Strategic Planning For The Ranch

Efficiency Is All About The Dollar Signs

Remember that efficiency only makes sense when we put dollar signs on inputs and outputs.

There’s a lot of talk these days about efficiency. Much of it focuses on feed efficiency in a feedlot setting, but it is just as important at the ranch level, where the issue isn’t so much feed for gain as feed for maintenance.

For most of my life, I’ve enjoyed and worked on cattle genetics. However, after about 20 years, I began to recognize that genetics, while effective, is a slow process, and there are more economically important issues for the typical rancher to consider.

In cattle breeding, there is only one quick, big effect and that is hybrid vigor. Of course, the levels of heterosis attained will vary depending on the extent of backcrossing and the genetic differences in the breeds being used, but most commercial ranches would be more efficient using the benefits of heterosis. Only sunshine and rain come with a lower price tag.

Grazing management and its potential to increase carrying capacity on the land, and lower costs over time, also offers great opportunity to ranchers. But good grazing management goes well beyond soil and grass. It includes yearlong feeding and supplementation programs, along with cow condition and good heifer development.

Good grazing management allows one person to handle more cattle, or one person to handle the same number of cattle, in less time. And, over time, improved grazing can result in a big change in efficiency that can happen fairly quickly.

For many ranches, for instance, changing the calving season to align animals’ peak nutritional needs more closely with the peak production of grazed feeds – in both quality and quantity – can greatly improve efficiency. This can reduce the need for supplements and “fed” feed. Plus, removing machinery and human labor from between the standing feed and the mouth of the cow can tremendously impact the efficiency and sustainability of many ranches.

In addition, the structuring of enterprises and the allocation of labor across enterprises can make big differences in efficiency – usually the simpler the better. Fewer herds allow for improved labor efficiency and less fencing cost for good grazing.

Let your imagination wander. What if a smaller ranch were to buy all its replacement cows from a larger ranch? The smaller ranch would never have to breed or calve a heifer – only cows. It could ensure that the cow size was small, and allow breeding to a terminal sire emphasizing growth and carcass. All calves would then be sold – with no replacements retained.

Meanwhile, the larger ranch is already breeding and calving heifers. So, why not produce a few more and get some economies of size and then sell cows to the smaller ranch where every female maintained has the potential to raise a calf?

  • If you farm (hay is farming), perhaps having someone else do that for you will save you expensive equipment costs and allow the contract farmer to spread his big cost across more work.
  • Cow size and milking ability are important to efficiency. One of the unintended consequences of selecting for increased growth rate is generally increasing cow size. Bigger cows and bigger appetites mean we either have to reduce our stocking rate or increase our supplemental feed – or probably both.

Combining good grazing, a change of calving season, enterprise simplification and a reduction in cow size will usually make a big change in efficiency and net income. A few weeks ago, I had a discussion with a rancher who had reduced cow size and made big changes in his grazing management; the two combined resulted in almost doubling his stocking rate.

Remember that efficiency only makes sense when we put dollar signs on inputs and outputs.  

 Burke Teichert, consultant on strategic planning for ranches, is retired as vice president and general manager of Deseret. He can be reached at burketei@comcast.net.

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What's Strategic Planning For The Ranch?

Burke Teichert provides readers with his practical take on efficient and cost-effective livestock production and ranch management.

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Burke Teichert

Burke Teichert was born and raised on a family ranch in western Wyoming and earned a B.S. in ag business from Brigham Young University and M.S. in ag economics from University of Wyoming. His work...

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