by Dave Pratt at Ranching for Profit Blog
Moments ago I read the following in a popular industry magazine: “…given the multiple challenges you face that are beyond your control—drought, rising feed and fuel costs, escalating land values—genetic selection may be the single most important component of your operation that you control.” If anyone out there believes that please explain it to me because I think genetics is WAY down the list of critical factors on which we as business owners need to focus. This really isn’t a case against genetics. It is an argument for other things first.
What comes first? If you own a ranch and profit is one of your goals, start with the land, not the animals. Ranch land is worth a lot of money these days, but only a fraction of its value is tied to its potential for agricultural production. Capitalizing or concessionizing ranch resources may make a six or even seven figure difference to our bottom line. It’s unlikely you’ll get that kind of return from evaluating EPD’s.
Next? Some places are better suited to growing stock than breeding stock. Cow-calf enterprises on irrigated pasture usually aren’t as profitable as stocker or heifer development enterprises can be on that same forage. It’d be a good idea to make sure we have the right enterprise mix before we get too worried about the genetic make-up of the animals in that enterprise.
And there’s more. Assuming a cow/calf enterprise is a good fit to our resource, let’s determine how it fits. We’d be well served to make sure our production schedule matches the forage cycle. In the Great Plains winter calving (February-April) might produce a big calf but usually requires winter feeding and all of the overhead costs that go along with that. Spring calving (May-June) may mean smaller calves, but often means less cost. The type of animal ideally suited to winter calving is unlikely to be the same that is ideally suited for a low-cost summer program. Before we worry about breed and body type and start picking bulls and replacement heifers, wouldn’t it be best to know which production strategy produces the highest margin, the lowest overheads and provides the most protection from risk (severe winters, drought, etc.).
Since I brought it up, what about those heifers? The decision to buy them or raise them ourselves can have as much or more impact on our profitability than the type of heifer we choose. Furthermore, who ever said that replacements had to be heifers? Some of your neighbors, particularly those with herds calving later than yours, might be well advised to buy your open and late calving cows as their replacements. That avoids the cost and stress of calving out first calf heifers and the difficulty of getting them pregnant for the second time. These are just some of the questions that often trump the economic impact of genetics.
This is not to say that genetics isn’t important. I’d be naive if I didn’t recognize the value of having animals selected for and adapted to the environment and production schedule. But the article is wrong in suggesting that it is the “single most important” thing that you control.
Perhaps the thing that really set me off as I read the article is the way it portrayed us as victims. It implied that we are victims of drought, rising feed and fuel costs and other externalities. I don’t mean to diminish the challenges we face when input costs rise faster than cattle prices or the economic and emotional toll we pay in drought; but the fact is that some of us weather the storm (or lack thereof) better than others. It’s true that none of us individually dictates the cost of feed or fuel, or can make it rain. But our choice of enterprises and the way we structure those enterprises has everything to do with our exposure to the risk of drought, our need for feed and fuel and just about any other external factor you can name. Those decisions trump the economic impact of genetics. It doesn’t matter what breed of cow you have or how good a bull you use if you ought not have cows!