Beef-on-Dairy: How This Iowa Dairy is Strategically Positioning Itself for Success

The beef-on-dairy sector is thriving, showing no signs of slowing down. What began as a trend over a decade ago has evolved into a steady and reliable revenue stream for dairy farmers nationwide. One such example is the McAllister Family Dairy in New Vienna, Iowa, co-owned by Ted and Megan McAllister.

About six years ago, Ted and his brother Rob decided to make a strategic investment in their herd’s reproductive program. Before this shift, they had relied primarily on herd bulls. Today, however, the farm uses 100% artificial insemination (AI) along with genomic testing and Allflex activity monitors for their 280-head herd of Holsteins and Jerseys. This shift has not only improved their herd’s genetic potential but also opened the door for using beef semen on some of their lower-performing cows.

Beef-on-Dairy: How This Iowa Dairy is Strategically Positioning Itself for Success. By introducing beef genetics into their breeding program, the McAllisters were able to improve the value of their bull calves, tapping into a much more profitable beef market. Megan explains, “What really drove our decision to start incorporating beef semen into our breeding program was genomic testing. We wanted to fully take advantage of that technology and create the best replacements possible. That meant managing our heifer inventory and not raising anything extra.”

Under the guidance of reproductive consultant Dave Erf from Zoetis, the McAllisters established a genomic-based breeding plan. Today, 60% of their lactating cows and 25-30% of their heifers are bred with beef semen. This strategic shift has become the cornerstone of their reproductive program, allowing them to focus on improving herd productivity while adding valuable beef-on-dairy genetics.

The McAllisters knew that precision in managing herd numbers would be critical for success. They needed to determine exactly how many replacement calves were required, how many first-calf heifers should join the milking herd, and the ideal monthly cull rate. “We ship our milk to Prairie Farms and operate within their base system,” Ted notes. “So, we are kind of capped on the amount of milk we can produce. That means we only need to create a few replacements each month for the herd to remain at its current size.”

Beef-on-Dairy: How This Iowa Dairy is Strategically Positioning Itself for Success. With a clear understanding of their milk production limitations, the McAllisters worked with Dave Erf to create a genetic audit to assess their progress. They aimed to produce about 12 heifer calves per month while maintaining a 30% cull rate and keeping 30% of the herd as first-calf heifers. “We really look forward to that audit each year because it allows us to see if we are hitting our benchmarks,” Megan shares. “It’s fascinating seeing those numbers and it allows us to be really picky with which animals we are choosing to make replacements from.”

With genomic data and regular audits, they make precise breeding decisions. By prioritizing cows with strong longevity and productivity, they reserve beef semen for animals that are less likely to remain in the herd long-term. “When we know an animal is going to get bred to beef, we try to pick Angus beef sires that have higher fertility and better calving ease traits,” Ted adds. This strategy ensures a steady flow of elite replacements, with beef-on-dairy calves rounding out the operation’s production.

Beef-on-Dairy: How This Iowa Dairy is Strategically Positioning Itself for Success. For the McAllisters, the incorporation of beef-on-dairy has proven to be a financial game-changer, especially in recent years as beef prices have soared. “We wouldn’t be where we are today without these beef-on-dairy calves,” Megan states. “They’re easily our third-largest source of income, behind milk and cull cows. From our perspective, we have to breed cows anyway, so you might as well make more profitable calves—and it’s certainly working for us.”

This shift has also reduced labor demands, as raising fewer replacement heifers has freed up both time and pen space for older animals. “We only rely on a few outside people for help,” Ted explains. “Otherwise, it’s just the three of us running the ship. Having fewer calves to take care of and less overcrowded pens to manage has really helped us from a labor standpoint.”

Looking ahead, experts like Dr. Woerner from Texas Tech University predict that beef-on-dairy will remain a profitable venture for years to come. With traditional beef cattle numbers still low due to factors like drought and feed shortages, beef-on-dairy calves have found a steady, respected market. “The demand for beef-on-dairy calves isn’t solely because of the shortage in beef cattle. They also offer great carcass quality and sustainability benefits,” Dr. Woerner explains.

For the McAllisters, the decision to incorporate beef-on-dairy genetics has been transformative. It’s increased profitability, reduced labor needs, and allowed them to focus on high-quality replacements for their milking herd. Megan reflects, “It fits into our plan so perfectly. I couldn’t imagine dairy farming today without it.”

As more dairy operations follow suit, the trend toward beef-on-dairy is not just a passing fad. It’s becoming a crucial strategy for both dairy and beef industries, ensuring higher profitability and sustainability in the years ahead.