Much Thought Went Into Latest CWT Herd Retirement

Much thought and analysis went into the CWT’s decision to launch its tenth herd retirement program. CWT CEO Jim Tillison said in Thursday’s DairyLine that they consider a number of factors and one of them is dairy cow culling, which has picked up dramatically.  

“Cull cow prices are very strong,” he said, “And cow prices on the market are not as strong so we thought that now would be an ideal time to keep things moving in the right direction and to take out as many cows as we could with the limited funds that CWT has available.”  When asked about a bred heifer program not being included this time around, Tillison said its original intent was to “take out future milk production,” but the belief this time was that the most effective use of CWT money would be to take out cows that are currently being milked or soon will be. He also added that the bred heifer program was not “strongly subscribed to” in the past.  

When asked about the criticism over the maximum bid only being $3.75 per hundredweight, Tillison responded, “One of the things that we can’t do is pay much more than what cows are selling for in the marketplace.”  He said that CWT always set a maximum bid but it’s just been in the last three removals that a maximum bid was announced. He said the committee considers what top springers are selling for across the country and “if you look at the sales, and I’m not talking about purebreds, I’m talking about top springers, they’re selling for around $1500.00.” They also consider beef prices which are running as high as 80 cents but have been averaging closer to 60 cents per pound.  

“When you take those two factors together, $3.75 is a pretty good price, Tillison argued. A producer bidding in the program with a 20,000 pound cow, production wise, is going to get probably close to $1500 per head, depending on the milk production of the cow, he concluded.