In recent weeks, I have been asked by several ranch owners and their employees, “In my daily or weekly activities, what are the most important things I should be doing?” For these particular ranches and the people asking the questions, my answer was, “In addition to managing self, add grazing, irrigation, breeding better cattle and marketing.”
Management of self begins with honesty and integrity. Then it incorporates prioritization of issues and tasks, control of temper and emotional intelligence, work ethic, self-discipline, being a good team player, becoming a lifelong learner, etc.
Grazing management can add more to profitability on the ranch than any other thing we can do. You need to spend time and perhaps a little money to learn the principles and practices, but it is time and money well spent.
Too many ranchers shy away from adaptive and regenerative grazing practices because they don’t like the sounds of fence and stock water additions that almost always need to be made. It’s easy to assume that there will be a lot more work. There is some work in putting infrastructure together; but it can be phased as time and budget will allow; and, once done, work actually diminishes and becomes easier.
As grazing management progresses, carrying capacity and then stocking rate also increase. Increases in stocking rate seldom require any increase in overheads. The economic, bottom-line power of an increase in stocking rate is huge.
Irrigation is a very important part of the ranches I mentioned, unlike most ranches in the U.S. Irrigation water, especially surface water, greatly increases value and productivity of land in the semi-arid West.
Irrigated land often sells for as much as 10 times the price of unirrigated deeded land in the same area. If you have water rights, you want to use them as advantageously as possible. Try to avoid over and under irrigation—not easy.
In recent years, many ranchers are transitioning irrigated ranch land from hay production to irrigated pasture. This helps improve the ratio of fed feed vs. grazed feed. Several of our ranches sold all of their haying equipment and began to graze most of the irrigated land
James Sewell, a good friend and previous co-worker, manages a sizable operation near Saratoga, Wyo. They irrigate a good number of acres with seasonal water from mountain streams. The water availability differs a lot from year to year depending on the winter snowpack.
James has several employees and says that in irrigation season everyone irrigates, including him. This is because of the value of increased productivity resulting from irrigation.
Breeding better cattle is important on nearly every ranch I have managed, visited or known about. It is interesting that all of those ranches have some cows that are good every year—they rebreed, raise a good calf and never get sick or need our attention.
Why won’t they all do that? They probably never will; but we can change the percentages significantly. It takes time to breed cattle to fit the environment, but it is necessary if you want highly fertile herds.
It boils down to culling the right cows and selecting the right bulls—bulls whose dams are ideal cows. If a cow is open, dry, bad disposition, raises poor calf and/or ugly, it should be culled.
I like to use young bulls from great older cows. The generation interval never catches up to those good old cows. They are simply reliably good.
Remember good is good and a cull is always a cull. I think maternal breeders (those keeping replacement heifers) try too hard to make great calves when they need to concentrate on making lots of good cows that will produce good (perhaps not great) calves. The money comes from good cows
Marketing is too often neglected except for the calves or yearlings which constitute the main enterprise. I hear new stories almost every month of people finding breakthroughs in marketing heiferettes, late bred cows, rebred dry cows and young open cows.
These cattle are being sold to repeat buyers as replacement cows for terminal crossing or to other ranchers who have developed a direct market for meat. This kind of marketing can greatly enhance the bottom line.
While working as a consultant, time and experience have led me to a mental template which helps determine the high leverage areas of a given ranch—those areas where a little effort and perhaps investment can make a large addition to profit.
I first remind myself that we are interested in “profit per acre” or whole ranch profit and not production or even profit per cow.
Then I look to a list of major determinants of profit:
- Enterprise mix and choices. Are there enterprises other than cattle that could offer potential?
- Overheads. Reduce as much as possible.
- Stocking rate. Affected by:
- Grazing management
- Cow size and milking ability
- Fed feed vs. grazed feed. Putting a machine between the mouth of the cow and her feed source costs money. Sometimes, in extreme conditions, it pays.
- Calving season. Calving in sync with nature greatly reduces the need for fed feed and supplementation while maintaining fertility.
- Realized herd fertility. This is more than conception. It includes a live calve that survives until it is marketed sometime in its life. Better herd fertility almost always means more profit, unless you feed too much to get it.
- Wise input use for optimum production. This means that one dollar spent on inputs will bring back more than one dollar in additional production value.
- Marketing. Try to sell every animal to its highest and best potential use.
Finally, I go to a statement that I have presented a couple of times in the last year.
For profitable ranching:
- Reduce overheads as much as possible.
- Get excellent reproduction.
- Market well.
- Then improve three key ratios:
- Acres per cow.
- Cows per FTE (full time labor equivalent).
- Fed feed vs. grazed feed.
Hopefully, looking at this template will help you understand some of the reasons why I recommended grazing management, irrigation, breeding better cattle and marketing as having a high value for the use of the rancher’s time. Just look at the lists in the template and think of how many items affect or are affected by these four things.
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 protected]. The opinions of the author are not necessarily those of beefmagazine.com or Farm Progress.