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Cows plus Work Equal Opportunity

By John Dhuyvetter

Returns from agriculture and particularly cattle are historically positive but low.  Grain farming has been however quite profitable for the last several years associated with corn led much higher prices for grain commodities.  Supply and demand fundamentals are now pushing beef and cattle prices to all time highs.

Full time ranching requires large numbers and a significantly large, land based operation.  Without the opportunity to transition into an existing operation, capital cost prohibits many new young persons interested in agriculture and ranching from getting in.

However many cattle are raised as a secondary or part time enterprise to farming or off farm jobs.  In light of today’s low cattle numbers, aging operators, and prospects for a number of “good” years, an opportunity may exist for some startup/ part time enterprises.  With high competition for land, not all startups can grow and expand to greater levels; however part time ranching can be fulfilling and profitable.

Getting into a startup/part time cattle enterprise that will economically work requires planning and management to take advantage of unique resource opportunities and fitting the type of operation to time and work constraints.  It’s a bit like putting a puzzle together; where many aspects or “pieces” need to be fit together.

Cow calf production is most competitive when feed and overhead costs are contained.  Generally more grazing, minimized equipment and taking advantage of underutilized resources are economic strategies.  In farming country,  an underutilized resource may be crop aftermath, postharvest cover crop, and waste land amongst farmed fields which can be used by grazing livestock August through November.

From both a labor and cost standpoint a critical piece of the puzzle is to summer graze beginning in May.  With an acre of tame grass needed per cow for spring and an acre and a half to two of pasture for summer months, an operation’s size is often limited to available pasture acres within a proximate location.  As an example, a fenced 30 acre tame grass mix hay field with a couple of 80 acre coulee pastures would likely pasture about 30 pairs through August.

Another piece of the puzzle is wintering and winter feed.  The site doesn’t need to be elaborate but must provide all weather water, shelter, and some handling/confinement facilities.  Haying equipment ownership requires a significant investment which needs to be covered over enough use to justify.   Unless enough acres or bales will be hayed it is likely more economical to purchase hay, hire contract haying, or have put up shares.

Equipment overheads are challenging to small operations.  A reliable feeding tractor is basic as probably is a pickup.  Low equity positions and margins from which to service debt limit options while trying to meet basic needs to feed and care for cattle in our snow climate.  Chutes and handling equipment might possibly be rented or jointly owned with others. 

There are a few incentives through government programs for beginning and limited resource farmers/ranchers.  Low interest rate and reduced equity requirements for financing may be available through targeted programs administered through the USDA-FSA.  NRCS cost share programs for water, fencing, and other developments are very favorable for startup operators.

Information, advice, and consulting are also available through the NDSU Extension service.  Many agricultural agents and specialists in addition to their training and support resources also are involved personally in limited scale cattle production.  Further programs can be envisioned to help meet the needs for sourcing high merit foundation stock and meeting the equipment challenge.

Filed under: Cows, John Dhuyvetter, 2011
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