,000 units, to reach 20.2 million units. Domestic use accounted for most of that growth, with beef units sold into beef herds rising 7% for the second consecutive year. In total, 9.8 million beef units were used domestically, with 8.1 million going into dairy herds and 1.7 million used in traditional beef herds.

Heterospermic beef semen, which combines genetics from multiple sires in a single straw, remains a significant portion of the market, though it declined from its 2024 peak of 2.8 million units to just over 2 million in 2025. Domestically, heterospermic units represented 2 million of the total, with 400,000 units exported. Angus remains the dominant beef breed, followed by crossbreeds and heterospermic products.

Export demand for beef genetics also continues to expand. Total beef semen exports grew 13% to 5.5 million units, underscoring the global appetite for U.S. genetics even as total semen unit exports declined overall.

Beef-on-Dairy Genetics Hold Steady

Beef-on-dairy genetics have become an increasingly important strategy for U.S. dairy producers, and 2025 was no exception. Domestic use remained steady at 8.1 million units, while exports of beef-on-dairy semen grew 13%, adding approximately 279,000 units.

This segment is fueled by genomic selection strategies that allow dairy producers to produce replacement heifers from their best animals while using beef sires on the remainder of the herd to create high-value F1 calves for feedlots. Adoption is also growing internationally, with rising demand for F1 calves and crossbred genetics, reinforcing the role of U.S. dairy producers in meeting both domestic and global needs.

Adaptive Trends and Future Opportunities

Despite the year’s unit declines, the industry is adjusting and finding its footing as global demand shifts and new breeding tools and market opportunities come along.

“Trends in semen usage reflect producers’ efforts to improve genetic outcomes and economic returns in an evolving marketplace,” Weiker says. “NAAB members should be complimented for their commitment to developing new markets and increasing market share in strategically important markets. There are many positives that can be gleaned from the 2025 results.”

With export value at record levels and beef-on-dairy strategies growing, the industry appears positioned for continued adaptation and progress in years ahead.

Are Beef-on-Dairy Calf Prices the New $24 Milk?

Mon, 09 Mar 2026 22:29:10 GMT

The rise of beef‑on‑dairy has changed the way many farms think about their finances. What began as an extra source of income is now a major contributor to overall profitability, especially during a year of tight milk markets. In fact, some industry leaders argue that beef revenue now rivals, and in some cases exceeds, the profit generated from milk itself.

“You guys may be in the beef business more than you are in the dairy business, ” says Gregg Doud, president and CEO of the National Milk Producers Federation, during this year’s Professional Dairy Producers conference.

This shift has happened quickly. Not long ago, beef revenue represented a relatively small portion of dairy income. But today, the need for more beef has dramatically increased the value of calves leaving the farm.

“At the end of 2022 on the farm, the average dairy was getting paid about a $1 to $1.50 a hundredweight in beef equivalent revenue,” says Mike North, President of the Producer Division at Ever.Ag “Today, that number is north of $5. We’ve tripled that part of the financials. It’s a massive opportunity.”

Filling the Cattle Gap

One of the biggest reasons beef-on-dairy has grown so quickly is simple: the beef industry needs more cattle. In recent years, the U.S. beef cow herd has shrunk due to weather, high input costs and lower heifer retention, tightening the supply of calves for feedlots.

That shortage has pushed feedlots to turn to beef-on-dairy calves to fill pens, which has driven calf prices higher and created a source of income that’s becoming hard to overlook.

“Beef has become a major contributor to our revenue stream,” says Will Babler, principal at Atten Babler Risk Management LLC. “And it’s not going away. These prices may not last forever, but they won’t go back to what they used to be.”

Rebuilding the national beef herd takes time, and until more heifers are retained, the number of feeder calves available will remain tight, keeping demand strong for crossbred cattle.

“The question I get asked most often is how long is this going to last,” Doud says. “The answer is a minimum of three to five years. If you take that [beef] heifer and you retain her, then her offspring become steak at the grocery store. How long does that take? The answer is a minimum of three years. So this does not change in terms of what these [prices] can do.”

A Protein Driven Future

Consumer demand is also a major factor behind the momentum. Even as retail prices climb, beef continues to hold a strong place in American diets, and restaurants and retailers have largely kept it on the menu. That steady demand keeps pressure on the supply chain to find cattle wherever they can be produced efficiently.

“Six years ago, if you would have told that a steak could rise from $30 all the way to $65 and restaurants would still be full on a Tuesday night, I would have told you you were crazy,” Doud says. “But we’ve done it. This is demand driven. The U.S. consumer loves that product.”

The trend isn’t limited to the U.S. market. Globally, demand for animal protein continues to grow, and Doud believes supply will struggle to keep pace.

“If you look over the next 10 years and beyond, the supply of animal protein in the world with beef, pork, poultry and dairy comes nowhere near meeting the demand,” he says. “The current demand for protein in the world is unbelievable.”

A Market on Fire

In today’s market, beef-on-dairy calves are pulling in prices that would have seemed unimaginable just a few years ago. Day-old calves can sell for more than $1,500, and in some regions, even higher. That kind of money has producers paying attention in the same way they do when milk prices hit rare highs. North compares the current beef-on-dairy market to $24 milk.

“What should one do with $24 milk?” he asked. “Walk quietly into the sunset and say, we’ll wait to see if it gets better?”

With prices sitting at all‑time highs, this isn’t the moment to step back.

“That’s where we’re at on beef right now,” he says. “We’re talking about all-time records, and you just don’t walk away from those and say, ‘Ah, I’ll check back in next month.’ That’s not how we approach markets like this. You’ve got to go after it.”

Part of what makes beef-on-dairy calves so valuable is the consistency and predictability they bring. Feedlots appreciate that these animals perform reliably and arrive in good condition.

“The buyers love these crossbred calves,” Babler says. “They have figured out how to get them to perform, and they show up on time. None of this is going to change.”

He believes that dairies bring more to the table than just animal performance. They also bring traceability, which could create additional opportunities for premium value.

“When you get into the packer community and start having conversations, not only do they love them, but there’s an extra set of opportunities attached to this animals,” Babler says. “Producers know their breeding decision, when that calf was born and every treatment it received, all the way up to that point of sale.”

That combination of predictability and traceability is why he believes beef-on-dairy brings more to the table.

“I’ve said for the last years it’s my belief that premium beef in the United States will be held largely by dairymen because of the extra benefits that these animals bring as they go to market,” Babler says.

Babler adds that the impact is clear on farms right now, and even when the market eventually levels out, the interest and value of these calves are here to stay.

“We have all realized the benefit of beef revenue on the dairy right now,” he says. “I’m really optimistic about where this beef and dairy intersection is going. We know that it may go higher, but we also know there’s going to be a reset. We just don’t know when. The good news is that even when it resets, the amount of beef value and interest on these cattle I just don’t see going away whatsoever.”

A Long-Term Opportunity

Ask any producer participating in a beef-on-dairy program and they will quickly tell you how it has become a major force in their farm’s profitability. Record-high prices and strong demand from feedlots have made this market impossible to ignore.

For many operations, selling crossbred calves has become a regular part of the business. And in years of low milk prices, that extra value can make a real difference in keeping finances steady.

Beef-on-Dairy is Becoming a Bigger Engine for the Beef Supply Chain

Thu, 26 Feb 2026 20:58:54 GMT

Beef-on-dairy has become a significant part of the U.S. beef supply over the past decade, gaining momentum much like a freight train that keeps picking up speed. In fact, roughly 20% of today’s beef now traces back to a dairy cow, reflecting how integrated dairy production has become with the broader beef value chain.

And according to Matthew Cleveland of ABS Global and Nick Hardcastle of Cargill North America, that momentum shows no signs of slowing down.

“I think we’re all aware of the scope and magnitude of what beef-on-dairy has become and the significant role it plays within our beef supply chain today,” Cleveland noted during a panel at the 2026 National Cattlemen’s Beef Association conference.

He says the sector’s growth has also changed how the dairy and beef industries view one another. Rather than operating as separate segments, the lines between them have blurred.

“The dairy business is a big part of the beef business,” Cleveland says. “I don’t even like to separate them now. We’re all in the beef business, and we value partnership with our dairy producers.”

As beef-on-dairy has expanded, more attention has turned to decisions made on the dairy, where breeding choices directly influence how those calves perform all the way through the beef system.

Breeding With the Beef End in Mind

In the early days of beef-on-dairy, breeding decisions were driven largely by convenience rather than genetic intent. Beef semen was often selected based on price and availability rather than how those genetics would fit the needs of the beef sector.

“Before people really started thinking about beef sire genetics on dairy cows, there wasn’t much consideration for what those genetics actually were,” Cleveland says. “Most decisions came down to what semen was already in the tank or what was free. The main goal was simply getting the cow pregnant.”

That approach began to change as the industry started to see beef-on-dairy as a long-term genetic opportunity rather than just a reproductive tool.

“We began looking at beef‑on‑dairy more seriously from a genetic improvement standpoint around 2012,” Cleveland says. “We started to see the signals that beef-on-dairy was growing.”

Not long after, dedicated breeding programs were being developed across genetic companies to address the needs of both dairy producers and the beef supply chain. Today, Cleveland says those programs continue to evolve, with commercial performance data feeding back into genetic evaluations to drive ongoing improvement.

From ‘Black Holsteins’ to Beef-Calf Performance

During the early days of beef-on-dairy, crossbred calves exposed real challenges for the beef industry. Cleveland notes that many of these animals were simply viewed as “black Holsteins,” which cooled enthusiasm among packers.

“If you think back to 2013-14, you were just trying to create a black calf,” he notes. “We weren’t seeing the performance that you would expect from a beef calf. And for a few years, I think that soured the supply chain on the idea of beef-on-dairy.”

As sire selection became more intentional, however, performance improved. By 2017-18, Cleveland says calves coming from dairy cows began to more closely resemble traditional beef calves.

“We had to create animals that were going to perform,” Cleveland says. “And for us, that was really about focusing our genetic improvement to ensure we selected for the right things each segment wanted.”

Some of those genetic improvements included:

Fertility and calving traits for dairies
Feed efficiency and growth traits for feedyards
Carcass merit and consistency traits for the packers

According to Cleveland, these efforts have helped beef-on-dairy calves perform more like native beef cattle. And by focusing on traits that matter for dairies, feedyards and packers, the beef-on-dairy animals that we know today are much more consistent and valuable.

Performance Trends from the Packer’s Rail

With beef-on-dairy calves now performing more like traditional beef cattle, packers see that consistency as essential for maintaining quality and keeping cattle moving through the system.

“Beef-on-dairy is a very important thing for the beef industry right now, especially when we’re talking about capacity,” Hardcastle says. “We have to make sure we have a beef population that can meet our consumers’ demand.”

Importantly, he emphasizes that these animals are not bringing down overall standards in the beef industry.

“They’re good for the consumer,” Hardcastle says. “Tenderness data shows they perform very well, making a positive impact. These aren’t just animals being blended in that lower beef quality; they actually help improve it.”

He references Cleveland’s remarks, highlighting how focused breeding and feeding approaches have contributed to stronger quality grades.

“Over the past five years, we’ve seen quality grade continuously improve,” he says. “Back in 2021, these animals graded 80% Choice or better. Today they’re leveling at about 92% Choice.”

Hardcastle says beef-on-dairy cattle are also making a notable contribution to Prime.

“From a marbling perspective, almost two-thirds of these cattle could qualify for upper two-thirds Choice,” he says. “The ones that don’t usually fall short because of factors like hot carcass weight, ribeye size and fat thickness.”

From a carcass quality perspective, Hardcastle says beef-on-dairy is delivering the kind of results the industry needs. They’re grading well, adding stability to supply and proving they can hold their own in a system that demands both consistency and performance.

Processing Challenges Inside the Plant

Even as grades and marbling improve, processors are still working through carcass traits that affect returns, particularly excess kidney, pelvic and heart (KPH) fat. Hardcastle explains that beef-on-dairy cattle often mirror their Holstein roots, tending to carry more KPH fat than native beef animals.

“From a packing perspective, you pay for a carcass with the kidney, pelvic and heart fat in it, but that fat can’t be sold as beef,” Hardcastle says. “It ends up in the tallow market at 50 to 60 cents a pound, compared with about $3.60 on a beef grid, creating an immediate value loss.”

On today’s heavier carcasses, even modest differences in KPH can add up.

“If I have a 950-lb. carcass, which is pretty common today, that can mean about 12 extra pounds of internal fat instead of saleable meat,” he says. “That difference can cost $30 to $40 per head.”

These carcass differences are also highlighting the limits of traditional yield grade assumptions.

“Yield grade is meant to estimate how much salable red meat a carcass will produce,” Hardcastle explains.

Based on ribeye size, backfat and carcass weight, beef-on-dairy cattle should cut better than native beef, but yield grades often don’t reflect their true performance.

“Yield grade and beef-on-dairy really aren’t closely related,” he says. “Research shows that yield grading doesn’t reliably predict cutability or value for Holsteins or beef-on-dairy cattle.”

This mismatch shows that standard measures like yield grade, internal fat and weight don’t always capture the real value of beef-on-dairy animals, making it challenging for processors to price and sort them at the rail. To address this, Cargill is testing new technology called SizeR to capture 3D carcass measurements at chain speed.

“So, we can evaluate the full composition of these animals, not just traditional ribeye and fat thickness,” Hardcastle says. “This will help feeders and geneticists be able to better target the right traits to improve cutability and consistency.”

Growing and Permanent Force

Each year, millions of beef-on-dairy calves enter the market, providing a reliable source of high-quality cattle that deliver value from the dairy all the way to the packer.

“We have somewhere in the neighborhood of 3 [million] to 3.5 million beef-on-dairy calves in the market today, which obviously represents a significant proportion of that beef supply chain,” Cleveland adds.

That presence is prompting both dairy and beef participants to think differently about their place in the larger system.

“At every stage, from the dairy to the feedyard to the packer, these animals are performing and adding value,” Hardcastle says. “We understand the significance of beef-on-dairy, and we know that beef-on-dairy is not going away.”

As the industry continues to refine how these cattle are evaluated and managed, beef-on-dairy is positioned to remain a dependable contributor to both supply and consumer demand. With ongoing genetic gains and strong beef demand fueling the engine, the sector is gaining momentum and becoming a permanent fixture in the beef supply chain.

Why High Protein Demand Isn’t Raising Your Milk Check

Mon, 23 Feb 2026 14:09:09 GMT

For the owner of a 700-cow dairy, the math of 2025 and 2026 isn’t just a line item on a spreadsheet — it’s a $275,000 hit to the bottom line. In an industry where margins are often measured in pennies, a slump of that magnitude can feel like a recession. But according to Ben Laine, Terrain’s senior dairy analyst, what we are seeing isn’t necessarily a total industry collapse; it is a high-stakes evolution.

In a recent deep-dive into the dairy markets, Laine dissected the inverse world of milk pricing, the growing reliance on beef-on-dairy revenue, and why the industry’s current short-term pain might be the necessary precursor to long-term gains.

High Demand Doesn’t Always Equal High Checks

Walk into any grocery store and the trend is undeniable. If a product doesn’t have “20g of protein” emblazoned on the label, it’s behind the curve. Consumers are insatiable for whey protein, shakes and bars. Logic suggests this surge in demand should be a windfall for dairy producers. However, Laine points out a unique quirk in federal order pricing that often leaves producers confused.

“The protein demand story is very positive,” Laine explains. “But the fact that protein values are high on milk checks right now is really more a function of the fact that butter values are low.”

Under the current federal order structure, protein value is often inverse to butter value. When butter prices fall — as they have recently — protein values automatically climb, regardless of whether a single extra shake was sold. This means producers must be careful not to mistake a pricing quirk for a long-term demand signal. While the long-term demand for protein is real and growing, the milk check doesn’t always reflect it in a straight line.

The Second-Half Rebound

The weak start to the 2025/2026 season is largely a result of a global oversupply. The U.S., Europe and New Zealand all saw production surges that hit the market simultaneously. However, Laine is optimistic this slump won’t be a multi-year trough like those seen in the past.

“I’m hopeful that this is a pretty short-lived trend,” Laine says. “We’re starting to see slaughter rates pick up, which moves us in the right direction toward reining in that oversupply. I expect to see prices improve in the second half of the year as global prices rise and our export values regain strength.”

The silver lining of low prices is that they often spur demand. As consumers find relief at the grocery store, and as U.S. cheese remains competitive on the global market, the surplus should begin to clear — setting the stage for a rebound by late 2026.

The Black Calf and the Aging Herd

Perhaps the most significant structural change in the industry is the beef-on-dairy revolution. Estimates from groups like Dairy Farmers of America (DFA) suggest 70% of producers are now engaged in breeding dairy cows to beef bulls — a number Laine suspects might actually be higher.

This isn’t just a side hustle; it’s a survival strategy. At current market rates, the revenue from these black calves can add $3 to $4 per hundredweight to a milk check. This buffer is what allows many farms to weather the current low milk prices.

However, this trend is creating a secondary effect: a tightening heifer inventory.

“We have the lowest ratio of heifers to milk cows since the ‘90s,” Laine notes. “Producers are holding onto older cows for an extra lactation just to get one more high-value beef calf.”

While this has caught the market off guard, Laine isn’t panicked. He argues the industry is becoming more surgical with its genetics. Producers are only breeding their absolute best animals for replacements, resulting in a smaller, but genetically superior, pool of heifers. While the industry may eventually find itself wishing for more replacements in the pipeline, the current expert management of the herd is keeping production levels surprisingly resilient.

The $11 Billion Question: Where Does the Milk Go?

The dairy industry is currently in the middle of a massive $11 billion processing expansion. New plants are popping up in regions like Kansas, where production is exploding to fill the new capacity. Laine notes that while this gives milk a place to go, it creates a new challenge at the other end of the plant.

“It’s a positive that we’re not seeing base programs or limitations because we have processing capacity,” Laine says. “But then we have to make sure there’s a place for the finished product — the cheese or the whey — to go. Often, that means exporting at lower prices than we’d like, but it’s better than having nowhere to send the milk.”

Diversification as a Shield

When asked if the industry is on the verge of a recession, Laine’s answer is a firm “no.” He views the current climate as an evolution rather than a decline. The modern dairy farm is no longer a single-commodity business. Between beef-on-dairy revenue, manure digesters producing natural gas, and carbon credits (LCFS), the revenue streams are more diversified than ever before.

“It’s not just about milk prices anymore,” Laine concludes. “We’ve developed better tools for managing risk, and we have additional revenue streams that help weather these storms better than in the past.”

For the American dairy farmer, the message of 2026 is one of grit and perspective. While the base milk price may feel like a flashback to leaner times, the tools at the farmer’s disposal — from genetic precision to renewable energy — are firmly planted in the future. The moment dairy is having is one of transformation, proving that even when the check stays stagnant, the farmer never stops moving forward.

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Why the U.S. Milking Herd is Growing Despite Record-Low Replacement Numbers

Thu, 19 Feb 2026 15:09:47 GMT

The traditional “manual” for running a dairy farm is being rewritten in real-time. For decades, the math was straightforward: cull underperforming cows, raise as many replacement heifers as possible, and focus almost exclusively on fluid milk volume. Today, that equation has been upended by a historic surge in the beef market and a genomic revolution that is fundamentally changing the biological output of the American herd.

According to Abbi Prins, a livestock analysis from CoBank’s knowledge exchange division, the industry is currently navigating a structural shift where the value of a cow is no longer tied solely to her milk production, but to her role as a surrogate for the high-value beef market. This beef-on-dairy movement is redefining heifer inventories, culling strategies and the very composition of the milk hitting the processing plants.

The Heifer Inventory Paradox

The current state of the U.S. heifer inventory is a primary point of concern for the industry. Historically, a tight heifer supply would signal an impending contraction in milk production. However, the U.S. milking herd remains robust, sitting at over 9.5 million head — the largest in over 30 years.

According to Prins, the reason for this paradox isn’t just producers holding onto older cows; it is a calculated shift in how they view their elite genetics.

“The beef-on-dairy movement has played a huge role in where total inventories stand,” Prins explains. “Dairy producers have found that when it comes down to profitability, they are breeding their elite animals for replacements and everything else to beef. You get a better price for that animal selling it as a beef-cross than you do making an extra replacement heifer that you might not need.”

This strategy has rewritten the traditional culling manual. In the past, if a cow wasn’t covering her feed costs or was underperforming in the parlor, she was sent to the back door. Today, the black calf in her uterus — often worth upward of $1,400 — acts as a high-value insurance policy.

“The equation is not as conducive to culling anymore because of where the beef market stands,” Prins says. “The value of that beef-on-dairy calf is worth more than just selling that cow off to be culled. It’s the reason we’re keeping cows longer.”

Holstein Cows Who Milk Like Jerseys

While the herd is skewing older, it is also becoming remarkably more efficient in terms of components. Prins notes a sentiment shared by International Dairy Foods Association CEO Michael Dykes: modern Holsteins are starting to milk like Jerseys.

“The shift in genomics to be able to produce more components is a big deal,” Prins says. “We are seeing record butterfat and protein levels. Even though the milk price is strained, producers are adding $3 to $4 a hundredweight to the bottom line because of these beef-on-dairy calves and high component values.”

Prins dismissed concerns that keeping older cows longer would result in a loss of genetic potential for the national herd. Because producers are being much more surgical with their breeding — using gender-sorted semen on only their top-tier animals — the next generation of replacements is genetically superior to anything the industry has seen before. The older cows are simply serving as surrogates for the terminal beef market, fulfilling a dual purpose that keeps the farm’s balance sheet afloat.

Weathering the 2026 Storm

As Prins looks toward the next six to 12 months, her forecast is one of “sadly optimistic” realism. She anticipates a slow, strategic pullback in the national herd size rather than a massive move.

“If we send too many cows to the back door at once, we create other issues,” she warns. “I’m hoping for a slow trickle down in cow numbers over the next six months, which should hopefully help the milk price rebound as we move out of this oversupply situation.”

Regarding the beef market, Prins is keeping a close eye on USDA’s cattle reports. While a rebuilding of the beef herd is inevitable, she believes the dairy-beef market has at least two more years of strength.

“Even if we start rebuilding the beef herd, we have to keep extra heifers on the cow-calf ranch, which further contracts the immediate beef supply. With strong consumer demand, that beef-on-dairy price should stay buoyant for the next couple of years,” she says.

The Bullish Bottom Line

When asked if the dairy industry is on the verge of a recession, Prins remains cautious. She points out traditional metrics, like how much Dairy Margin Coverage (DMC) is paying, don’t account for cull cow revenue, calf sales or labor costs, and therefore don’t tell the whole story.

“If you look at milk income over feed cost, it looks tough,” Prins admits. “But if you add beef-on-dairy into the equation, we’re not looking so bad.”

For Prins, the path to long-term gains requires enduring some short-term pains. She remains bullish on the industry’s future, citing massive investments in dairy processing and the stability of feed costs — barring any catastrophic weather events.

“Agriculture is cyclical. The highs eventually end, and the lows eventually come back up,” she concludes. “Between the processing investment and the beef-on-dairy market, there are a lot of things to be bullish about. The dairy industry is in a good position to rebound without turning the table.”

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Beef Prices will Continue to Rein in Milk Cow Numbers

Wed, 18 Feb 2026 14:54:54 GMT

Historically high beef prices continue to play heavily in the dairy market. For the eighth consecutive year, heifer inventories at the beginning as of January 1 were lower than they were the year before. And that will continue to incentivize dairy producers to breed for the beef market while keeping more older cows in the milk herd, according to Sarina Sharp, analyst with the Daily Dairy Report.

According to USDA’s recent Cattle report, as of January 1, the national milk herd contained 3.905 million heifers, 11,000 fewer than last year. The number of heifers ready to calve and enter the milk herd dipped by 3,000 head to 2.498 million.

(Fran Howard)

“Heifer numbers are the lowest since 1978 and illustrate the continued tension producers are facing with respect to cattle sales,” Sharp said. “Astronomical beef prices are encouraging the expanded use of beef-on-dairy breeding strategies to deliver crossbred calves that can be sold for high cash value.”

For example, Sharp said, values for crossbred calves, weighing between 70 and 75 pounds, were selling for as high as $1,700 each at a recent New Holland livestock auction. “These previously unheard-of values are providing a critical cash infusion to producers, particularly during a time of weak milk margins,” she added.

Shrinking heifer numbers also shed light on the growing milking herd, which last year, expanded by 212,000 head.

“With heifer numbers down, it has become increasingly apparent that the herd grew largely through delayed culling and keeping older animals in the herd through one more calving and lactation cycle,” Sharp noted. “Ultimately the market should respond to elevated beef prices by growing supplies. But given the time required to increase inventories, this change will be slow in arriving.”

(Fran Howard)

The pressure to continue breeding for crossbred calves will keep heifer supplies limited if beef prices remain at historical highs, she said.

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Respiratory Disease Follows Beef-on-Dairy Calves for Life

Wed, 18 Feb 2026 15:32:38 GMT

When beef‑on‑dairy calves first started moving off of dairy farms and onto the next stage of life, they didn’t get much attention. But today, these crossbred calves represent a significant revenue stream for dairy producers, bringing their early-life care into sharper focus.

“Beef-on-dairy calves have exploded in popularity,” says Melissa Cantor of Penn State University. “Holstein bull calves are worth good money, but the beef-on-dairy [market] has really exploded. We saw $1,500 prices for calves here in the Northeast in the past couple weeks.”

When calves are bringing in that kind of money, what happens early on matters — especially around bovine respiratory disease (BRD) issues. During a recent “The Dairy Nutrition Blackbelt Podcast,” Cantor spoke on how even mild respiratory disease early in life can leave a lasting mark that follows beef-on-dairy calves all the way to the packing plant.

Early Respiratory Disease Starts Small

Despite their rising value, many beef-on-dairy calves still receive minimal nutrition early in life. Cantor notes they are often limit-fed and given lower-quality colostrum. At the same time, respiratory disease often spikes around weaning, when stress, nutrition and environment collide.

“We see a lot of respiratory disease around weaning,” Cantor says. “So, we wanted to know: how does that affect long-term growth, and is there something we should change in how we raise these calves?”

To answer that question, Cantor’s team followed 145 beef-on-dairy calves from early life through slaughter. The team used ultrasound around weaning to spot any early signs of respiratory disease. However, when disease was identified, it often looked minor.

“It was just very early lung consolidation — about one centimeter,” Cantor explains. “It’s basically a tiny spot on the lung. The calves still looked healthy. But as a dairy farmer, you’d probably never notice it. Maybe they’d cough a little, but that’s about it.”

In the study, about 25% of the calves showed this level of lung consolidation, which Cantor says is typical for weaning-age animals. But while it appeared mild, it still had consequences.

Feedlot Performance Can Be Misleading

When the calves moved on to the feedlot level, researchers tracked how they ate and grew to see if early respiratory disease showed up later. They monitored feed intake, weight gain and finishing weights.

“We weighed them when they arrived at the feedlot, and we knew what their dry matter intakes were,” Cantor says. “Dry matter intake, acclimation to the diet, average daily gain in the feedlot, finishing weight — they were all the same despite if the calves had respiratory disease or not. We were shocked.”

In other words, calves that had been sick early in life caught up in growth. By the end of the feeding period, they looked just as productive as calves that had never shown signs of respiratory disease.

However, this changed at slaughter.

“We followed these crossbreds all the way out to slaughter, and we actually had carcass tracing on those animals,” Cantor says. “We were able to look at carcass dressing weight and marbling, which is huge.”

That’s where the impact of that early respiratory disease became clear.

“What was so interesting to me is that the marbling in those animals that had respiratory disease was less,” Cantor says.

Lower marbling leads to a lower carcass grade, reducing the animal’s final value.

“If we have a lower marbling score and a lower carcass grade, you’re going to get paid less for that animal, or even potentially get discounted,” Cantor says. “This is how these beef producers are being paid, and no one’s ever thought about managing respiratory disease to deal with these long-term effects.”

So why does early respiratory disease leave this lasting mark? One explanation Cantor offers relates to how calves use energy during critical stages of development. Even when intake and average daily gain even out, healthier calves can direct more energy toward fat deposition, while calves fighting illness may divert nutrients to support their immune system instead.

In short, when calves fight disease during these windows of fat cell development, nutrients may be redirected away from marbling, leaving them with lower carcass quality even if their growth appears normal later in life.

Spotting and Preventing BRD

While early respiratory disease can be easy to overlook, even mild cases can lower marbling and carcass grade at slaughter, reducing the animal’s value long after it leaves the dairy. And while this may not seem like a major concern for dairies that sell calves early, calf ranchers and buyers may avoid sourcing animals from farms with a history of BRD.

Because early cases can be easy to miss, it helps to watch for these symptoms:

Increased or labored breathing
Coughing
Ear droop
Nasal or eye discharge
Lethargy
Poor appetite
Fever
Diarrhea
Isolation from the group

To help reduce the risk of respiratory disease, focus on these prevention steps:

Provide adequate, high-quality colostrum
Maintain consistent milk feeding
Follow vaccination programs
Provide ample, dry bedding
Ensure proper ventilation
Keep housing draft-free
Maintain clean, sanitary facilities
Detect and treat disease early
Keep low stocking densities
Minimize stressors

For dairy farmers and calf ranches, early‑life management still matters, even if the calf leaves the farm soon after birth. Investing in colostrum, nutrition, housing and respiratory disease prevention protects not only calf health but also long-term value.

Dairy Faces a “Very Weird Situation,” Forcing Farmers to Rethink Revenue

Thu, 12 Feb 2026 17:27:19 GMT

Dairy farmers are standing on shaky ground. Milk checks are tight and input costs are up, but replacement heifers and beef-on-dairy calves are providing an unusually strong backstop. As Gregg Doud, president and CEO of the National Milk Producers Federation, puts it, dairy is in a “very weird situation” right now.

Beef-on-Dairy Helps Pay the Bills

With today’s market conditions, many dairy farmers are finding that the most valuable part of their operation is not in the parlor, but in the maternity pen.

“The milk check is not much,” Doud told “AgriTalk” host Chip Flory during Farm Journal’s 2026 Top Producer Summit. “But those calves are worth so much.”

In some regions, that beef-on-dairy value is staggering.

“The latest number I heard in the Northeast recently, a black day-old calf [is worth] $1,600,” Doud adds. “You talk to [dairy farmers] and they say, ‘We’re in the beef business now.’”

At a time when the milk check alone is not enough to carry the operation, beef-on-dairy has become a financial lifeline that is helping many farms stay profitable.

“Beef-on-dairy doesn’t have 100% penetration into the industry, but it’s close,” Doud says. “I would say it’s over 75% at this point.”

This shift is reshaping how farmers think about cow value, reproductive decisions and even culling strategies. A cow is no longer evaluated only on her milk production or longevity, but on the value of the calf she is carrying.

“If a cow is pregnant, she’s staying,” Doud adds. “The calves are worth too much to ignore.”

Fewer Replacements

That shift, however, comes with consequences for the future makeup of the herd.

With so many breedings going to beef, Doud says the number of replacement dairy heifers in the industry has dropped to levels that are noticeably short.

“The number of replacement dairy heifers is way below what it ought to be,” he says. “So, this is going to be interesting, and there could be a big swing in cow numbers at some point here.”

Doud notes the current reduction in replacement heifers is something the industry is watching closely.

Risk Management Remains Essential

As producers navigate all the shifting pieces in today’s market, Doud draws a firm line on risk management. In a margin environment like this, Dairy Margin Coverage (DMC) and Dairy Revenue Protection (DRP) are not optional tools in his mind. They are essential.

“The Dairy Margin Coverage program for dairy is something that I think everybody in agriculture needs to look at,” he says. “It kicks in when you need it.”

Although DMC has limits on how much milk can be covered at the highest level, Doud notes it still works well for most dairies. He follows that point with strong encouragement for producers to also consider DRP, explaining it offers another way to safeguard milk income by allowing farms to insure a portion of their future revenue against market swings.

“Every dairy farmer in America, my goodness, if you are not signed up for DMC and also DRP on the insurance side of the equation, get signed up for these things,” he adds.

In his view, these tools were designed specifically for moments like this, when margins are thin and markets are unpredictable.

Cautious Optimism in an Uncertain Market

Looking ahead, Doud acknowledges milk checks are likely to remain tight, but the value of beef-on-dairy calves is helping farms navigate a difficult margin environment.

With additional dairy processing capacity coming online and continued demand for protein, he is hopeful milk prices will improve. In the meantime, he views risk management tools and beef-on-dairy breeding decisions as practical safeguards for producers working through challenging market conditions.

The Beef-on-Dairy Revolution: How Black Calves and AI are Reshaping the Dairy P&L

Thu, 12 Feb 2026 14:22:27 GMT

The dairy industry is currently undergoing a structural transformation. What was once a singular focus on milk production has evolved into a multi-faceted agribusiness model. As Kansas dairy producer Greg Bethard puts it: “We might be more ranchers than we are dairymen now, because the uterus has more value than the mammary gland.”

The Beef-on-Dairy Revolution

The most significant shift in recent years is the black calf phenomenon. With beef prices at historic highs, the revenue generated from crossbreeding dairy cows with high-quality beef genetics has upended the traditional P&L.

“We have cows spitting out $1,400 calves now,” Bethard says. “It has changed the math for the entire operation.”

This new revenue stream provides a buffer that allows dairies to remain profitable even when milk prices are disappointing. Idaho dairy producer Hank Hafliger has embraced this by breeding a large percentage of his herd to Angus crosses, while TJ Tuls of Tuls Dairy in Nebraska, has vertically integrated by raising his own steers to 680 lb. before selling them, capturing more of the value chain.

“Angus breed on our pro-cross cow yields have been really good,” Tuls notes. “We’re producing an amazing calf, and it’s definitely been a nice injection [into the operation].”

Technology as a Management Tool

While the AI buzzword is everywhere, these producers are selective about which technologies they adopt. For Bethard, three must-haves for managing large groups are sort gates, activity collars and milk meters.

“I would never want to build a dairy without those three,” he says.

Tuls is pushing the boundaries further by testing AI-driven cameras to monitor employee performance, animal movement and milking procedures. The goal isn’t just to watch people, but to ensure that the dairy’s specific protocols are being followed consistently, which protects both animal welfare and milk quality.

“At the end of the day, though, it’s feeding you data back, and it’s what you do with that information. Having really good people who go out and act on the data that it’s giving you back really makes a difference.”

TJ Tuls

Vertical Integration and Sustainability

Diversification is the key to long-term resilience. Tuls has aggressively pursued vertical integration, building a trucking company and, most recently, a milk processing plant.

“We’re looking at how we can serve our own businesses,” Tuls says.

This includes a high-protein, low-sugar milk product that is already expanding across the Midwest and West Coast.

Sustainability has also become a revenue center rather than a cost. Tuls’ digester projects now produce enough gas to heat 6,000 houses per year. In Idaho, Hafliger is focusing on innovative manure management, working with scientists to extract micronutrients from manure to create new value-added products.

“In Idaho, manure management is going to be huge. We’re doing a lot of innovative studies, pulling out micronutrients out of our manure and utilizing it. That’s what we really need to focus on,” Hafliger shares.

The Water Constraint

Perhaps the most sobering topic during Milk Business Conference panel was the future of water. In Idaho, Hafliger notes that “water is king,” with every well metered and allocations strictly controlled by the state. Bethard, operating in the High Plains of Kansas, is already strategizing for a future with less water by transitioning his crop rotation toward wheat and soy, which requires fewer inputs than corn silage.

“We have to make sure that 30 years from now, we can still milk cows where we are,” Bethard says.

This long-term thinking — balancing immediate revenue from black calves with the existential reality of resource management — is what separates the top-performing producers from the rest of the field.

The modern dairy is no longer a single-commodity enterprise; it is a complex ecosystem of logistics, genetics and resource stewardship. By leveraging immediate windfalls like the beef-on-dairy market to fund long-term investments in technology and vertical integration, producers like Bethard, Tuls and Hafliger are doing more than just chasing margins — they are future-proofing their legacies. In an industry where water is becoming as precious as milk and data is as vital as feed, the successful producer of 2026 and beyond will be the one who balances today’s black calf revenue with the existential necessity of long-term resource management.

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Why Fiber Quality Matters More for Beef-on-Dairy

Thu, 05 Feb 2026 22:33:19 GMT

On paper, a beef-on-dairy steer may look about the same as conventional beef at finishing. But at the bunk and in the rumen, it’s a very different animal.

While physically these animals are identical, beef-on-dairy cattle are running on a more expensive engine, according to University of Nebraska beef systems Extension educator Alfredo Di Costanzo. During his recent webinar on beef-on-dairy fiber requirements, he used grazing data to highlight the different fiber needs for this terminal cross.

Different Genetics, Different Requirements

During a recent study, when Di Costanzo compared beef breeds to beef-on-dairy animals on pasture, the results were consistent. The traditional beef cattle converted forage to gain more efficiently, while the beef-on-dairy group gained more slowly and finished at lighter weights. To Di Costanzo, it showed the genetic influence of the dairy breed increases the energy required for growth.

“Because I put dairy [genetics] on this beef animal, the maintenance requirements have gone up,” he explains. “If we’re going to increase fiber inclusion, we’re going to have to do it with a better-quality forage.”

Why Low-Quality Fiber Doesn’t Cut It

The challenge is not just that beef-on-dairy cattle use more energy. It is also how quickly feed moves through their systems.

Dairy and dairy-cross animals tend to have a faster rate of passage through the rumen, Di Costanzo notes. That may not sound like a major difference, but it changes what kind of forage they can actually use. A stemmy, lower-quality roughage a beef steer might handle fairly well can end up acting like little more than gut fill in a Holstein-influenced calf.

While this study focused on cattle on pasture, the same idea applies at the feed bunk.

Di Costanzo explains lower-quality fiber does not stay in the rumen long enough to be properly digested for these beef-on-dairy crosses. In nutrition terms, that can create negative effects where poor-quality roughage drags down the performance of the entire ration by taking up space without delivering much energy in return.

“Lower quality forage, for me, means less time for ruminal digestion and more time, too, for negative associative effects,” Di Costanzo warns.

Those negative effects can show up as lower total digestibility, poorer feed efficiency and more variability in intake, especially when cattle are already being pushed on a high‑concentrate program. For beef‑on‑dairy cattle, that means cheap, low‑quality roughage is rarely worth the investment. Di Costanzo notes every pound of dry matter must work harder, making junk roughage a poor economic fit.

Is Cheap Roughage Costing You Gain?

Biologically, cattle can get by on very little fiber if energy and protein are there, Di Costanzo notes.

“At zero or near-zero inclusion of fiber in the diet, cattle are continuing to thrive,” he adds. “There’s really no NDF requirement for maintenance or growth.”

But in a real‑world feeding program, beef‑on‑dairy cattle need rations that turn a profit, not just keep them alive. That’s why Di Costanzo warns against using cheap, low‑quality hay or residues just to say the diet has enough roughage.

Instead, he suggests aiming for about 10% to 15% NDF from good‑quality forage. For many feed yards, that might mean favoring well‑processed silages or higher‑quality forages over the cheapest roughage available. The goal isn’t to stuff the rumen. It’s to support muscle gain without sacrificing efficiency.

Quality Over Quantity

Fiber decisions are not just about keeping the rumen healthy. They also affect how cattle perform on feed and the value you get when it’s time to sell.

Adding more fiber to beef-on-dairy diets can help support greater feed intake, but there’s a limit. Average daily gain starts to drop quickly once physically effective NDF goes above about 15.5%, and feed conversion efficiency also declines. The challenge for producers and nutritionists is finding the sweet spot where cattle eat enough without slowing growth.

Overall, the type of NDF is less important than making sure cattle get the right amount of good-quality fiber. Hitting that balance helps support intake, maintain feed efficiency and keep beef-on-dairy steers performing at their best. For beef on dairy cattle, a well-planned grower ration with the right balance of concentrate and quality fiber can set cattle up for a better finish.

Idaho’s $4 Billion Dairy Boom: Why the Gem State is Defying West Coast Trends

Tue, 03 Feb 2026 14:05:50 GMT

While milk production across the West Coast faces a period of contraction, Idaho is carving out a different narrative. With USDA reporting the state’s production value near $4 billion in 2024, Idaho has transitioned from a regional player into a global dairy powerhouse. According to Rick Naerebout, chief executive officer of the Idaho Dairymen’s Association, this surge isn’t accidental. It is the result of a unique confluence of business-friendly policy, aggressive vertical integration and a fundamental shift in how dairy cattle are valued.

A Surge on a Massive Base

The sheer scale of Idaho’s recent growth is impressive. Naerebout reports the state has seen consistent growth rates of 5% to 8% per month year-over-year for the last 15 months. For 2025, Idaho is projected to be up 7.5% in total milk production.

“That 7.5% is on a very big base,” Naerebout explains. “It equates to roughly 3.5 million pounds of milk a day more this year than we had last year. We’ve definitely turned on the milk production.”

This growth has been facilitated by two primary catalysts. First, Idaho’s dairy producers are entering the current economic downturn with exceptionally healthy balance sheets following strong financial performances in 2024 and early 2025. Second, and perhaps most importantly, regional processors have finally lifted base restrictions that limited producers to fractional growth for years. With those caps removed, the Idaho dairy industry has surged to meet the available capacity.

The Magic Valley: The Heart of the Industry

The epicenter of this expansion remains the Magic Valley. While growth is visible across the state, approximately 75% of Idaho’s dairy industry is concentrated in this region. The concentration allows for an infrastructure of scale that is difficult to replicate elsewhere.

Idaho’s operations are notably larger than the national average, boasting nearly 2,500 cows per dairy. This scale, combined with a business-friendly climate — including the absence of agricultural overtime pay — allows Idaho producers to maintain lower costs than their neighbors in California or Washington.

Components and the “Black Calf” Phenomenon

Interestingly, the growth isn’t just coming from more cows; it’s coming from “better” milk. According to Naerebout, while volume is up 7.5%, the increase in milk components means the actual yield for processors is closer to 9%. This allows plants to produce more cheese, butter and powder for every pound of milk delivered.

Producers in Idaho, like other states, are also shifting culling practices.

“We’re hanging onto cows because they’ve got a black calf in them, and that calf is worth roughly $1,500,” Naerebout says.

The beef-on-dairy trend has become ubiquitous in Idaho, with adoption rates significantly higher than the national average of 70%. For many Idaho producers, the day-old calf has become a high-value commodity that provides immediate cash flow with minimal risk, as many are partnered with large feedlot operators, like Simplot, or feedlots to take the animals immediately.

Resilience Through Risk Management

The dairy industry is notoriously volatile, yet Idaho has shown remarkable resilience. Over the last 30 years, the state has only seen negative growth twice: in 2009 and 2013. Naerebout attributes this to a sophisticated approach to business that sets Idaho producers apart.

“Our dairymen are very savvy businessmen,” he notes. “We have a higher-than-average use of hedging tools. They insulate themselves from market downturns by making sure they are hedged.”

This financial discipline, coupled with being well-capitalized, allows these large-scale operations to weather economic storms that might shutter smaller farms in other regions.

The Shift to Vertical Integration

Perhaps the most significant structural change in Idaho’s dairy landscape is the move toward vertical integration. Unlike the traditional cooperative structure involving hundreds of members, Idaho has seen the rise of “processor-producers.”

Facilities like Idaho Milk Products and High Desert Milk were founded by small groups of dairy families — sometimes fewer than six — who pooled their capital to build their own processing plants. While Naerebout describes the startup phase of these ventures as “absolute hell” where families nearly lost everything, those who survived are now capturing the margins that previously went to third-party processors.

“They are capturing more margin for their business and using it as a form of risk mitigation,” Naerebout says.

This evolution from simple milk producers to sophisticated industrial processors represents the future of the Idaho dairy model.

Looking Ahead

As the industry faces a tightening economic window, Idaho’s producers remain focused on the long term. The goal for many is not just survival, but the creation of viable, multi-generational businesses. By combining aggressive adoption of technology, sophisticated risk management, and a willingness to invest in the processing side of the value chain, Idaho is proving that even in a mature industry, there is still significant room for a “growth state” to thrive.

“Idaho has been, and will likely remain, a growth area for plants and processors alike,” says Phil Plourd, president of Ever.Ag Insights. “It’s a hospital environment where all the stakeholders seem aligned around growing the industry.”

With strong components, high-value beef-on-dairy calves and a business environment that rewards scale, Idaho is well-positioned to remain the cornerstone of Western dairy production for the foreseeable future.

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Why the 2016 Flashback Hits Differently for Dairy Farmers

Mon, 02 Feb 2026 17:12:55 GMT

Lately on social media, there’s been a trend to look back at photos of our lives from 10 years ago, in 2016. Back then, the world felt like it was moving at the speed of a viral trend. We were chasing Pokémon through our neighborhoods, freezing in place for the “Mannequin Challenge” and celebrating the Chicago Cubs finally breaking their 108-year curse. It was a year of digital shifts and rose-colored nostalgia. But for a dairy farmer in the U.S., looking at a milk check today can feel like a strange case of déjà vu.

The Price of Stagnation

In January 2016, the base price for our milk in East Moline, Ill., stood at $14.44. In nearly ten years, the fundamental revenue for the wholesome dairy product we have poured into our life has relatively stayed the same.

While the milk price has remained almost frozen in time, the world around the farm has moved at a breakneck pace. The nostalgia of 2016 fades quickly when you look at the financial ledger. The true story of the last decade isn’t just found in the base price, but also in the input creep:

Labor: Since 2016, the cost of keeping a reliable team on the ground has surged by 30% to 50%, driven by a tightening rural workforce and rising cost of living. This especially holds true for farms located in states that have since mandated overtime laws for dairy employees.
Feed: The cost of fueling the herd has risen by approximately 20%, according to dairy financial analysts, as global supply chains and weather volatility redefined the price of a ration.
Operation: From stainless steel parts to the diesel in the tractor, the 2016 dollar simply doesn’t command the same power it once did. In fact, steel prices have risen more than 100% and concrete 65% in the last decade.

The Resilience of the American Dairy

However, the truth illustrates there are fewer farms in the last decade. In fact, the latest licensing data show there were about 5,100 dairy herds operating in Wisconsin at the start of the New Year. That’s just over half of the number of farms operating ten years ago. I know this data isn’t just isolated to the Badger State.

The 2016 trend reminds us of what we’ve lost and what we’ve gained, but for dairy farmers all around the U.S., it highlights a profound reality: Efficiency is no longer an option; it is the only way to survive. To deal with basically the same milk price a decade later, while costs have skyrocketed requires a level of grit and innovation that a viral hashtag could never capture.

Corey Gillins, chief milk marketing officer for Dairy Farmers of America, says they estimate 70% of dairy farmers are now engaged in beef-on-dairy, adding a significant $2.50 to $3.00/cwt. to their bottom line. Gillins also notes rising component values are adding another $1 to $3/cwt. to milk checks that are showing up even in Holstein herds that are now achieving high protein and butterfat levels.

The world might look back at 2016 with rose-colored glasses, remembering the music and the games. But the dairy industry is looking at the numbers. We are proving that even when the milk price stays the same, the American farmer never stops moving forward — evolving, innovating and finding new ways to turn a stagnant check into a sustainable future.

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