Burke Teichert: More “what If” questions on profitable ranch managementBurke Teichert: More “what If” questions on profitable ranch management
Burke Teichert shares more thoughts and ideas on how to run a profitable ranch.
July 6, 2017
After receiving a huge email response to the “what if” questions of a month ago, I decided to keep on asking and suggesting a few answers.
What if grazing were managed to prevent overgrazing, reduce erosion and evaporation, increase water infiltration rates and soil moisture holding capability, improve distribution of livestock and uniformity of grazing, improve distribution of manure and urine, and allow plants to fully recover after each grazing period before being grazed again?
More of the actual rainfall will become effective rainfall, thus resulting in more plant growth. Plants will be green during a greater portion of the year, meaning photosynthesis is doing its work longer.
Roots will be getting deeper into the soil and thereby tapping into moisture and mineral reserves previously out of reach. Soils will tend to be covered; that, combined with living roots feeding soil microorganisms, will cause an increase in soil life. Organic matter will be increasing and your management will be building soil. These are just a few of the complex interactions in the soil that you can be improving.
What if carrying capacity were to double as a result of your grazing management?
This may seem far-fetched, but I have seen a good number of examples of this happening. When you can do this, you have just bought another ranch for the price of fence and stock water development.
One rancher has spent about $50 per acre over a 20 year period for electric fencing materials (both permanent and portable) and stock water development. In the meantime, he has doubled his stocking rate in a location where land will cost at least $500 per acre and probably more.
Another rancher continues to develop water and fence and has doubled the normal carrying capacity for the area. He thinks he will add another 50%, which will be three times the original carrying capacity. His cost so far is about $100 per acre in an area where land sells for over $1,500 per acre.
However, to successfully increase carrying capacity requires an investment in time and learning.
I suggest a good grazing school followed by visits to good graziers. Caution: most good graziers don’t immediately double carrying capacity. It usually requires several years because of the learning curve, budgeted cost outlays, not wanting to move too fast and biological lag time.
Don’t let this warning discourage you. I know of no better or cost-effective way to add carrying capacity than to improve grazing practices.
There are some situations where it would be very difficult or cost prohibitive to double carrying capacity. In arid areas, the cost of fence (or herding) and water development per animal can make it economically unfeasible to get to a high level of grazing intensity.
This doesn’t mean that the principles don’t apply or that you shouldn’t or can’t make improvements in grazing. You can. On federal lands grazing permits, the agencies may never allow an increase in animal days even if range productivity were improved.
What if you could graze year long?
Most ranches in the U.S. spend several months each year feeding hay to their livestock. This is not necessary. Feeding hay is a very expensive way to feed cows. Good grazing with strategic supplementation and hay feeding only when absolutely necessary will get good, adapted cows through winter in good condition with significant cost saving.
Any time you replace a day of feeding with a day of grazing, you have saved money. One of the graziers mentioned above feeds no hay. The other feeds very little—only in deep or crusted snow.
There are good arguments for windrow or even bale grazing in certain situations. You will get more animal days per acre with windrow and bale grazing. The question you must answer is if the value of the additional days and additional quality of the feed will cover the machine cost. It is certainly less costly than carrying the feed to a stack yard and then hauling it back out at feeding time.
What if you could cut overhead costs in half?
You would be much more profitable. The ranches that I have watched as they moved from being unprofitable to being profitable have made most of the change by significantly reducing overheads.
The ranchers cited above added some overhead for fence and water, but all the other overheads, on a per cow basis, were cut in half because they didn’t add people, facilities or equipment in the process. Overheads (land, buildings, facilities, people, equipment and tools) are usually the low hanging fruit. Remember, increasing carrying capacity spreads overhead costs across more units of production and income, if you don’t add people or equipment; and you shouldn’t.
What if ranchers thought of themselves as business managers in charge of high value assets responsible for improving land, livestock and people while making a profit rather than as hired hands chained to a never-ending work load?
Many ranchers in the U.S. are self-employed and don’t have a very good boss. They tend to see the daily workload and operational tasks as their job.
If they could see themselves as managers of a thriving business with responsibility for the wise and profitable use of resources, and if they would organize themselves to spend time in financial planning and analysis of ranch business alternatives, and if they would regularly involve all team members (even if all are family members) in the planning of ranch business strategies, they could begin to put good ideas into a meaningful context for evaluation and possible implementation.
Good businesses start with a shared vision and then making economic decisions to bring the vision to fruition.
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 burketei@comcast.
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