As beef producers consider expansion, key expenses to consider are the cost of buying versus the price of developing your own replacements.
Oklahoma State University’s Mark Z. Johnson says there is evidence of an increase in heifer retention with improved drought conditions across much of the Central Plains and summer video auctions reporting a smaller percentage of heifer calves.
“Retention does not appear to be aggressive,” says Johnson, Extension beef cattle specialist, in a recent Cow-Calf Corner newsletter. “With the calf market on pace for another year of record prices providing incentive, herd rebuilding remains sluggish compared to past cycles.”
Lingering drought continues to limit forage availability in key regions while high interest rates and the substantial capital required to develop or purchase bred females further suppresses expansion. Many producers also remain wary of a repeat of the post-2014 market correction, adding a layer of caution to long-term decision-making.
“Even with bred female values at record highs, relative to calf prices, breds may still be undervalued, a sign of producer hesitation rather than a lack of economic feasibility,” Johnson explains.
He says an excellent metric to consider when purchasing bred heifers is the number of calves it takes to pay for the purchase. CattleFax recently reported in 2025 that figure is projected to average just 2.75 calves, well below the long-term average of 4.5 and far beneath the 2015 peak of 9 calves.
“This ratio is likely to rise over time, driven by higher bred female prices, moderating calf values, or a combination of both,” he explains. “If feed resources allow, this dynamic suggests that adding females to the herd today may be the best time from a breakeven perspective to expand.”
Keeping Replacements vs. Buying Bred Heifers
Johnson stresses replacement heifers are expensive; not only with respect to dollars invested but also the expenditure of time and labor involved.
“Recent market reports indicate 550-lb. weaned heifer calves selling for well more than $2,000 per head. Those heifers calves are still two years away from weaning their first calf if all goes according to plan,” he explains. “Accordingly, operations looking to add inventory may find a better option of purchasing bred heifers in the current market.”
What Should Bred Heifers Be Worth?
Johnson says assuming weaned calves remain at a value of $2,000 to $2,500 per head over the next few years, your annual cost of running a cow will largely determine what you should invest in a bred heifer.
“The annual cost of maintaining a beef cow is highly variable and has increased tremendously over the past five years,” he explains. “Variable costs such as fuel, fertilizer and herbicides have been blamed as the primary culprits; however, fixed costs such as equipment, hired labor and land have increased as well.”
Total economic costs associated with U.S. cow-calf production for 2018 were estimated to range from $910 per cow for operations with 500 or more cows to $2,099 per cow for operations with 20 to 49 cows.
“These results show significant economies of scale, with costs per cow declining with increased herd size,” Johnson says.
Kansas Farm Management Association estimates the annual cost of running a cow to be approximately $1,551 according to data collected in 2024.
Johnson says it is noteworthy that pasture and feed only account for $684 of that total. Visit AgManager.info for a detailed breakdown of the other actual expenses.
Market fundamentals are strong for a continued robust cattle market until cow inventories start to climb.
“There is currently not much indication of that happening anytime soon,” Johnson summarizes. “That being said, what bred heifers are worth to your operation, and how many calves a female needs to raise in order recapture your initial purchase price, will depend on how much profit she nets each year per calf rather than on the gross value of each calf she produces.”
