Grazing Management Pays Net Profit, Even On Small Farms

Virginia case study on 22-cow operation shows 50% increase in profits from good grazing management.

Published on: Jun 20, 2013

By Terri Queck-Matzie

Pasture in poor condition can support cattle and sometimes make a profit but that doesn't mean better pasture isn't better.

"The environmental effects of pasture improvement are huge," says Madalene M. Ransom, an economist with NRCS, "but people don't always realize the economic benefits."

Ransom and USDA Grazing Lands Specialist Kevin Ogles have collected data which proves exactly that in work at the East National Technology Support Center in Greensboro, N.C.

Ransom and Ogles define poor grazing land as having 50% ground cover with most of the good vegetation already eaten. Their definition of good grazing includes some rotation with 75% ground cover of grass only. Excellent grazing is 95% ground cover consisting of cover, grass, litter and clover, together with excellent rotation practices.

Best pasture: To create the highest quality pasture one requirement is to plan grazing so plants get plenty of recovery time.
Best pasture: To create the highest quality pasture one requirement is to plan grazing so plants get plenty of recovery time.

Based on case studies and conversations with extension personnel, Ransom and Ogles show improvements which create excellent pasture conditions, decrease costs over time and increase animal weights and also profits by nearly 50% per pound of animal sold.

"Excellent grazing may cost money up front to install," says Ransom, "but it may be the most profitable by yielding the most benefits." She says many producers fail to factor in lost profit opportunity.

Ransom and Ogles say a case study conducted on a Virginia ranch showed significant advantage. It showed the gross benefits of improved grazing with 22 cows and one bull on 65 acres of improved pasture totaled $11,672. Deduct from that $3,312 in additional costs and they said there was a net annual benefit of $8,359.

Poor pasture: Poorly management pasture can make a profit but not as much as well-managed pasture.
Poor pasture: Poorly management pasture can make a profit but not as much as well-managed pasture.

The benefits derived from a combination of increased revenues of just over $7,000 and decreased costs of around $4,500.

Benefits and cost savings included:

* Better herd health due to increased clover and improved water sanitation.

* A 50% reduction in fertilizer and lime.

* Less purchased hay and less rented land to produce it.

* Lower labor and transportation costs for hay.

* A 60% decrease in mowing.

Revenues increased from:

* Higher weight gain from the high-quality forage.

* The rancher in the case study was able to increase his herd from 22 cow/calf pairs to 33 pairs and buy a genetically superior bull due to his improved forage availability.

* Calves from the additional cows brought in an extra $5,100 and existing calves utilized the better genetics and better forage to produce an additional $1,994 in revenue.

The improvements did, however, come at a cost.

* Additional fencing was estimated at around $530 per year.

* Concrete watering troughs cost another $184 annually.

* The herd upgrades averaged $1,400 per year.

* Pasture improvements such as soil testing, seed and fertilizer cost the producer nearly $1,200 per year.

That still places the annual cost of improvements at $3,312, well below the realized financial benefits.

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"It's too easy, especially for the smaller cow/calf producer with 20 to 30 head and an off-farm income, to call breaking even good enough," says Ogles. "They've covered their costs. But they can do better – for themselves and for the land."

Ransom says her vision is for producers to make pasture improvements because it makes economic sense, in addition to enhancing the environment. "Yes, we want to see environmental improvements, to keep the soil from eroding and disappearing down rivers and streams," she says.

"But it's also good economics and they should consider the economics before they make decisions on changing pasture management."

Grazing Management Pays Net Profit, Even On Small Farms

Just right: Where the lines cross indicates the ideal stage for plant consumption, when digestibility and yield are well balanced.

Pasture by the numbers

Kevin Ogles researches why animal weights might increase and why costs can decrease as pasture management is improved.

The USDA grazing lands specialist explains that he calculates the Forage/Animal Balance by dividing annual forage production times seasonal utilization rate by herd intake per day times length of the growing season.

The utilization rate varies as rotational grazing is implemented. Grazing one pasture continuously results in a 30% utilization rate, while breaking the pasture into 12 paddocks, each grazed two to four days at a time, produces a utilization rate of 65%.

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Rotational grazing also affects pasture productivity. "Digestibility is best when plants are small," explains Ogles, "and goes down as plants mature and become more stemmy. But larger plants yield more mass. The trick is to time grazing to maximize yield and digestibility."

For cool-season grasses that is generally when the plants are 10 to 14 inches, depending on the species.

Grazing at the right time is crucial for plant health, and thus, overall pasture health. Once grazed to three to four inches, plants need time for rest and regrowth to optimum grazing height. Ogles says removing 50% of a plant's leaves will start to diminish root growth. At 60% of leaf consumption, 50% of root growth ceases.

"Plants with better root systems withstand drought better and pull minerals from deeper in the soil," he says. "Grazing all the time doesn't give plants a chance to recover. Rotational grazing lets the roots continue to expand, making overall pasture yield higher."

Rotational grazing also increases manure distribution, thus reducing the need for additional fertilizer.

"Animals choose to hang out where there is shade in the heat or where there is water, so that's where the nutrients concentrate," says Ogles, adding that beef animals excrete 65-90% of nutrients they've consumed in manure and urine. "By confining them to a small area at a time, it forces better overall distribution of nutrients."

Further accentuating the value of rotational grazing is its effect on infiltration and run-off. Ogles cites a study by USDA and University of Nebraska which calculates run-off from a three-inch, 90-minute rain on silt loam soil with a 10% slope. He says excellent pasture with 95% ground cover has 15-20% run-off with zero soil loss, while poor pasture with 50% ground cover loses more than four tons of soil per acre with 70% run-off.

He also says in pasture with grass and plant littler present, water infiltrates the ground at more than two inches of water per hour. This compares with poor land where grass and litter has been removed and infiltration is less than one inch per hour.

Better plant health also means reduced soil temperatures, keeping needed moisture and microorganisms in the soil.

Queck-Matzie writes from Fontanelle, Iowa.