In the two weeks prior to writing this article, the stock market took a big dive and the cattle market dropped for all classes of cattle. In that same time period, I read that average ranches in Kansas have only been profitable two out of the last 10 years when all costs are considered. I have also been told that most of the ranches of 50 cows or less are dependent on the owners’ off-farm jobs to continue to operate.
The drops in the stock and cattle markets are not surprising. That has been happening periodically over the last 100 or more years. What is disturbing is that average ranches are not profitable—especially in the last 10 years. Except for those stricken with drought, we have never had better times in this business.
Ranches don’t need to lose money, nor do they need to be subsidized with off-farm income unless you inherit or incur too much debt. Ranches should have been profitable during most of the last 10 years and preparing for tough times to come.
If your ranch has not been profitable most of that time, it might be a good idea to consider liquidation while prices are high. Otherwise, you very probably will need to give up equity by selling off some land or borrowing more money or maintain equity by depending on the subsidies from your off-ranch sources of wealth and income.
Last month I talked about “low-input, high-management cattle.” I think it is nearly impossible for high-input ranches and high-input cattle to be profitable. Land, labor and equipment (overheads) can be very expensive. We need to keep land costs as low as possible and reduce labor and equipment to the lowest possible level to get “needed” work done. In other words, reduce overheads.
The other big cost is feed. If the feed comes from the land and cattle do the harvesting, that part of the feed cost is included in the land cost. The rest of the feed must be used judiciously and timed to fit the needs of the livestock.
What's a "good cow?"
Good cows are those that get pregnant as a yearling and rebreed early in each subsequent breeding season. They do this on minimal fed feed inputs. The right cattle using low inputs will always be more profitable. Because we have manipulated their behavior and genetics, management is required to help the animals do their job. Too many of our modern-day cattle have become input dependent. They can’t breed as yearlings and rebreed each year without significant use of fed feed and supplements. This does not have to be. Cattle can be developed to breed as yearlings in a short breeding season with minimal development. The same cattle can also be expected to rebreed in short breeding seasons each year thereafter.
For profitability, nothing is more important on a ranch than reproduction and calf survivability. This must be done on low inputs—grazing all or most of the year with hay feeding only in times of deep snow or prolonged severe cold; strategic supplementation of protein and minerals only to correct nutritional deficiencies and using very little labor for individual animal attention. This implies that selection pressure will be used for natural bred-in fertility, calf health and resistance to flies and parasites. Therefore, you will settle for less-than-maximum growth rate and carcass quality. However, they can be very acceptable for your area and management.
Now please be aware that you can’t just suddenly reduce inputs and expect the same cattle to tolerate it. To move from high amounts of hay feeding with large amounts of supplements toward a low-input approach will take some time. I would start by grazing longer and feeding less. Protein supplementation will need to adjust to fit the need of the cows in relationship to expected calving dates and quality of the grazed feed.
Simultaneously, I would shorten the breeding season for yearling heifers to not more than 30 days. This will require exposing more heifers than usual. Then I would make sure that each new bull would add or maintain heterosis at a good level and was born to a highly fertile cow. I would also want to know that he was showing signs of early sexual maturity at a year of age.
I am convinced that yearling heifer fertility and subsequent early breed back (or calving interval) are more highly heritable than the heritability estimates for fertility that we commonly see. What if:
- Every bull you ever used was born to a cow that had calved as a result of conceiving in the first 21 days of the breeding season for her first three calves?
- These bulls had good weight and muscling in relationship to frame size at a year of age and could also pass a breeding soundness exam at the same time indicating good early growth and early sexual maturity?
- This could all be done on low inputs?
What if breed associations would develop EPDs for first cycle (not first service) conception and for subsequent calving interval? Stayability is not sufficient. We would like them to breed back in the first 21 days.
What if seedstock breeders treated their cows the way you would like to treat yours? Too many of us keep paying top dollar for bulls that are too big, whose daughters try to produce too much milk and that don’t enable the maintenance of a good level of heterosis. We keep buying that kind of bull. Should we expect them to produce anything different? Good commercial cattlemen need to define what constitutes a good bull and quit buying what someone else wants to sell you unless it fits your definition.
Good cows get pregnant early every year, calve unassisted, wean healthy calves with reasonable (not exceptional) weights and do it with minimal inputs of feed and labor. Those cows produce more total ranch profit which is the same as more profit per acre.
Burke Teichert, a consultant on strategic planning for ranches, retired in 2010 as vice president and general manager of AgReserves, Inc. He resides in Orem, Utah. Contact him at email@example.com.