It’s no secret why beef on dairy calf prices soared higher in 2025. The beef-cow herd, reduced by mass liquidations over the past few years due to drought, input costs, and interest rates, was at its smallest in decades at just 27 million (Figure 1). This decline has made beef on dairy calves essential to keeping feedlots at capacity. This domestic decline in beef cattle, alongside the screwworm-driven border closures preventing American feeders from sourcing Mexican cattle to fill their yards, drove feeder-calf prices up, up, and away to an average nearing $400/cwt (Figure 1) in the fall of 2025. The cow-herd has yet to show large signs of rebuilding. According to Dr. Derrell Peel, heifer retention from calf crops has not seen a true uptick yet, though the liquidation of mature cows at least seems to have slowed – indicating we are in for high-calf demand for some time yet¹. But, for how long?
The September USDA Livestock, Dairy, and Poultry Outlook² indicate that both cattle harvests and feedlot placements, alike, were low through 2025. To compensate for low supply of incoming cattle, feeders have been tending to keep cattle on feed longer to keep pens in utilization, meaning additional slowing of harvests. Beef export and import considerations became volatile through late 2025, but beef consumption didn’t seem to slow.
So, what does this mean for dairy producers in the U.S.? A few key strategies will keep producers on track no matter when or how the market changes.
1. Herd and inventory management
Per Figure 2, calf prices soared, with average sale-barn highs climbing closer to $2,000 per calf. Understandably, it becomes increasingly important to strike the right balance between creating enough replacements while taking advantage of high calf prices, given the replacement-heifer population has also been at an all-time low. “Our goal through CentralStar’s reproductive and genetic consulting services is to make every calf count,” says Regional Consulting Manager Emily Middleton-Gyomory. “By using our inventory-monitoring tool and SMS®, producers can identify the sweet spot in herd management, producing the optimal number of heifers, balancing beef on dairy with replacement needs, and boosting both milk production and genetic progress.” The support of a trusted team helping to keep eyes on the trends can be the tipping point between being reactive or proactive to market developments.
2. Calf-risk management
- $2,000 for a one day-old beef calf is certainly a welcome source of revenue in the current milk market. However, consider more than just the calf price, and profit can quickly and stealthily be stripped away without careful management.
- Days open has a cost, and a sneakily cumulative one at that! The quick benefit of a few more dollars promised on a day-old-calf price can easily be wiped away when semen of unknown-processing quality or undocumented fertility is used. Select Sires ProfitSOURCE brings together on-farm results and a true, statistical evaluation to make beef selection less of a gamble and more of a security.
- At this point in time, all available calves are needed by growers and feeders, and thus the pricing signals may say any ol’ bull will do. However, we continue to hear from feeders and growers that they know exactly which kinds of calves keep their business moving forward. In fact, some of those “any ol’ beef bulls” are no-go’s when growers see them being used on a farm. No quality means no bid or only a low bid! Building relationships and integrity with ProfitSOURCE will set up producers for the best-possible outcome when growers and feeders have the opportunity to differentiate prices, again.
- Calf health. $2,000 is great – given the calf actually lives. Remember that many buyers operate under a standard protocol, whereby calf mortality within the first 24 hours of arrival means no calf payment. That means we need to set up calves for success throughout transport-and-arrival processing in order to benefit from our beef inputs. Proper colostrum management and newborn protocols can help prevent the blow of missing out on a sizeable calf check. Herd-management solutions available through CentralStar can help when it comes to colostrum solutions and personalized ProfitSOURCE protocols. Producers may also wish to investigate Livestock Risk Protection (LRP) as a potential strategy for mitigating risk while managing high-quality beef inputs on-farm.
While the price is right for now, and may be for some time, producers can ensure this favorable beef market is not just a blip on the radar, but a long-term success with a forward-thinking ProfitSOURCE beef on dairy strategy.
References: ¹Rook, 2025. USDA Cattle on Feed Bullish, Inventory Report Confirms Record Low Herd; ²USDA, 2025. Livestock, Dairy, and Poultry Outlook: September 2025
Author: Lauren Kimble, Manager of ProfitSOURCE® Supply Chains, Select Sires