Wesley Tucker

It seems in the beef industry the cost of success continues to climb higher while cattle prices are on a downward trend.

Most producers have been left asking themselves a number of questions. One of those questions that keeps coming up is how they are going to spend their limited forage dollars?

That question, according to Wesley Tucker, University of Missouri southwest area agriculture business specialist, requires a certain amount of thought.

Tucker, who recently spoke to producers at the Webster County Soils and Crops Conference in Marshfield, Mo., challenged producers to take a close look at their feed costs.

“On average, cow/calf producers lose about $10 per head per year,” he explained. “But, what is average?”

According to him, when looking at the meaning of average in correlation to the beef industry, it just means some producers are better and some are worse.

Examining University of Missouri research data Tucker showed that producers in the top 25 percentile had made nearly $128 per cow per year. The group of producers in the bottom 25 percentile had lost $144 per cow per year.

“By looking at that data it shows me the top 25 percent are going to be able to weather some tough times,” he explained. “Unfortunately, I believe we have some tough times coming in the next couple years.”

Just like the amount of money made varies from producer to producer so does the cost of keeping a cow from year to year.

When it comes from separating profitable producers from less profitable producer Tucker said the answer is simple—feed cost.

“Feed cost is the variable that separates those who are profitable from those who are not,” he explained. “So, how do we cut that cost?”

According to Tucker the cattle industry was built on cheap land and cheap feed.

“Those days are over folks and you are going to have to be good managers the next few years,” he said.

One of the areas Tucker felt was most overlooked when it comes to cutting feed costs is utilization.

“Most producers utilize, and this is being generous, 30 percent of their pastures,” he explained.

According to him, by raising that utilization rate from 30 percent to 50 percent can generate a profit increase of 260 percent.

“Why am I raising grass if it isn’t going in the belly of my cow?” he questioned.

It is no secret that pasture utilization increases with the implementation of such concepts as strip grazing.

“If you still have grass in your pastures and you aren’t strip grazing you are wasting money,” he said.

When comparing strip grazing to not strip grazing Tucker asked producer if they would put all their hay out at one time.

“I know you don’t put all your hay out for your cattle to eat,” he said. “But that is basically what you are doing if you aren’t strip grazing your grass.”

Another advantage of grazing, according to Tucker, is that you are leaving nutrients on the pasture.

“Whether you are haying or grazing a pasture you are producing the same grass,” he said. “However, for every bale of hay you take off that pasture you are removing $25 worth of nutrients.”

Where grazing is concerned, many times producers get wrapped up in the amount of forage that is available on the pasture.

The other part of the equation, which can often times be overlooked, according to Tucker, is stocking rates.

“You need to look at how you stock your pastures,” he explained.

According to him, some pastures are stocked at maximum capacity all the time.

“We need to look at some different ideas here in order to become more efficient.”

Some of the things Tucker challenged producers to look at is stocking at 75 percent of maximum capacity.

“You need to keep in mind the difference in dry years too,” he said. “There is obviously going to be less available forage during dry years than during normal years.”

Tucker told producers that being successful in cutting feed costs is going to vary from producer to producer but it is something they needed to evaluate.

“I don’t have all the answers but look at some of these things and see how you can improve upon them at your place,” he concluded.

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