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Dairy calf-to-beef systems have seen significant growth in the Republic of Ireland (ROI) within the last decade as dairy cow numbers expanded in the post-quota era.
In 2024, approximately 60% of prime cattle kill processed in ROI were animals born to a dairy dam, with the remaining 40% being suckler bred.
Five years ago,that ratio was the mirror opposite, according to Teagasc livestock specialist Alan Dillon.
Speaking at last week’s Ulster Grassland Society conference, Dillon outlined some of the key lessons learned within the Dairy Beef 500 programme operating south of the border.
Launched in 2022, the five-year programme is an industry-backed partnership demonstrating best practice on farms specialising in rearing dairy calves through to slaughter.
Along with a central demonstration farm in Tipperary, 14 commercial farms participate in the programme, aiming for a net margin averaging €500/ha, excluding family labour and subsidies.
“Fifty percent of the farmers involved operate on a part-time basis, so there is a big focus on labour efficiency, which gets overlooked in calf rearing.
“On average, the farms purchase 40 calves per year, with 1,947 calves bought in the first three years of the programme.
“Approximately 1,300 of those animals were Holstein-Friesian, 500 being Angus or Hereford and the rest being continental cross,” stated Dillon.
Data such as purchase age, price, milk powder, concentrate input, weight gains and carcase weight are recorded, which provides in-depth feedback to each farm.
Beef index
“The introduction of the Commercial Beef Value (CBV) index has been a game changer within dairy calf-to-beef systems over the last five years.
“It gives an insight into an individual calf’s genetic merit. Basically, the higher the index, the greater the animal’s potential for beef production.
“The CBV is available when buying calves in a mart. It gives farmers a better handle on which calves are likely to have good growth and carcase weight potential.
“It also gives farmers a heads up on what calves to avoid. For dairy farmers, the CBV is a great way to advertise high genetic merit calves for sale, be that direct from farm or via the mart.
“On average for every €1 increase in CBV, farmers are getting an extra €1.70 back in terms of higher output from increased carcase weight and beef price,” outlined Dillon.
Price competition
A drawback to having this information has been greater buying competition for high index calves, which ultimately increases the purchase price.
However, Dillon stated that there are seasoned farmers running successful calf-rearing enterprises, sourcing high index Friesian calves at a fraction of the cost of beef-sired animals.
“Under the right management, good farmers are killing these Friesian bullocks into 280kg to 300kg deadweight. Although they generate a lower beef price due to conformation, the calves cost less to buy. In the right hands, they can achieve good weight gain and leave a healthy margin.
“On some of the demo farms within the programme, there are Friesian calves costing €150 less than a Hereford calf, yet they are outperforming them in terms of carcase weight and net profit.”
Sub index
While the CBV is an overall index based on carcase traits and feed efficiency, Dillon said dairy farmers are focusing on some of the sub-index information available when choosing AI sires.
“The dairy farmer still wants an AI bull with a short gestation and calves with a low birth weight. This information is available in the Dairy Beef Index (DBI), which has around one third of its weighing based on calving traits.
“Both the CBV and DBI are relatively new developments and they do have limitations. The information is reliant on farmers recording the calf sire at birth. As more sires are recorded, the more accurate the indices become. That accuracy increases further when farmers genotype animals.
“It is in everyone’s interest to record more sire information, so the industry can avoid using bulls breeding calves which fail to produce a carcase greater than 240kg. ”
Profitability
All financial data is benchmarked on the programme farms annually. In 2021, net margin was €650/ha with fixed costs of €692/ha, variable costs of €1,541 and farms stocked at 2.31 livestock units per ha (LU/ha).
In 2022, stocking rate was unchanged, but net margin fell to €516/ha, despite the average beef price paid to farmers rising 73c/kg to €4.78/kg.
“Farmers don’t need reminding about the spike in input costs that year. Variable costs jumped to €1,953/ha and fixed costs rose to €768/ha. That had a major bearing on net profit.
“During 2023, variable costs were similar at €1,985/ha, with fixed costs rising to €790/ha. Beef price rose to €4.96/kg and stocking rate increased to 2.37 LU/ha, lifting net margin to €550/ha.
“We would be hopeful the 2024 figures, once finalised, will see a marked improvement as some inputs fell in value, while beef price late in the year improved significantly.
“But ultimately, running a profitable dairy calf enterprise requires high levels of efficiency throughput, buying the right calf at the right price and a viable beef price being paid.
“Over the years, the data shows that for every 10 farmers buying calves in one specific year, only four will return to the live ring the following year to buy again.
“That is a 60% drop out rate and shows calf rearing is not straightforward or an easier way to make money over sucklers or stores.”
Lessons learned
Reasons for such a high dropout rate are varied. But according to Dillon, the leading cause is calves experiencing a major disease challenge in early life, be that scour or respiratory illness.
“To overcome this, buying trends are changing. Farmers are looking to purchase calves older than three weeks and, ideally, around four weeks old.
“By this stage, most of the scour risks should have passed. Buyers want calves that are at least 60kg liveweight, or heavier, as they tend to be stronger and less prone to pneumonia problems.
“Buyers are prepared to pay more for calves that meet this criteria and dairy farmers responding to these requirements are being rewarded.”
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