The cyclical nature of the cattle market produces hardship for producers when prices are low, but those periods also offer opportunity. North Dakota State University economist Harlan Hughes suggests that changing a beef herd's culling rate as the herd progresses through a 10-year cattle cycle can result in an overall higher average net income for the complete cycle.

"Let's look at 1996 heifer calves," he says. "Remember how you had to give them away because nobody wanted 1996 heifer calves?" Steer calves during that time, he notes, sold in the low $60s and heifers were discounted another $10 to $12 per hundredweight. But those heifers born in 1996 and bred in 1997 produced calves in 1998, 1999 and 2000 and will produce beyond that, Dr. Hughes points out, right over the top of the calf price cycle.

"My recommendation is to develop a countercyclical culling strategy to enhance net income over the total cattle cycle. Cull deep when calf prices are low, generate cash flow from cull sales, and hold back low-priced heifer calves. Then, reduce culling when cattle prices are high, and sell all calves born. Use the high-price times to build a financial reserve for the next price low in the beef cow business."

For more information on this strategy, see the March 16 edition of Dr. Hughes' "Market Advisor" newsletter, online at