A few days back, I received an email from a friend who, with her husband Fernando Falomir, ranches in the northern Chihuahua, Mexico. She Wrote:
Jimmy, How are things going for you? I have a bit of a heavy question. I’m not sure if you, or anyone you know, has any experience with the subject matter but we are considering changing our management style completely from controlled calving to year-round calving. I will explain our situation and reasoning below.
If you do have any knowledge will you share it with us and also the pros and cons. I thought to ask you this question as I know you are familiar with the terrain and environment in which we ranch and you know a ton of ranching folks who may have also run into a similar issue.
For the past 5+ years we have been set in our ideals of rotational grazing, controlled calving, higher animal impact when able, and yes we have seen amazing progress in both our pastures and genetics. We derived our management from holistic aspects, and have adapted many tools from mentors and through self study and observation of what does and doesn’t work for our ranch/land/environment.
Those tools have enabled us to be more productive. What we see as a/the problem though is trying to manage things at the mercy of nature. For the past ten years the ranch hasn’t had any predictable weather patterns as the old timers have seen. My husband personally has only seen two years out of six in which we have met our average 230 mm a year, and unfortunately for those two years majority of it feel during one or two events.
As a result we have seen a major impact economically from failure to achieve high pregnancy rates, especially in our heifers/first time mamas. We are now beginning to think there is a direct correlation to lack of nutrition given our brittle environment which is affecting their natural cycle and health. My husband has observed our herd seems to be cycling every 15 to 16 months instead of a normal 12 month period.
Although visually our cattle look good, healthy and have an above average body condition score compared to our neighbors, we are left scratching our head that our numbers are not higher. We release the bulls mid November for 60 days and calve August-October, when we should have rain and more “green pasture” to support better nutrition for the mother cows.
All our herd has been vaccinated for ibr bbv and everything, bull fertility is good to excellent as we have them tested, and more importantly we have stuck to the idea of focusing on body condition two months before calving until the end of bulling, and during non growing seasons only then manage for landscaping.
From the perspective of land health and cattle health we believe we are way above average from all our neighbors and we are quite satisfied from the results and the improvements we have seen. For the exception of pregnancy rates.
Simply put, we have observed our cows are not being able to cycle soon enough and as a result either there is a low pregnancy or a very extended breeding period.
This essentially leads to good and young cattle being culled. We have really tried to maintain optimal body condition at the time of breeding and no diseases to blame so we are left to believe only a couple of things: Either our cows are not yet fully adapted to the environment or the environment has really been to erratical to attempt to manage predictably.
With all of that being said, we are contemplating running two controlled breeding seasons (Fall and spring) or simply let nature be nature and release the bulls year-around. We are leaning towards that option.
We believe we should have better pregnancy results if we allow the bulls to be with the cows at all times because maybe they are cycling during a time in which we do not normally have them with the bulls.
By the way things are looking this year, we have only received 3 inches of rain all year and the raining season is over, we are beginning to be convinced if we stick to our guns on controlled calving we will be heading for financial ruin.
Anyway….that is more or less the scenario and just our honest situation. Of course we are 100 times better off than most however, when the ranch is your livelihood and you see and obverse things every single day you begin to make certain questions.
Thus, this is our biggest one currently. We are also awaiting the advise/experience from a friend in Africa who went from controlled to year-around. We are very curious about the pros and cons in his experience.
Thanks for any advise you may have!!
Alyssa Wagner Falomir
Alyssa, wow! You referred to it as a “heavy” question. I’d say so. It is indeed a complex question with the pertinent attributes and assumptions so inter-related as to be confounded. This is the type of decision making that is greatly facilitated by a step by step planning process.
To address such questions, we generally use a planning process that was developed over hundreds of years by the militaries of the Western World in situations where critical decisions have to be made quickly and decisively while under stress. This type of planning follows a logical, step-by-step process where each decision is made in a manner that takes full consideration of those made before it.
I don’t promise to get all that involved and will try to simplify the process a little by sharing my experiences meant to give you some things to think about and other things to consider.
Your comments and questions are reminiscent of things that Stan Parsons has talked about for years. For sure, you guys are doing one thing right—planning strategically. Way too many business managers spend way too much time working “in” the business rather than “on” the business.
I will try to address your questions by giving you my personal preferences (developed through personal experiences) with what kind of operation you might want to have.
Number one choice
First, (and I cover this in detail at Cell Grazing: Part VII. How to Get Rich on Drought and Bad Cattle Prices) on any ranch I might own or manage, the only cow close to the place would be the one that the wife milks in the morning. I would run stockers (steers and heifers).
The reason is a flexibility that allows me some control over both drought and bad cattle prices:
Let’s start with the forage. At the end of each growing season, I can match forage available with the appropriate animal numbers (including a drought reserve). I do a forage inventory which tells me how many head days of grazing that I have available.
After that, I check the futures markets (put options) to see if I can place an effective hedge on my estimated amount of production.
But, even if I can, I would still not rush out and buy cattle.
Instead, I’d check the grass market—what can I expect to receive by running pasture (someone else’s) cattle.
At that point I choose the most profitable—own and hedge or take in pasture cattle and the numbers would be matched with the forage inventory.
Note that by using this process I have, in effect, established a great deal of control over both prices and rain. Plus, I have insured that my profits are maximized (or losses minimized) each and every year consistent with sound long-term range resource conservation.
Plus, this approach has an additional advantage over cow-calf operations in that it takes far less labor to achieve—nobody ever had to get up at 2AM and pull a calf out of a steer (I used to tell my university students that, if they didn’t understand that they could see me after class and I would explain it. lol)
You guys might do very well at prepping light cattle (including pre-conditioning) for the feeder cattle export market.
Also, depending on the market situation, there is good money to be made in over-wintering skinny cows for somebody else.
In fact, Chris Gill at the Circle Ranch only runs cattle during the winter months and they always belong to somebody else. And he does very well at it and his land appreciates it too.
Another (very good) reason to avoid cows.
Going back to my old mentor, Stan Parsons, from his little book “If you Want to be a Cowboy, Get a Job.”
Stan developed a marketing model that revealed that NEITHER reproductive rate NOR weaning weight are the primary determinates of cow-calf gross margin. NOR is it the market price of calves. Instead it is the cattle “cycle.”
Cow depreciation is the main determinant and it depends further on when (during the cattle cycle) they are culled. Here is how that works.
Rise in prices > increase in heifers retained and fewer cows culled > increase in the price of cows. This continues until, ultimately, as true as the law of gravity, fat cattle prices start to fall and eventually (after a year or so) cow prices begin to fall very quickly—sometimes to as low as 30% of what they were worth when they were acquired at the peak of the previous upswing.
In other words, most ranchers lose money when they sell cows.
Sometimes those that produce their own replacement heifers are deceived into believing that they have not suffered such a loss but they are forgetting to account for opportunity costs. In the first place, the cost of raised replacement heifers is far greater than most ranchers would believe. Secondly, if that heifer had not stayed at home, she could have been sold for the high price that prevailed at the time.
To avoid all of this would take some very sophisticated strategic planning. There are simply better and easier ways to operate.
So, if by now I have not convinced you that you would be better off not having cows, let’s talk about your proposed decision model—two controlled breeding seasons vs. turning the bulls out permanently.
Forget the two controlled breeding seasons. You would only be doubling the market cycle vs. cull cow price complexity I outlined above.
Actually, if I was forced to run cows, I would turn those bulls out before the sun goes down tonight. There are so many advantages to that.
First, let’s deal with the most frequently held objections.
Sometimes some people confuse (or associate) leaving the bulls out yearlong with yearlong grazing. The two should not be confused.
In fact, leaving the bulls out yearlong facilitates rotational grazing. It enables you to put everything together into one heard which improves your stock density and herd effect which, in turn, improves the productivity, carrying capacity and profitability of your land.
Probably the most frequently herd objection is that most people want to confine their calving period to 60 days or so in the belief that a uniform group of calves will fetch a better price at the market. And there is some truth to that.
But, there is a forehead slapping, duhhh, why didn’t I think of that? solution. You can get exactly the same result through culling—if she doesn’t calve with your designated time frame, she goes to town. In fact you can get the jump on that by pregnancy testing at a time that will guarantee she will calve during the designated time.
Of course, you still have the cattle price-cull cow price cycle to deal with. Perhaps you could mitigate some of that by taking lesions from a few good stocker operators—sell and replace. In this case you would be buying bred cows at the same time you sell dry cows—sell expensive (cheap) and at the same time buy expensive (cheap).
And coincidentally, WRT the machinations of the weather. The only thing that is constant in the desert is change. On all arid lands, annual rainfall is more often below average than it is above average. The long term average is about 1 to 4–One really good year for every 4 below average years. But the problem with that is being able to rely on it due to variability—it may be 8 years off and 2 years on—you just don’t know.
The grazing plan is the key to coping with it. When you go into your closed ended plan, you budget your forage out to last until the beginning of your expected rainy season PLUS A DROUGHT RESERVE.
And time goes on until you enter your rainy season. But it does not start raining as you expected. You IMMEDIATELY construct another closed ended plan to budget out what you have PLUS A DROUGHT RESERVE.
Etc, etc, etc for as long as it doesn’t rain. When it finally does, you immediately make and implement an open ended plan.
I have a good friend up at Tucumcari, NM who did that all throughout the last drought and never had to destock drastically—remember you can get rid of one cow today or 180 cows 180 days from now. He knew that and acted on what he knew.
At cattle growers meetings, our friends would be belly aching about the drought. All he would say is “we plan for it and the plan is working.”
One last indirectly related comment on your comment about your cattle “looking good.” It used to happen to me more often than it does now. I guess maybe they have learned. But I have helped with many gathers where cows were to be culled. The rancher would invariably say, “Boy, that sure is a good looking cow. She don’t have a calf but I think I’ll keep her because she looks so good.” I could never resist saying, Hey buddy, the fact that she doesn’t have a calf is WHY she looks so good.
Hope this helps
PS It is raining outside as I write this.
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