Take a hard look at the loads of solid black and solid red, 9-weight steers prowling the August grass at Gracie Creek Ranch north of Burwell, NE. You’d be forgiven for assuming such uniformity is the result of a single breeding program.
That would have been true until 2004-2005, when cows roamed these pastures, building calves to stock a Colorado yearling operation owned by Bob Price and his family. Now, these are what Price refers to as his tail-enders, about a week from marketing through the Bassett Livestock Auction.
These calves, most of them preconditioned, came from multiple sources within about 200 miles. They’re procured from sale barns in places like Bassett and Valentine, direct and via video.
“We look at our market and see what fits our area,” Price says of his genetic preference. “A higher percentage English calf seems to fit our market best.”
The ranch is in midst of a drought Price says is the testiest summer he can remember since his folks bought the ranch in the mid 1970s. But these heavy feeder cattle are in top condition, with plenty of grazing left in this storied Nebraska Sandhills country. That excess grass and some of the heaviest yearling weights in the ranch’s history underscore Gracie Creek’s evolution, and some would say the management revolution, that occurred here in recent years.
Planned grazing is the key
Price is the third generation to carve a living from growing cattle on grass. His daughter Lindsey Smith and her husband Clayton, who returned to the ranch a year ago, will be the fourth.
His grandparents, Dee and Elvon, started it all, homesteading in New Mexico in 1916, bartering for calves to grow. Price’s dad, Jim, continued with western cattle, as well as those from the Southeast before that part of the nation was discovered as a hot bed for stocker calves.
Over time, the family began leveraging resources, building the calves it would stocker. Then several years back, Price says they had too many cows and too many that didn’t fit the ranch. Plus, markets were favorable, so they sold the cows and turned Gracie Creek Ranch into a total yearling operation.
They start with the end in mind: a 9-weight steer to market at Bassett Livestock Auction in mid-summer from July to August. Typically, they start buying 5-weight calves in October, and finish up with 6-weights in later November or early December. That gives them a heavy stocker of 750 lbs. or so to begin the summer grass season.
Their meticulously planned grazing system enables them to graze most of the year, in effect, double-stocking the ranch.
“Some people’s definition of a proper stocking rate is to take all the grass that’s there,” says Terry DeGroff, who consults for the ranch through his Management Information Systems. As a consultant, DeGroff says he analyzes data from the client and other sources to better allow the client to make decisions.
Instead of taking every blade of grass standing, Price and his crew defer about 25% of the ranch during the grass-growing season – a different 25% each year. The standing forage they stockpile gives them winter grazing, which means hay and supplemental feed costs are significantly less than if they used all their grass during the season.
“You can increase the total production of the ranch overall through deferment,” DeGroff emphasizes.
Deferred plants build root strength and depth, making for more drought resistance. That’s one reason the Price family came to appreciate sandy soils. Price says the plant water cycle is more efficient, thereby increasing drought resistance.
“Our emphasis is on increasing the use of forage and decreasing the need for supplementation,” he says.
Gains during grass-growing season run 2 lbs./day and better. During the winter, Price targets gains of 1 lb./day to keep the cattle gaining, but for less total cost. When cattle do receive supplement, it is hay and a ration built around grain byproducts.
Refining the grazing system
When the family arrived almost four decades ago, the system basically rotated among 2-3 pastures. Intensive grazing and a more holistic approach to ranch management came next. Ultimately, they arrived at a carefully planned and disciplined scheme that rotates four groups of cattle through 100 pastures.
“We were on the right track, we just needed to refine the grazing system,” Price says. Rather than eyeball the grass and decide when to rotate cattle, Price’s rotation is based on a plan generated with software called The Grazing Manager. Instead of using animal units as the measuring stick, the software is based on grazing demand days, which adjusts for maintenance requirements of the animals based on body weight as well as the forage demand for desired gain.
Before their grazing year of May 1 to April 30 begins, the software allows them to estimate forage production in each pasture based on historic growing conditions, and plot a rotation schedule and stocking rate based on the cattle to be grazed. Once the year starts, the plan is updated and adjusted based on current growing conditions and actual cattle weights. When the schedule says to move cattle, they do.
“You make small adjustments early so you don’t have to make big changes later on,” DeGroff explains.
This summer’s drought may offer the strongest testament to the system’s power.
“It’s been a very testy summer but the system is made to deal with situations like this,” Price emphasizes. “If you take care of the land, it will take care of you. We’ve worked hard on conservation practices and a planned grazing system. We’ve been able to stockpile adequate forage to operate as we normally do and we’re also in a position to market hay. The landscape is more drought-tolerant. We have a lot of flexibility built into the system.”
Daughter Lindsey points out that her dad always says profit and conservation go hand in hand. “A year like this one gives us lots of confidence in the system,” she adds.
This system is counterintuitive for many. For one, the notion of leaving perfectly good grass standing during the growing season seems bonkers to some. For another, though the plan is meticulous and requires discipline, it means you don’t have to be as exacting.
“With this deferred system, you have more flexibility,” DeGroff says. “You’re not trying to squeeze every ounce of gain out of every day.”
Flexibility is why the Price family has always been such a champion of the stocker business.
“With a cow-calf herd, if the market gives you an opportunity, you don’t have a chance to react to it,” Price says. “In addition, labor is getting to be a bigger issue and you have to figure out how to manage with less of it.” That favors stockers and yearlings, too.
In fact, think of the most labor-intensive jobs associated with ranching, such as haying and building fence; Price hires others to do it. By doing so, he saves money because specialized equipment isn’t weighing on the balance sheet. It also allows him and his ranch crew to have more time for the cattle.
Start by knowing true costs
DeGroff says what sets Gracie Creek Ranch apart is the willingness to admit they don’t have all of the answers. Adds Price about the decision to enlist outside experts like DeGroff: “Sometimes, you have to give up control in order to gain control.”
This operation leaves as little to chance as possible. The grazing system is an example, as is Price’s penchant for locking up feed ahead of time. In August, he already knew his cost of gain for calves he’ll purchase in the fall.
One reason he’s comfortable making decisions further out is because he knows his true costs and financial position heading in.
“There are no opportunity values used in calculating at Gracie Creek Ranch,” DeGroff says. “It’s all actual costs.” Right down to charging itself the going rate for grass.
By knowing his costs, Price can establish profit goals for each set of calves. Thus, he knows when that goal is achieved, allowing him to manage his risk with futures and options when appropriate. Incidentally, Price can tell you that his calves accounted for a 13.13% return on investment last year.
“In agriculture, you have a lot of risk. Managing that risk gives us more opportunity for the future,” Price says. By the same token, he allows, “Those who take reasonable risks seem to get along better than those who take no risk.”
Price says his dad Jim passed on to him the lessons he learned from his father. Among them was that the buy often determines ultimate profitability. “Your grandfather walked away from more deals than he ever made,” Jim told his son.
“Don’t try to outguess the market, take the good with the bad, and most importantly manage risk so that you can be there for the good years,” Price says.
Price also learned early in life the value of sorting cattle to make them more marketable to buyers. From the time cattle arrive at Gracie Creek to when they leave, Price will have sorted them at least five times, swapping cattle among groups to achieve the pea-in-a-pod consistency mentioned earlier.
“He doesn’t just build uniform load lots,” DeGroff says. “He builds uniform pen lots of 200-300 head. That’s the single biggest thing he does to add value to the calves.”
Price is such a stickler for uniformity that he winds up with 70 head or so every year that just don’t fit any group. He’ll feed them out in a local yard rather than accept the discounts the market would impose.
Price merely credits the procurement prowess of his trusted order buyer, Jeremy Olson at Randolph, NE. “We’re blessed to live in an area that allows us access to high-quality genetics and markets that will recognize quality cattle,” Price adds.
Ask folks who know him, though, and they’ll tell you Price not only understands the business of grass inside and out, but possesses that rare eye for reading cattle.
“If you’re patient, it seems like somewhere along the way you’ll have a chance to make them work.”