An Economic Analysis of Grazing, Haying and Cropping Marginal Highly Erodible Crop Land in Southcentral North Dakota


Grazing Marginal Highly Erodible Land

One hundred and thirty-nine cow-calf pairs grazed 370 acres of reseeded marginal land in 2000. While total precipitation was below normal for the year ending October 31, the forage production on the study was good with ample residual vegetation standing at the end of the grazing period. For the past three years these pastures have been grazed in a complementary system with native range on the Research Center. When the grazing season was shortened to accommodate the new grazing system the number of cow-calf pairs was increased to maintain a similar stocking rate. For the purpose of doing this analysis, costs for the native pastures are included in the land costs and are calculated on the basis of 1.3 acres/animal unit month (AUM) grazing at a rental rate of $11.05/acre. Again in 2000, land and winter feed were the two highest costs for maintaining the cow herd although the abundance of hay in the region decreased the cost of hay to $25.00/ton (table 3) thus lowering the total winter feed by $10.92/cow over 1999. For most estimated costs a 3% increase was applied to last year to cover inflation. The exception was fuel and electricity which were increased 6% from 1999. Total per head costs for the year were $316.19 which included the cost of maintaining the bulls and replacement heifers.

Table 3. Costs Per Cow and Per Acre
Year

Average
1992-98

1999 2000

9-Year
Average


Acres 370 370 370 370
No. of Head 94 140 139 104
Fuel & Elec. $38.51 $41.82 $44.33 $39.53
Dep. bldg. & Equip. $14.93 $15.86 $16.34 $15.19
Feed $93.59 $74.52 $63.60 $88.14
Salt & Mineral $9.32 $10.26 $10.57 $9.57
Replacements $29.04 $16.10 $16.34 $26.19
Bulls $10.81 $10.65 $10.05 $10.71
Veterinary $5.53 $6.13 $6.32 $5.69
Marketing $4.01 $4.22 $4.35 $4.07
Labor $16.85 $20.99 $20.99 $17.77
Land Costs $115.04 $118.73 $114.57 $115.40
Death Loss $8.92 $7.97 $8.74 $8.79
Total Cost/Cow $346.56 $327.26 $316.19 $341.04
Total Costs/Acre $87.81 $123.83 $118.79 $95.26
Total
Herd Costs
$32,490.43 $45,816.20 $43,950.98 $35,244.46

Table 4 shows the livestock inventory for the study. In 2000, 73 steer calves and 66 heifer calves were used on the trial. Twenty-seven heifer calves were kept for replacements and 27 cull cows were sold. The value of the herd increased during the year by $27,393.10 reflecting the changes that have occurred in the livestock market.

Table 4. Livestock Inventory


Year

Average
1992-98


1999


2000
9-YR.
Average

Beginning Inventory $82,918.86 $111,554.77 $121,434.40 $90,380.13
Steers Born 49 67 73 54
Heifers Born 45 73 66 51
Steers Sold 49 67 73 54
Heifers Sold 27 46 39 30
Kept for Replacement 18 27 27 20
Value/Replacement $531.65 $527.20 $607.50 $539.56
Value/Bred Heifer $597.14 $650.00 $875.00 $633.89
Culls Sold 17 27 27 19
Value/Cow $728.57 $675.00 $850.00 $734.04
Cows Kept 77 118 118 86
End Inventory Bulls $5,257.14 $10,000.00 $8,500.00 $6,144.44
End. Inv. Heifer Calves $9,728.83 $14,234.40 $16,402.50 $10,970.97
End. Inv. Bred Heifers $10,151.43 $17,550.00 $23,625.00 $12,470.56
End. Inventory Cows $55,457.14 $79,650.00 $100,300.00 $63,127.78
Ending Inventory $80,594.54 $121,434.40 $148,827.50 $92,713.74
Inventory Change -$2,324.32 $9,879.63 $27,393.10 $2,333.61

The calves were weaned on October 24 with the steer calves averaging 563 lbs/head and heifer calves averaging 539 lbs/head (table 5). The value was calculated based on local livestock sales with 550 to 600 lb steers bringing around $0.95/lb and 500 to 550 lb heifers bringing $0.90/lb. The cows weighed 1340 at weaning and cull cows brought $.36/lb at that time. The last line in table 5 indicates the returns to the livestock grazing system. The $48.71/acre or $129.66 per cow reflects what most producers would regard as their bottom line.

Table 5. Livestock Returns

Average
1992-98

1999 2000 9-YR.
Average

Acres 370 370 370 370
Heifers 27 46 39 30
Avg Wt. 517 513 539 519
Price/Lb. $0.74 $0.84 $0.90 $0.77
Return-Heifers* $9,722.94 $18,831.20 $17,972.96 $11,651.64
Steers 49 67 73 54
Avg. Wt. 558 567 563 559
Price/Lb. $0.79 $0.90 $0.95 $0.82
Return-Steers* $20,536.13 $32,480.60 $37,091.85 $23,702.82
Culls 17 17 27 18
Avg. Wt. 1305 1298 1340 1308
Price/Lb. $0.37 $0.38 $0.36 $0.37
Return Culls* $7,915.83 $7,965.83 $12,373.56 $8,416.69
Total Returns $38,174.90 $59,277.63 $67,438.36 $43,771.14
Opportunity Costs $3,913.33 $5,019.96 $5,464.55 $4,208.64
Total Herd Costs $32,490.43 $45,816.20 $43,950.98 $35,244.46
Total Cow Costs/A(table 3) $87.81 $123.83 $118.79 $95.26
Net Returns/A $4.79 $22.81 $48.71 $11.67
* =Less 5% shrink

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