AN ABSTRACT OF THE THESIS OF (Name) (Degree)

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AN ABSTRACT OF THE THESIS OF
EUGENE DUANE PANASUK
(Name)
in
for the
MASTER OF SCIENCE
(Degree)
AGRICULTURAL ECONOMICS presented on
(Major)
Title:
//- /, c#///^/V
(Date)
MANAGEMENT AND MARKETING STRATEGIES FOR HIGH
DESERT BEEF RANCHES IN EASTERN OREGON
Abstract approved:
Dr. A. Gene Nelson
Ranchers in the high desert area of Eastern Oregon traditionally market their calves when they are weaned in late fall.
This is the time when the market prices for calves are at a
seasonal low.
In this study the economic feasibility of various alternative
management and marketing strategies for the utilization of range
forage •with a spring calving operation is determined.
The operational
objectives were (1) to determine the most profitable time and weight
to market the spring-born calves, (2) to determine whether supplementary feeding of yearlings is economically feasible, (3) to explore
the competitive relationship between cows and yearlings for limited
range forage, and (4) to determine the combination of beef production and growing activities which will provide the highest net
returns.
Linear programming was used to determine the combination
of activities that would maximize net returns subject to the constraint of forage quality and quantity.
The quality and quantity of
the range forage was determined by using data provided by the
Squaw Butte Experiment Station, Burns, Oregon.
All the basic
data pertaining to the high desert area were obtained from Squaw
Butte.
The initial L. P. solution indicated the heifers should be sold
March 1 at 600 pounds having been fed to gain 1. 5 pounds per day
while the steers were sold April 16 at 780 pounds, gaining 2. 0
pounds per day.
The cows earned a higher MVP for the limited
resource, range forage, than could the yearlings either with or
without supplementary feeding.
In the second solution barley price was reduced from $50 to
$45 per ton and the steers were sold April 16 at 780 pounds (same
as initial solution).
The heifers were sold June 16 weighing 900
pounds having been fed to gain 2. 0 pounds per day.
Supplementary
feed was provided on the range for these heifers from April 16 to
June 15.
The study shows that the traditional management and marketing
practice is not the most profitable alternative.
The feed costs are
less than the increase in income from feeding the animals to heavier
weights.
Management and Marketing Strategies For
High Desert Beef Ranches in Eastern Oregon
by
Eugene Duane Panasuk
A THESIS
submitted to
Oregon State University
in partial fulfillment of
the requirements for the
degree of
Master of Science
June 1972
APPROVED:
-j^ji-
Assistant Professor of Agricultural Economics
in charge of major
j——=_^
1
Head of Department of Agricultural Economics
Dean of Graduate School
Date thesis is presented
QcdtLv tQl} mi
Thesis typed by Mary Lee Olson for
EUGENE DUANE PANASUK
ACKNOWLEDGEMENTS
I wish to express my deepest thanks and appreciation to
Dr. A. Gene Nelson for his guidance, assistance, and encouragement given during the duration of this study.
I am also indebted to Dr. Clinton Reeder for his time spent
in reading my entire dissertation and for his valuable comments.
Thanks are also extended to the staff of the Squaw Butte
Experiment Station for their assistance, time, and cooperation
in helping obtain the data used in this study.
Without the data
provided by them, this study would not have been as comprehensive.
Special thanks are extended to Mr. Lynn Sherman and Billy
Chou of the Oregon State University computer center staff for
their assistance in the use of the computer.
Finally, I wish to thank my many friends for their encouragement throughout my graduate studies.
TABLE OF CONTENTS
Chapter
I
II
Page
INTRODUCTION
Characteristics of Study Area
Objectives
Research Procedure
Plan of Thesis
3
4
5
6
LINEAR PROGRAMMING MODEL
7
General Description of Model
Structure of Model
Description of Activities
Range Forage Grazing Activities
Feed Activities
Cow Activity
Replacement Heifer Activity
Gestation Heifer Activity
Growing and Feeding Activities for
Steers and Heifers
Selling Activities for Steers and Heifers
III
1
DATA DEVELOPMENT
Feed Nutrient Content
Range Forage
Meadow Hay, Alfalfa Hay, Barley,
and Cottonseed Meal
Feed Costs
Nutrient Requirements for Cattle Activities
Cow Requirements
Steer and Heifer Nutrient Requirements
Death Loss
Variable Costs
Interest on Operating Capital
Salt and Minerals
Fuel and Oil
Property Tax
Veterinary and Medicine
Grazing Fee
Bull Depreciation
Cattle Prices
7
8
9
9
9
11
12
13
13
14
15
15
16
18
19
20
20
21
23
24
24
24
24
25
25
26
26
26
Chapter
III
IV
Page
Selling Costs
Commission Charge
Hauling Costs
ANALYSIS AND RESULTS
General Description of Results
Net Returns for the Initial Solution
Most Profitable Enterprise Combination
With Initial Solution
C ow s
Replacement Heifers
Gestation Heifer
Steers
Heifers
Comparison of Initial Solution With
Traditional Operation
Net Returns With $5 Lower Barley Price
Most Profitable Enterprise Combination
With $5 Lower Barley Price
Heifers
Comparison of Second Solution With
Traditional Operation
Analysis of Supplementary Feeding In The
Two Solutions
The Effects of Changes In The Availability
and Price of Hay
No Alfalfa Available
Meadow Hay Price Reduced to $10 Per Ton
V
SUMMARY AND CONCLUSIONS
27
27
28
29
29
30
32
33
34
35
36
37
39
41
41
44
46
48
50
50
51
52
BIBLIOGRAPHY
58
APPENDICES
62
LIST OF TABLES
Table
1
2
Page
Percent Cattle Sales are of Total Sales in Three
County Area, 1968.
3
Outline Showing the Transactions of the Activities
in Model.
10
Quantity and Quality of Range Forage As Consumed
By Livestock Class.
17
4
Feed Nutrient Content.
19
5
Assumed Prices for Hay and Concentrate Feeds.
19
6
Nutrient Requirements for Cows.
20
7
Property Tax Rates for Cattle in Harney County.
25
8
Net Returns From Cattle Operation Obtained In
Initial Solution.
31
Annual Cattle Numbers, Range Used, and Feed
Fed for Initial Solution.
32
Cows and Bull: Feed Consumed and Costs, Per
Head, In Specified Time Periods for Initial
Solution.
33
Replacement Heifers: Feed Consumed and Costs,
Per Head, In Specified Time Periods for Initial
Solution.
34
Gestation Heifers: Feed Consumed and Costs,
Per Head, In Specified Time Periods for Initial
Solution.
35
Steers: Feed Consumed Per Head, In Specified
Time Periods for Initial Solution.
36
Steers: Feed Costs, Variable Costs, and Income
Per Head In Specified Time Periods for Initial
Solution.
37
3
9
10
11
12
13
14
Table
15
Page
Heifers: Feed Consumed Per Head, In Specified
Time Periods for Initial Solution.
38
Heifers: Feed Costs, Variable Costs, and Income
Per Head, In Specified.Time Periods for Initial
Solution.
38
17
Enterprise Analysis of the Initial Solution.
40
18
Net Returns From Cattle Operation for Solution
With $5 Lower Barley Price.
42
Annual Cattle Numbers, Range Used, and Feed Fed
With $5 Lower Barley Price.
43
Heifers: Feed Consumed Per Head, In Specified
Time Periods With $5 Lower Barley Price.
45
Heifers: Feed Costs, Variable Costs, and Income
Per Head, In Specified Time Periods With $5
Lower Barley Price.
45
Enterprise Analysis of Second Solution.
47
16
19
20
21
22
LIST OF APPENDIX TABLES
Table
A-l
A-2
A-3
A-4
B-1
B-2
B-3
B-4
B-5
B-6
B-7
B-8
B-9
Page
Computer Input: List of Columns, Rows, and
Coefficients Used in Study.
62
Names of Nutrient Requirements, Feed and
Livestock Constraints . (Rows)
68
Names of Activities (Columns) for Livestock,
Livestock Selling, and Feed Sources.
71
Names of Activities (Columns) for Livestock
Feeds.
72
Dry Matter Intake for Growing and Finishing
Steers and Heifers.
74
Total Digestible Nutrient Requirements for
Growing and Finishing Steers
75
Total Digestible Nutrient Requirements for
Growing and Finishing Heifers.
76
Digestible Protein Requirements for Growing
and Finishing Steers and Heifers.
77
Cow and Bull Nutrient Requirements and
Variable Costs. (Per Head)
78
Replacement Heifer Nutrient Requirements
and Variable Costs. (Per Head)
80
Gestation Heifer Nutrient Requirements and
Variable Costs. (Per Head)
81
Example of Worksheet Used for Computing
Steer Nutrient Requirements and Variable
Costs. (Per Head)
82
Example of Worksheet Used for Computing
Heifer Nutrient Requirements and Variable
Costs. (Per Head)
83
Page
Table
C1
Feeder Steer Prices ($/cwt.).
84
C-2
Good Heifer Prices (800-1000 lbs.).
86
C-3
Good Steer Prices (900-1100 lbs.).
87
C-4
Utility Cow Prices.
88
LIST OF GRAPH
Graph
1
Pag(
Value of Steers and Heifers Gaining 1. 5
and 2. 0 Pounds Per Day For Various
Weights in Various Months.
49
MANAGEMENT AND MARKETING STRATEGIES
FOR HIGH DESERT BEEF RANCHES
IN EASTERN OREGON
CHAPTER I
INTRODUCTION
Ranchers operating within the high desert region of Eastern
Oregon traditionally follow a management and marketing program
of weaning their spring-born calves in late fall when the cows are
brought into the winter headquarters.
The calves are usually then
sold weighing 320-350 pounds when market prices for calves are
at their seasonal low.
The purpose of this study is to explore alternative strategies
which might be followed by the ranchers regarding the disposition
of these weanling calves to most economically utilize available
resources and maximize net returns.
Rather than selling the calves
when weaned, it may be more profitable to feed the calves during
the winter and then sell, or put them out on range and sell in late
summer as long yearlings.
If they are fed the rancher must decide
upon the rates of gain and the combinations of feeds to obtain the
various rates of gain.
They might also be supplementarily fed if
they are put out on range.
in this research.
These are some of the issues studied
These decisions must be made in consideration of the fact that
the nutrient content of the range forage on the high desert deteriorates
rather rapidly after the month of May.
For example, studies done at Squaw Butte show
that protein becomes a limiting nutrient for growing cattle as early as June. The study also shows
that due to the low nutrient content of the forage,
calves will not gain any weight after approximately
September 1 or may even lose weight if they remain
out on the range without supplementary feeding.
(21, p. 108-114)
Another consideration dealt with is the seasonal pattern of
cattle prices within the year, which can have a substantial effect
upon the returns from marketing of cattle.
The timing of the rancher's wean and/or sell decision not
only affects his own income but also the income and general economic
activity in the surrounding community.
In Harney County, for
example, livestock is the major industry.
To show the importance
of the livestock industry in this area, table 1 was prepared comparing the three county area of Grant, Harney, and Lake counties to th£
entire state of Oregon.
Cattle sales account for a high percentage
of the total sales in the three counties as compared to the state.
In summary, the study is to determine the economic implications of various alternative strategies of management and marketing as compared to the traditional program followed in the high
desert area.
TABLE 1.
Percent Cattle Sales are of Total Sales in Three
County Area, 1968.
Total sales of crops
and livestock
Percent cattle
sales are of
total sales
County
Sales of cattle
and calves
Grant
$
5,280,000
$5,643, 000
93. 6
Harney $
7,966,000
8,801, 000
90.5
Lake
$
6,663,000
7,847,000
84.9
Totals
$ 19,905, 000
$22,291, 000
Oregon $132,205,000
$507,182, 000
% counties
total of
Oregon
total
15. 1
26. 1
4. 4
Characteristics of Study Area
The area to which this study specifically pertains is the high
desert range of Eastern Oregon, excluding such areas as timber
land and the flooded meadows that are used for grazing.
The type of soil on this high desert range is
shallow, well drained, and somewhat to
extremely stony. Approximately 40 percent
of the soil in Harney County is of this makeup
and it lies mostly west of Burns and south of
the timber line (at the SE corner of Crook
County). The elevation ranges from 4100
to 6500 feet and has an average growing
season of 50 to 100 days. (19, p. 64-70)
The results of this research may also prove helpful to other areas of
the high desert which have similar conditions.
Squaw Butte Experiment Station, characteristic of
much of the high desert area, has very warm, dry
summers and cold winters. Annual precipitation
averages about 11 inches in much of the area. Twothirds of the precipitation occurs as snow in the
winter and the remainder as rain during the growing season of April, May and June. (21, p. 108-114)
The native forage in this high desert area is sagebrushbunchgrass.
grass.
Introduced species consist primarily of crested wheat-
As one can surmise from the precipitation pattern, there
is only one growth cycle and all the forage species mature at about
the same time with little difference in quality between the species.
With the short growing period and rapid decline in the nutrient
quality of this forage, the management of this range forage is very
critical to the success of any ranch operation in the area.
Objectives
There is one major objective consisting of several components
which this study intends to accomplish.
The major objective is to
examine the economic feasibility of alternative management and
marketing strategies for the utilization of range forage with a springcalving operation
(cows calving in the months of March ahd April).
The following operational objectives comprise the major
objective.
The first operational objective is to determine the most
profitable time and weight to market the spring-born calves weaned
September 1.
The second operational objective is to determine whether
supplementary feeding of yearlings is economically feasible, considering the questions of when and how much to feed.
The third-operational objective is to explore the competitive
relationship between the cow-calf unit and yearlings for limited
range forage.
The fourth operational objective is to determine the combination
of beef production and growing activities which will provide the
highest returns to the range forage.
Research Procedure
The objectives of this study will be achieved through the use
of linear programming.
An L. P. model will consider many more
alternatives than the use of a simpler technique such as budgeting.
The application of the L. P. model is explained in Chapter II.
The basic data pertaining to the high desert area were obtained
from the review of literature published from research work done
at the Squaw Butte Experiment Station and conversations with the
research personnel at Squaw Butte.
Ranchers in the area also
provided guidelines which were followed in developing the analysis.
Information was obtained from other sources as well (see bibliography).
Plan of Thesis
Chapter II presents the structure of the L. P, model used in
this study.
A description of the activities included in the model
is presented.
Chapter III defines the coefficients of the activities and their
derivation.
The procedure used in obtaining the variable costs and
the cattle prices is described in the last part of the chapter.
Chapter IV discusses the solutions obtained from the L. P.
model.
Chapter V summarizes the study and points out what
conclusions can be drawn.
The limitations of the study due to the
generalization and lack of sufficient data are also discussed.
CHAPTER II
LINEAR PROGRAMMING MODEL
Linear programming as applied to this study, is the optimizing
technique for selecting the different combinations of activities which
will maximize net returns subject to certain specified constraints,,
The primary constraint dealt with here is the availability of range
forage, with its varying nutrient composition over the grazing
season.
The use of linear programming within this study allows
determination of that set of forage utilization alternatives with the
highest net return, considering the opportunity cost of forage use
in other alternatives.
For further details on the linear programming
method, refer to reference 9.
General Description of Model
The objective function of this model is to maximize net
returns.
The alternatives considered in the model are the different
comginations of beef production activities, various selling dates for
calves, various rates of gain to be achieved if calves are fed, and
what feeds are fed to each class of animals in each time period.
One of the decisions made within the model involves the
determination of the most profitable herd size subject to the range
forage available.
The cow herd size then determines the number
8
of calves weaned.
Selling dates are determined considering prices,
weight of animal and time of year in regard to type of forage available.
The number of replacement heifers needed-to maintain the cow herd
is given.
The total amount of each feed used is based on the least
cost rations for the specific rates of performance computed for each
class of animal in each time period.
Structure of Model
Within this model the quality and quantity of range forage are
the limiting constraints. There is no limit on the amount of other
feed available for use.
When "feed" is mentioned throughout this
research it pertains to all feed available excluding range forage.
Labor is assumed not to be a limiting factor in deciding which
alternative to select as the study is attempting to optimize net
returns given the range resource situation.
Also, the availability
of labor varies greatly among operations.
Variable costs that are included in the model are interest
on operating capital, salt and minerals, fuel and oil for hauling
and inspecting cattle, property tax, veterinary and medicine, and
grazing fees.
Chapter III.
Computations of these costs are discussed in
Description of Activities
Table 2 helps understand how the activities are set up.
The
table shows the different transactions that occur within the various
time periods.
Following the table each activity is explained in
further detail.
Range Forage Grazing Activities
It is assumed there are 10,000 acres available for grazing.
The quality and quantity is specified for each of six time periods,
as there is a continual change in the nutrient content of the forage
during the grazing season.
The range forage is assumed available
for grazing from April 15 to November 1.
See Table 2.
Feed Activities
Meadow hay, alfalfa hay, barley and cottonseed meal are the
feeds available for use in this study.
It is assumed there is no limit
on the amount available for consumption.
In addition to the meadow
hay that is put up in stacks, bunched meadow hay that is fed ad lib
is also included.
Feeding of bunched meadow hay is a practice
carried out by Squaw Butte and some ranchers in the area.
Meadow
and alfalfa hay are available for feeding from September 1-April 15.
Barley and cottonseed meal are available during the winter months
and for supplementary feeding for the yearlings while on range.
10
Table 2.
Outline Showing the Transactions of the Activities in Model.
Cow - (September 1 - August 30).
Sept. 1
Nov. 1
April 1
April 15
June 15
Calf weaned
Sell cull cows
To winter lot
(lose weight)
Calve
To range
(gain weight)
Bred
Replacement heifer - (September 1 - August 30).
Sept. 1
April 15
Weaner from cow To range
to winter lot.
(gain 1-1. 5
(gain 1 lb. /day)
lbs. /day)
June 15
Aug. 30
Bred
Transfer to
gestation heifer
Gestation heifer - (September 1 - April 1).
Sept. 1
April 1
To winter lot
(gain weight)
Calve
Transfer to cow
Steer and heifer calves - (September 1 - August 1).
Sept. 1
Nov. 1
Jan. 1
Mar. 1
Weaner from cow
sold or fed at winter
lot.
(gain 1. 0, 1.5, or
2. 0 lbs./day)
Sold or fed at
winter lot.
Sold or fed
at winter
lot.
(gain 1. 0,
1.5, or 2. 0
lbs. /day)
Sold or fed
at winter
lot.
(gain 1. 0,
1.5, or 2. 0
lbs. /day)
Aug. 1
(gain 1. 0, 1.5,
or 2. 0 lbs. /day)
April 15
June 15
Sold or to range
Supplementary feed
provided.
(gain 1. 5, 2.0, or 2.5
■Ibs./day)
Sold or fed on range
Supplementary feed provided
(gain 1. 5, 2. 0, or 2. 5
lbs, /day)
Sold
11
Cow Activity
The following assumptions were made regarding the cow
activity.
As shown in table 2, the cow is out on range from April 15
to November 1 when she is taken off range and fed hay and/or other
feeds until the following spring.
The calving date is April 1 and the
cull cows are sold September 1, at the time the calves are weaned
weighing 330 pounds.
While the cow is out on range, her entire nutrient requirements are assumed to be obtained from the range forage.
During
a
the winter months her requirements are met by the feed provided
at the winter headquarters.
As can be seen from table 2 the cow
does gain and lose weight but these weight changes are not great
enough to affect her rate of production or conception.
It was assumed there is one bull for 25 cows and the bull's
feed requirements are added to the cow's feed requirements.
The
bull's weight of 1800 pounds is held constant during the year.
One
twenty-fifth of one bull's requirements are added to each cow's
nutrient requirements.
The cows have a 90 percent conception rate and 82 percent
weaned calf crop based on average percentages at Squaw Butte.
It is assumed that 50 percent of the calf crop is steers and 50 percent is heifers.
for cows.
The study assumes a 14 percent replacement rate
The rate is based on a study done at the Washington
12
Agricultural Experiment Station (27), showing that as the cow's
age increases beyond 10 years, her profitability decreases.
After
an annual death loss is accounted for, the 14 percent replacement
rate is needed to replace the cows lost due to death and the cull
cows sold.
The variable cost coefficient is the amount the variable
cost for the cow and bull exceeds revenue from the sale of the
cull animals.
Replacement Heifer Activity
As shown in table 2, the replacement heifer activity begins
when she is weaned, September 1 and ends August 31.
She is fed
from September 1 to April 15 and is then put out on range April 16
to be bred.
The heifer's nutrient requirements can be met in the winter
by the feeds provided at the winter headquarters.
When she is out
on range her entire requirements are assumed to be obtained from
the forage.
Gain of one pound per day is assumed during the
winter and when out on range, she is assumed to gain one and a
half pounds per day till July 31.
During the month of August she
is assumed to gain one pound per day due to the declining nutrient
content of the range forage.
To account for death loss the number of replacement heifers
is constrained to be larger than the number of heifers in the gestation
activity.
13
The variable cost coefficient is the amount of variable cost
that occurs in maintaining a heifer in the specified time period.
Gestation Heifer Activity
The gestation heifer activity is a transfer from the replacement heifer activity and begins September 1 and ends March 31 as
a two year old heifer which is transferred to the cow herd.
See
table 2.
The nutrient requirement for this heifer is obtained from the
feeds available in the winter.
She has a weight gain of one pound
per day.
The number of gestating heifers going into the cow activity
is constrained to account for death loss.
The variable cost coefficient is the amount of variable cost
incurred.to maintain the gestating heifer for this time period.
Growing and Feeding Activities for Steers and Heifers
At the beginning of each time period the steers and heifers
can be sold or can continue to be grown.
are those not kept for replacement.
The heifers in question
The calves are weaned
September 1, the beginning of the first time period, at a weight of
330 pounds.
Referring back to table 2, the various time periods
considered in this study and the rates of gain these cattle are
assumed to be capable of attaining can be seen.
Only the steers
are assumed capable of achieving the 2. 5 pounds gain per day.
14
It is assumed all steers and heifers will be sold on or before
August 1.
The nutrient requirements are obtained from the range forage
and feed provided.
Supplementary feeding on the range is provided
if profitable during the period April 15 through August 1.
supplementary feeds used are barley and cottonseed meal.
The
The
requirements during these months can be met by a combination of
range forage, barley and cottonseed meal.
The difference between the number of animals at the beginning
and the end of each time period for the growing activities allows
for death loss.
The variable cost coefficient is different for each
activity due to the different weights and values of the steers and
heifers.
Selling Activities for Steers and Heifers
The selling dates are the same periods mentioned in the
growing activities.
See table 2.
They must be sold at the beginning
of the time period.
The prices used are appropriate for the specific
date and weight the animals are sold.
A selling cost is substracted from the amount received from
the sale of these steers and heifers.
The selling cost consists of
a commission charge and a hauling cost.
15
CHAPTER III
DATA DEVELOPMENT
The representative ranch to which the data in this study refers
is in the high desert area of Eastern Oregon.
The ranch is assumed
to consist of 10, 000 acres which is leased from the BLM.
is assumed to be in very good condition.
This range
The winter headquarters
is located on native flood meadows where the cattle are grazed on
aftermath and fed hay and/or barley and cottonseed meal.
The
winter hay supply is usually grown on these native flood meadows
but the costs used for the hay and other feeds provided in this study
are the opportunity cost, that is, market value, of this feed.
It is
also assumed there is sufficient labor available for any of the
alternatives that are considered in this study.
The following is an
explanation of the data used in this study.
Feed Nutrient Content
For the range forage and each feed available for use, there are
separate activities providing nutrients to each class of livestock.
The reason is so one class of animal will not eat a portion of the
feed and obtain one nutrient while another class of animal consumes
the remaining quantity and obtains the other nutrient.
16
Range Forage
The grazing activities are structured to show the nutrient content and quantity of the range forage on a per acre basis.
The time
periods and coefficients in each time period are such as to account
for the continual change in the quality and quantity of the forage during the grazing season.
Table 3 shows the coefficients used to identify
the quality and quantity of the range forage.
As can be seen from table 3, the coefficients differ in the early
part of the grazing season for different classes of livestock.
In the
first time period. (April 15-May 31), the coefficients for the cows
are higher than for the replacement heifers or growing steers and
heifers.
The reason is that the assumption was made that the cow
will consume more old growth than will the replacement heifers and
yearlings.
The old growth referred to here is available on that part
of the range which was grazed early the prior year and the cattle
removed in time to get rdgrowth.
The coefficients for the first time period were obtained in the
following manner.
It is assumed there are 150 pounds of old growth
DRM per acre from the prior year with a 40 percent TDN value and
zero percent DGP value per acre.
can be consumed.
Two-thirds of the old growth
There are 106 pounds DRM of new growth with
a 68 percent TDN value and 12 percent DGP value per acre.
percent of this is available for consumption.
Fifty
The figures for the new
17
TABLE 3.
Class of
Livestock
Quantity and Quality of Range Forage As Consumed
By Livestock Class.
Time Periods
Dry matter Total
digestable
DRM
nutrient TDN
Digestable
protein
DGP
(Lbs. per acre)
Cow
April 15-May 31
153.00
7.6. 04
6. 360
June 1-30
120. 50
66.28
8. 203
July 1-31
145. 50
72.75
7.280
August 1-31
149. 00
71. 52
4. 470
September 1-30
147. 5 0
63.43
1.480
October 1-31
146.00
58.40
0.740
118. 00
62. 04
6. 360
June 1-30
120.50
66.28
8. 203
July 1-31
145.50
72.75
7. 280
August 1-31
149.00
71.52
4. 470
118. 00
62. 04
6. 360
June 1-15
112. 50
64.69
8.203
June 16-30
131.25
70.22
8. 203
July 1-31
145.50
72.75
7.280
Replacement
heifer
April 15-May 31
Growing steers
and heifers
(yearlings) April 15-May 31
18
growth are averages over the time period.
This provides the
coefficient to identify the range that is available for consumption by
the cows.
With the higher nutrient requirements needed by the
replacement heifers and yearlings, it is assumed they consume 45
percent new growth and 55 percent old growth through selective grazing.
After the first time period, there is only new growth available
for consumption.
The amount of DRM available consisting of a
certain percentage of TDN and DGP, are averages during that time
period.
Fifty percent of the amount on the range is available for con-
sumption as reflected in the coefficients.
In the month of June the
coefficient related to the yearlings are divided into half month
periods to help coincide the range quality changes with the decision
points of the growing activities.
Meadow Hay, Alfalfa Hay, Barley, and Cottonseed Meal
It is assumed there is no limit on the amount available for consumption of these feeds.
The coefficients used to identify the quality
was obtained from Morrison Feeds and Feeding
(Reference 13).
Table 4 shows the nutrient composition of each feed.
19
TABLE 4.
Feed Nutrient Content
Feed
Meadow hay-
DRM
TDN
DGP
Amount in 100 pounds of feed —'
(lbs. )
CTEsTj
flSsT)
90.2
48.0
4, 1
Alfalfa hay
90. 5
50.7
10.9
Barley
89.9
78.8
6.9
Cottonseed meal
92.9
71.7
33. 3
— No change in c omp osition during year.
Feed Costs
Prices used for the feed are based on the data obtained from
Squaw Butte Experiment Station.
TABLE 5.
Table 5 shows prices used.
Assumed Prices for Hay and Concentrate Feeds.
Feed
Meadow hay
$ per ton
$20
Alfalfa hay
30
Barley
50
Cottonseed Meal
95
20
Nutrient Requirements for Cattle Activities
Cow Requirements
With the cow gaining and losing weight during the year, her
weight is assumed to range between 1000 to 1100 pounds.
Her
requirements will change during the year due to weight changes and
her physiological stage.
Listed in table 6 are the requirements for
a cow during lactation and for wintering pregnant cows.
TABLE 6.
Nutrient Requirements for Cows.
Type and weight
of cows
Maximum
Minimum
DRM
TDN
(Pounds per head per day)
DGP
Lactating cow:
1000 lbs.
1100 lbs.
27
28
12. 3
13.2
1. 17
1.26
18
19
8. 0
9. 0
. 42
. 46
Wintering pregnant cow:
1000 lbs.
1100 lbs.
Source: Reference 12 and 16
It is assumed the cow's DRM intake while out on range will
be the same as for a lactating cow even after the calf is weaned.
The reason for this is due to the very low quality of the range.
During the months of August-O ctober, the TDN and DGP requirements listed in Appendix Table B-5, are lower than her actual
requirements and correspond to nutrients available in the range
21
forage.
The assumption made here is that the cow will obtain her
needed requirements from body tissue or through selective grazing.
The requirements from September 1 - March 31 are for only . 86
of a cow as the cull cow is sold September 1 and the gestation
heifer doesn't enter the cow herd until April 1.
The requirements
for one twenty-fifth of a bull are added to the cow requirements.
Appendix Table B-5 shows the specific monthly requirements.
Steer and Heifer Nutrient Requirements
The nutrient requirements for steers and heifers are determined for different weights and rates of gain.
The maximum amount
of dry matter (DRM) the animal can consume is figured by using the
following formula:
0 75
M = 0. 125 W '
M is dry matter in pounds per head per day.
W is live weight of animal in pounds per head.
The equation was derived from information obtained from NRC
(National Research Council).
See Appendix Table B-l for the dry
matter constraints for the various weights.
The total digestible nutrients (TDN) requirements for steers
and heifers are different because of the difference in their conversion efficiency.
The equation used to derive the TDN require-
ments for steers and heifers is:
22
TDN = NEW X . 90 + NE^
M
G
X 1.37
TDN is total digestible nutrients in pounds per head per day.
NE
is the net energy required for maintenance per day
subject to the animal's weight and sex.
NE
is the net energy required for gain per day subject
to animal's weight, rate of gain and sex.
The steer's net energy requirements are lower than for the heifer's
net energy requirements.
The formula was obtained from a study
done at the University of California, Davis (References 10 and 11).
See Appendix Table B-2 for the steer's TDN requirements and
Appendix Table B-3 for the heifer's TDN requirements for different
weights and rates of gain.
The digestable protein requirements for the steers and heifers
are derived by using the following equation:
DGP
DGP
W
kg
g
=2.79 W.
kg
0 75
'
(1+1.905G)
is the amount of digestable protein in grams.
is the animal's weight in kilograms,
G is the daily gain in kilograms.
DGP
is divided by 453. 6 to convert it to pounds per head per day.
The equation was obtained from a study done by Preston (Reference 20).
See Appendix Table B-4 for the requirements of the various weights
and rates of gain.
Specific monthly nutrient requirements for replacement and
gestation heifers are in Appendix Tables B-6 and B-7.
The specific
23
monthly nutrient requirements for the other heifers and all steers for
the various weights and rates of gain can be observed from the
computer input.
See Appendix Table A-l.
Death Loss
The difference in the beginning and ending number of animals
for the livestock activities accounts for death loss during the period.
It is assumed there is a annual death loss of 1. 5 percent in the cow
herd giving a survival rate of 98. 5 percent.
The replacement
heifers have a survival rate of 99. 5 percent over a year's time and
the gestation heifers have a 99. 4 percent survival rate over a seven
month period.
There is a higher death loss among the gestation
heifers due to death occuring during calving.
A death loss of 1. 67 percent annually is assumed for the growing heifers and steers.
It is assumed there is a higher number of
deaths accounted for in the first month after weaning than in any
month thereafter.
The percent survival for each time period can
be observed from the computer input.
See Appendix Table A-l.
The rates used are based on beef production studies done in the
Western states.
24
Variable Costs
Interest on Operating Capital
The interest charge is based on the average value of the animal
during the specified time period and is figured at an annual rate of
8 percent.
The average value for a cow is assumed to be $250;
bull at $1000; and gestation heifer at $200.
For the replacement
heifers and growing steers and heifers, the average market value is
used.
Salt and Minerals
It is assumed that an animal consumes $. 25 per head per year
of salt and $2. 00 per head per year of minerals.
Figures are taken
from studies done in Montana, California, and Washington (References
1, 2, 8, 15 and 26).
Fuel and Oil
The costs included are for hauling the cattle to and from range
(a practice used by Squaw Butte Experiment Station and other ranchers
in the area), and for the feeding and inspection of the cattle.
The
hauling costs were obtained by using the Williamette tariff rates.
The rate of $. 21 per hundred weight is used in this study for hauling
the cattle to and from range.
A charge of $1. 50 per head per year is used for the feeding of
minerals and inspection of the cattle.
25
Property Tax
The property tax is levied on the animal if there is possession
at the first of the year.
Table 7 shows the rates for the different
classes of cattle.
TABLE 7.
Property Tax Rates for Cattle in Harney County.
Class of livestock
a/
Tax rates —
Calves, under 6 mos.
Steers, 6 mos. - 1 yr.
Heifers, 6 mos. - 1 yr.
Steers, 1 yr. and over
Heifers, 1-2 yrs.
Cows, 2 yrs. and over
Bulls, 1 yr. and over
($ per head per year)
$1. 00
2. 55
2. 00
3. 33
2.89
3. 44
6. 44
a/
Rates were obtained from Harney County Assessor's office
Veterinary and Medicine
There is a $2. 00 charge per head per year for the cow activity.
Included in this charge are the expenses incurred by the calf from
birth to weaning.
head per year.
The growing activities have a cost of $. 64 per
It is assumed that $. 20 per head occurs the first
month after weaning and $. 04 per head per month thereafter.
replacement heifer has a cost of $2. 00 per head per year.
gestation heifer, there is a cost of $. 04 per head per month.
The
For the
26
Grazing Fee
The rate charged for grazing is $. 64 per AUM (animal unit
month).
This is the rate charged in 1971 by the BLM (Bureau of
Land Management). (Reference 30).
If the livestock are on the
range for only part of a month, a charge is made for only the time
they are on the range. It is assumed that after the calves are weaned
and taken off range, there is no charge for a grazing fee as they
are put on deeded land.
Bull Depreciation
There is a $7. 00 charge per cow for the depreciation of the
bull.
The rate is made assuming there is one bull for 25 cows and
the bull is used for four years.
For specific computations of the variable costs incurred by
the cows, replacement and gestation heifers, see Appendix Tables
B-5, B-6, and B-7.
For an example of a completed worksheet on
how the variable costs coefficients were obtained for the steer and
heifer growing activities see Appendix Tables B-8 and B-9.
Cattle Prices
Prices used in the study for calves up to 800 pounds were
obtained from the Ontario market.
Prices for steers and heifers
over 800 pounds and for cull cows were obtained from the North
Portland market.
27
For all the feeder prices used in this study and an explanation
on how they were obtained, see Appendix Table C-l.
The prices
for all the different weights in each month are given.
Heifer prices over 800 pounds were obtained by using prices
for 800-1000 pound Good animals.
1960-1970 was used in the study.
An average price for years
Appendix Table C-2 shows how
the averages prices used were obtained.
Steer prices over 800 pounds were obtained in the following
way.
Good steer prices for 900-1100 pounds were obtained.
Prices
between 800-900 pounds were interpolated between feeder and
slaughter prices.
It is assumed there is a linear relationship
between the feeder and slaughter prices.
Appendix Table C-3
shows how the average prices for Good steers, 900-1100 pounds,
were obtained.
Utility cow prices are used for the selling price of cull cows.
The price used is a 10 year average for the months of August and
September.
See Appendix Table C-4.
Selling Costs
Commission Charge
Information pertaining to the commission charge was obtained
from the Ontario Livestock Commission Company.
The charges
used in the study are $3. 00 per head for animals 425 pounds and
28
over and $2.75 per head for animals less than 425 pounds.
Hauling Costs
Willamette tariff rates for hauling livestock are used.
study the rate of $. 33 per hundred weight is used.
In this
The rate is
higher for hauling to market than for hauling to range because of
an assumed longer hauling distance to market.
These selling costs are computed and than substracted from
the returns to obtain the coefficient used for the net returns in
this study.
See computer input, Appendix Table A-1 for the net
return coefficients for each selling activity.
29
CHAPTER IV
ANALYSIS AND RESULTS
The results presented in this chapter show the combinations
of activities that will provide the highest net returns for the spring
cow-calf operation.
It must be remembered that the results
obtained from this programming model are a function of the
assumptions made and data as reflected in the coefficients.
General Description of Results
There are two major solutions discussed in this chapter with
reference to two other solutions.
After obtaining the initial solution,
the cost of barley was reduced $5. 00 per ton from $50 to $45 and
the second solution was obtained.
In the initial solution there are 256 cows in the operation and
the calves are kept and fed after weaning.
The heifers are fed to
gain 1. 5 pounds per day and sold March 1 weighing 600 pounds.
The
steers are fed to gain 2. 0 pounds per day and are sold April 16
weighing 780 pounds.
The cows, replacement heifers, and gestation
heifers are maintained on meadow and alfalfa hay during the winter
and the growing steers and heifers receive meadow hay, alfalfa hay
and barley.
30
In the solution with barley cost reduced $5 per ton, there are
247 cows, a decrease of 9 compared to the initial solution.
The
reason for the decrease in cow numbers is that the yearling heifers
are put out on range for two months and are using range forage that
was used by the cows in the first solution.
The heifers are fed to
gain 2. 0 pounds per day and are sold June 16 weighing 900 pounds.
They are supplementarily fed barley and cottonseed meal while out
on range.
The steers are fed to gain 2. 0 pounds per day and sold
April 16 weighing 780 pounds, same as the initial solution.
Net Returns for the Initial Solution
The net returns obtained from the 10, 000 acre cattle operation
in the initial solution was $4250.
The net return referred to here
and throughout this study, is the return to labor, buildings, lots,
equipment and management used in beef production, but not those
resources used for hay or grain production.
The charges for hay
and grain fed are based on the opportunity costs, that is, market
value, of these feeds.
Table 8 shows the breakdown of net returns
on a per cow and on a per acre of range basis for the initial
solution.
31
TABLE 8.
Net Returns From Cattle Operation Obtained In Initial
Solution.
Total
Per
Cow
Per acre
of range
Income:
Selling 104 steers at $27. 68/cw,t.
weighing 780 lbs. less selling cost.
Selling 68 heifers at $25. 60/cwt.
weighing 600 lbs. less selling cost.
Total Income
$21,862
10, 118
$31,980
$124. 77 $3. 20
Expenses:
Feed costs:
Meadow hay at $20/ton.
Alfalfa hay at $30/ton.
Barley at $50/ton.
Total feed costs
Variable costs;
a/(256 head)
Cows—
Replacement heifers
Gestation heifers
Steers
Heifers
$12,176
2,492
3,037
$17,705
$69. 08 $1.77
$ 6,677
967
487
1, 325
569
Total variable costs
$10,025
$ 39. 11 $1. 00
Total operating expense
$27,730
$108. 19 $2.77
Net Return—
$ 4,250
$ 16. 58 $ .43
— Is amount V. C. is above income received from sale of cull cows.
— Is the return to labor, management, buildings, lots, and equipment
used in beef production.
32
The net return per cow is $16. 58, or $. 43 per acre of range.
To provide a return of $10, 000 above variable cost per year, these
results indicate a ranch would need to be about 24, 000 acres with
about 600 cows, assuming a ranch that large could be operated at the
same average costs assumed in this study.
Most Profitible Enterprise Combination With Initial Solution
An explanation of the most profitable enterprise combination
which obtains the above net return is shown in table 9.
The number
of animals maintained in the operation, acres of range used, and
tons of feed fed are given.
TABLE 9.
Annual Cattle Numbers, Range Used, and Feed Fed
for Initial Solution.
Class of
cattle
Cow
Replacement
heifer
Gestation
heifer
Steer ±J
Heifer *
Totals
Animal
numbers;
(head)
Range
Amount of feed consumed
used Meadow Hay Alfalfa
Barley CSM
(tons)
(acres)
__
256
9351
359.7
36
649
41.4
7.3
__
11. 0
49.9
15. 0
__
--
62.7
84. 4
60.5
51.0
9.9
---
608.7
83.2
60.9
0
36
104
68
10,000
a/
— 104 is number sold on April 16.
105 are weaned September 1.
68 is number sold on March
69 are weaned September 1.
33
All the range forage is consumed by the cows and replacement
heifers as the yearling steers and heifers are sold prior to the grazing season.
This suggests the MVP of the range is higher for cows
and replacement heifers than for the yearlings.
The following tables show what feeds are consumed and the
costs incurred for each class of livestock.
Cows
The amount of range used in each time period by the cows and
bulls and the amount of winter feed used in each period is shown on
a per cow basis in table 10.
TABLE 10.
Cows and Bull: Feed Consumed and Costs, Per Head,
In Specified Time Periods for Initial Solution.
Time period
Jan. 1-31
Feb. 1-28
Mar. 1-Apr. 15
Apr. 16-May 31
June 1-30
July 1-31
Aug. 1-31
Sept. 1-30
Oct. 1-31
Nov. 1-30
Dec. 1-31
Totals
Feed
Costs
(dollars)
Range
used
(acres)
Meadow hay
consumed
(pounds)
—-»—
481
47 3
867
$ 4. 81
4.73
8.67
498
488
4.98
4.88
2807
$28. 07
8.8
6.0
5.6
5.9
5.1
5.1
36.5
Variable costs (net)
Total fee<d and variable costsi
26. 05
$54. 12
34
The cow and bull obtain all their nutrient requirements during
the grazing season from the range forage.
During the winter months,
meadow hay, fed in the amounts shown, fulfills their nutrient requirements.
Replacement Heifers
The amount of range used by the replacement heifers and the
amount of feed consumed as indicated in table 11 is on a per head
basis.
TABLE 11.
Replacement Heifers: Feed Consumed and Costs, Per
Head, In Specified Time Periods for Initial Solution.
Time period
Range
used
(acres)
Sept. 1-30
Oct. 1-31
Nov. 1-30
Dec. 1-31
Jan. 1-31
Feb. 1-28
Mar. 1-Apr. 15
Apr. 16-May 31
June 1-30
July 1-31
Aug. 1-31
Totals
^mc^nt of feed_cons_umed _ Feed
Meadow
Alfalfa
costs
hay
hay
(dollars)
(pounds)
253
272
285
302
315
332
522
6.6
4.2
3.6
3.5
17.9
44
46
51
53
57
59
95
$ 3. 19
3.41
3. 62
3.82
4. 01
4.21
6.65
405
$28.91
-----
2281
Variable costs
Total feed and variable costs
26. 64
$55. 55
35
The replacement heifer obtains all her nutrient requirements
during the grazing season from the range and from meadow and
alfalfa hay during the months she is not on range.
Alfalfa and meadow
hay are required in a ratio of 1:5-1/2, that is, 10 pounds of alfalfa
for each 55 pounds of meadow hay.
Gestation Heifer
The amount of feed consumed by the gestation heifer is indicated
in table 12.
It is on a per head basis.
TABLE 12.
Gestation Heifers: Feed Consumed and Costs* Per
Head, In Specified Time Periods for Initial Solution.
Time period
Sept.
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
1-30
1-31
1-30
1-31
1-31
1-28
1-31
Totals
_ Arnount_of^feecl consumed_
Meadow hay
Alfalfa hay
(pounds)
Feed
Costs
(dollars)
471
484
494
510
525
536
82
81
84
88
89
91
92
$ 5.76
5.93
6. 10
6.26
6.44
6.62
6.74
347 3
607
$43. 85
45 3
Variable costs
13.49
Total feed and variable costs
$57. 34
The gestation heifer obtains all her nutrient requirements
from meadow and alfalfa hay.
The ratio of alfalfa to meadow hay
36
is the same as for the replacement heifer, 10 pounds of alfalfa to
55 pounds meadow hay.
Steers
For each specific time period, the number of animals on hand
at the beginning of the periocj, beginning weights of the animals, and
the amount of feed that is consumed to achieve the most profitable
daily gain of 2. 0 pounds are given in table 13.
Table 14 shows the
beginning weights of the animals and the costs incurred in each
specific time period.
The date, weight and dollar value when the
steer is sold are also given.
TABLE 13.
Steers: Feed Consumed Per Head, In Specified Time
Periods for Initial Solution.
Time period
Initial
number
(head)
Sept. 1-Oct. 30
Nov. 1-Dec. 31
Jan. 1-Feb. 28
Mar 1-Apr. 15
Totals
105.
104.
104.
104.
1
8
5
2
Initial
weight
(pounds)
330
450
570
690
^IT1?}1^ £f Je£d_consumed _
Meadow
Alfalfa
hay
hay
Barley
(pounds)
336
405
485
390
197
2 39
197
249
283
246
1616
952
975
2 37
279
37
TABLE 14.
Steers: Feed Costs, Variable Costs, and Income Per
Head In Specified Time Periods for Initial Solution.
Time: period
Sept.
Nov.
Jan.
Mar.
Apr.
1 - Oct.
1-Dec.
1-Feb.
1-Apr.
16
Initial
number
(head)
30
31
28
15
105. 1
104. 8
104. 5
104. 2
103.9
Totals
Initial
weight
(pounds)
330
450
570
690
780
Feed
Costs
Variable
Net
returns
costs
(dollars)
$11.25
13. 84
16. 12
13.64
-- --
$3.21
2. 81
3.61
3. 04
- --
$54. 85
$12.67 $142.81
-$14.46
- 16.65
- 19.73
- 16. 68
210. 33
The steers gaining 2. 0 pounds per day require barley, alfalfa
and meadow hay in a ratio of about 1:1:1. 7, that is 10 pounds barley
and 10 pounds alfalfa hay to every 17 pounds of meadow hay.
ratio is the same throughout the time periods.
The
The steer is sold
April 16, which is the beginning of the grazing season,
weighing
780 pounds.
Heifers
For each specific time period, the number of heifers on hand
at the beginning of the period, beginning weight of the animals, and
the amount of feed that is consumed to achieve a daily gain of 1. 5
pounds are given in table 15.
The initial weight and the feed and
variable costs incurred in each time period are shown in table 16.
The sale date, weight and dollar value of the heifer when sold are
also shown.
38
TABLE 15.
Heifers: Feed Consumed Per Head, In Specified
Time Periods for Initial Solution.
Initial
number
(head)
Time period
Sept. 1-Oct. 30
Nov. 1-Dec. 31
Jan. 1-Feb. 28
68.7
68. 5
68. 3
Amount of feed consumed
Initial Meadow Alfalfa
weight
hay
hay
Barley
(pounds]
(pounds)
330
420
510
Totals
TABLE 16.
1-Oct. 30
1-Dec. 31
1-Feb. 28
1
Totals
591
676
126
143
171
84
98
105
1767
440
287
Heifers: Feed Costs, Variable Costs, and Income
Per Head, In Specified Time Periods for Initial
Solution.
Time period
Sept.
Nov.
Jan.
Mar.
5 00
Initial
number
(head)
68.7
68. 5
68. 3
68. 1
Initial
weight
(pounds )
330
420
510
600
Feed
costs
Variable
Net
costs
returns
(dollars )
$ 8.99
10.52
11.96
$2.95
2. 38
2.98
- --
-$11.94
- 12.90
- 14.94
148.62
$31.47
$8. 31
$108. 84
The heifer gaining 1. 5 pounds per day requires barley, alfalfa
and meadow hay in a ratio of about 1:4:6, that is, 10 pounds of
barley and 40 pounds of alfalfa hay for every 60 pounds of meadow
hay.
The difference occurring between the heifers and steers is
due to the different rates of gain and efficiency in conversion.
The heifers are sold March 1 weighing 600 pounds.
39
Comparison of Initial Solution With Traditional Operation
In table 17 the initial solution has been decomposed into three
enterprises:
calf production, steer growing, and heifer growing.
The income and expenses of the initial solution have been allocated
to each enterprise.
The calf production enterprise resembles the traditional
system of operation for ranchers in the high desert.
It assumes:
(1) the calves are weaned September 1 and fed for the two month
period of September 1-November 1; (2) the steers will gain an
average of 2 pounds per day and (3) the heifers will gain an average
of 1. 5 pounds per day during the two month period.
Table 17 illustrates the expected contribution to net returns
as a result of adding steer and heifer growing enterprises to the
traditional calf production enterprise.
The net returns from the
steers alone in the initial solution is higher than when all the calves
are sold November 1.
Net returns for the ranch management alternative of selling
the calves November 1 is $1121.
By feeding the heifers until
March 1 and the steers until April !£, the net return is increased
$3129.
There is a "loss" of $2008 from not feeding steers and
heifers for a longer time period.
The "loss" per cow is $7. 84 --
a "loss" of $3920 for a 500 cow operation.
One needs to be careful
TABLE 17.
Enterprise Analysis of the Initial Solution.
Cow and calf,
calf sold Nov. 1
Total for
Per cow
256 cows
bred
Steer growing
Nov. 1-Apr. 15
Total for
Per steer
104 steers
sold
Heifer growing
Nov. 1-Mar. 1
Total for
Per heifer
68 heifers
sold
Income:
Selling steers
Selling heifers
Total Income
$14,019
$21,862
7,388
$21,407
$10,118
$83.52
$21,862
$210.33
$10,118
$148.62
$14,019
$134.88
$7,388
$108. 52
Expenses:
Beginning value
Feed costs
Variable costs
Total Expenses
Net Returns
0
$11,619
$45.33
4,550
43.78
1, 536
22. 56
8,667
33. 82
990
9.52
368
5. 41
$79.15
$19,559
$188.18
$9,292
$136.49
"$"826
$ 12.13
$20,286
$1,121
$4.37
$^,303
^""ziVis
-
o
41
in interpreting these comparisons generally due to the difference
in winter feeding costs and season cattle price patterns from year
to year.
Net Returns With $5 Lower Barley Price
The net returns obtained from the 10, 000-acre cattle operation
when barley price was reduced $5 per ton was $4674.
Table 18
shows the breakdown of net return on a per cow and on a per acre
of range basis.
The net return per cow was $18. 95 or $. 47 per acre of range.
This is an increase of $2. 37 per head or $. 04 per acre over the
initial solution due to a $5 per ton reduction of barley price and
a recombination of activities.
This solution helps realize the effect
a change in feed prices can have on which activities comprise the
nnost profitable operation.
The following tables and explanation will
help show what changes were made in the operation with the $5 per
ton reduction in price of barley.
Most Profitable Enterprise Combination With
$5 Lower Barley Price
In obtaining results in the solution with barley price reduced
from $50 per ton to $45 per ton, there is a change in cattle numbers
and amount of feed consumed compared to the initial solution.
Table
19 shews the number of cattle maintained and amount of feed consumed.
42
TABLE 18.
Net Returns From Cattle Operation for Solution With
$5 Lower Barley Price.
Total
Per
cow
Per acre
of range
Income:
Selling 100 steers at $27. 68/ cwt.
weighing 780 lbs. less selling costs. $21, 038
Selling 65 heifers at $23. 37/c-wct.
weighing 900 lbs. less selling costs.
$13, 321
Total Income
$34,359
$139.29 $3.44
Expenses:
Feed costs:
Meadow hay at $20/ton.
Alfalfa hay at $30/ton.
Barley at $45/ton.
Cottonseed meal at $95/ton.
Total feed costs:
$11,417
2. 690
5, 188
104
$19,399
Variable costs:
a/
Cows - (247 head)
Replacement heifers
Gestation heifers
Steers
Heifers
$78.'64$1.94
$ 6,426
930
469
1,276
1,185
Total variable costs
$10,286
$ 41.70 $1.03
Total operating expense
$29,685
$120. 34 $2.97
$ 4,674
$ 18.95 $ .47
h/
Net return-
'
a/
— Is amount V. C. is above income received from sale of cull cows.
h/
— Is the return to labor, management, buildings, lots, and equipment
used in beef production.
TABLE 19.
Annual Cattle Numbers, Range Used, and Feed Fed With $5 Lower Barley Price.
Class of
cattle
Cow
Animal
numbers
(head)
Range
us_ed _.
(acres)
Amount of feed consumed
Meadow hay
Alfalfa hay
Barley
(tons)
CSM
247
8999
346. 1
Replacement heifer
35
624
39. 8
7. 1
Gestation heifer
35
60.4
10. 5
Steer ^
100
81.4
47.9
49.0
Heifer-
65
377
43. 3
24.2
66.2
1. 1
10, 000
571. 0
89.7
115.2
1. 1
Totals
a/
— 100 is number sold on April 16.
101 are weaned September 1.
b/.65 is number sold on June 16.
66 are weaned September 1.
See tables 20 and 21 for further details.
44
The major change in the operation is that the heifers are fed
for a longer period.
They are fed until June 15 compared to March 1
in the initial solution therefore requiring more feed.
All other
changes are in proportion to the decrease in cattle numbers due to
the heifers using 377 acres of range, the limiting factor, thus
reducing the cow number.
The following tables show the changes occurring in the feed
consumed and costs for the heifers.
Heifers
Tables 20 and 21 show the changes that have taken place in
relation to heifer growing activities.
The amount of. feed that is
consumed to achieve a daily gain of 2. 0 pounds per day and the
initial number of heifers at the beginning of each period is shown
in table 20.
The initial weight and the feed and variable costs
incurred for each specific time period are given in table 21.
The
sale date, weight and dollar value of the heifer when sold are also
given.
In comparing these two tables with tables 15 and 16, the
differences in amount of feed consumed, rate of gain, and selling
value can be seen.
The heifers gain an average of 2. 0 pounds per
day rather than 1. 5 pounds per day as in the initial solution.
They
are fed until June 15 and sold weighing 900 pounds rather than selling at 600 pounds in March 1.
Barley, alfalfa and meadow hay are
45
TABLE ZO.
Heifers: Feed Consumed Per Head, In Specified Time
Periods With $5 Lower Barley Price.
Initial
number
(head)
Time period
Sept.
Nov.
Jan.
Mar.
Apr.
1-Oct. 30
1-Dec. 31
1-Feb. 28
1-Apr. 15
16-June 15
66. 1
65.9
65.7
65.5
65.4
Totals
TABLE 21.
148
186
217
185
377
1313
736
314
37 3
434
376
522
33
20 19
33
Heifers: Feed Costs, Variable Costs, and Income Per
Head, In Specified Time Periods With $5 Lower Barley
Price.
1 - Oct. 30
1-Dec. 31
1-Feb. 28
1-Apr. 15
16-June 15
16
Totals
268
334
397
314
377
Times period
Sept.
Nov.
Jan.
Mar.
Apr.
June
Armount of fe<2d consumed
Range Meadow Alfalfa
hay
hay
used
Barley CSM
(acres)
(pounds)
Initial
number
(head)
66.1
65.9
65.7
65.5
65.4
65.2
Initial
weight
(pounds)
330
450
570
690
780
900
Feed
costs
Variable
costs
(dollars)
$11.97
14. 54
17. 00
14. 38
13. 22
$ 2.98
2.50
3. 13
2. 68
6.76
-$14.95
- 17.04
- 20. 13
- 17. 06
- 20. 08
204. 36
$71.21
$18. 05
$115.10
Net
returns
required in a ratio of about 2:1. 2:1, that is 20 pounds barley to 12
pounds alfalfa and 10 pounds meadow hay.
The heifer is consuming
more barley and less meadow hay than in the initial solution.
This
is due to the higher rate of gain and the lower cost of barley.
When
the heifer is out on range from April 16-June 15, she requires
46
supplementary feeding of barley and cottonseed meal (CSM) in a ratio
of 16:1, that is 16 pounds barley to 1 pound CSM.
Comparison of Second Solution With Traditional Operation
In table 22 the second solution has been decomposed into three
enterprises: calf production, steer growing, and heifer growing.
The income and expenses of the second solution have been allocated
to each enterprise.
The calf production enterprise resembles the traditional system
of operation for ranches in the high desert.
The same assumptions
are made in regard to the traditional operation as stated when compared to the initial solution except the heifers are assumed to gain
2. 0 pounds per day rather than 1. 5 pounds per day from September 1November 1.
This is the reason for the higher total income in the
calf production enterprise in table 22 compared to table 17.
Table 22 illustrates the expected contribution to net returns as
a result of adding steer and heifer growing enterprises to the
traditional calf production enterprise.
$3332.
The net returns are increased
There is a "loss" of $1990 or $8. 06 per cow when the calves
are sold November 1 rather than being fed.
Again one needs to be
careful in interpreting these comparisons generally due to the
yearly differences in winter feeding costs and seasonal cattle price
patterns.
TABLE 22.
Enterprise Analysis of Second Solution.
Cow and calf,
calf sold Nov. 1
Total for Per cow
247 cows Bred
Steer growing
Nov. 1-Apr. 15
Total for
Per steer
100 steers
sold
Heifer growing
Nov. 1-June 15
Total for
Per heifer
65 heifers
sold
Income:
Selling steers
Selling heifers
Total Income:
$13,491
$13,
491
7,531
7, 531
$21,038
$13,321
$21,022
$85.22
$21,038
$210.33
$13,321
$204.36
0
$11,333
$ 8,347
$45.94
33.84
$13,491
4,180
951
$134.88
41.79
9.50
$7,531
3,886
988
$115.53
59.61
15.16
Total Expenses:
$19,680
$79.78
$18,622
$186.17
$12,405
$190.30
Net Returns --
$ 1,342
$5.44
$ 2,416
$ 24.16
$
$ 14.06
Expenses:
Beginning value
Feed costs
Variable costs
916
48
Analysis of Supplementary Feeding In The Two Solutions
Even though supplementary feeding was allowed if the yearlings
were put out on range, all the yearlings were sold prior to the date
when range was available in the initial solution.
In the solution when
barley prices were lowered, only heifers were put on range and
supplementarily fed from April 15 to June 15.
An explanation for
the results pertaining to supplementary feeding is related to a
combination of factors.
One means of evaluating the supplementary feeding alternative
is with the utilization of the following graph which relates the total
dollar "value" of the animal for various rates of gain in various
months.
This may help to show what affect the average seasonal
pattern of cattle prices may have on the total value of the animal
in the various months.
Graph 1 shows the steer and heifer values
for 1. 5 and 2. 0 pounds daily gain in the various time periods when
they can be sold within this study.
It can be seen from this graph that the price pattern may have
a big influence upon the most profitable rate of gain and selling date
for steers and heifers.
Until March 1 there is a steady increase
in value for both rates of gain for the steer.
As the weights and
value of the steer increase after March 1, the steer's value increases
at a decreasing rate throughout the remainder time periods when
gaining 1. 5 pounds.
When gaining 2 pounds per day, the value
49
GRAPH 1. Value of Steers and Heifers Gaining 1. 5 and 2. 0 Pounds
Per Day For Various Weights In Various Months.
240 H
220
200 A
•r-t
<u
(0
0
180 H
•H
u
>
u
o
160 A
1)
rH
>
<»
140 -1
120
100 4
80
Sept. 1. Nov. 1
Jan. 1
Mar. 1
Apr. 15 Jun. 15 Aug. 1
50
increases at a decreasing rate until June 15 after which it increases
at an increasing rate again.
The likely reason for this may be that
the steer gaining 2. 0 pounds per day reaches a slaughter weight by
August 1 and can be sold at slaughter prices.
Point 1 on the graph
shows the value of the steer when sold in both solutions.
The heifer's value increases at an increasing rate until March 1
when gaining 1. 5 pounds per day after which it increases at a decreasing rate until June 15.
Point 2 shows the value of the heifer when
sold in the initial solution.
The heifer's value increases at an
increasing rate throughout the time periods when gaining 2. 0 pounds
per day.
The likely reason for this continual increase is because
she can reach slaughter weight at a lighter weight and can be sold
at slaughter prices.
There is less difference between slaughter
heifer and steer prices than between feeder heifer and steer prices
which may explain why the heifers are supplementarily fed in the
solution with reduced barley prices rather than the steers.
Point 3
on the graph shows the value of the heifer when sold in the solution
with reduced barley prices.
The Efc'ects of Changes In The Availability and Price of Hay
No Alfalfa Available
A solution was made allowing no alfalfa to be fed.
There was
no change in cattle numbers, rates of gain, or selling dates from the
51
initial solution.
The only change that occurred was that some cotton-
seed meal (CSM) was fed to all classes of cattle that were consuming
alfalfa hay in the initial solution.
tein requirements.
The CSM was needed to meet pro-
The feeding of the CSM increased the feed costs.
Meadow Hay Price Reduced to $10 Per Ton
The results obtained when meadow hay costs were reduced $10
per ton were of more significance than when no alfalfa was allowed.
This solution was based on barley price at $45 per ton and meadow
hay price at $10 per ton (assumed variable costs to raise own hay).
The changes that occurred were:
(1) more meadow hay was fed;
(2) no alfalfa hay was fed; and (3) some CSM was fed to all animals
that consumed alfalfa hay.
The cattle numbers were the same as in
the initial solution, see table 9, but the heifers were sold April 16
weighing 670 pounds rather than being sold March 1 weighing 600.
It would appear from this study that a change in meadow hay
prices would not be a major factor in the management and marketing strategy for the high desert beef ranchers, subject to the fact
that all other things remain the same.
52
CHAPTER V
SUMMARY AND CONCLUSIONS
The problem dealt with in this research was to analyze the
economical utilization of the scarce range forage resource.
An LP
model subject to various assumptions was utilized to determine the
most profitable date and weight to market spring-born steers and
heifers.
Many different alternatives were examined in obtaining the
solutions in this research.
First, the number of cows that could
be maintained on the available range forage was determined.
The
entire livestock enterprise was considered in determining the cow
numbers to see whether any other class of livestock could compete
for the consumption of the range forage.
The feed ration combina-
tion was determined for each class of livestock, and the rates of
gain to be achieved by the steers and heifers were determined.
The effects of changes in feed prices and availability on the solution
were also incorporated into the study.
The operational objectives that were established for the study
are as follows:
(1) What is the most profitable time and weight
to market the spring-born calves weaned September 1?
(2) Is
supplementary feeding of yearlings economically feasible?
(3) If
these yearlings are put out on the range and supplementarily fed,
would there be a competitive relationship for the forage between the
53
cow-calf unit and the yearlings?
(4) What combination of livestock
enterprise would provide the highest returns from the range forage
and other resources for a Harney County, Oregon (or similar) cowcalf ranch of 10,000 acres of range?
There were two major solutions derived in this study.
The
initial solution obtained indicated heifers should be sold March 1 at
600 pounds having been fed to gain 1. 5 pounds per day from weaning (September 1) to selling date.
The steers were sold April 16
at 780 pounds and fed to gain 2. 0 pounds per day from weaning to
selling date.
In the solution with barley price reduced $5 per ton from $50
to $45, the steers were sold April 16 at 780 pounds (same as the
initial solution).
The heifers, however, were sold June 15 weigh-
ing 900 pounds having been fed to gain 2. 0 pounds per day from weaning (September 1) to selling date.
The heifers were supplementarily
fed while on the range between April 16 and June 15.
The initial solution found that it was not economical to graze
yearlings on range forage.
The relationship between market price
and animal weight is one likely reason why the yearlings were sold
on or prior to April 16, the beginning of the grazing season.
Between
the period of April 16 and June 15, cattle prices are decreasing and
the total value of the yearlings is
rate.
increasing but at a decreasing
Consequently, the time to sell is earlier when the weight-price
54
combination is more profitable.
Another possible reason is that
range quality in the first month of grazing (April 16-May 15) is
low and there is very little new growth available yet.
If yearlings
were put out on range they would require supplementary feeding to
maintain a satisfactory rate of gain. It thus appears that the cows
can earn a higher MVP for this limited resource, range forage,
in the initial solution.
In the solution with reduced barley prices, the heifers were
put on range and fed a supplementary ration between turnout and
market dates.
One reason why heifers were put on range rather
than steers is that the heifers reach slaughter grades at lower
weights than steers.
Also the steer-heifer price differentials at
the time steers are sold (April 16) are such that it pays to keep
heifers longer and add more weight by putting them on grass.
The
differential between heifer and steer prices at slaughter is lower
in comparison to the differential in the feeder prices for heifers
and steers, making such an alternative (holding heifers longer)
more profitable.
A reduction in hay price doesn't appear to have much effect
on the management and marketing practices in this study.
Meadow
hay price -was reduced $10 per ton and there were no major changes
in the solution.
It would appear that sale at weaning time or at an early date
55
like November 1 is not the "most profitable" alternative.
The feed
costs are less than the increase in income from feeding the animals
through the winter.
This decision, however, is certainly contingent
upon having facilities and capital to provide the necessary feed.
In trying to draw general conclusions from the results discussed, it must be remembered that the results are subject to all
the assumptions made.
The study indicates further work is needed concerning overall
management and marketing on these range cow-calf ranches.
A
difficult and limiting factor in this study was trying to obtain data
on the range quantity and quality.
With the range forage playing
such a big part in the management decisions on these ranches and
fluctuating from year to year due to weather, more detailed studies
are needed.
These detailed studies should provide the amount of
range forage available for grazing and the nutrient content of this
forage.
It would be of great benefit for any further studies.
With
the continual change in the nutrient content of the range forage, it
is recommended in further studies that the time periods be of a
shorter duration.
This would help determine the best way to utilize
the range, especially in the early part of the grazing season where
quality and quantity of forage is changing rapidly.
The nutrient content of the range forage and feeds have a
substantial influence on the rates of gain.
It would be interesting
56
to evaluate in more detail the effects a change in the nutrient content
would have on the rates of gain and upon market dates.
The rate of gain achieved by the animals in the study varied
with the kind of feed available, feed cost, and time of marketing.
Further study is needed in determining what rates of gain are
feasible and most profitable, considering the different times when
these animals are sold subject to the feed availability and costs.
In this study it was assumed all the winter feed needed was
available.
Further study should be made regarding the supply of
the winter feed and what effect a price change or a shortage of
winter feed would have on both feeding programs and sale dates.
Another interesting facet to be studied is to determine when
supplementary feeding heifers and steers is most effective
and
what grades should be achieved when feeding on the range for a
specified length of time.
A further study pertaining to the demand in the market for
these yearlings at various selling dates may be quite helpful in
decision making.
If there is a market established, (special sales,
etc. ) for these yearlings at various dates, what effect will this
have on cattle prices during other time periods for the geographic
area being studied?
Another consideration needing further study for cow-calf
ranches is in regard to risk.
For instance, if a rancher had an
57
operation set up as shown in the initial solution with the cows consuming all the range forage and all yearlings sold by April, what
would he do in a bad year when the quantity of grass is low?
Should
he sell the cows and replace them later?
For the second solution with the yearling heifers consuming
some grass, these yearlings could be sold in a bad year prior to
putting them out on range to save the limited amount of range forage
for the cows.
Is it more profitable then to follow the "all cows"
strategy and gamble on the grass or have a "combination of cows
and yearlings" and have more flexibility concerning grass utilization?
It would be interesting to see which alternative provides the greatest
net returns "on the average" over time.
These are just a few additional problems one might consider
if further work is done in management and marketing on the high
desert cow-calf ranches.
58
BIBLIOGRAPHY
1.
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Yellowstone County that winters on the range. Bozeman,
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Service. Bulletin 1073.)
2.
Bucher, Robert F. , et al. Costs and returns of yearling ranch
in Yellowstone County. Bozeman, August, 1970. 11 p.
(Montana State University. Extension Service. Bulletin 1078. )
3.
Bullock, Bruce J. and Samuel H. Logan. An application of
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4.
Castle, E. N., Joe D. Wallace and Ralph Bogart. Optimum
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5.
Cole, David L. Effect of merchandising methods on prices
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6.
Cook, C. Wayne. Energy budget of the range and range livestock. Fort Collins, December, 1970. 28 p. (Colorado.
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7.
Coppedge, Robert O. (ed. ) Agriculture in Oregon counties:
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9. Heady, Earl O. and Wilfred Candler. Linear programming
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59
11.
. Net energy tables for use infeeding beef cattle.
Davis, University of California, Dept. of Animal Science, 1969. 25 p.
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13. Morrison, Frank B. Feeds and Feeding. 22nd ed. Clinton,
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15. Mueller, Robert G. Costs of cow-calf ranching in northern
interior Washington. Pullman, January, 1968. 22 p.
(Washington. Agricultural Experiment Station. Circular
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18.
Oehrtman, Robert Lee. Physical and economic determinants
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Master's thesis. Corvallis, Oregon State University, 1965.
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19.
Oregon. State Water Resources Board. Oregon's long-range
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20. Preston, R. L. Protein requirements of growing-finishing
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60
22. Raleigh, Robert J. , Larry Foster, and H. A. Turner. Fall
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2 3.
Raleigh, Robert J. and Joe D. Wallace. Nutritive value of range
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Corvallis, March, 1965. p. 1-6. (Oregon. Agricultural
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24.
. Protein and energy supplements for yearlings
on crested wheatgrass pasture. In: 1963 progress report -Research in beef cattle nutrition and management. Corvallis,
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25.
. Supplementing yearlings on native range.
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61
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leaves.
APPENDICES
Table A-1.
ROHS
SNETRTN
<CFBT0N
<C6MT0N
<CJLTDN
<CSPTON
<CNWIDN
<SJAT0M
<SMATnN
<SFJTON
<SJLTDN
<SAGTDN
<SOTTON
<S0CTON
SNV390
SJA51.0
SMR630
SAP610
SAP720
SJN700
SJN79a
<HOTTON
<H0CTDN
•cHFBTDN
<HAMTON
<HLJTDS
HNV390
HJA51.0
HHR630
HAP610
HAP720
HJN700
HJN790
>RJAORM
<RFBT0N
<RAMTON
<RJLTON
<RSPTON
<RNVTON
>GJAORf
<GFBTDN
<GSPTnN
<GNVT0N
<HJLrON
SJN8I.0
$AG715
SAG81C
SaG900
HAG715
HAGSIO
HAG90C
•3AG905
SGlOi.5
COLUINS
ALFALFA
MEADOW
TARLEY
OOTSEEO
CGZAtM
CGZJUN
Computer Input: List of Columns, Rows, and Coefficients Used in Study.
<GRZRST
<CFBDGP
<CANDGP
<CJLOGP
<CSPDGP
<CNVDGP
<SJADGP
<S1A0GP
<SFJDGP
<SJLDGP
<SAGOGP
<SOTOGP
<SOCOGP
SNVltSO
SJA570
SMR660
SAP630
SAPrSO
SJN72U
SJN810
<HOT0GP
<HOCDGP
<HFBOGP
<HA.10GP
<HLJOGP
HN>/1.20
HJA570
HMR660
HAP630
HAP750
HJN72I1
HJN810
<RJATON
<RFBDGP
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TABLE A-2.
Names of Nutrient Requirements, Feed and Livestock Constraints.
Row name
Unit
NETRTN
GRZRST
$1.00
Acre
ALFACNT
cwt.
MEADCNT
cwt.
BARLCNT
cwt.
CSM CNT
cwt.
a
b
hd.
b
hd.
s__ ___
H
a
RPLHFR
hd.
GESHFR
hd.
_
a
DRM
lb.
Description of constraint
The objective row, "Net Returns".
Restricts the total acres of range land that
can be used by all the livestock activities.
Relates alfalfa hay source and feeding
activities.
Relates meadow hay source and feeding
activities.
Relates barley source and feeding
activities.
Relates cottonseed meal source and feeding
activities.
Relates steer growing activity to either
steer selling or a continual steer growing
activity.
Relates heifer growing activity to either
heifer selling or a continual heifer grooving
activity.
Relates number of replacement heifers
raised to number transferred to gestation
heifer activity.
Relates number of gestation heifers raised
to number entering cow herd.
Cows dry matter intake.
(Rows)
Time period
N/A
N/A
N/A
N/A
N/A
N/A
SP, NV,
JA, MR,
AP, JN, AG
and G.
SP, NV,
JA,. MR, AP,
JN, AG and G.
N/A
N/A
JA, FB, MA, AM,
JN, JL, AG, SP,
OT, NV, DC
o-
TABLE A-2.
Row name
(Continued)
Unit
Description of constraints
Time periods
JA,
JN,
OT,
JA,
JN,
OT,
FB,
JL,
NV,
FB,
JL,
NV,
MA, AM,
AG, SP,
DC
MA, AM,
AG, SP,
DC
JA,
JN,
OT,
JA,
JN,
OT,
JA,
JN,
OT,
FB,
JL,
NV,
FB,
JL,
NV,
FB,
JL,
NV,
MA, AM,
AG, SP,
DC
MA, AM,
AG, SP,
DC
MA, AM,
AG, SP,
DC
TDN
lb.
Cows total digestible nutrient intake.
DGP
lb.
Cows digestible protein intake.
R
DRM
lb.
Replacement heifer dry matter intake.
R
TDN
lb.
Replacement heifer total digestible nutrient
intake.
R
DGP
lb.
Replacement heifer digestible protein
intake.
G
DRM
lb.
Gestation heifer dry matter intake.
G
TDN
lb.
Gestation heifer total digestible nutrient
intake.
C
G
DGP
lb.
Gestation heifer digestible protein intake.
DRM
lb.
Steer dry matter intake.
JA, FB, MA, SP,
OT, NV, DC
JA,
OT,
JA,
OT,
FB,
NV,
FB,
NV,
MA, SP,
DC
MA, SP,
DC
JA, FB, MA, AM,
FJ, LJ, JL, AG,
SP, OT, NV, DC
TABLE A-2.
Row name
S
^TDN
(Continued)
Unit
lb.
Description of constraints
Time periods
Steer total digestible nutrient intake.
JA
FJ
SP
JA
FJ
SP
FB,
LJ,
OT,
FB,
LJ,
OT,
JL,
NV,
MA
JL,
NV,
AG,
DC
AM
AG,
DC
JA
FJ
SP
JA
FJ
SP
JA
FJ
SP
FB,
LJ,
OT,
FB,
LJ,
OT,
FB,
LJ,
OT,
MA
JL,
NV,
MA
JL,
NV,
MA
JL,
NV,
AM
AG,
DC
AM
AG,
DC
AM
AG,
DC
S
DGP
lb.
Steer digestible protein intake.
H
DRM
lb.
Heifer dry matter intake.
H
TDN
lb.
Heifer total digestible nutrient intake.
H
DGP
lb.
Heifer digestible protein intake.
MA, AM
a) The two (2) blanks in these row names indicate the different time periods in each code name.
b) The three (3) blanks in these row names indicate the different weights at the beginning of time
periods.
c) Time period codes are: JA-January; FB-February; MR-March; MA-March 1-April 15;
AP-April: AM-April 16-May 31; JN-June; FJ-June 1-15; LJ-June 16-30; JL-July;
AG-August; SP-September; OT-October; NV-November; DC-December
N/A - Not applicable.
o
71
TABLE A-3.
Names of Activities (Columns) for Livestock, Livestock
Selling, and Feed Sources.
Column code name
Unit
Description
COWACT
RHFACT
GHFACT
hd.
hd.
hd.
hd.
Cow
Replacement heifer
Gestation heifer
Steer calf, feeding for specific
rate of gain,
Heifer calf, feeding for specific
rate of gain,
Selling steer at specific time and
weight,
Selling heifer at specific time and
weight.
Alfalfa hay source for feeding
activities.
Meadow hay source for feeding
activities.
Barley source for feeding activities.
Cottonseed meal source for feeding
activities.
Range forage source for cows in
specific months.
Range forage source for replacement heifers in specific months.
Range forage source for steers in
specific months.
Range forage source for heifers
in specific months.
b c
b c
H
b
SS
hd.
hd.
SH
hd.
ALFALFA
Ton
MEADOW
Ton
BARLEY
COTSEED
Ton
Ton
CGZ
RGZ
SGZ
HGZ
d
d
d
d
Acre
Acre
Acre
Acre
a) The two (2) blanks in these column names indicates the different
time periods in each code name.
b) The three (3) blanks in these column names indicates the different
weights at the beginning of time periods.
c) The one (1) blank in these column names indicate the different
rates of gain. The codes are: 1-1. 0 lbs. per day; 2-1. 5 lbs.
gain per day; 3-2. 0 lbs. gain per day; and 4-2. 5 lbs. gain
per day.
d) The three (3) blanks in these column names indicates the different
months range forage is available. The codes are: A+MApril 15-May 31; JUN-June; FJN-June 1-15; LJN-June 16-30;
JUL-July; AUG-August; SEP-September; OCT-October.
72
TABLE A-4.
Names of Activities (Columns) for Livestock Feeds.
Column code
name
Unit
Activity type and purpose
Time periods
CMHY
cwt.
Meadow hay feed for cows,
CAHY
cwt.
Alfalfa hay feed for cows,
CBAR
cwt.
Barley feed for cows,
CCSM
cwt.
Cottonseed meal for cows.
JA,
NV,
JA,
NV,
JA,
NV,
JA,
NV,
RMHY
cwt.
Meadow hay feed for replace- JA, FB
ment heifers.
SP, OT
RAHY
cwt.
Alfalfa hay feed for replacement heifers.
REAR
cwt.
Barley feed for replacement
heifers.
RCSM
cwt.
Cottonseed meal feed for
replacement heifers.
GMHY
cwt.
Meadow hay feed for
gestation heifers.
GAHY
cwt.
Alfalfa hay feed for
gestation heifer.
GEAR
cwt.
Barley feed for gestation
heifer.
GCSM
cwt.
Cottonseed meal feed for
gestation heifer.
SMHY
cwt.
Meadow hay feed for steers.
SAHY
cwt.
Alfalfa hay feed for steers.
DC
JA,
SP,
DC
JA,
SP,
DC
JA,
SP,
DC
JA,
SP,
DC
JA,
SP,
DC
JA,
SP,
DC
FB
DC
FB ,
DC
FB
DC
FB
DC
MA,
MA,
MA,
MA,
MA,
NV,
FB MA,
OT NV,
FB MA,
OT NV,
FB MA,
OT NV,
FB MA,
OT NV,,
FB MA,
OT NV,
FB MA,
OT NV,
JA, FB MA,
SP, OT NV,
DC
JA,
SP,
DC
JA,
SP,
DC
FB MA,
OT NV,
FB MA,
OT, NV,
73
TABLE A-4.
(Continued)
Column code
name
Unit
Activity type and purpose
Time periods
SBAR
cwt.
Barley feed for steers.
FB, MA,
FJN, LJN,
SP, OT, NV,
SCSM
cwt.
Cottonseed meal feed for
steers.
JA,
AM,
JL,
DC
JA,
AM,
JL,
DC
HMHY
cwt.
Meadow hay feed for heifers.
HAHY __
cwt.
Alfalfa hay feed for heifers.
HEAR
cwt.
Barley feed for heifers.
JA,
OT,
JA,
OT,
JA,
AM,
JL,
NV,
FB, MA, SP,
NV, DC
FB, MA, SP,
NV, DC
FB, MA,
FJN, LJN,
SP, OT,
DC
HCSM
cwt.
Cottonseed meal feed for
heifers.
JA,
AM,
JL,
NV.
FB, MA,
FJN, LJN,
SP, OT,
DC
FB, MA,
FJN, LJN,
SP, OT, NV,
a)The two (2) blanks in these code names indicate the different
time periods in each code name.
b)The time period code names are: JA-January; FB-February;
MA-March 1-April 15; AM-April 16-May 31; FJN-June 1-15;
LJN-June 16-30; JL-July; AG-August; SP-September;
OT-October; NV-November; DC-December.
74
TABLE B-1.
Dry Matter Intake for Growing and Finishing Steers
and Heifers.
Body weight
(lbs. /hd. )
300
350
400
450
500
550
600
650
700
750
800
850
900
950
1000
Maximum intake
__
(lbs. /hd. /day)9.01
10. 12
11.18
12,21
13.22
14.20
15. 15
16.09
17.01
17.92
18.80
19.68
20.54
21.39
22.23
a/
— For equation used, see Chapter III.
75
TABLE B-2.
Total Digestible Nutrient R equirements for Growing
and Finishing Stieers.
Daily gain (lbs. )
Body weight
~i."b
(lbs. /hd. )
300
350
400
450
500
550
600
650
700
750
800
850
900
950
1000
1.5
2.0
2.5
(lbs. /hd. /day) £/
4. 19
4.68
5. 18
5.66
6. 12
6.57
7.02
7.44
7.88
8. 30
8.71
9. 12
9.50
9.91
10. 30
4.96
5.53
6. 11
6.67
7.22
7.75
8.28
8.79
9.29
9.78
10.28
10.75
11.22
11.68
12. 15
a/
For equation used, see Chapter III.
Source: References 10 and 11.
5.74
6. 41
7.08
7.74
8. 37
9.00
9.59
10. 18
10.77
11. 34
11.92
12.48
13. 01
13.56
14. 09
6.58
7. 34
8. 11
8.85
9.59
10. 30
10.98
11.66
12. 33
12.98
13. 63
14.27
14.89
15.52
16. 12
76
TABLE B-3.
Total Digestible Nutrient Requirements for Growing
and Finishing Heifers.
Body weight
Daily_gain (lbs.
1. 0
(lbs. /hd. )
1.5
2.0
(lbs. /hd. /day)*/
300
4. 36
5.22
6. 16
350
4.86
5.83
6. 89
400
5. 37
6.45
7.62
45 0
5.86
7.04
8. 31
500
6. 34
7.62
9.00
550
6.80
8. 17
9.67
600
7.26
8.73
10. 32
650
7.72
9.27
10.95
700
8. 16
9.80
11.58
750
8.59
10. 33
12. 19
800
9.02
10.84
12. 80
850
9.44
11. 34
13.40
900
9.85
11.83
13.98
950
10.25
12. 32
14.57
1000
10.67
12.82
15. 13
a/ For equation used, see Chapter III.
—
Source: References 10 and 11.
77
TABLE B-4.
Digestible Protein Requirements for Growing and
Finishing Steers and Heifers.
Body weight
1.0
(lbs. /hd. )
Daily ^ain (lbs. )
1.5
2. 0
2.5
([lbs. /hd. /day)»/
300
0.46
0. 56
0.67
0. 78
350
0.51
0. 63
0.75
0.87
400
0.57
0. 70
0.83
0.96
450
0.62
0. 76
0.91
1. 05
500
0.67
0. 83
0.98
1. 14
550
0.72
0. 89
1. 05
1.22
600
0.77
0. 95
1. 12
1. 30
650
0.82
01
1. 19
1. 38
700
0.86
06
1.26
1. 46
750
0.91
12
1. 33
1.54
800
0.95
17
1.40
1. 62
850
1. 00
23
1.46
1.69
900
1.04
28
1.52
1.77
950
1.08
34
1.59
1. 84
1000
1. 13
39
1.65
1.91
a/ For equation used, see Chapter III.
—
Source: Reference 20.
78
TABLE B-5.
"3
'.
Nutrient
Cow and Bull Nutrient Requirements and Variable
Costs. (Per Head)
'■
a/
requirements;—
Minimum
DGP-
Month
_
Maximum_
TDN
DRM
(lbs. /hd. )
Jan.
12.90
231
510
Feb.
12.70
227
5 06
Mar. 1-•Apr. 15
31. 00
416
925
Apr. 16 -May 31
56. 10
5 87
1350
June
38. 20
399
861
July
38.80
405
867
Aug.
26. 19
408
873
Sept.
7.58
247
758
Oct.
3.77
241
753
Nov.
13.20
2 39
518
Dec.
13. 00
2 34
513
Variable:
C(osts:
a/
Interest on operating capital
Salt and Minerals
Fuel and Oil
Hauling
Inspection and feeding
Property tax
Veterinary and medicine
Grazing fee
Bull depreciation
$21. 60
2., 16
Total variable costs
$46. 10
4. 45
1. 44
3. 22
2. 08
4.,20
7., 00
79
TABLE B-5.
(Continued)
Income from cow/year: V
Selling 1050 lbs. cow Sept. 1
- - Selling costs
Total income
Net Returns
$20.76
0. 81
$19. 95
-$26. 05
a/
— Figures are for 1 cow Apr. -Aug. ; . 86 cow Sept. -Mar. and
1/25 of bull for Jan. -Dec.
b/
Figures are for . 125 of a cow, number of cows sold/yr. after
death loss.
80
TABLE B-6.
Replacement Heifer Nutrient Requirements and
Variable Costs. (Per Head)
Nutrient requirement!s:
M inimum
Month
TDN
DGP
Maximum
DRM
(lbs. /hd.,)
Jan.
19. 10
180
375
Feb.
20. 00
189
394
Mar. 1-Apr. 15
31. 80
299
623
Apr. 16-May 31
42. 10
386
782
June
30. 00
276
510
July
26. 00
260
520
Aug.
15. 75
251
525
Sept.
15. 20
144
300
Oct.
16. 20
154
320
Nov.
17. 30
163
337
Dec.
18. 20
172
357
Variable costs:
Interest on operating capital
$12.40
Salt and minerals
2.25
Fuel and Oil
Hauling
Inspection and feeding
2.72
1.55
Property tax
2.89
Veterinary and medicine
2.00
Grazing fee
2.88
Total variable costs
Net Returns
$26. 64
-$26. 64
81
TABLE B-7.
Gestation Heifer Nutrient Requirements and Variable
Costs. (Per Head)
Nutrient requirements:
Maximum
DRM
Minimum
Month
DGP
TDN
(lbs. /hd. )
Jan.
30.6
290
603
Feb.
31.4
298
621
March
32.0
304
634
Sept.
27.5
259
540
Oct.
28. 1
267
556
Nov.
29.0
275
572
Dec.
29.9
282
588
Variable costs;
Interest on operating capital
Salt and minerals
Fuel and Oil
Hauling
Inspection and feeding
Property tax
Veterinary and medicine
$ 9. 33
1. 32
. 88
1.68
. 28
Grazing fee
Total variable costs
Net Returns
$13.49
-$13.49
82
TABLE B-8.
Example of Worksheet Used for Computing Steer
Nutrient Requirements and Variable Costs. (Per Head).
Ending
Beginning
Month
Weight (lbs.)
60 days
60 total
gain
Sept. 1
330
Daily gain (lbs. )
% survival
Sex
Oct. 31
390
1. 0
99..7
H
($)
Nutrient Requirements:
Month
Minimum
DGP
Jan.
Feb.
March
April
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
15. 1
16.2
TDN
(lbs. /hd. )
139
148
Maximum
DRM
300
320
Variable costs:
Interest on operating capital
Salt and minerals
Fuel and oil
- Hauling
- Inspection & feeding
Property taxes
Veterinary and medicine
Grazing fee
Total Variable Costs:
Net Returns:
$1.,55
,40
,69
,25
-.24
$3., 13
$3. 13
83
TABLE B-9.
Example of Worksheet Used for Computing Heifer
Nutrient Requirements and Variable Costs. (Per
Head)
Beginning
Month
Weight (lbs'.)
Daily gain (lbs. )
% survival
Sex
Sept. 1
330
1.0
99.7
a^_
Ending
60
60
days
total
gain
Oct. 31
390
S
Nutrient R<squirements;
Month
Minimum
DGP
TDN
(lbs.. /hd. )
Jan.
Feb.
March
April
MayJune
July
Aug.
Sept.
Oct.
Nov.
Dec.
15. 1
16.2
Maximum
DRM
300
320
144
154
Variable C osts:
Interest on operating capital (8%)
Salt and minerals
Fuel and oil
- Hauling
- Inspection & Feeding
Property taxes
Veterinary and medicine
Grazing fee
Total Variable Costs:
Net Returns
$1,. 34
• 40
69
• 25
• 24
$2,.92
$2.92
TABLE C-1.
Coefficient
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
a/
Feeder Steer Prices — ($/cwt.:)
Index
300
350
400
1. 0336
1. 0630
1. 0782
1. 0672
1. 0762
1. 0521
1. 0139
1. 0099
1.0000
1. 0001
1. 0122
1. 0307
2. 36
34.48
35.46
35. 97
35. 60
35.90
35. 10
33. 82
33.69
33. 36
33. 36
33.77
34. 38
1.62
33.72
34. 68
35. 17
34.81
35. 11
34. 32
33. 07
32.94
32.62
32.62
33. 02
33.62
0
32. 04
32.95
33. 42
33. 08
33. 36
32.62
31.43
31. 31
31. 00
31. 00
31. 38
31.95
WEIGHT IN POUNDS
450
500
550
600
- .45
31.58
32.47
32.94
32. 60
32. 88
32. 14
30.97
30.85
30.55
30.55
30.92
31.49
-1. 10
30.90
31.78
32. 24
31.90
32. 18
31.46
30. 32
30. 20
29.90
29.90
30.26
30.82
-2. 15
29. 82
30.67
31. 11
30.79
31. 05
30. 35
29.25
29. 14
28. 85
28.85
29.20
29.74
-3. 04
28.90
29.72
30. 15
29.84
30. 09
29.42
28. 35
28.24
27.96
27.96
28. 30
28.82
650
700
750
800
-3.76
28. 16
28.96
29. 37
29. 07
29. 32
28.66
27. 62
27.51
27.24
27. 24
27.57
28.08
-4.49
27.40
28. 18
28. 58
28.29
28. 53
27.89
26. 88
26.77
26.51
26. 51
26. 83
27. 32
-4.99
26.88
27. 65
2 8. 04
27.75
27.99
27. 36
26. 37
26.27
26. 01
26. 01
26. 33
26. 81
-5. 11
26.76
27. 52
27. 92
27.63
27. 86
27.24
26. 25
26. 15
25. 89
25. 89
26.21
26.68
a/
— An explanation on how prices were derived is given on the following page.
Source: Reference 5.
oo
85
How Feeder Prices Were Derived
The feeder prices were obtained in the following way.
The
equation used to derive the prices is: Price for (X) cwt. = $31. 00
+ or - coefficient of (X) cwt.
X index for given month.
$31. 00 is
the average price for 400 pound steers in September for the years
1966-1970 (Ontario prices).
The coefficients for the various weights
ranges were derived from the study cited in table.
The coefficients
were interpreted to set a 400 pound steer's coefficient = 0.
The
index for each month was derived from Ontario prices for steers
and heifers (1960-1970 prices) setting September = 100.
The heifer prices are obtained by substracting $4. 34 from
the steer prices.
cited in table.
This coefficient of $4. 34 was derived from study
86
TABLE C-2.
Good Heifer Prices (800-1000 lbs. )-
Year
May
June
($/cwtJ
1961
22.62
1962
July
Aug.
22.28
22.25
2 3. 02
24.30
23.78
22.75
2 3. 00
1963
20.95
20. 92
22. 19
22.25
1964
18.91
18.50
1965
21.81
22.55
21. 88
20. 88
1966
2 3. 36
2 3. 14
21.83
21.94
1967
22. 35
2 3. 27
23.50
22.94
1968
2 3.62
23.91
23.90
23. 17
1969
27. 60
28.83
26.72
25.02
1970
25.90
26.56
26.55
25. 12
Average
23.14
2 3.37
23.51
22.60
a/
— Prices are from North Portland Auction.
18.67
87
TABLE C-3.
Good Steer Prices (900-1100 lbs. )
Year
May
June
($/cwt.)
July
Aug.
1960
25.84
25. 65
25.28
24.88
1961
22.62
22. 28
22. 25
2 3. 02
1962
25.43
25. 03
24.47
25. 16
1963
21.90
21. 88
24. 02
2 3. 62
1964
19.60
20. 90
21.90
21. 31
1965
24.20
24. 59
24. 58
23.94
1966
24.86
24. 56
23. 35
23.29
1967
23.73
24. 68
24. 86
24. 58
1968
24.69
24. 88
24.77
24.42
1969
29.81
30. 81
28.23
26. 36
1970
27.25
28. 12
28.23
26. 38
24.54
24. 85
24.72
24. 27
Average
a/Prices are from North Portland Auction.
—
88
TABLE C-4„
Year
a/
Utility Cow Prices August
($/cwt. )
September
1961
15.00
15. 00
1962
15. 37
14. 94
1963
15.75
14. 38
1964
11. 55
11. 52
1965
13.45
13. 84
1966
15. 88
16. 03
1967
16.20
16.00
1968
17. 07
17. 58
1969
19.57
18. 88
1970
19.95
19.47
15.98
15.66
Average
a/
— Prices are from North Portland Auction.
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