Cash Value of the Dairy Cow Predicted from Net Income over Remaining Herd Life

¹ Department of Animal and Veterinary Sciences, University of Maine, Orono 04469

For decisions involving the purchase of dairy cattle, cow cash value can be defined as net income over remaining herd life plus terminal salvage value. Cow net income per month was predicted from income curves, and life expectancy was estimated using standard life table techniques. Estimates of cow net income per month over 13 calvings were calculated for cows with 27 combinations of cow characteristics (including parity, stage of lactation, fertility, producing ability, salvage value, and health problems) in combination with nine milk and feed prices. Remaining herd life was estimated for each cow parity, pregnancy status, and stage of lactation. For each parity, lactation stage, and pregnancy status combination, appropriate estimates of cow net income per month over estimated remaining herd life were discounted to the cow’s present age, summed, and added to a terminal cow salvage value. These observations of cow cash value were analyzed by regression analysis. Parity, producing ability, and milk price had the most effect on cash value. Cash value was highest at freshening in second lactation with a consistent pattern of change after calving in all parities. Prediction equations can estimate the maximum price or depreciation for a particular animal and the relative values of different animals.

Key Words: herd life • profitability • cattle sales

Submitted on January 20, 1989
Accepted on October 2, 1989