Managing Cow Costs
to Improve Profitability
by Troy Smith, field editor, Angus Journal
RAPID CITY, S.D. (Dec. 3, 2013) — Management of production costs was one of the topics explored during the Range Beef Cow Symposium Dec. 3-5 in Rapid City, S.D. The agenda included a panel of ranch managers associated with three successful operations. They talked about their management philosophies and the practices they have implemented to manage costs and enhance revenue.
“Developing low-maintenance replacement females has resulted in a 25% decrease in supplemental feed costs,” said Chip Ramsay, manager of Nebraska's Rex Ranch.
Leading off was Chip Ramsay, manager at Rex Ranch located near Whitman, Neb. Ramsay called the crossbred cow and the heterosis advantage important in managing costs and optimizing production. Late-spring calving matches the cow reproductive cycle to the forage cycle, making optimum use of grazed forages and significantly reducing the need for hay.
Ramsay said a disciplined, written grazing plan emphasizes ample postgrazing recovery time for rangeland, enhancing the vigor of native grasses and allowing for higher stocking rates. Data-based genetic selection has resulted in cattle that are well-adapted to the environment.
“Developing low-maintenance replacement females has resulted in a 25% decrease in supplemental feed costs,” said Ramsay. “Enhancing the human resource may be the most important thing we try to do. We hire good people and reward them for results.”
“We determined the minimum amount of machinery and vehicles needed to run the ranch, and sold the excess,” said Wyoming cattleman James Sewell.
Reducing operational costs became a priority for James Sewell, manager of TA Ranch near Saratoga, Wyo. He explained how reduction of costs associated with equipment, including all vehicles, farm equipment, fuel, repairs and depreciation was targeted.
“We determined the minimum amount of machinery and vehicles needed to run the ranch, and sold the excess,” said Sewell, noting that six tractors, five balers, four hay processors, one swather and one loader were eliminated. Not only were costs reduced, the sell-down of equipment resulted in cash flow representing about $150 per cow.
The elimination of all but necessary equipment coincided with a shift to managing forage for an extended grazing season and less dependence on harvested forage.
“We still put up hay, but we have reduced the amount by half. We probably can cut it down more,” added Sewell.
South Dakota cattleman Ed Blair said selling irrigated farm ground used to produce feed for the ranching operation resulted in better cost management.
A partner in Blair Bros. LLC, located near Vale, S.D., Ed Blair said better cost management resulted from selling irrigated farm ground that had been used to produce feed for the ranching operation. Careful analysis showed the farming operation required too many inputs.
“Now, we contract for hay. We’re always in the market and will buy when the price is right. We load up if it’s cheap enough,” stated Blair. “We also use short-duration rotational grazing. We started with replacement heifers and eventually went to that for the cows, too. We’ve seen a positive effect on range conditions that has allowed for increased stocking rates.”
Blair said other management strategies include grazing of rented crop residues and early weaning, during drought, to reduce nutrient requirements for cows. Low-stress preconditioning, weaning and cattle-handling techniques help maintain animal health and reduce treatment costs.
“Whatever we buy, we try to buy it right,” added Blair. “It pays to shop around.”
Ramsay, Sewell and Blair spoke Tuesday at RBCS XXIII. Visit the Newsroom at www.rangebeefcow.com/2013 to listen to this presentation.
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The RBCS is a biennial educational symposium offering practical production management information. It is sponsored by the Cooperative Extension Service and animal science departments of the University of Wyoming, South Dakota State University, Colorado State University and the University of Nebraska.
Comprehensive coverage of the symposium is available online at www.rangebeefcow.com. Compiled by the Angus Journal editorial team, the site is made possible through sponsorship of LiveAuctions.tv and the cooperation of the host committee.
Editor’s Note: This article was written under contract or by staff of the Angus Journal. To request reprint permission and guidelines, contact Shauna Rose Hermel, editor, at 816-383-5270.
