New calculator helps determine the value of a bull

The calculator estimates breakeven price for a bull based on management

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Different traits of bulls contribute differently to an operation’s bottom line.

For example, a bull with a higher calving ease EPD (expected progeny difference) may contribute to a higher weaning rate. Not surprisingly, bulls with higher calving ease (or lower birth weights) sell for a higher price, according to research by Simms.

With the large variation in bulls available, bull prices extend over a range from $1,000 to more than $20,000 per head.

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Identifying a fair price during sire selection contributes to higher efficiency in operation economics. To estimate a breakeven bull price, a bull valuation calculator has been developed. The purpose is to provide a general idea of how much a bull is worth based on key farm parameters.

Bull values — two scenarios

The value a bull provides depends on its individual performance, the environment (for example, pasture productivity), management (cow-to-bull ratio) and markets (calf price). For example, large-framed bulls require more feed, leading to a higher maintenance cost, but that may be offset by heavier calves at sale time.

Two scenarios were studied — a low maintenance farm versus a high maintenance farm. The default values in the calculator are the averages of the two scenarios.

The low maintenance farm is assumed to have a larger pasture size reducing the cow-to-bull ratio, multiple bulls in a field with potential for fighting, as well as rough terrain contributing to reduced bull longevity, and reduced feeding costs over fewer days, resulting in lower maintenance costs. This management style is reflected in the cow herd as well with a lower weaning rate and lower weaning weights.

The high maintenance farm is assumed to have smaller breeding pastures, more labour, and more feed, which leads to a higher cow-to-bull ratio, greater longevity, higher weaning rates, and higher weaning weights.

Despite keeping key parameters constant like the proportion of the calf value attributed to the bull and expected calf price, there is a large variation in bull value between the two farm scenarios.

The high maintenance farm has a break-even bull price more than double that of the low maintenance farm. In fact, the low maintenance farm would have had a much lower break-even price if the annual maintenance cost was similar to the high maintenance farm. However, the lower annual maintenance cost helped to offset the lower cow-to-bull ratio and lower weaning rate.

For the high maintenance farm, the producer can afford to pay more for a bull given the expected performance of both the bull and its offspring. The large variation in bull prices on the market reflects the different abilities of the bull to bring value to an operation. This is impacted not only by the bull, but also the environment and management system used by differing operations.

Driving factors of bull price

The value a bull provides is in the calves sired over a lifetime, the long-term genetic change of the herd, and salvage value at the end of a productive life. As long-term genetic change is not readily measurable by producers, this parameter was excluded from the calculator.

The value provided depends on:

  • Cost factors, such as bull maintenance cost and death loss;
  • Performance factors, such as years of service, the expected cow-to-bull ratio, expected weaning rate, expected weight of feeders, and proportion of the calf value attributed to the bull;
  • Price factors, such as expected price of feeders and salvage value.

For more information, read the Canfax Research Services fact sheet.

The Excel bull valuation calculator can be downloaded by entering the above web address into a web browser then clicking on the (XLS) Bull Valuation Calculator option that appears in the results window.

Find more calculators like this at the Beef Cattle Research Council website.

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