Trends in size, land tenure, income, organization, and management of selected cattle ranches in
southeastern Montana, 1924-48
by A Dale Saunders
A THESIS Submitted to the Graduate Committee in partial fulfillment of the requirements for the
Degree of Master of Science in Agricultural Economics
Montana State University
© Copyright by A Dale Saunders (1949)
Abstract:
This is a study of the trends and changes that have taken place on twenty-one cattle ranches in
southeastern Montana during the past twenty-five years. Some of the more important changes that have
taken place during this time are: (1) The amount of controlled land used by the ranches has increased
by 159%. The most important increase in size has come about through the purchase of more land, much
of which was formerly owned in small uneconomical tracts by homesteaders.
(2) The era of free land and uncontrolled use of the Public Domain has come to an end. The ranchers
have the firmest control over the land they use than at any other time in the history of cattle ranching in
Montana.
(3) The ranchers appear to be more concerned with the way the range is used and stocking rates have
been reduced.
(4) During the past twenty-five years there has been a shift from the marketing of three-year-old steers
to the marketing of calves and yearlings. In 1924 the ranchers marketed 213 pounds of beef per animal
unit of livestock run, by 1948 this had increased to 332 pounds of beef per animal unit of livestock run.
(5) Breeding practices have shifted from breeding on common range with other herds to breeding in
private pastures. This change has helped increase the percentage of calf-crop.
(6) The amount of investment per animal unit in the past twenty-five years has nearly doubled, the
chief factor causing this increase was a 155% increase in deeded land.
(7) The amount of debt per animal unit has decreased in the past twenty-five years by 37%. Only 26%
of the ranchers had any debts in 1948 compared with 79% of the ranchers in 1924.
(8) During the period studied, inputs have increased by 130%, the major increases were in general
supplies, taxes, and depreciation on buildings and machinery. The only input that showed a decrease
during the period was interest paid on debts.
(9) The most profitable year for the ranchers during the study was 1948, and the least profitable was
1924. The most important factor accounting for the high income in 1948 was the favorable relationship
between the prices of inputs and outputs. TRENDS IN SIZE, LAND TENURE, INCOME,
ORGANIZATION, AND MANAGEMENT
OF SELECTED CATTLE RANCHES
IN SOUTHEASTERN MONTANA,
192U - I4S
by
A. DALE SAUNDERS
A THESIS
S u bm itted to th e G raduate Committee
i n p a r t i a l f u l f i l l m e n t of th e re q u ire m e n ts
f o r th e D egree o f M aster o f Soienoe
i n A g r ic u ltu r a l Economics a t
Montana S ta te C o lleg e
Approved*
/^ 7
^ 7
In Charge o f M ajor Work
cW irman,
Lag Committee
November, 19l&
SoLS-j tr
|Z" a h -L• 2 *
TABLE CF COUNTS
Page
L i s t o f T a b le s .................. ...............................................
L i s t o f I l l u s t r a t i o n s .................. ..
S
..............
6
.
7
PART I i
.....................................................................................................
8
The A re a ...........................................................................................
8
The S i t u a t i o n . . . . ..................................... .. .............................
12
The Purpose and O
15
b
j e
c
t i v
e
s
. .........
The S am ple..................................................... ...............
16
Method o f A n a ly s is ......... ............................................................
22
SIZE AND LAND TENURE.......................................................
23
I n tr o d u c tio n ........... ......................... .............................................
23
In c re a s e in Land A rea o f R anches..................................
23
D isap p earan ce o f Free Land . . . . . . . . . . . . . . . . . . . . . .
25
In c re a s e i n Deeded L a n d . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26
Land Use - O ra tin g L a n d .. . . . . . . . . . . .
.. . . . . . ..
29
Land Use - N on-O rating L a n d .................................................
32
C o n clu sio n s......... ............ ..............................
3k
ORGANIZATION AND MANAGEMENT......................................
36
Type and C lass o f L i v e s t o c k . . . . . . . . . . . . . . . . . . . . . . . .
36
Type o f C a ttle M a r k e t e d . . . .
39
B reeding P r a c t i c e s . .................. ....................... ..
U7
C alf Crop................ ....................... .................................. ..
50
D eath L o sse s.............. ...................
51
Feeding P r a c t i c e s ......................................................... ...............
51
PART I I I i
CSj
U
A b s t r a c t . . . . . .................... ..................... .................................. ..
PART I I I
-I
<k
O
IP
CO
* ..............
92607
• 3•
Pace
C o n clu sio n s........................................................
P A lT IT s
53
ITrraST-IFTTTf COSTS ATTD ITTCOTra.......................................................
5h
TTothod o f A p p ro a ch ....................... ..............................................................
5h
In v e s tm e n t.............................................................................................
55
D ebt......... ................................................................ .... ............. ..
58
Rato o f I n t e r e s t P a id ................................................................................
61
C o sts...............
62
Income - D e f in itio n s o f V ario u s Types o f Incom es. . . . . . . . . . .
70
C ross In co m e................................................
72
Changes and Trends i n TTet Income.................. ..
75
TTo t Income Computed on a "Normal" P r ic e R e la tio n s h ip B a s is .
77
C o n clu sio n s......................................................
79
PART Vt
RUTWART ATTD PtJTlTRR PROSPECTS.........................................................
SI
C r i t i c a l A p p ra isa l o f th e Study and Rbthods T T s o d . . , . . . . . . , .
81
Summary.....................................
82
P ro s p e c tiv e Changes and Problem s Por P b tu re S tu d y ......................
Bh
hand Tenure and U se.................. ..
85
.
.. .. ..
......... ..
P b tu re N et Income E x p e c ta tio n s ................
87
APPENDIX A..................................................................................................................
09
APPENDIX ..............................................................................................
90
BIBLIOGRAPHY...................................................................
91
ACKNOWLEDGMENTS.........................................................................................................
93
m If, m
L la t o f T ables
Page
T able I
T able I I
T able I I I
T able IV
T able V
T able VI
T able V II
T able V III
Table IX
Table X
Table XI
The Average S ls e and Land Tenure o f a S e le c te d Group
o f C a ttle Kanchea i n S o u th e a s te rn Montana In
19214, 1929, W
and W ..............................................................
2k
Changes i n A creage o f Deeded Land Owned by TwentyOne C a t tle Hanohes i n S o u th e a s te rn M ontana, 1 9 2 ^ ^ 5 .• ,
27
Land Use F a c to rs on a S e le c te d Group o f C a t tle Ranches
i n S o u th e a s te rn M ontana, 1921*-IjB .
............
JO
P e rc e n ta g e Com position o f L iv e s to c k f o r Twenty-One
S e le c te d Ranches in S o u th e a s te rn M ontana, 1924- 148. . . . .
37
P e rc e n ta g e C om position o f C a ttle M arketed by Age C la sse s on Twenty-One Ranches i n S o u th e a ste rn Montana
D uring Four D if f e r e n t Y e a r s . . . . . . . . . . . . . . . . . . . . . .
J4O
P e rc e n ta g e Breakdown o f Ranches M arketing V ario u s Age
C la sse s o f C a t tle in S o u th e a s te rn M ontana, D uring
Four D if f e r e n t Y e a r s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
k2
R e la tio n s h ip Between T o tal L iv e s to c k Run and Amount
o f B eef Sold on Twenty-One Ranches i n S o u th e a ste rn
Montana D uring Four D if f e r e n t Y e a r s ... . . . . . . . . . . . . .
k5
A Comparison o f th e P e rc e n ta g e C om position o f C a ttle
M arketed to th e T o ta l V alue o f th e V ario u s Age - C lass
o f C a ttle M arketed on Twenty-One C a ttle Ranches in
S o u th e a s te rn M ontana, 192i*-IiS....... ........ ...........
1*8
Some Feeding F a c to rs on Twenty-One C a ttle Ranches i n
S o u th e a s te rn M ontana, 1 9 2 1 4 -1 4 3 ...........................................
52
Average In v estm en ts Per Animal U n it on Twenty-One
C a ttle Ranches i n S o u th e a ste rn M ontana, 19214-liS.• • • • • •
56
Amount o f Debt i n A ctu al D o lla rs P er Animal U n it on
Twenty-One C a t tle Ranches i n S o u th e a s te rn Montana
I92I4-I48........................................................................................
T able X II
A verage O p eratin g C osts Per Animal U n it on Twenty-One
C a ttle Ranches in S o u th e a s te rn M ontana, I92I4-I43......*
60
65
- 5 -
Table X lI I
Trends i n R e la tiv e In p u ts o f V ario u s P ro d u c tio n F a c to rs
65
Table XIV
P e rc e n ta g e BreeUtdoim o f th e A verage O p e ratin g C osts on
Twenty-CMe C a ttle Ranches in Southeastezm Montazia,
1 9 2 M i8 .......................................................................................................
68
T able XV
T able XVI
Average Ranch Income P e r Animal U n it on Twenty-One
C a t tle Ranches i n S o u th e a s te rn M ontana, 1921*-I4S .
7
Average Ranch Income P e r Animal U n it on TwentywQne
C a t tle Ranches i n Southeastezm M ontana, I 92I4.-I18. ........... ..
U
78
6
L is t o f Illu s tra tio n s
Page
F ig u re I
F ig u re 2
F ig u re 3
F ig u re U
F ig u re 5
F ig u re 6
F ig u re 7
F ig u re 8
Map o f th e N o rth ern G reat P la in s showing th e g e n e ra liz e d
ty p e s o f farm ing a re a s and th e lo c a tio n o f th e a re a o f
s t u d y .................................................................................. .. . . .
9
R a in f a ll d e v ia tio n from a v erag e a t M iles C ity , M ontana,
1900 - 19 bB....................................................... .........................................
11
A com parison o f th e p r ic e s re c e iv e d by ra n c h e rs , and
th e amount o f an n u al r a i n f a l l i n M iles C ity , Montana,
1921 - 19lt3................................................................................................
IU
!’ap o f T'ontana showing th e lo c a tio n o f th e tw enty-one
ran ch es s tu d ie d ............................................................... .......................
17
Land u se in 19U+, i n s ix c o u n tie s i n s o u th e a s te r n
’Montana.............................................. ...........................................
19
S ources o f a g r i c u l t u r a l income in s ix c o u n tie s i n
s o u th e a s te r n M ontana, in I 9W1.......................................................
20
P e rc e n ta g e o f t o t a l anim al u n i t s o f g ra z in g o b ta in e d
from fo u r d i f f e r e n t la n d so u rc e s by tw en ty -o n e c a t t l e
ran ch es i n s o u th e a s te r n M ontana, in th e y e a rs 1924# 1929
1940 and 1948 ............................................................................................
33
A com parison o f th e anim al u n i t s o f c a t t l e s o ld to th e
t o t a l anim al u n i t s o f l i v e s to c k r a is e d on tw en ty -o n e
c a t t l e ran ch es i n s o u th e a s te r n **0ntana in th e y e a rs
1924, 1929, 1940 and 1948 ..................................................................
44
7
ABSTRACT
T h is i s a s tu d y o f th e tr e n d s and changes t h a t have ta k en p la c e
on tw enty-one c a t t l e ra n c h es i n s o u th e a s te r n Montana d u rin g th e p a s t
tw e n ty -fiv e y e a r s . Some o f th e more im p o rta n t changes t h a t have ta k en
p la c e d u rin g t h i s tim e a r e :
(1 ) The amount o f c o n tr o lle d la n d used by th e ra n c h es nas i n ­
c re a s e d by 159/6. The most im p o rta n t in c r e a s e i n s i z e has come ab o u t
th ro u g h th e p u rc h a se o f more la n d , much o f which was fo rm e rly owned
i n s m a ll uneconom ical t r a c t s b y h o m e stea d ers.
(2) The e ra o f f r e e la n d and u n c o n tro lle d u se o f th e P u b lic
Domain has come t o an e n d . The ra n c h e rs have th e f ir m e s t c o n tr o l o v er
th e la n d th e y u se th a n a t any o th e r tim e in th e h i s t o r y o f c a t t l e
ra n c h in g i n M ontana.
(3) The ra n c h e rs a p p e a r to be more concerned w ith th e way th e
ran g e i s u sed and s to c k in g r a t e s have been re d u c ed .
(U) D uring th e p a s t tw e n ty -fiv e y e a rs th e r e has b een a s h i f t
from th e m a rk e tin g o f th r e e - y e a r - o ld s t e e r s to th e m ark etin g o f c a lv e s
and y e a r l i n g s . I n 192U th e ra n c h e rs m arketed 213 pounds o f b e e f p e r
anim al u n i t o f l iv e s to c k ru n , b y 19U8 t h i s had in c re a s e d to 332 pounds
o f b e e f p e r anim al u n i t o f liv e s to c k ru n .
(5 ) B reeding p r a c t i c e s have s h i f t e d from b re e d in g on common
range w ith o th e r h e rd s to b re e d in g i n p r iv a te p a s t u r e s . T h is change
has h elp ed in c r e a s e th e p e rc e n ta g e o f c a lf - c r o p .
(6 ) The amount o f in v e stm e n t p e r an im al u n i t i n th e p a s t tw e n ty f i v e y e a rs has n e a r ly do u b led , th e c h ie f f a c t o r c a u s in g t h i s in c re a s e
was a 155% in c r e a s e i n deeded la n d .
( 7 ) The amount o f d e b t p e r a n im al u n i t has d e c re a se d i n th e p a s t
tw e n ty -fiv e y e a rs by 37%. Only 26% o f th e ra n c h e rs had any d e b ts i n
19U8 compared w ith 79% o f th e ra n c h e rs i n 192U.
(8 ) D uring th e p e rio d s tu d ie d , in p u ts have in c re a s e d by 130%,
th e m ajor in c r e a s e s were i n g e n e r a l s u p p lie s , ta x e s , and d e p r e c ia tio n
on b u ild in g s and m achinery. The o n ly in p u t t h a t showed a d e c re a se
d u rin g th e p e rio d was i n t e r e s t p a id on d e b ts .
(9 ) The m ost p r o f i t a b l e y e a r f o r th e ra n c h e rs d u rin g th e s tu d y
was 19U8 , and th e l e a s t p r o f i t a b l e was 192 U. The most im p o rta n t
f a c t o r a c c o u n tin g f o r th e h ig h income i n 19U8 was th e fa v o ra b le
r e l a t i o n s h i p betw een th e p r ic e s o f in p u ts and o u tp u ts .
- 8 -
PART I .
INTRODUCTION
The Area
The tw o - th ir d s o f Montana t h a t l i e s e a s t o f th e Rocky M ountains
i s a p a r t o f th e N o rth e rn G re at P la in s which composes a t e n t h o f th e la n d
a re a w ith in th e U n ited S t a t e s .
In a d d itio n to Montana th e N o rth ern G reat
P la in s in c lu d e th e e a s te r n t h i r d o f Wyoming, th e n o r th e a s te r n c o rn e r o f
C olorado, and th e th r e e q u a r te r s o f th e D akotas and N ebraska which l i e s
w e st o f th e n in e ty - e ig h th m e rid ia n .I /
The e le v a tio n o f th e P la in s re g io n o f Montana v a r ie s from a b o u t
two to f o u r th ousand f e e t .
I n g e n e r a l th e la n d i s r o l l i n g w ith rough and
broken ’♦badlands" a r e a s b e in g found n e a r many o f th e l a r g e r stream s and
riv e rs .
The s o i l ty p e s i n th e a re a show a c o n s id e ra b le d e g re e o f v a r ia ­
t i o n though from a p e d o lo g ic a l s ta n d p o in t th e y a r e g e n e r a lly young and
u n g la c ia te d . i /
One o f th e o u ts ta n d in g c h a r a c t e r i s t i c s o f th e a re a i s th e seraia r i d and h ig h ly u n p re d ic ta b le c lim a te .
The te m p e ra tu re a t M iles C ity has
v a r ie d from a low o f h9 below z ero to a h ig h o f U l 0R ^ / The av erag e a n n u al
p r e c i p i t a t i o n f o r th e a re a i s betw een 12-15 in c h e s w ith a b o u t 70 p e rc e n t
o f t h i s coming i n th e growing sea so n months o f A p ril I t o Septem ber 3 0 . V
I / R o g le r, G .A .,and H o rtt, L .C ., "The N o rth ern G re at P la in s ,"
G rass Yearbook o f A g r ic u ltu r e , 19iiQ, U .S .D .A ., p . k ' d .
2 / C ie s e k e r, L .F ., M orris, S .R ., S tr a b o m , A .T ., and M anifold,
V-B., b o i l Surv ey o f The N o rth ern P la in s o f Montana. S e r ie s 1929, No. 21,
B ureau o f C hem istry and S o i l s , U.S.D .A . i n c o o p e ra tio n w ith th e Montana
A g r ic u ltu r a l experim ent S t a t i o n .
3 / C lim ate and Man, Yearbook o f A g r ic u ltu r e . 1 9 U , U.S.D.A., p. 9 9 5 .
4 / Annual and S e a so n a l P r e c i p i t a t i o n a t S ix R e p re s e n ta tiv e
L o c a tio n s i n Montana, B u i. Ult1? , Montana A g r ic u ltu r a l E xperim ent S ta tio n .
November 19L7, p . 'IU .
- 9 -
F ig u re I .
Map o f th e N o rth ern G re at P la in s showing th e g e n e ra liz e d
ty p e s o f farm in g a re a s and th e lo c a t io n o f th e a re a o f s tu d y .
S ouroei G ra ss , Yearbook o f A g r ic u ltu r e , 19^8»
S.
D epartm ent o f A g r ic u ltu r e , "Government P r in tin g O ffic e ,
/Washington, D, C.
** 10 **
The im p o rta n t f a c t o r i n re g a rd to r a i n f a l l i n th e N o rth ern G re a t P la in s i s
t h a t th e a n n u a l p r e c i p i t a t i o n v a r ie s aro u n d a c r i t i c a l p o in t - t h a t a t
w hich s u c c e s s f u l w heat p ro d u c tio n b e g in s .
I n y e a rs o f above a v erag e p re ­
c i p i t a t i o n w heat y ie ld s a r e h ig h b u t , i n y e a rs o f below a v erag e p r e c i p i t a ­
t i o n , w heat y ie ld s a r e re d u c e d , som etim es t o z e r o .^
A nother u nique f a c t o r
a b o u t th e p r e c i p i t a t i o n i n th e N o rth e rn G re a t P la in s i s t h a t y e a rs o f h ig h
and low p r e c i p i t a t i o n do n o t te n d to a l t e r n a t e , b u t in s te a d te n d to come
i n "b u n ch e s".—^
As shown i n F ig u re 2 , th e s e groups o f w et and d ry y e a rs
a r e sometimes a s lo n g a s te n to e le v e n y e a r s .
Looking back t o F ig u re I , th e n o rth e rn h a lf o f th e P la in s re g io n
i n Montana i s g e n e r a lly dev o ted to s m a ll g r a in fa n n in g and liv e s to c k
ra n c h in g .
The s o u th e rn p a r t o f th e a re a i s d ev o ted m ain ly to ran g e be­
cause c lim a te , s o i l o r to pograph y makes c ro p p ro d u c tio n to o r i s k y .
The
p r i n c i p a l s p e c ie s o f n a tiv e g ra s s e s found i n t h i s re g io n a r e b lu e gram a,
w e s te rn w h e a tg ra s s , n e e d le -a n d -th r e a d , Sandberg b lu e g ra s s , and th e sedge
n ig g e rw o o l.
The s ig n if ic a n c e o f g ra s s a s a cro p i n th e ra n g e a re a i s w e ll
s t a t e d by M. M. K elsoj "G ra ssla n d a s ran g e o ccu p ied some 85% o f th e la n d
i n 19Wt and s u p p lie d a b o u t o n e -h a lf o f th e n u t r i e n t s needed by th e l i v e ­
s to c k , which s u p p lie d a b o u t th r e e - f o u r t h s o f th e g ro s s a g r i c u l t u r a l i n ­
come.
G ra ssla n d a s hay fu r n is h e d a b o u t 30% o f th e fe e d r e q u ire d by th e
l i v e s t o c k . "-Z/
5/ Clawson, Marion, "Sequence in Variation of Annual Precipitation in the Western United States," The Journal of Land and Public Utility
Economics, August 1947, Vol. XXIII, No. 3, p. £?3.
6 / I b id , p p . 273 and 278-279.
7/ K elso , M. M., "The P la c e o f G rasslan d F arm ing," G rass, Y ear-
book o f A g r ic u ltu r e , 1948, U .S.D .A ., p p . 481 and 482.
11 years above overage
I O
I
8
7
I
_
9 years above
^ o v e r o g e ____~ \
- 3yeors
I
ov.
1
2
3 %
4
IO
9
^
8
7
6
5
4
1
2
3
4
-------------------------------- 3
;5 ^
F
1= = : —
:> i I ^ = = T "
:5
66 k----- x/----- 4 -------------------------4 Vears _ 3 yrs----------- z _ /
^ ----------------------------------6 6
7
____________________ 7 7
7 6 y e a r s ------------ :--------- belov# — b e l o w -----------____ /'
g
b e l o w ___________________________________ average _________ o v . ________________________ L d ________________________________________________________ 0 8
8
----------------------------------- ------------ ---------- »______ v _______ 4 ----------------------- 9 9
9 o v e ro Oe
"Nz^
IO
IO
IOyeors below ov.
*
'I0O
av.
I
'00
Source:
A ____ I
'05
'10
'15
I
'20
'25
'30
'35
'40
'45
'50
Figure 2.
R a in fa ll d e v ia tio n from average a t M iles C ity , Montana, 1900 - 19US.
Annual and Seasonal P r e c ip ita tio n a t S ix R epresen tative Locations in Montana, B ui.
November 19U7, Montana A g ricu ltu ra l Experiment S ta tio n , Bozeman, Montana.
U U ?,
12
The S i t u a t i o n
The range l iv e s to c k in d u s tr y i n th e P la in s re g io n i n s o u th e a s te r n
Montana d a te s back to a b o u t 1880.
At t h a t tim e th e ran g e was "open" and
th e s i z e o f a m an's ran ch and th e number o f c a t t l e he ra n depended la r g e ly
upon h is a b i l i t y to c o n tr o l h is range and to d e a l w ith o th e r men.
i e s w ere i n d e f i n i t e and fe n c e s w ere a th in g o f th e f u t u r e .
Boundar­
D uring t h i s
e a r l y p e rio d th e p r i n c i p a l ty p e o f c a t t l e m arketed from th e a re a were g ra s s
f a t t e n e d s t e e r s o f te n ru n to an age o f f i v e to s ix y e a rs and w eighing o v e r
tw e lv e hundred pounds.
The o p e r a tio n u n d er t h i s ty p e o f a s e t- u p was a low
c o s t one, and p r o f i t s depended l a r g e l y upon th e volume o f c a t t l e run and
s o ld , management was o f seco n d ary im p o rtan c e , hence th e ra n c h es were la r g e
i n s i z e . —/
As more p e o p le m ig ra te d W est, a t t r a c t e d by th e o f f e r o f f r e e la n d
and th e id e a o f g e ttin g s t a r t e d i n fa rm in g , th e c a t t l e i n d u s tr y was fo rc e d
to change i t s w ays.
As th e p re s s u re on th e la n d from th e new s e t t l e r s i n ­
c re a s e d , and was b ro u g h t to i t s peak d u rin g th e hom esteading days o f th e
n in e te e n - te n s and e a r l y tw e n tie s , th e s iz e o f ra n c h es w ere d r a s t i c a l l y re ­
duced and more th o u g h t had t o be g iv en to management and th e ty p e o f c a t t l e
b e in g r a i s e d .
Volume a lo n e was no lo n g e r th e key to su c c e ss i n ra n c h in g .
The ra n c h e rs who were u sin g th e ran g e a t th e tim e o f th e o n sla u g h t
o f hom esteaders and who managed to c o n tin u e i n o p e ra tio n d id so on: ( l) la n d
p u rc h a se d o r le a s e d from th e N o rth ern P a c if ic R a ilro a d ; (2 ) la n d th e y them­
s e lv e s were a b le to hom estead, ( q u it e o f te n a l l o f th e h ir e d h e lp was f i l e d
8 / F le tc h e r , H .S ., O rg a n iz a tio n o f th e Range C a t tle B u sin ess i n
E a s te r n Montana, Montana A g r ic u ltu r a l E xperim ent S t a tio n , b u l. 265, June 1932.
- 13 a s h o m e ste a d e rsj) (3 ) la n d c o n tr o lle d by c o n tr o llin g w a te r - o f te n th e
ra n c h e rs s tru n g t h e i r hom esteads o u t i n t r a c t s o f f o r t y a c r e s a lo n g c re e k s
o r r i v e r s ; (U) la n d s t h a t w ere n o t even a t t r a c t i v e to h o m e stea d ers.
S in c e th e e s ta b lis h m e n t o f th e c a t t l e ran ch in g in d u s tr y i n Montana
sometime around 1880, i t has gone th ro u g h a s e r i e s o f v a ry in g c o n d itio n s .
Unique among th e v a ry in g c o n d itio n s w ith w hich th e in d u s tr y has been fa c e d ,
i s t h a t g e n e r a lly d u rin g th e "bunches" o f y e a rs when th e r a i n f a l l was above
a v erag e th e p r ic e s f o r b e e f c a t t l e was above a v e ra g e , and d u rin g th e
"bunches" o f below a v e ra g e r a i n f a l l y e a r s , th e p r ic e s o f b e e f c a t t l e was
below a v e r a g e .
T h is phenomenon has been o b serv ed from th e re c o rd s , b u t
th e r e i s n o th in g t o i n d i c a t e a s c i e n t i f i c re a so n f o r i t s o c c u rre n c e .
D uring th e p a s t tw e n ty -fiv e y e a r s , th e p e rio d w ith which t h i s
t h e s i s i s c o n ce rn e d , th e c a t t l e ra n c h es i n s o u th e a s te r n Montana have under­
gone th r e e p e rio d s o f v a ry in g c o n d itio n s .
The f i r s t p e r io d , from 192U to
1930, was one o f n e a r ly norm al c o n d itio n s .
The p r ic e o f b e e f c a t t l e was
a b o u t n in e ty c e n ts below a v erag e f o r th e tw e n ty -fiv e y e a r p e rio d and th e
r a i n f a l l was o n ly .06 in c h e s below th e a v e ra g e f o r th e tw e n ty -fiv e y e a r
p e r io d .
The second p e r io d , which was from 1931-1939, was one o f extrem e
h a rd s h ip f o r most o f th o ra n c h e rs i n th e a r e a .
The p r ic e o f b e e f c a t t l e
was o f f by a b o u t UOjS, and r a i n f a l l was 2$% below norm al.
The t h i r d p e rio d ,
19U0 to d a te , has been th e b e s t p e rio d known to th e ra n c h e rs o f M ontana.
Not o n ly has th e p r ic e o f b e e f c a t t l e b een th e h ig h e s t f o r any n in e y e a r
p e rio d i n h i s t o r y b u t r a i n f a l l has a ls o b een w e ll above a v erag e f o r th e
e n t i r e p e r io d .
-Iil-
S per
Inches ot rain­
fall (annual)
—r------ 2 0
ANNUAL
AT
RAINFALL
MILES
CITY
L _1924-28 overage
-
PRICE
BEEF
IN
F ig u re
OF----
CATTLE
MONTANA
3*
A com parison o f th e p r ic e s re c e iv e d by r a n c h e rs , and th e
amount o f an n u al r a i n f a l l i n I l i e s C ity , M ontana, 192i| - 19l|8e
Comparison i s on a th r e e y e a r moving a v e ra g e . Source * Annual
and S easo n al P r e c i p i t a t i o n a t Si x Re p r e s e n ta tiv e L o c a tio n s in
M ontana, Op. C it. and Montana Farm and Ranch P r ic e s , 1909-19l|8,
TEmeogranhed C ir c u la r [51, A p ril 19l!9, Montana A g r ic u ltu r a l Expeitlm ent S t a t i o n , Bozeman, M ontana.
The tw e n ty -fiv e y e a r p e rio d was a ls o c h a r a c te r iz e d b y a number o f
changes i n la n d te n u r e .
A. la r g e amount o f th e p u b lic domain t h a t was b e in g
u sed w ith o u t t i t l e o r c o s t came u n d er th e d i r e c t s u p e r v is io n o f th e f e d e r a l
Government w ith th e p a s s in g o f the T a y lo r G razing Act o f 193k,
A nother
im p o rta n t change was th e la r g e amount o f la n d t h a t went i n t o th e hands o f
th e county f o r ta x e s d u rin g th e t h i r t i e s t h a t has r e tu rn e d to p r iv a te
ow nership u n d er th e stim u lu s o f h ig h Incomes in re c e n t y e a r s .
Of s t i l l
g r e a te r im portance was th e tre n d o f many o f th e sm all la n d owners le a v in g
th e a r e a , th e u n i t s th e y l e f t b ein g added to n eig h b o rin g farm s and ra n c h e s j
th u s , some o f th e hom esteading farm ers w ere a b le to a d a p t to th e c o n d itio n s
o f th e a re a by becoming stockm an.
The P la in s have alw ays been a f f e c t e d w ith e v e r changing c o n d itio n s ,
th e w e a th e r u s u a lly b e in g th e m ost v io le n t o f th e c h an g es.
The problem
t h a t n a t u r a l l y a r i s e s i s how to a c h ie v e a system o f o p e r a tio n t h a t i s
f l e x i b l e enough to cope w ith th e e v e r changing c o n d itio n s , and a t the same
tim e g iv e th e o p e ra to r a f a i r l y s ta b le incom e.
The Purpose and O b je c tiv e s
The purpose o f t h i s stu d y i s th re e fo ld *
( I ) To f in d and an aly ze
th e changes t h a t have ta k e n p la c e in th e c a t t l e ran ch in g in d u s tr y in so u th ­
e a s te r n Montana in th e p a s t tw e n ty -fiv e y e a r s , and; (2 ) To d eterm ine in th e
l i g h t o f th e s e changes s te p s t h a t m ight be taken to a d j u s t to th e v a ry in g
c o n d itio n s , and; (? ) Ahat th e f u tu r e i s l i k e l y to hold f o r ran ch in g i n th e
a re a.
S p e o if l o a lly th e o b je c tiv e s o f t h i s stu d y are*
( I ) To s tu d y tr e n d s and changes i n th e lan d te n u re and s iz e o f
th e la n d b a se o f th e s e le c te d ra n c h e rs .
Tenure w i l l b e c o n sid e re d
— 16 —
from th e s ta n d p o in t o f , (a ) Im d owned, (b ) la n d le a s e d - from
wh<Mn ( p r iv a te p e rso n s o r c o r p o r a tio n s , o r from some government
agency - f e d e r a l , s t a t e , o r l o c a l ) , (c ) la n d u sed on an anim al
u n i t p e rm it b a s i s , (d ) f r e e la n d . 2 /
( 2 ) Io stu d y th e changes t h a t have ta k e n p la c e i n f a c t o r s o f pro­
d u c tio n and management, and how th e s e changes have a f f e c te d c o s t s ,
income and in v e s tm e n ts .
('5.‘ To c o n s id e r how th e changes t h a t have ta k e n p la c e w ill a f f e c t
th e f u tu r e o f c a t t l e ra n c h in g in th e a r e a .
The Sample
Tho b a se s f o r t h i s stu d y a re tw enty-one ran ch es t h a t a re lo c a te d
in Ciio G re at P la in s re g io n o f s o u th e a s te r n Montana.
These p a r t i c u l a r
ranches /ore u sed b ecau se th e r e were com plete b u s in e s s re c o rd s a v a ila b le
f o r e i t h e r 192*4 o r 1929. 191*0, and 191)8 . 12/
These tw enty-one ra n c h es a re lo c a te d in M u s s e ls h e ll, Rosebud,
C u s te r, Powder R iv e r, C a r te r , and P r a i r i e c o u n tie s .
W ith th e e x c e p tio n o f
a em ail a re a a lo n g th e p r in c ip a l r i v e r s , th e whole re g io n i s devoted m ain ly
to th e g ra s in g o f li v e s t o c k .
Over 75% o f th e la n d in th e a re a i s c l a s s i f i e d
2/ ^rc e
r e f e r s to a l l la n d n o t owned by th e u s e r w hich he i s
u s in g w ith o u t c h a rg e . P u b lic Domain was in t h i s c l a s s i f i c a t i o n t i l l a f t e r
th e p assag e o f th e T ay lo r G razing A ct in 193)4,
1 2 / These re c o rd s were ta k e n in c o n n e c tio n w ith ra n o h in g s tu d ie s
and su rv e y s t h a t have been made i n th e p a s t . These su rv ey s in c lu d e , ( I ) The
Lgrfchern G reat P la in s Su rv e y o f 1925, by th e U n ited S ta te s Departm ent o f ----A g ric u ltu re i n c o o p e ra tio n w ith th e A g r io u ltu r a l Experim ent S ta tio n s o f Mon»ana. N orth D akota, SoutIi D akota, and WyOTaingj (2 ) A s im ila r stu d y by th e
same group in 1928j (3 ) Montana Ranch S tu d ie s by M. H. Saunderson f o r th e
y e a rs 1929 to 1933; (4 ) Montana .iauoh SfaTSyT y G. H. C ra ig , I 9I4O1 and (3) a
fo llo w -u p su rv e y o f tills same group o f ra n d ie s made i n th e s p rin g o f 19li9
b y D r, M. M. K elso and th e a u th o r.
Proirie
„ ' 0 MusselN
h o shell I
rx
o .-'
iRosebud
C u ster
Pow SerRiver C a r t e r
Map o f Montana showing the lo c a tio n o f the twenty-one ranches studied
- 18 -
a s s u i t a b l e f o r g ra z in g la n d o n ly .
Farming on o th e r th a n th e i r r i g a t e d
la n d i s o f sec o n d a ry im portance e x c e p t f o r th e p ro d u c tio n o f hay and some
fe e d c ro p s f o r w in te r f e e d in g .—^
a re a i s from ra n g e l i v e s t o c k .
The number one so u rce o f income i n th e
The income from b e e f c a t t l e i s g r e a t e r th a n
t h a t from a l l o th e r a g r i c u l t u r a l so u rc e s com bined.5 ^ /
These ra n c h es w ere o r i g i n a l l y p ic k e d a t la r g e from ran ch es i n th e
a re a t h a t w ere g r e a t e r th a n one hundred an im al u n i t s i n s iz e and whose
p r i n c i p a l so u rc e o f income was from th e s a le o f b e e f c a t t l e .1 5 / The ra n c h es
v a ry from one hundred to ab o u t f i f t e e n hundred anim al u n i t s i n s i z e .
Due
to economic and c lim a tic f a c t o r s , th e s iz e o f th e s e ra n c h e s , o v e r th e
p e rio d o f y e a r s , has f lu c t u a t e d c o n s id e ra b ly b o th i n th e amount o f la n d
c o n tr o lle d and th e number o f c a t t l e ru n .
T here have a ls o b een changes in
ow nership i n some c a se s due to d e a th s and r e tir e m e n ts , b u t i n a l l c a se s
th e s e ra n c h es r e p r e s e n t th e same b a s ic o r i g i n a l ran ch u n i t s from which
f i r s t re c o rd s w ere ta k e n i n e i t h e r 192k o r 1929.
S in ce i t i s th e i n t e n t o f t h i s s tu d y to fo llo w th ro u g h th e y e a rs
th e changes t h a t have ta k e n p la c e on th e same ranch u n i t s , and n o t compare
v jy O ilm an, V .D ., Types o f Farming i n S o u th e a s te rn Montana^
B u i. 287, A p ril 193k, Montana A g r ic u ltu r a l E xperim ent S t a t i o n , "p . 11.
1 2 / Compiled from , U .S. Census o f A g r ic u ltu r e , 19U5, Volume I ,
P a r t 27, U .S. D ep t, o f Commerce, Bureau oi1 th e Census, W ashington, D.C.
1 3 / An anim al u n i t i s th e e q u iv a le n t o f a 1,000-pound range cow
w ith c a l f . A y e a r lin g i s c o n sid e re d a s b e in g e q u iv a le n t to 2 /3 o f an a n i­
mal u n i t ; a tw o -y e a r-o ld .8 5 ; a th r e e - y e a r - o ld s t e e r i s one u n i t ; b u lls and
h o rs e s I l / 3 u n i t s e a c h . Ewes a re c o n sid e re d to be e q u iv a le n t to .2 o f a
u n i t . These u n i t s r e p r e s e n t th e ap p ro x im ate r e la tio n s h ip o f d i f f e r e n t
c la s s e s o f c a t t l e i n a n n u al range and fe e d re q u ire m e n ts.
M.H. Saunderson and D.W. C h itte n d e n , C a ttle Ranching i n Montana,
B u i. 341, May 1937, Montana A g r ic u ltu r a l Experim ent S ta t i o n , p . 9 .
',Vhen anim al u n ite o f g ra z in g a r e spoken o f i n t h i s t h e s i s , a
u n i t r e f e r s to one anim al u n i t o f g ra z in g f o r a f u l l tw elve-m onth y e a r .
- 19-
x ,
NON AGRICUL­
TURAL
USE
LIVESTOCK
TOTAL
LAND
GRAZING
AREA: 1 2 ,1 6 5 ,1 2 0
Figure
ACRES
5*
Land use in 19LL# in s ix counties in Southeastern Montana.
(Counties* M u sselsh ell, Bosebud, Custer, Powder S iver,
Carter and P r a ir ie .) Source* United S ta tes Census o f
A gricu ltu re, 191*5»
- 20 ,M ISC .. 2 %
io n
TOTAL AGRICULTURAL INCOME: $16,351,635
Figure
6.
Sources o f A gricultural income in s ix counties in
Southeastern Montana, in l9ltL»
(Counties* M u sselsh ell, Rosebud, Custer, Powder River,
Carter and P r a ir ie .) Source* United S tates Census o f
A gricu ltu re, I9lj5»
21 -
a v e ra g e s f o r th e whole a r e a , th e number o f c a s e s making up th e sample i s
r e l a t i v e l y s m a ll.
Because o f th e s m a ll number o f ra n c h es b e in g s tu d ie d i t
m ust be r e a liz e d t h a t r e l i a b i l i t y o f th e d a ta from a s t a t i s t i c a l s ta n d p o in t
i s lim it e d when u s in g i t a s a sample o f th e tr e n d s f o r th e e n t i r e a re a . The
a v erag e s iz e o f th e ra n c h es i n th e sample i s a ls o l a r g e r th a n th e av erag e
f o r a l l ra n c h es f o r more th a n a hundred a n im al u n its i n th e r e g i o n . ^ /
An­
o th e r f a c t o r o f b ia s t h a t may a ls o be p r e s e n t i s t h a t m ost o f th e s e ra n c h es
have rem ained under th e same ow nership and have p o s s ib ly been a l i t t l e more
s u c c e s s f u l i n t h e i r lo n g ru n management th a n th e a v erag e ran ch i n th e a r e a .
A nother d i f f i c u l t y In v o lv e d i n th e a n a ly s is was t h a t re c o rd s w ere
n o t alw ays a v a il a b le i n com plete form i n e v e ry y e a r .
In 1924 o n ly f o u r te e n
ran ch re c o rd s w ere a v a il a b le w h ile i n 1929 th e r e were o n ly t h i r t e e n re c o rd s
ta k e n on th e tw en ty -o n e ra n c h e s .
Complete re c o rd s on a l l o f th e tw enty-one
ran ch es w ere a v a il a b le f o r 1940.
I n 1948, a l l tw en ty -o n e o f th e ran ch es
were v i s i t e d and some in fo rm a tio n was a t t a i n e d from e ac h ; how ever, f u l l and
com plete re c o rd s w ere n o t o b ta in e d i n th r e e c a s e s .
B ecause o f th e v a r ia ­
tio n s i n th e sample i n th e d i f f e r e n t y e a rs th e e x a c t a v e ra g e s g iv e n i n t h i s
p a p e r a r e n o t alw ays a b s o lu t e ly a c c u r a te , b u t a c a r e f u l s tu d y o f th e
ra n c h es from th e in fo rm a tio n a v a i l a b l e i n d i c a t e s t h a t th e s e ran ch es d id n o t
d i f f e r s u f f i c i e n t l y from th e o th e r ran ch es i n any p a r t i c u l a r y e a r to e f f e c t
th e g e n e r a l tr e n d s and changes t h a t a r e th e main co n cern o f t h i s s tu d y .
l i t / I n 19^4, th e a v erag e s iz e c a t t l e ran ch es i n s o u th e a s te r n
M ontana, e x c lu d in g a l l ra n c h es u n d er 100 an im al u n i t s , was betw een 263 and
287 anim al u n i t s . D ata com piled from u n p u b lish e d m a te r ia l on f i l e w ith th e
B ureau o f A g r ic u ltu r a l Econom ics, a t Montana S ta te C o lle g e , o r i g i n a l l y
com piled from U. S . Census o f A g r ic u ltu r e , 1945#
22 W ith th e s e l i m i t a t i o n s i n m ind, by stu d y in g th e s e ran ch es from
a ease h i s t o r y s ta n d p o in t th e sample i s p ro b a b ly la r g e enough to in d ic a te
th e m ajor changes t h a t have o c c u rre d i n th e o p e ra tio n and management o f
c a t t l e ra n c h es i n th e a r e a .
Method o f A n a ly sis
In t h i s s tu d y , c o s t s , in v e s tm e n ts , f a c t o r s o f p ro d u c tio n , la n d
and la n d u s e have been computed in r e l a t i o n t o anim al u n i t s .
T his has been
done to g iv e th e s tu d y a oonanon denom inator and to h e lp i n f a c i l i t a t i n g
com parisons.
A lthough i t was o r i g i n a l l y p lan n ed to b re a k th e ran ch es up
i n t o v a rio u s e ls e g ro u p s, t h i s was abandoned, b ecau se th e r e were n o t enough
c a s e s c o n ta in e d i n th e s m a lle r groups t o g iv e any s ig n if ic a n c e a t a l l to
them .
The in fo rm a tio n p re s e n te d , u n le s s o th e rw is e s p e c i f i e d , w i l l r e p r e s e n t
an a r ith m e tic av erag e o f th e com plete sample f o r th e s p e c if ie d y e a r .
PAST II.
SISK AW) LASD TSNTOB
I n tr o d u c tio n
One o f th e b ig g e s t q u e stio n * o f management and, s t a b i l i t y t h a t has
alw ays plag u ed th e ra n c h e r i n s o u th e a s te r n Montana i s w h e th er to le a s e o r
to own h ie ra n g e .
The ra n c h e r who l e a s e s h is la n d u s u a lly has lo w er c o s t
o f o p e ra tio n b u t i s o f te n i n a s t a t e o f u n c e r ta in ty a b o u t h is f u tu r e o p era­
tio n .
The man who owns h i s own ran g e i s much more c e r t a i n o f h ie f u tu r e
o p e r a tio n s b u t i a o f te n fa c e d w ith h ig h e r o p e ra tin g c o s ts
The o th e r u n iq u e s i t u a t i o n t h a t most o f th e ra n c h e rs a r e fa c e d
w ith i s t h a t a la r g e amount o f th e ran g e la n d th e y use b e lo n g s to th e
F e d e ra l Government.
The p u b lic ow nership o f la n d , u t i l i s e d b y p r iv a te i n ­
d iv id u a ls f o r p r i v a t e p r o f i t s , i s p r a c t i c a l l y unknown i n any o th e r ty p e o f
a g r i c u l t u r a l e n t e r p r i s e i n o u r c o u n try .
In crease in Land Area o f Ranches
S in c e 192li, th e amount o f c o n tr o lle d la n d p e r ra n c h h as been i n ­
c r e a s in g .
T able I shows t h a t th e a v e ra g e amount o f la n d p e r ra n c h more
th a n d o u bled betw een th e 19?lt-29 p e rio d and 19W .
By 19it9 th e e l s e o f th e
same ra n c h es had a g a in in c re a s e d by an a v e ra g e o f o v e r 2 ,8 0 0 a c re s p e r
ra n c h , ( th e d if f e r e n c e betw een 192U and 1929 i s n o t s i g n i f i c a n t a s t h i s
d if f e r e n c e was caused m ainly by v a r i a t i o n s i n th e sa m p le .)
As im p o rta n t to
th e ra n c h e rs a s th e t o t a l in c r e a s e i n a c re a g e i s how t h i s in c r e a s e has come
a b o u t.
1 $ / K elso ,
Kenarks C oncerning th e P u b lic O rasin g Land
Q u e stio n , made d u rin g th e round ta b le d is c u s s io n o f t h a t problem a t th e
m eeting o f th e Montana Stockgraerers A s s o c ia tio n , B u tte , M ontana, May 23,
19k7. U npublished in fo rm a tio n i n th e Montana S ta te C o lle g e f i l e s .
2h
TABLE I . THE AVERAGE SIZE MD LAND TENURE
OF A SELECTED GUDUP OF CATTLE RANCHES
IN SOUTHEASTERN WNTANA IN 192!;, 1929, 19W and I 9I4B
Y e aI r
1924
1929
1940
1948
T o ta l A cres
5772
5542
11914
14742
Deeded Acres
3962
3461
5532
9587
Leased Acres
1810
2081
6268
5121
A cres Leased From P r iv a te Owner
1492
1561
1357
777
318
520
4911
4344
y
2/
u4
34
A cres Leased From P u b lic Owner i /
A cres Used F ree o f Charge
l / This does n o t in c lu d e N a tio n a l F o re s t g ra z in g t h a t was sec u re d
by p e rm it on a head b a s i s b u t does in c lu d e F ed eral and S ta te g ra z in g d i s ­
t r i c t la n d t h a t was sec u re d by p e rm it on a p e r head b a s i s . No acreag e
f ig u r e s wore a v a il a b le i n th e case o f th e F o re s t g ra z in g , b u t acreag e f ig ­
u re s were a t t a i n a b l e on th e g ra z in g d i s t r i c t s .
2 j Ho a c re a g e f ig u r e s were a v a il a b le on f r e e la n d i n I 92I4. o r 1929»
T his u n accounted a c re a g e f o r f r e e ran g e re p r e s e n ts p a r t o f th e d if f e r e n c e
i n amount o f th e t o t a l a c r e s o f la n d re p o rte d i n 1929 and 1940•
—
2^
—
D isap p earan ce o f F re e Land
The f i g u r e s f o r 1921* and 1929 o f th e t o t a l a c re a g e a r e d e c e p tiv e
u n le s s th e u se o f th e P u b lic Domain and p r i v a t e l y owned la n d u sed f r e e o f
ch arg e a re c o n s id e re d .
D uring t h i s p e rio d a la r g e p a r t o f th e range used
by th e ra n c h e rs was composed o f th e P u b lic Domain w hich b elo n g ed to th e
U n ited S ta te s Government and upon which no deeds had e v e r been g ra n te d .
Many o f th e c a ttle m e n u sin g th e "open ran g e" had v e ry l i t t l e i f any id e a
o f how much a c re a g e t h e i r c a t t l e were ru n n in g o v e r.
Furtherm ore much o f
th e g ra z in g on th e "open ran g e" was done i n common w ith o th e r ra n c h e rs '
c a t t l e and sh ee p ; th e r e f o r e no f ig u r e s a s to th e amount o f f r e e range used
d u rin g t h i s p e rio d w ere a v a i l a b l e .
The o n ly d a ta a v a il a b le on th e use o f
f r e e range was th e number o f anim al u n i t s and th e le n g th o f tim e th e y w ere
g ra z e d on th e open ra n g e .
T h is was th e m ost im p o rta n t re a so n f o r th e
c o m p a ra tiv e ly s m a lle r s iz e o f th e ra n c h es i n 1921* and 1929.
I n June o f 1934» th e P u b lic Domain was c lo se d to hom esteading
w ith th e p a ssa g e o f th e T a y lo r G razing A c t.
IVith th e p a ssa g e o f t h i s a c t
th e f r e e and open ran g e p r a c t i c a l l y d is a p p e a re d .
The la n d t h a t had com­
posed th e P u b lic Domain was tu rn e d o v e r to th e G razing S e rv ic e i n th e
D epartm ent o f th e I n t e r i o r .
The G razing S e rv ic e i n tu r n le a s e s t h i s la n d
to th e ra n c h e rs i n th e a re a who were u sin g i t b e fo re th e A ct was p a sse d .
Where th e P u b lic Domain l a i d i n la r g e t r a c t s F e d e ra l g ra z in g d i s t r i c t s have
been e s ta b lis h e d and th e ran g e i s u s u a lly le a s e d on an an im al u n i t b a s i s .
Where th e P u b lic Domain was broken up b y a la r g e number o f p r iv a te h o ld ­
in g s , th e la n d was u s u a lly le a s e d on an a c re a g e b a s is w ith some r e s t r i c t i o n
— 26 —
b e in g p la c e d on th e u se o f th e la n d .
The p assag e o f th e T a y lo r G razing Act
l a r g e l y e x p la in s th e in c r e a s e i n th e la n d le a s e d from p u b lic ow nership i n
19^0 and I 9I48 t h a t was shown i n T ab le I .
The f r e e la n d t h a t e x is t e d and was u sed i n 19UO and 19U8 was made
up o f sm a ll s c a t t e r e d t r a c t s t h a t were a c q u ire d by h o m estead in g .
The
owners o f th e s e t r a c t s have long s in c e l e f t th e a re a b u t c o n tin u e to pay
th e ta x e s on t h e i r la n d .
These t r a c t s a re so s i t u a t e d t h a t no one co u ld
u se them e co n o m ica lly o th e r th a n th e ra n c h e r whose la n d su rro u n d s them .
Because o f t h i s f a c t th e ra n c h e r s e e s no need f o r l e a s in g , and th e owner
o f th e t r a c t s a re u s u a lly u n w illin g to s e l l .
About th e o n ly co n ce iv a b le
re a so n f o r th e e x is te n c e o f th e s e t r a c t s i s t h a t th e owner i s h o ld in g them
f o r s p e c u la tiv e p u rp o s e s, p ro b a b ly hoping t h a t th e la n d may be o v e rly in g a
la r g e p ool o f o i l .
I n 19U8 th e r e were o n ly two o f th e s e t r a c t s l e f t , b o th
o f 320 a c r e s , i n th e group o f ra n c h es s tu d ie d .
In c re a s e i n Deeded Land
The l a r g e s t in c r e a s e i n t o t a l la n d was found i n deeded a c re a g e .
As shown i n T able I I , 19 o u t o f th e 21 ra n c h es showed a n e t in c re a s e on
th e a v erag e o f 5921 a c r e s each f o r th e tw e n ty -fiv e y e a r p e r io d .
One o f
th e ra n c h es had a d e c re a s e o f U60 a c r e s , and one o f th e ra n c h e s , t h a t was
su rro u n d ed by N a tio n a l F o r e s t, showed no change i n deeded a c r e a g e .
The
l a t t e r ran ch had a la n d b ase o f 320 deeded a c r e s , a l l th e r e s t o f th e la n d
used b elo n g ed t o th e N a tio n a l F o r e s t.
The ra n c h t h a t showed a lo s s o f U60
a c r e s was fo rc e d to s e l l t h a t t r a c t i n th e d ro u g h t and d e p re s s io n y e a r s .
J t has n o t in c re a s e d i n s iz e s in c e b ecau se th e r e has n e v er been any
- 27-
TABLE I I .
CHANGES IN ACREAGE OF DEEDED LAND OWNED BY TlIrENTY-ONE CATTLE
RANCHES IN SOUTHEASTERN MONTANA, 192U t o 19U8
Changes i n Amount o f Deeded Land Owned
x e ar
In c re a s e d
Number
Average
of
Number
Ranches o f A cres
D ecreased
Number
Average
of
Number
Ranches
o f A cres
No Change
dumber
of
Ranches
1924-29 to 1940
18
2657
2
875
I
1940 to 1948
17
4147
2
2278
2
1924-29 to 1948
19
5921
I
460
I
28 -
su rro u n d in g la n d to buy s in c e 1939.
The two ran ch es t h a t d e c re a se d i n s iz e d u rin g th e 191*0 to 191*8
p e rio d d id so a s th e r e s u l t o f th e whole u n i t changing h an d s.
In one case
th e ran ch was d iv id e d betw een two so n s, and i n th e o th e r case th e ran ch
was broken down to make i t e a s i e r to s e l l .
Both o f th e ra n c h e s t h a t de­
c re a s e d i n s iz e betw een 1929 and 19U0 d id so a s a r e s u l t o f th e d e p re s s io n
and d ro u g h t.
One o f th e s e ra n c h es has s in c e purch ased back th r e e tim es as
much la n d a s was l o s t .
The in c re a s e d a c re a g e o f deeded la n d s has been th ro u g h th e p u r­
chase o f la n d s from a number o f s o u rc e s .
The c h ie f so u rce o f th e s e p u r­
c h a se s has been from u n s u c c e s s fu l h o m e stea d ers.
The p o lic y o f th e governm ent to g iv e 160 a c r e s o f la n d , l a t e r
in c re a s e d t o 320 and f i n a l l y to 61*0 a c r e s , to any one who c o u ld e x i s t on
th e t r a c t f o r f i v e y e a rs r e s u l t e d i n much n e e d le s s m alad ju stm en t i n th e
re g io n .
C o n sid e rin g th e f a c t t h a t 12$ t o 1$0 anim al u n i t s o f c a t t l e a re
needed to y i e l d a "minimum co m fo rt1* s ta n d a rd o f l i v i n g , ^ / and t h a t i t
ta k e s from 35 to 1*0 a c r e s o f ran g e la n d to s u p p o rt one an im al u n i t i n most
p la c e s w ith in th e a r e a H / i t i s l i t t l e wonder t h a t th e h om esteaders soon
w ent broke and had to s e l l o u t to some o f th e l a r g e r ra n c h e s a lre a d y e x i s t ­
in g i n th e a r e a .
A few o f th e hom esteaders were a b le to s ta y by buying o u t
o th e r h o m e stea d ers.
1 6 / S aunderson, M.H., R e a d ju s ting M ontana's A g r ic u ltu r e . V.
"Economic Changes i n M ontana's Vtange L iv e s to c k P ro d u c tio n ," B u i. 311, F eb .
1936, Montana A g r ic u ltu r a l Experim ent S t a t i o n , p . 18.
1 7 / I b i d , p . 21.
23 -
S e v e ra l o f th e ran ch es i n th e group b ein g s tu d ie d w ere s t a r t e d by
hom esteading, b u t a t one tim e o r a n o th e r a l l b u t one o f them have in c re a s e d
t h e i r h o ld in g s o f deeded la n d by p u rc h a se s from u n s u c c e s s fu l h o m estead ers.
These p u rc h a se s have been made e i t h e r d i r e c t l y from th e u n s u c c e s s fu l home­
s te a d e r o r i n many c a se s from th e c o u n ty .
P u rch ases from th e co unty re p ­
r e s e n t c a se s where th e h o m e ste a d e r's t r a c t w ent i n t o th e hands o f th e
county f o r d e lin q u e n t ta x e s , th e n was p u rc h a se d b y th e s u c c e s s f u l ra n c h e rs
i n th e a r e a .
Many o f th e ra n c h e rs w ere le a s in g t h i s la n d from th e county
i n 19it0, b u t had pu rch ased i t by 1948.
T h is i s th e main re a so n f o r th e
d e c re a se i n a c re a g e le a s e d from p u b lic ow nership i n 1948.
A nother im p o rta n t so u rc e o f la n d t h a t acco u n ted f o r th e in c r e a s e
i n deeded a c re a g e on some o f th e ran ch es was la n d p u rch ased from th e N orth­
e rn P a c if ic R a ilro a d .
At th e tim e th e r a i l r o a d was b u i l t , th e government
gave th e r a i l r o a d a l t e r n a t e s e c tio n s f o r f o r t y m ile s on b o th s id e s o f th e
r ig h t-o f-w a y f o r i t s d is ta n c e a c r o s s M ontana.
U n til th e l a s t two o r th r e e
y e a rs much o f th e r a i l r o a d la n d has been le a s e d by th e ra n c h e rs ; s in c e 1946
( f o r th e f i r s t tim e i n re c e n t y e a rs ) th e r a i l r o a d has s o ld a g r e a t d e a l o f
t h i s la n d to th e r a n c h e rs .
The s a le s o f r a i l r o a d la n d s l a r g e l y acco u n ts f o r th e re d u c tio n
i n th e amount o f la n d le a s e d from p r i v a t e owners i n th e p e rio d betw een
1940 and 1948.
The r e s t o f th e r e d u c tio n has been th e r e s u l t o f buying
sm a ll uneconom ical t r a c t s , u s u a lly from fo rm er h o m estead ers.
30
TABLE III. LAHD USE FACTORS OH A SELECTED GROUP OF
CATTLE RANCHES IN SOUTHEASTERN MONTANA l /
192k, 1929, 1940, 1948
T ea r
Land Use
1929
1940
1948
T o ta l Number o f Animal U n its o f G razing 2 /
462
351
319
428
A cres o f G razing P e r Animal U n it 3 /
25.9
2 6 .4
5 0 .6
4 0 .7
P e rc e n ta g e o f Land Used f o r G razing
942
932
952
962
A cres o f Hay P e r Animal U nit
.46
.78
.77
.66
A cres o f Crops P e r Animal U n it
.70
O•
P e rc e n ta g e o f Lard Used f o r Crops
P e rc e n t o f Land Used f o r Crops
O th er Than Hay
62
2.042
ir\
co
1924
.73
72
52
42
.512
.452
.402
l/ Based on twenty-one ranches located in Carter, Custer,
Musselshell, Powder River, Prairie, and Rosebud Counties.
2 / An anim al u n i t o f g ra z in g r e p r e s e n ts tw elv e months o f g ra z in g
p e r y e a r by one an im al u n i t .
N a tio n a l
how ever,
o b ta in e d
from th e
3 / I n th e c ase o f th e f r e e ra n g e i n 1924 and 1929, and th e
F o r e s t i n a l l o f th e y e a r s , no a c re a g e f ig u r e s were a v a il a b le ;
d a ta was a v a il a b le a s to th e number o f an im al u n i t s o f g ra z in g
from th e s e s o u rc e s , and th e s e an im al u n i t s have been deducted
t o t a l anim al u n i t s i n f ig u r in g a c r e s o f g ra z in g p e r anim al u n i t .
- 31
Land Use - G razing Land
In view o f th e l a r g e in c r e a s e i n a crea g e owned and c o n tr o lle d ,
th e n e x t im p o rta n t q u e s tio n to c o n s id e r i s - has th e r e been any im p o rta n t
changes i n th e use o f th e la n d by th e ra n c h e rs ?
The most n o tic e a b le change i n la n d use d u rin g th e p e rio d IpZii1PU8 i s th e d e c re a se d r a t e o f s to c k in g on th e ran g e la n d .
As shown in
T able I I I , i n 19Zli-29 th e r a t e o f s to c k in g , ( a f t e r allo w an c e s f o r anim al
u n its
12 months
o f g ra z in g on f r e e la n d had been d e d u c te d ), was about
one anim al u n i t to 26 a c r e s .
I n 19U0, th e amount o f g ra z in g la n d p e r
an im al u n i t had a lm o st d o u b le d .
In 19U8, th e r a t e was UO.? a c r e s p e r
anim al u n i t , a d e c re a se from th e 19ii0 r a t e b u t s t i l l an in c r e a s e o f 61#
o v e r th e 192U-29 r a t e .
In c o n s id e rin g th e r a t e o f s to c k in g i n 192U-29 two im p o rta n t
f a c t o r s sh o u ld be c o n s id e re d .
In th e 192U-29 p e rio d , th e f ig u r e s g iv e n
r e p r e s e n t th e sto c k in g r a t e on th e owned and le a s e d la n d s o n ly .
The
second f a c t o r to be remembered i s t h a t a la r g e amount o f g ra z in g was done
on th e open range and i n most c a s e s th e ra n c h e r had o n ly a r a t h e r sk e tc h y
id e a o f how much g ra z in g h is s to c k d id do on f r e e la n d and an even Ik in ter
id e a o f th e amount o f la n d h is s to c k were a c t u a l l y g r a z in g .
For th e s e
re a so n s th e f ig u r e s g iv e n f o r 192U and 1929 a r e n o t f u l l y a c c u r a te .
The im p o rta n t f a c t o r co n cern in g g ra z in g i n th e days o f th e open
range was t h a t most o f th e ra n c h e rs were tr y i n g to ru n more c a t t l e th a n
th e y had g r a s s w ith w hich to fe e d them .
T h is c o n d itio n was b ro u g h t ab o u t
by th e f a c t t h a t ra n c h e rs had th e ten d en cy to ru n a l l th e c a t t l e on th e
- 32 open range t h a t th e y p o s s ib ly c o u ld .
The f e e lin g g e n e r a lly was i f th e y
d id n o t g e t th e g ra s s t h e i r n e ig h b o r w ould.
The open ra n g e was u s u a lly
u sed i n th e summer, th e n th e c a t t l e would be b ro u g h t home to w in te r, and
o f te n th e home ran ch was f a r to o sm all f o r th e h erd t h a t was ru n on th e
P u b lic Domain.
Thus, heavy o v e r-g ra z in g on th e c o n tr o lle d la n d was a ls o
common.
A f te r th e p a ssa g e o f th e T a y lo r G razing A ct, th e days o f th e
open range w ere o v e r.
F o r th e f i r s t tim e i n th e h is to r y o f th e ran ch in g
in d u s tr y i n Montana th e ra n c h e rs were re a so n a b ly c e r t a i n o f how much g ra c ­
in g la n d th e y had f o r t h e i r own u s e .
I t i s g e n e r a lly h e ld by a u t h o r i t i e s
on ran g e management t h a t t h i s f a c t o r p lu s th e o c cu rren c e o f th e s e v e re
d ro u g h t i n th e t h i r t i e s caused th e ra n c h e rs to become more concerned o v er
th e u se o f t h e i r range la n d s and r e s u l t e d i n th e d o u b lin g o f th e amount
o f la n d u sed p e r anim al u n i t a s shown i n 191+0.
The in c re a s e d r a t e o f s to c k in g found i n 19U8 has r e s u lte d
l a r g e l y from th e in c re a s e d p r o d u c tiv ity o f th e ran g e due t o th e above
a v erag e p r e c i p i t a t i o n .
I n d ic a tio n s a r e t h a t th e range i s a ls o more p ro ­
d u c tiv e b ecause o f th e d e c re a se i n o v e r-g ra z in g .
The f u tu r e s to c k in g r a t e
on most o f th e range w i l l p ro b a b ly f a l l somewhere betw een th e p re s e n t r a t e
and th e r a t e i n 19l*0.
F ig u re 7 shows th e p e rc e n ta g e o f t o t a l anim al u n i t s o f g ra z in g
c l a s s i f i e d by th e ow nership o f th e la n d g ra z e d f o r th e s e le c te d group o f
ra n c h e r s .
The most n o tic e a b le change t h a t has o c c u rre d i s th e alm o st
com plete d is a p p e a ra n c e o f f r e e g ra z in g which has dropped from 22 .7 to
- 33 PERCENT
PERCENT
60
60
1924-1929
1948
1940
Figure
7«
Percentage o f t o t a l animal u n ite o f graslng obtained from four
d iffe r e n t land sources by twenty-one c a t t le ranches In Southeastern
Montana, in the years l 92 l#-29 , 19I4Q and 19^8.
** 3U —
t o 0 .3 $ .
The p e rc e n ta g e o f g ra z in g from deeded la n d showed l i t t l e change
betw een 1924-29 and 1940j how ever, betw een 1940 and 1948 th e amount o f
g ra z in g o b ta in e d from th e deeded la n d in c re a s e d by 19$.
The amount o f
g ra z in g o b ta in e d from le a s e d la n d s in c re a s e d from 30$ t o 47$ i n 1940, and
th e n dropped back down t o 31$.
The amount o f g ra z in g o b ta in e d from th e
N a tio n a l F o r e s t has rem ained a lm o st c o n s ta n t a t 12-13$.
Land Use - Non-Grazing Land
The amount o f c o n tr o lle d la n d u sed f o r c ro p s i n a l l th e y e a rs
covered by th e s tu d y was o f m inor im p o rtan c e ; 7$ r e p r e s e n tin g th e h ig h e s t
amount o f th e t o t a l i n an y one y e a r .
D uring th e p e rio d o f th e s tu d y th e
amount o f la n d i n c ro p s v a r ie d from .7 to .8 5 o f an a c r e p e r an im al u n i t .
The h ig h e s t f i g u r e was re c o rd e d i n 1940, t h i s s l i g h t in c r e a s e probablyr e p r e s e n tin g a n a tte m p t by th e ra n c h e rs to r e b u ild t h e i r dw indled fe e d
s u p p lie s ; a l s o , th e number o f an im al u n i t s o f s to c k ru n was th e lo w e st i n
1940.
ra is e d .
I n a l l o f th e y e a rs s tu d ie d hay was b y f a r th e m ost im p o rta n t crop
I n 1924 a s m a ll amount o f g r a in was r a is e d f o r cash s a l e b y a
few o f th e r a n c h e r s ; by 1948 o n ly one o f th e ra n c h e rs r a i s e d any ap p re­
c ia b l e amount o f g r a in f o r c a sh s a l e .
I t i s o f te n th e p r a c t i c e among
many o f th e ra n c h e rs to p la n t a sm a ll amount o f w heat and o a ts each y e a r .
I f th e cro p lo o k s l i k e i t w i l l y ie ld v e ry much i t i s th ra s h e d b u t i f th e
p ro s p e c ts a re p oor i t i s c u t f o r h ay .
T h is i s th e u s u a l e x te n t o f farm ­
in g done o th e r th a n h a y in g .
The h aying o p e r a tio n s w ere g e n e r a lly o f two ty p e s ; ( I ) n a tiv e
o r w ild hay w hich i s o u t o u t o f th e sw ales and more m o ist s p o ts on th e
- 35 ~
ra n g e , and ( 2) a l f a l f a and c r e s te d w heat g r a s s , r e f e r r e d t o a s tame hay,
w hich i s grown on i r r i g a t e d o r d ry la n d .
P r a c t i c a l l y a l l o f th e hay
r a is e d was u sed f o r w in te r fe e d in g on th e home ran ch ; v e ry l i t t l e hay was
e v e r s o ld .
In g e n e r a l a l l o f th e la n d u sed f o r cro p s was deeded la n d ,
e x c e p t i n th e c a se o f two ra n c h es which w ere o p e ra tin g t o t a l l y from
le a s e d la n d i n 192k and 1929.
C onclu sio n s
D uring th e p a s t tw e n ty -fiv e y e a r s , th e ra n c h es i n t h i s s tu d y
have g r e a t l y in c re a s e d i n a c r e a g e .
The most im p o rta n t in c r e a s e i n s iz e
has come a b o u t th ro u g h th e p u rc h a se o f more la n d , much o f which was
fo rm e rly owned i n sm all t r a c t s b y h o m e stea d ers.
The e r a o f f r e e la n d and
u n c o n tro lle d u se o f th e P u b lic Domain has come to an en d .
The ra n c h e rs in
th e a r e a have p r e t t y d e f i n i t e c o n tr o l o v e r m ost o f th e la n d th e y u se f o r
th e f i r s t tim e i n th e h i s t o r y o f c a t t l e ra n c h in g i n e a s te r n M ontana.
Be­
cause th e r a n c h e r s ' la n d b a se has become more s t a b l e and f ix e d i n quan­
t i t y , th e in d ic a tio n s a r e t h a t th e ra n c h e rs have become more i n t e r e s t e d
i n th e way t h e i r range re s o u rc e s a r e u t i l i z e d .
g e n e r a l r e d u c tio n i n th e r a t e o f s to c k in g .
T h is has l e d to a la r g e
T h is re d u c tio n has been made
p o s s ib le i n many c a se s by th e l a r g e r s iz e o f th e ra n c h e s .
The whole la n d
te n u re p i c t u r e f o r th e re g io n a p p e a rs more s ta b l e th a n a t an y tim e i n th e
p a s t.
- 56 —
PART I I I .
OHaATflZATIOir AKD MANAffEMBSt
Type and Class of Livestock
As the ranches in this study are classified as cattle ranches it
is not surprising to find that
carried were cattle.
or more of the animal units of livestock
For the first three years studiedj I9 2 I1., 1929, and
I9 I4O, the proportion of cattle to other livestock was very constant at
Bh* $3, and Slj'- respectively.
In 19W, the proportion of cattle to other
livestock had sharply increased to 9 6 /%*
Although the proportion of cattle to total livestock was almost
constant during the period from I9 2 J4.to 1 9 ^ 0 there was a considerable change
in the proportion of various classes of cattle.
The most important change
was in the proportion of non-breeding stock two years old and over.
This
class of cattle decreased from a high of 19;J in 1921*. to a low of 10> in
19i*0.
This change was offset by an increase in the proportion of yearlings
and breeding cows.
This shift in production is largely the result of three major
changes« (I) An increase in the market demands for younger cattle, which
will be discussed in detail a little later; (2) Increased fixed costs largely
the result of changes in land tenure; and, (J) A greater degree of certainty
and a reduction of risks in raising youngor cattle brought about by a firmer
control of the land used by the rancher.
In the days of the open range,
land was not considered as being a limiting factor of production.
Although
younger cattle could make more efficient utilisation of the range, older
steers were run because they required less attention and were more able to
37
TABLE IV . PESCMTfttF! COMPOSTTIOW OP LIVESTOCK
POR TrtENTY-ONE SELECTED RAMCiIES IH SOUTHEASTERN MONTANA, 192U-1*0
Types and C lass o f
L iv e s to c k
Yoar
192U
1929
19U0
19U8
7«
h5
£9
&
56
B u lls
2
k
5
3
Y e a rlin g H e ife rs
9
7
10
12
Y e a rlin g S te e r s
9
9
13
12
N on-Breeding S tock 2 y e a r o ld s and o v er
19
IU
10
13
A ll C a ttle
81*
83
81*
96
P orsee
16
15
10
k
O
2
6
16
17
16
U
T o ta l L iv e sto o k
100
100
100
100
T o ta l iauober of Animal U n its o f a l l
C la sse s o f L iv e s to c k P er Ranch
1*62
351
319
1*28
2 / I n none o f th e y e a rs d id hogs amount to more
th e y have been o m itte d .
♦
O
Bireedlng Cows
Sheep
T o ta l P e rc e n ta g e o f L iv e s to c k o th e r
th a n C a ttle 2 /
0 y
l / L ess th a n 0.5/"»*
th e r e f o r e
- 38s h i f t f o r them selves#
Under open range c o n d itio n s th e p e rc e n ta g e o f c a l f
crop was o f te n r e l a t i v e l y sm all making th e r a is in g o f o ld e r s t e e r s more
p r o f i t a b l e . - ^ / In many p la c e s l i t t l e e f f o r t was made to fe e d th e o ld e r
s t e e r s I n th e w in te r m onths.
Under th o s e c o n d itio n s i t was o fte n more
p r o f i t a b l e to ru n s t e e r s to th r e e o r som etim es fo u r y e a rs o f age r a th e r
th a n to s e l l c a lv e s o r y e a r lin g s .
In I 9I48, due t o a n a rro w e r m argin betw een th e p r ic e s o f o ld e r
s t e e r s and c a lv e s , and above a v e ra g e range v e g e ta tio n p r o d u c tiv ity , a
sm all in c r e a s e i n o ld e r s to c k was re c o rd e d .
The n arro w er m arg in betw een
o ld e r s t e e r s and c a lv e s was a c a r ry -o v e r from th e days o f w ar-tim e p r ic e
c o n tr o l.
The g r e a t e s t in c r e a s e how ever, 8# o v er 19^0, wns reco rd ed in
b re e d in g cows.
I t i s im p o rta n t to n o te t h a t m ost o f th e in c r e a s e s made
i n th e c a t t l e c la s s e s w ere done a t th e c o s t o f o th e r l iv e s to o k .
The second m ost im p o rta n t c la s s o f liv e s to o k i n term s o f A n W t
u n i t s w ere h o r s e s .
In th e open ran g e d a y s, much o f t h i s a r e a , p a r t i c u l a r l y
C u ste r C ounty, was an Im p o rtan t re g io n i n th e p ro d u c tio n o f h o rs e s .
Prom
a h ig h o f 16# i n 192i* h o rs e s have s t e a d i l y d e c lin e d t i l l i n 19^8 th e y
re p re s e n te d o n ly
o f th e liv e s to o k .
In th e 1 9 2 0 's h o rs e s accounted f o r
o v er 30# o f th e liv e s to o k on f iv e o f th e tw enty-one ra n c h e s .
In 19l*B none
o f th e ra n c h e s were making any e f f o r t t o r a i s e h o rse s f o r oommeroial
p u rp o s e s.
Sanohers who had been r a i s i n g h o rs e s g e n e r a lly had two m ajor
ISyZ vroom an, C.W., C hattaw ay, O .P ., and S te w a rt, A ., C a ttle
Ranching in ,Yestern Canada. P u b lic a tio n No. 778, F eb ru ary I 9U5 , Dominion
o f Canada, D ept, o f A g r ic u ltu r e , O ttaw a, Canada, p . 65.
- 39
c o m p la in ts ab o u t h o rs e s i n I 9I4S .
The f i r s t was t h a t th e r e vas "no lo n g e r
any money in th e b u s in e s s ," and second t h a t i t was a lm o st im p o ssib le to
h i r e a man to b re a k and work w ith h o rs e s .
Sheep on t h i s p a r t i c u l a r group o f ran ch es have n e v e r been a
m ajo r e n t e r p r i s e ; a lth o u g h , i n I 9I4O, one o f th e s m a lle r ra n c h es was de­
v o te d l a r g e l y to sheep p ro d u c tio n .
This p a r t i c u l a r o p e ra to r had to s e l l
o u t d u rin g th e d ro u g h t and was making h is comeback w ith sh ee p .
By IOljS ,
t h i s ra n c h Iiad been so ld to an E a s te rn r e a l e s t a t e b ro k e r and was a g a in i n
th e p ro d u c tio n of c a t t l e .
The o n ly sheep b e in g r a is e d by any o f th e se
ra n c h es was a band o f s i x t y ewes on one o f th e s m a lle s t ra n c h e s.
Hogs o r o th e r c la s s e s o f li v e s t o c k f o r o th e r th a n home u se have
n e v e r b een o f any im portance on any o f th e ran ch es s tu d ie d .
Most o f th e ra n c h es i n th e group w ere r a i s i n g t h e i r own c a t t l e
from t h e i r own b re e d in g h e r d s .
Only f o u r o f th e ran ch es have e v e r made any
p r a c t i c e o f b uying s to c k e r c a t t l e , and n e v e r have th e s e s to c k e rs re p re ­
s e n te d more th a n IOfS o f th e t o t a l c a t t l e f o r th e e n t i r e g ro u p .
Type o f C a ttle M arketed
D uring th e p e rio d from 1921; to 19^8 th e changes t h a t have o c cu rred
i n th e c a t t l e ra n c h in g in d u s tr y In s o u th e a s te r n Montana a re m ark eted ly
r e f l e c t e d i n th e s i z e , a g e , and c la s s o f c a t t l e m ark eted .
The m ost s i g n i f i c a n t f a c t shown i n Table Y i s t h a t w h ile th e
p e rc e n ta g e o f o ld e r c a t t l e m arketed was d e c r e a s in g , th e p e rc e n ta g e o f y e a r­
li n g s and c a lv e s had been in c r e a s in g .
I t w i l l be n o ted t h a t o v er UtyZ o f
th e c a t t l e s o ld i n I 92I4. and 1929 were s t e e r s two y e a rs o ld and o v e r.
By I 9I4O, t h i s c la s s had been reduced to 115# and by 19W3# s t e e r s o f two
• 1+0 ■
TABLE V .
PSHCMTABE CO!JPOSIT IOlT 0? CATTLE TtUSCETED
BY ASB CLASSES ON TLSKTY-ONB MNCHES
IN SOU
TLHN L O N T A M , DU ICElTG POUE D IFFE H E N T YEA CS
Y e a r
Age - C lass of C a ttle M arketed
1921+
1929
19J4Q
19W
%
30
%
2h
#
11
>
17
3
6
12
15
H e ife rs and Spayed H e ife rs 2*s
0
0
10
h
B u lls
7
I
2
2
Calves
7
25
12
52
Cows
H o lfe rs
Vs
S te e re
Vs
Ih
3
hs
26
S te e r s
2*8
17
15
11
5
S te e r s
?»s
22
10
0
5
6
18
0
0
100
100
100
100
S te e r s <over V s
A ll C a ttle M arketed
- 24 -
y e a rs o r more composed o n ly 6# o f th e t o t a l c a t t l e m ark eted .
Y e arlin g
s t e e r s w ere by f a r th e m ost Im p o rta n t c la s s o f c a t t l e s o ld from the a re a In
192»0, and by 192*8, c a lv e s had become th e le a d in g c la s s o f c a t t l e m arketed
by th e ra n c h e rs .
W hile th e g e n e ra l lo n g -ru n tre n d has been tow ard t h e m arketing
o f younger c a t t l e , th e r e was some r e v e r s a l o f t h i s tre n d d u rin g th e war
y e a rs when th e r e was l i t t l e m argin i n p r ic e fa v o rin g younger c a t t l e , la b o r
was s c a rc e and th e ran g e was u n u s u a lly p ro d u c tiv e b ecau se o f above av erag e
ra in fa ll.
In t a lk in g w ith th e ra n c h e rs d u rin g th e s p rin g o f 192*9, th e y
o f te n e x p re ssed t h e i r i n te n tio n s o f going back on to a cow - c a l f b a s is
b ecau se th e y c o n s id e r i t l e s s r is k y and more p r o f i t a b l e i n th e lo n g ru n .
This l a r g e l y e x p la in s th e s l i g h t in c r e a s e I n th e number o f ra n c h es s e l l i n g
th r e e y e a r o ld s t e e r s In 192*8.
However, i t i s im p o rta n t to n o te t h a t
c a lv e s made up th e l a r g e s t p e rc e n ta g e o f t h e number o f c a t t l e s o ld i n 19l*8.
An I n t e r e s t i n g f a c t to n o te was t h a t w h ile th e r e was a 20% In ­
c re a s e I n th e number o f c a lv e s s o ld , s t i l l l e s s th a n h a l f o f th e ran ch es
w ere s e l l i n g any c a lv e s .
T his was acco u n ted f o r by th e f a c t t h a t la r g e r
ra n c h es w ere th e c h ie f m a rk e te rs o f c a lv e s .
One o f th e two ra n c h e s t h a t
was m a rk e tin g th r e e y e a r o ld s t e e r s i n 192*8 was among th e s m a lle r ra n c h e s ,
( l e s s th a n 225 anim al u n i t s and 5#000 a c r e s , )
The o p e ra to r o f t h i s ran ch
I n o rd e r to In c re a s e h i s lnocaae w ith h is lim it e d f a c i l i t i e s had I n t e n s i f i e d
h ie o p e ra tio n by r a i s i n g l a r g e r amounts o f fe e d cro p s and do in g c o n s id e ra b ly more fe e d in g th a n was custom ary In th e a r e a .
A lthough t h i s means o f
i n t e n s i f i c a t i o n was h e lp f u l i n in c re a s in g th e o p e r a t o r 's incom e, i t l a I
I
d o u b tfu l t h a t he oan compete eco n o m ica lly w ith C orn-B elt f e e d e r s .
^
TABLE VI. PERCENTAGE BREAKDOWN OP RANCHES MARKETING
VARIOUS AGE CLASSES OF CATTLE IN SOUTHEASTERN MONTANA,
DURING FOUR DIFFERENT YEARS
Y e a r
Age - C laes o f C a ttle M arketed
1929
%
93
%
85
f
75
*
94
36
25
50
61
0
O
5
17
B u lls
57
63
70
56
CalTee
14
25
25
44
Cowa
H e ife rs
1*6
H e ife rs and Spayed H e ife rs
2*s
1940
191*8
1924
S te e re
1 'e
36
25
80
72
S te e r s
2*6
Tl
88
30
17
S te e r s
3 '*
79
75
O
12
21
50
O
0
S te e r s 1aver 3*8
-
1*3 -
A lo g i c a l q u e s tio n a t t h i s ju n c tu r e I s t
Why have th e ra n c h e rs
i n th e a re a tu rn e d to th e m ark etin g o f younger c a t t l e ?
The answ er t o t h i s q u e s tio n t h a t was m ost o fte n e x p re sse d by th e
ra n c h e rs th em selv es w as, th e y could make more money on th e younger c a tt le #
The re a so n s f o r t h i s w ere t h a t younger c a t t l e w ere more i n demand, made
f a s t e r g a in s and u sed l e s s fe e d i n making th e s e gains#
I n th e end t h i s
adds up to more pounds o f s a le a b le b e e f produced p er u n i t o f f ix e d co st#
As shown in F igure 8 , and Table V II a l a r g e r number o f anim al u n its o f
c a t t l e were m a rk e ted , i n r e l a t i o n to th e t o t a l number o f an im al u n i t s ru n ,
i n th e y e a rs when th e younger c a t t l e w ere sold#
In 1921* th e r e were 213
pounds o f b e e f s o ld p e r anim al u n i t run w h ile i n I 9I48 t h i s had in c re a s e d
to 332 pounds o f b e e f s o ld p e r anim al u n i t ru n .
A nother re a so n o f te n e x p re ss e d w as, b ecau se o f th e f a s t e r tu rn ­
o v e r th e r e was l e s s c a p i t a l and th e r e f o r e l e s s r i s k in v o lv e d w ith th e
younger c a t t l e .
O lder s t e e r s w ere c o n sid e re d more r is k y b e ca u se th e y
in v o lv e a l a r g e r in v e stm en t p er h e ad , and th e r e tu r n p e r pound o f g a in i n
r e l a t i o n to th e amount o f fe e d consumed d e c re a se s r a p id ly a s th e s te e r
in c r e a s e s i n s i z e .
F u rth erm o re , ra n c h e rs i n 191*8 were f e a r f u l o f f u tu r e
p r ic e s w hich m ight reduce th e v a lu e o f o ld e r c a t t l e t h a t had made t h e i r
g a in s on h ig h p r ic e d f e e d .
W hile a stu d y o f Table V i n d i c a t e s t h a t th e r e
has been some g e n e ra l d e c re a se i n th e number o f cows m arketed i n r e l a t i o n
to o th e r c la s s e s o f o a t t l e , a com parison o f th e number o f ra n c h es m ark etin g
oowa i n Table VI i n d ic a te s t h a t g e n e r a lly m ost o f th e ra n d ie s m ark et some
cows each y e a r .
Cows a r e u s u a lly m ark eted i n a cc o rd w ith w hether a ra n c h i s
-W iNo Of
animal
units
500
450
^Animal units of other livestock
TOTAL
\ A N I MA L
UNITS
OF
CATTLE
1924
1929
1940
1948
Figure
8#
A comparison o f the animal u n ite o f o a t tle so ld to the t o t a l
^
u n its o f liv e s to c k ra ised on twenty-one o a t tle ranches in Southeastern
Montana in the years 1921*, 1929, 191*0 and 191*8.
TABLE HI. RELATIONSHIP BETWEEN TOTAL LIVESTOCK HOT
AND AMOUNT OP BEBP SOLD ON TWENTY-ONE CATTLE RANCHES IN
SOUTHEASTERN MONTANA DURING POUR DIFFERENT YEARS
Ye a r
1924
1929
1940
1948
T o ta l Animal U n its o f L iv e s to c k Run
1*62
351
319
428
Animal U n its o f C a t tle S old
102
73
98
142
4 .5 3
4 .5 0
3 .2 6
3.01
I/
y
Number o f A .U .'s o f L iv e s to c k Run
p e r A.U, o f C a ttle S old
Pounds o f B eef S old p e r Animal U n it
o f L iv e s to c k Bum
213
l / No f ig u r e s were a v a ila b le on th e pounds o f b e e f s o ld i n
1929 o r 19W ,
332
U6
expanding o r c o n tr a c tin g t o t a l num bers, and a s th e cows g e t o ld o r a re
c u lle d out*
The re a so n why a low er p e rc e n ta g e o f th e ra n c h e rs m arketed
cows i n I 9I4O was t h a t th e ran ch es were r e b u ild in g t h e i r b re e d in g h erd s
a f t e r th e re d u c tio n s made due to th e d ro u g h t i n th e 1950*8*
There has
b een no a p p re c ia b le change i n th e p e rc e n ta g e o f b u l l s s o ld d u rin g th e
p e rio d u n d er study*
A side from th e s e ra n c h c o n d itio n s t h a t fa v o r th e m ark etin g of
younger o a t t l e th e r e a r e changes i n th e m ark et f o r b e e f c a t t l e .
changes a r e , namely*
These
th e changes in th e consumers* demand f o r b e e f,
and th e developm ent o f th e o a t t l e fe e d in g in d u s tr y i n th e C o rn -B e lt.
P r io r to th e developm ent o f th e l a r g e r c a t t l e fe e d in g in d u s tr y
i n th e C o rn -B elt m ost o f th e o a t t l e were sh ip p ed d i r e c t to th e E a s te rn
m ark ets a s " g r a s s - f a tte n e d " b e e f .
These o a t t l e were u s u a lly v e ry la r g e
i n s iz e and o f c o n s id e ra b le age by p r e s e n t day s ta n d a rd s .
W ith th e
ra p id in c r e a s e In th e p o p u la tio n o f th e E a s te rn o i t i e e , th e tr e n d tow ard
more s e d e n ta ry l i f e , and s m a lle r f a m i l i e s , th e consumers* demand s h i f t e d
tow ard s m a lle r , te n d e r e r , l e s s f a t t y c u te o f b e e f .
The r e s u l t o f t h i s
s h i f t i n demand was th e b u ild in g up o f th e o a t t l e fe e d in g in d u s tr y in th e
C o rn -B elt w hich s p e c ia liz e d in th e p ro d u c tio n o f young g r a in f in is h e d
o a t t l e t h a t have a sm all amount o f f a t in te rm in g le d i n th e le a n , b u t do
n o t have a heavy s t r i p o f w aste f a t around th e o u ts id e o f th e le a n m eat.
The fe e d e rs p r e f e r th e younger ty p e o f o a t t l e b e ca u se th e y a re
b e t t e r a b le to ta k e advantage o f th e c h ea p e r g a in s made p o s s ib le by th e
n a tu r a l grow th and f a t t e n i n g q u a l i t i e s o f younger a n im a ls.
By fe e d in g
c a lv e s th e fe e d e r i s a b le to tu r n o u t i n n in e months to a y e a r* s time a
-Itff a tte n e d b e e f t h a t can be s o ld to th e E a s te rn tr a d e as "baby b e e f ."
Baby b e e f I s In heavy demand on th e E a ste rn m arket and th u s y ie ld s th e
h ig h e s t p r ic e to th e f e e d e r , w hich i s i n r e tu r n r e f le c te d back t o th e
W estern ra n c h e r in w hat he re c e iv e s f o r h is p ro d u c t.
W ith a d e c re a se i n th e age o f th e c a t t l e m a rk e ted , th e n a tu r a l
e x p e c ta tio n would be f o r an a p p re c ia b le d e c lin e i n th e p e r head v a lu e .
A lthough t h i s has been tr u e t o some e x te n t , i t i s im p o rta n t to n o te t h a t
th e r e has n o t been an o v e r - a l l d e c re a se i n th e income o f th e ra n c h e rs even
though few er t o t a l o a t t l e a re ru n , b ecau se th e y a r e a b le t o produce more
pounds o f h ig h e r p ric e d b e e f p e r u n i t o f la n d w ith th e younger o a t t l e .
A s tu d y o f T able V III shows t h a t th e r e i s a c lo s e c o r r e la tio n
betw een th e av erag e o f th e p e rc e n ta g e o f o a t t l e in each o la e s m arketed and
th e p e rc e n ta g e o f r e tu r n s r e a l i s e d f o r each o la s s .
The c l o s e s t c o r r e la tio n
was in th e c a se o f th e y e a r lin g s and two y e a r o ld s t e e r s .
The c a lv e s
showed th e lo w e st r a t e o f r e tu r n p e r head m arketed w h ile t i e th r e e y ear
o ld s t e e r s showed th e h ig h e s t r a t e o f r e t u r n .
The d if f e r e n c e i n the c a s e
o f c a lv e s would be o f f s e t i n th e lo n g run by th e in c re a s e d volume and more
e f f i c i e n t u t i l i z a t i o n o f th e range r e s o u r c e s .
A com parison f o r th s b u l l s
would n o t be j u s t i f i a b l e because a few o f thorn were s o ld a s p u re-b red a
t h i s was n o t th e case f o r any o f th e o th e r c l a s s e s .
B reeding P r a c tic e s
There has been a c o n s id e ra b le change i n b re e d in g p r a c t i c e s on
th e s e ran ch es d u rin g th e p e rio d o f th e s tu d y .
In 192/* and 1929 when
p r a c t i c a l l y a l l o f th e ra n c h e rs were u s in g e i t h e r open ran g e o r f o r e s t
g ra z in g th e p r a c tic e was to tu r n th e oows and th e b u l l s o u t on common p a s tu r e
TABLE VIII. A COMPARISON OF THE PERCENTAGE COMPOSITION OP CATTLE MARKETED
TO THE TOTAL VALUE OF THE VARIOUS AGE - CLASSES OP CATTLE MAfKETSD
OM TWENTY-ONE CATTLE RANCHES IN SOUTHEASTERN MONTANA, I9 2 M 48
Ago - C lass o f C a ttle M arketed
Cows
Year
H e ife rs
Vs
H e ife rs B u lls
and
Spayed
H e ife rs
___ 2 :a .....
192U
Nxmber o f Head
T o tal Value
%
30
22
%
3
2
%
0
0
%
I
2
1929
Number o f Head
T o ta l V alue
2U
20
6
h
0
0
I
I
l9bP
Number o f Head
T o ta l Value
11
11
12
10
10
10
19*48
Number o f Head
T o ta l V alue
17
20
13
6
U
12
Calvos
S te e r s
Vs
S te e r s
2*s
S te e rs
3*8
S te e rs
A ll
over
C a ttle
3 ’s
M arketed
%
Ik
12
JC
17
20
22
31
23
12
5
5
13
17
10
14
18
27
100
100
2
3
12
8
*42
43
11
15
O
O
O
O
100
100
2
3
32
20
26
29
3
U
3
6
O
O
100
100
%
7
3
%
6
8
%
100
100
d u rin g th e b re e d in g season*
S in c e th e cows and b u lls o f th e v a rio u s
ra n c h es u s in g th e range u s u a ll y in te rm in g le d , th e ra n c h e r n e v e r knew w hat
b u l l b re d w hat cow*
Under t h i s ty p e o f a s e t up some o f th e ra n c h e rs ra n
few er b u lla th a n th e y s h o u ld , hoping f o r f r e e s e r v ic e from t h e i r n e ig h b o rs ;
w h ile o th e r s ra n more b u l l s th a n n e c e s s a ry i n o rd e r to b e s u re t h e i r cows
g o t b re d .
A good i l l u s t r a t i o n o f t h i s was i n 1929 when th e extrem es o f th e
r a t i o o f cows p e r b u l l v a r ie d from a h ig h o f 105 to I on one ran o h t o a
low o f ta n to one on a n o th e r ranch*
B oth th e ra n c h e rs w ere b re e d in g on
th o P u b lic Domain i n common w ith o th e r herds*
D e sp ite th o s e extrem es th e
a v erag e r a t i o o f cows p e r b u ll i n fo u r y e a rs s tu d ie d o n ly v a r ie d from 26
to 29 cows p e r b u l l and th e r e was no s i g n i f i c a n t tr e n d i n t h i s v a r ia tio n *
In 19^8, th e o n ly y e a r f o r w hich a c c u ra te f ig u r e s were a v a il a b le ,
o n ly 27/C o f th e ra n c h e rs w ere b re e d in g i n common p a s tu r e s w ith, o th e r h e rd s .
Of th e rem aining ra n c h e rs a l l th e r e s t wore b ro o d in g i n m u ltip le b u ll
p a s tu r e s c a r ry in g o n ly t h e i r own c a t t l e .
Three o f th e ranchos had one o r
more s in g le b u l l p a s tu r e s ; however two o f th e s e o u t f i t s w ere r a i s i n g pure
brods*
Because m ost o f th e ra n c h e rs a re b ro o d in g on t h e i r own p r iv a te
ra n g e , th e q u a l i t y o f b u l l s u se d as in d ic a te d by t h e i r v a lu e has g r e a tly
in c r e a s e d .
The ra n c h e r now knows t h a t h i s own b u l l s a re b re e d in g h is own
cow s, and th e r e f o r e he i s w illin g to spend more to g e t b u l l s o f good q u a l i t y .
Most o f th e ra n c h e rs I n th e p a s t have fo llo w ed th e p r a c tic e o f
b re e d in g y e a r lin g h e i f e r s a lth o u g h th e y would have p r e f e r r e d to b read t h e i r
h e i f e r s f o r th e f i r s t tim e when th e y w ere two y e a rs o ld .
The re a so n f o r th e
p r a c t i c e was t h a t most o f th e ra n o h e rs f e l t t h a t th e y co u ld n o t p ro v id e
— 5 0 ■*
th e f a c i l i t i e s n e c e s s a ry to ru n th e y e a r lin g h e i f e r s s e p a ra te from th e
cow h e rd .
In re c e n t y e a rs more o f th e ra n c h e rs have gone to th e b re e d in g
o f tw o 's ; i n 191*8# 39^ o f th e ra n c h e rs were no lo n g e r b re e d in g y e a r lin g s .
C alf Crop
One o f th e m ost im p o rta n t f a c to r s a f f e c t in g ra n c h income i s th e
p e rc e n ta g e o f c a l f o ro p .2 2 Z TIio p e rc e n ta g e o f c a l f cro p among th e ranches
s tu d ie d shows one sh arp and d i s t i n c t change.
I n 1921; and 1929 th e av erag e
p e rc e n ta g e o f c a l f cro p was Tl and 6 ? p e rc e n t r e s p e c tiv e ly , w h ile i n I9b&
and 19i(8 i t was 83 and 90 p e rc e n t r e s p e c tiv e ly .
This v e ry d e f i n i t e in ­
c re a s e i n c a l f crop was u n d o u b ted ly th e r e s u l t o f th e improved management
and b re e d in g p r a c tic e s s tu d ie d abo v e.
In a s tu d y i n N o rth D akota, Johnson
found an in c r e a s e o f 1 2 - l l $ i n th e I 9I4U o a l f crop when th e cows were b re d
on p r iv a te range o v e r th e o a l f cro p s o f f i f t e e n y e a rs b e fo re t h a t were
b re d u n d e r open ran g e c o n d itio n s . 5 2 /
In view o f th e s h i f t t h a t m ost o f th o ra n c h e rs Imve made t o th e
m a rk e tin g o f c a lv e s and y e a r l i n g s , t h i s in c r e a s e i n o e l f c ro p i s v e ry im­
p o r ta n t.
A ran ch w ith a low c a l f crop (50-60/.) can tu r n o f f more pounds o f
1 9 /S a u n d e rs o n , H.H. and C h itte n d e n , D.W., C a t tle Ranching In
M ontana, B u i. 3U l, May 1937» Montana A g r ic u ltu r a l E xperim ent S ta tio n ," p . 2 0 .
th e terra c a lf - c r o p a s u sed h e re r e f e r s to th e p e rc e n ta g e o f c a lv e s weaned
i n p ro p o r tio n to th e number o f cows exposed to b re e d in g .
2 0 / Jo h n so n , M .B., Bangs C a ttle P ro d u ctio n i n aes& em N orth
D akota , BuTT 3U7# J u l y 19^7# N orth balcota A g rlc u l t u r a l Experim ent' 'fetation
and Bureau o f A g r ic u ltu r a l Econom ics, U n ite d S ta te s D ep t, o f A g r ic u ltu r e ,
C o o p eratin g , p . 1*1.
—
S i
—
b e e f a y e a r w ith a g iv e n number o f an im al u n its i f i t i s s e l l i n g th re e -y e ar^
o ld s t e e r s , th a n i f s e l l i n g c a lv e s .
However, i f th e same ra n c h had a h ig h
c a l f cro p (75# o r more) i t c o u ld produce a f a r g r e a t e r q u a n tity o f b e e f p e r
y e a r w ith c a lv e s th a n w ith th r e e - y e a r - o ld s t e e r s .
D eath Losses
The p e rc e n ta g e o f d e a th lo s s e s f o r th e ra n c h es av erag ed 5 .2 # i n
192k; 3 .0 # i n 1929; U.5* i n 19k0; an d , 3.U# i n 19k8.
A d e a th lo s s o f 3#
i s g e n e r a lly c o n sid e re d norm al and u n a v o id ab le i n s p i t e o f good management
p r a c t i c e s F r o m th e d a ta c o lle c te d th e r e does n o t a p p e a r to be any s ig ­
n i f i c a n t tr e n d i n re g a rd to d e a th l o s s e s .
P ro b ab ly th e most im p o rta n t
f a c t o r s a f f e c t i n g th e amount o f d e a th l o s s a r e th e w e a th e r, c o n d itio n o f
th e ra n g e , and th e p re se n c e o f some d is e a s e s o r p a r a s i t e s t h a t cro p up a t
i r r e g u l a r i n t e r v a l s o r come i n c y c le s .
The management on th e p a r t o f th e
o p e r a to r t o d e a l w ith th e s e f a c t o r s has a ls o been o f g r e a t im portance i n
re d u c in g and p re v e n tin g d e a th l o s s e s .
F eeding P r a c tic e s
On a l l o f th e ra n c h e s s tu d ie d , g ra z in g i s th e main so u rc e o f fe e d .
The fe e d in g o f Iiay o r c o n c e n tra te s i s p r a c tic e d o n ly i n th e w in te r and th e n
o n ly a t tim e s th e s to c k can n o t o b ta in s u f f i c i e n t fe e d by g r a z in g .
The
le n g th o f th e fe e d in g p e rio d on most o f th e ra n c h es i s d e term in e d by th e
s e v e r i t y o f th e w e a th e r, and th e c o n d itio n o f th e w in te r ra n g e .
As shown
i n T able DC, a l l o f th e fe e d in g p r a c t i c e s show c o n s id e ra b le v a r i a t i o n .
2 l / Vrooraan, C .ff., C hattaw ay, Q .P ., and S te w a rt. A .. Op. C i t . .
p . 65.
2 2 / Saunder s o n , M .H., and C h itte n d e n , D.W., Op. C i t . , p . 21.
52
TABLE IX.
SOME FEEDING FACTOSS ON TWENTY-ONE CATTLE RANCHES
IN SOUTHEASTERN MONTANA, 192i*-l*8
Y e a r
Feeding F a c to rs
Tone o f Bay Fed p e r A ninal U n it o f C a ttle
P e rc e n t o f Ranchers Feeding C o n ce n tra te s
Average Number o f Days Fed
Tone o f IIay C a rrie d Over Fron P revious Year
192U
1929
19W
191*8
• 51
.6 3
• 50
.1*7
92/.
85/»
72%
103
99
80
32
71
152
527
200
57,2
- 53 The av erag e le n g th o f th e fe e d in g p e rio d v a rie d by o v er 20&
The amount o f
hay fe d p e r anim al u n i t o f c a t t l e te n d s t o ru n ab o u t a h a l f to n p e r year*
Most o f th e ra n c h e rs fe d some c o n c e n tr a te s , e i t h e r g r a i n , o r c o tto n o r
soybean c ak e .
The amount o f hay re s e rv e o a rre d over from one w in te r to th e
n e x t showed c o n s id e ra b le v a r i a t i o n .
Most o f th e ra n c h e rs t r y to keep a t
l e a s t one V earf S hay su p p ly i n re s e rv e a t a l l tim e s .
C onclusions
In th e l a s t e ig h t y e a rs th e p ro p o rtio n o f c a t t l e t o t o t a l l i v e ­
s to c k c a r r ie d by th e ra n c h es has g r e a t l y in c re a s e d ; h o rse s a r e no lo n g e r
im p o rta n t as a seco n d ary e n t e r p r i s e .
D uring th e tw e n ty -fiv e y e a r p erio d
th e r e has been a s h i f t from th e m ark etin g o f th r e e y e a r o ld s t e e r s to th e
m a rk e tin g o f c a lv e s and y e a r lin g s .
B reeding p r a c t i c e s have l a r g e l y changed from b re e d in g on co m on
range w ith o th e r h e rd s t o b ro o d in g i n p r iv a te p a s tu r e s .
r e f l e c t e d i n th e in c r e a s e i n th e p e rc e n ta g e o f o a lf c ro p .
change was found i n d e a th l o s s e s .
This change i s
Ko a p p re c ia b le
L i t t l e change m s found i n fe e d in g
p r a c t i c e s ; th e s e u s u a ll y b e in g determ in ed by v a r i a t i o n i n y e a r to y e a r
c o n d itio n s
- $4 PART IV.
INVESTMENT, COSTS AND INCOME
Method o f Approach
In o rd e r to make th e d a ta i n t h i s s e c tio n com parable from y e a r to
y e a r , a l l f i n a n c i a l f a c t o r s have been p la c e d on an anim al u n i t b a s i s .
By
u s in g anim al u n i t s a s th e common d en o m in ato r, d if f e r e n c e s i n t o t a l s due to
th e v a r i a t i o n i n e ls e betw een in d iv id u a l ra n c h es and betw een th e av erag e
■ is e s f o r d i f f e r e n t y e a r s , a re e lim in a te d .
Because o f th e g r e a t amount o f v a r i a t i o n t h a t i s en co u n tered due
to f l u c t u a t i o n s in p r ic e s d u rin g th e tw e n ty -fiv e y e a r p e rio d b e in g s tu d ie d ,
a l l c o s t , p r i c e , and in v e stm en t f a c to r s have been computed on a p r ic e in d ex
25/
b a s i s . —^ By p u ttin g a l l c o s t s , p r ic e s and in v e stm e n ts i n term s o f th e v a lu e
o f "1935-59 d o l l a r s , " th e v a lu e o f th e d e f la te d f ig u r e s i s a good in d ic a tio n
o f th e r e l a t i v e changes i n in p u ts and o u tp u ts .
The in d e x es u sed f o r p r ic e s
re c e iv e d by ra n c h e rs a r e f o r th e S ta te o f M o n ta n a .^ ''' S in c e no d a ta was
a v a ila b le f o r in d e x es o f p r ic e s p a id by Montana ra n c h e rs , n a tio n a l o r re g io n ­
a l a v erag e s had to be u s e d .
The main s o u rc e s o f th e s e were A g r ic u ltu r a l
S t a t i s t i c s , ^ / a n d o th e r in fo rm a tio n p u b lis h e d by th e U. S , D epartm ent o f
A g r ic u ltu r e .
W herever a c tu a l p r ic e s a re u sed th e y w ill b e so la b e le d .
2 3 / 1935-39 2 100.
See appendix f o r th e in d e x es u s e d .
2I4/ Halo row, H.O. and G reer, P . J . , Montana Farm and Ranch P r ic e s
1909 - 19^57 Mimeographed C ir c u la r 5 1 , A p r il 1949, M o n ta n a k ta te C ollege
A g r ic u ltu r a l E xperim ent S t a t i o n .
2 5 / A g r ic u ltu r a l S t a t i s t i c s , 19W , U .S. Departm ent o f A g r ic u ltu r e ,
Government1 P r in tin g O f f ic e , ^ a sk in g to n , D.C.
- 55 Inv estm en t
D uring th e p a s t tw e n ty -fiv e y e a rs (on th e b a s i s o f v a lu e o f
nI
P
d o l l a r s " ) th e in v e stm e n t p e r an im al u n i t has g r e a t l y in c r e a s e d .
The in v e stm e n t p e r anim al u n i t i n 192U was $10U.3ii; by 19I4O, t h i s had i n ­
c re a s e d to 3 1 6 9 .5 4 .
The amount o f in v e stm e n t p e r an im al u n i t i n 1948 was
n e a r ly double t h a t re p o rte d i n 1924# and amounted to $ 2 0 2 .1 8 .
F o r t h i s s tu d y th e amount o f th e in v e stm e n t has been d iv id e d
i n t o f o u r m ajor c l a s s i f i c a t i o n s :
nam ely, la n d and b u ild in g , liv e s to c k ,
m achinery and equipm ent, and fe e d and s u p p lie s .
In view o f th e g r e a t l y in c re a s e d a c re a g e o f deeded la n d i t i s n o t
s u r p r is in g to f i n d t h a t th e g r e a t e s t in c r e a s e i n t o t a l in v e stm e n t has been
i n la n d and b u ild in g s .
As shown i n T ab le X, th e in v e stm en t p e r anim al u n i t
i n 1948 i n la n d and b u ild in g s was g r e a t e r th a n th e t o t a l in v e stm e n t in
e i t h e r 1924 o r 1 9 2 9 .^ ^
Not o n ly has th e in v e stm e n t i n la n d and b u ild in g s
made th e g r e a t e s t t o t a l in c r e a s e i n d o l l a r s , i t has a ls o in c re a s e d p ro p o r­
t i o n a t e l y i n r e l a t i o n to th e o th e r in v e s tm e n ts .
I n 1924 la n d and b u ild in g s
acco u n ted f o r 49.2% o f th e t o t a l in v e stm e n t p e r an im al u n i t ; by 1940 t h i s
had r i s e n to 54%; and i n 1948 la n d and b u ild in g s acco u n ted f o r 60.7% o f
th e t o t a l in v e s tm e n t.
The v a r i a t i o n betw een 1924 and 1929 i s n o t s i g n i f i ­
c a n t a s i t i s due m ainly t o v a ria n c e s i n th e sam ple.
2 6 / The "value o f la n d and b u ild in g a s shown in T ab le X pay be a
l i t t l e low a s th e in d ex number used f o r d e f l a t i n g was f o r a l l th e farm and
ra n c h r e a l e s t a t e i n M ontana. I t i s g e n e r a lly h e ld by th e p e o p le who d e a l
i n r e a l e s t a t e t h a t th e p r i c e o f cro p la n d ( p a r t i c u l a r l y w heat la n d ) has
in c re a s e d a t a f a s t e r r a t e th a n th e p r i c e o f g ra z in g la n d s in c e 1940. No
in d e x f ig u r e s on th e v a lu e o f g ra z in g la n d a lo n e were a v a i l a b l e f o r Montana.
56
TABLE X. AVERAGE INVESTMENTS PER ANIMAL UNIT
ON Tst1ENTY-ONE CATTLE RANCHES IN SOUTHEASTERN MONTANA, I 92I4-I48,
A d ju sted to Index B a sis (1955-39 - 100)
T e a r
XttVy8 util©ri u6
192U
1929
19140
1948
Land and B u ild in g s 3 /
I
51.38
$
!45.92
*
91.51
I
122.74
L iv e s to c k 2 /
148.27
!41.35
5 7 .9 8
61.83
M achinery and Equipment l /
3.142
!4.90
7 .1 0
9 .7 3
Feed and S u p p lie s l /
1 .2 7
6 . J8
12.95
7 .8 8
10U.3U
9 8 .5 5
1 6 9 .5 4
202.18
T o ta l In v estm en t
l / Indexes d e riv e d from A g r io u ltu r a l S t a t i s t l o s , I 9I4B, and o th e r
y e a r s . Op. Cit .
2 / Indexes used d e riv e d from Montana Farm and Rsaioh P r ic e s 1 9 0 9 -W *
Op. cI t .
57
The ite m o f in v e stm e n t n e x t in im p o rtan ce to la n d and b u ild in g s
was l i v e s to c k .
A lthough, th e v a lu e o f th e l iv e s to c k p e r anim al u n i t in ­
c re a s e d d u rin g th e p e rio d o f th e s tu d y , th e in v estm en t i n l i v e s to c k in
r e l a t i o n to th e o th e r in v e stm e n ts d e c lin e d ,
^he in c r e a s e i n th e v a lu e p e r
anim al u n i t o f l i v e s to c k i n I 9I4O and I 9I4S o v e r t h a t o f 1924 and 1929 ean be
l a r g e l y a t t r i b u t e d t o two c a u s e s .
The f i r s t re a so n was t h a t i n 1940 and
1948 th e p e rc e n ta g e o f c a t t l e ru n i n r e l a t i o n to h o rs e s in c r e a s e d , and th e
v a lu e p e r anim al u n i t o f c a t t l e exceeded th e v a lu e p e r anim al u n i t o f h o rse s
on th e ran ch es b ein g c o n s id e re d .
The second f a c t o r i s t h a t fo llo w in g th e
days o f th e open range t h e ra n c h e rs s p e n t more t o sec u re t h e s e r v ic e s o f
b e t t e r q u a l i t y b u l l s , and t h i s u p b reed in g o f t h e i r com m ercial s to c k has
r e s u lte d in a h ig h e r v a lu e p e r h e ad .—^
The v a lu e o f th e in v e stm e n t i n fe e d and s u p p lie s has f lu c tu a te d
more r a d i c a l l y th a n any o f th e o th e r c a te g o r ie s o f in v e stm e n t.
This f lu c ­
tu a tio n has been c h ie f ly on a y e a r t o y e a r b a s is w ith no d e f i n i t e tre n d
a p p a r e n t.
T his y e a r to y e a r f l u c t u a t i o n was d eterm in ed to a la r g e e x te n t
b y th e w e a th e r, w hich i n tu r n d e term in e s th e amount o f fe e d produced in
any one y e a r and th e amount o f fe e d c a r ry -o v e r from th e p re v io u s y e a r .
A lthough th e amount o f in v e stm e n t in m achinery was r e l a t i v e l y
sm all i n com parison w ith th e in v e stm e n ts i n liv e a to o k , and r e a l e s t a t e i t
was an im p o rta n t f a c to r t h a t has been in c re a s in g s t e a d i l y d u rin g th e l a s t
" '27/ The f a o t t h a t u p b reed in g o f o a t t l e i n s o u th e a s te r n Montana has
r e s u lte d i n a g r e a t e r v a lu e p e r head th a n f o r th e v a lu e p e r head f o r the
e n t i r e s t a t e i s based on u n p u b lish e d in fo rm a tio n from th e Montana S ta te
S t a t i s t i c i a n 's o f f i c e , B .A .E. This d if f e r e n c e i s g r e a t e s t in th e c ase o f
b u l l s , c a lv e s , and y e a r lin g h e i f e r s .
- 50 tw e n ty -fiv e y ears*
This s te a d y in c r e a s e I n In v estm en t i n m achinery becomes
o f g r e a t e r im p o rtan ce when c o n s id e ra tio n i s g iv en to th e c o s t o f m ainten­
ance and d e p re c ia tio n *
These a d d itio n a l c o s ts a r e d e a l t w ith i n Table X II
and i n th e d is c u s s io n on c o sts*
In th e l a s t two o r th r e e y e a rs th e r e has been a ten d en cy on
th e p a r t o f s e v e r a l o f th e ra n c h e rs to i n v e s t h e a v ily i n new m ach in ery .
In 191(8 a l l b u t one o f th e ra n c h es had a t l e a s t one t r a c t o r ( th e o n ly
ra n c h w ith o u t a t r a c t o r i n 191(8 purch ased one i n th e s p rin g o f 19U9 »)
Over s i x t y p e rc e n t o f th e ra n c h es had two o r more t r a c t o r s and a l l b u t two
o f t h e ra n c h es had a t l e a s t one tr u c k i n a d d itio n to th e fa m ily autom obile
and o th e r farm m ach in ery .
B eeause o f th e more i n t r i c a t e n a tu r e o f modem
t r a c t o r o p e ra te d m ach in ery , th e In v estm en t i n m achinery has g r e a t l y in ­
c re a s e d o v e r t h a t u sed when h o rs e s were th e p rim ary so u rc e o f pow er.
Al­
though th e a d d itio n o f t h i s new m achinery p ro v id e s g r e a t e r e f f i c i e n c i e s
i n many w ays, i t a ls o r e q u ir e s a g r e a te r c a sh o u tla y f o r o p e r a tio n , main­
te n a n c e and r e p a i r s th a n d id th e u se o f h o rse-d raw n im plem ents*
e s ti n g q u e s tio n f o r some f u tu r e s tu d y would b e :
An i n t e r ­
Has t h i s g r e a t e r in v e s t­
m ent in m achinery proven t o be e co n o m ically f e a s ib le ?
Debt
The long run tr e n d among th e ra n c h e rs i s tow ard a re d u c tio n and
com plete l i q u i d a t i o n o f a l l d e b ts .
ty p e s :
The lo a n s were o f u s u a ll y one o f two
( I ) Long term lo a n s u s u a ll y b ased on 5 to 55 y e a r pay o ff# an d ,
(2 ) S h o rt term lo a n s u s u a lly c o n tra c te d f o r a y e a r o r l e s s tim e .
The lo n g
term lo a n s were u s u a lly i n th e form o f r e a l e s t a t e lo a n s , w h ile th e s h o r t
term lo a n s w ere c h a t t e l lo a n s u s u a lly made on liv e s to c k .
In 1921* th e r e
- 59 «
w ere fo u r lo a n s t h a t were p e rso n a l lo a n s , a l l o f th e s e were from p r iv a te
E a s te rn In d iv id u a ls *
S in c e 192i* none o f th e lo a n s have been from p r iv a te
p a rtie s .
The t o t a l amount o f d e b t p e r anim al u n i t has v a r ie d c o n s id e ra b ly
from y e a r to y e a r .
The main f a c t o r s c au sin g t h i s v a r ia tio n a re th e p r ic e
o f b e e f c a t t l e and th e c o n d itio n o f th e ra n g e .
As shewn i n Table X I, th e
amount o f d e b t per. anim al u n i t In c re a s e d betw een 1929 and 191*0 , t h i s b ein g
a p e rio d o f low p r ic e s and poor ran g e c o n d itio n s .
S in ce 19lj0 th e amount o f
d e b t has r a p id ly d e c re a se d i n s p i t e o f th e la r g e a d d itio n a l p u rch ases of
la n d .
Of c o u rs e , I 9UO-I1.8 has been a p e rio d o f h ig h p r ic e s and fa v o ra b le
range c o n d itio n s .
The p e rc e n ta g e o f ran ch es w ith d e b ts a ls o d ecreased
d u rin g th e p e rio d from 19l*0 to 19l|8.
T able XI shows th e amount o f d e b t i n c e n ts i n r e l a t i o n to th e
t o t a l d o l l a r s o f in v e s tm e n t.
The amount o f d e b t dropped betw een 1921* to
1929$ was ab o u t th e same from 1929 to 19l*0j and showed a 75% d e c lin e betw een
19l)0 to I 9I4B*
C o n sid erin g th e la r g e in c r e a s e i n a crea g e owned p e r ran ch
t h i s would in d ic a te t h a t m ost o f th e ra n c h e rs have n o t gone i n d eb t to
expand th e s iz e o f t h e i r h o ld in g s .
One f a c t o r to remember i n c o n sid e rin g
th e s ig n if ic a n c e o f th e s e tre n d s i s t h a t o v e r 75% o f th e s e ranches have
h e m i n th e hands o f th e same owner o r fa m ily f o r over tw e n ty years*
Long
tim e ow nership i s a f a c t o r t h a t i s u s u a ll y c o n sid e re d conducive to low d e b ts .
In I 9I4B, o n ly f i v e ranches r e p o r te d any d e b ts ; two o f th e se
ra n c h es accounted f o r 88^ o f th e t o t a l .
The amount o f d e b t on th e o th e r
th r e e ranches d id n o t e q u al 15% o f th e v a lu e o f t h o i r l a s t y e a r ’ s c a t t l e
s a le s .
The ran ch h aving th e l a r g e s t d e b t {5U% o f th e t o t a l d e b t f o r a l l
- 60
TABLE XI. AMOUNT OP DEBT IN ACTUAL DOLLAHS PER ANIMAL UNIT
ON r/'/KNTY-ONE CATEjE RANCHES IN SOUTHEASTERN MONTANA,
Y e a r
D ebt F acto r*
W
19#
192U
1929
Amount o f Debt
$2 5 .0 0
$16.52
$21.61+
$1#50
I n t e r e e t P aid
I 1.71+
$ 1 .0 5
$ 1.5 2
I
.5 1
Amount o f Debt P er D o lla r o f In v estm en t
I
$
I
$
.0 5
A verage R ate o f I n t e r e s t
P e rc e n ta g e o f Ranchers Having Some Debt
.1 9
.1 2
.1 2
7 .5 9 *
6 .8 #
6 .0 8 #
W o#
79%
62#
86#
26#
—6 l —
o f th e ra n c h e s) had j u s t f in i s h e d making a s e r i e s o f c o s t l y improvements
i n hopes o f s e l l i n g o u t to some E a s te r n e r f o r a fa n c y p r i c e .
The o th e r
ra n c h t h a t was h e a v ily i n d e b t was owned by a man who p u rc h a se d i t two
y e a rs ago and was tr y i n g to g e t s t a r t e d on v e ry lim ite d c a p i t a l .
Rate o f I n t e r e s t P aid
The r a t e o f i n t e r e s t p a id on lo a n s by th e ra n c h e rs has been
s t e a d i l y d e c r e a s in g .
I n 1929 th e a v e ra g e r a t e o f i n t e r e s t p a id on a lo a n
b y th e ra n c h e rs was 7 .5 ? $ ; by 191*8 th e i n t e r e s t r a t e s on lo a n s had dropped
to th e p la c e w here th e a v erag e was lu7Q%,
I n 1921* th e m ost common r a t e
o f i n t e r e s t charged was 8% w ith th e ex trem es b e in g from 5 t o IO g.
In
191*8 , th e m ost common r a t e o f i n t e r e s t ch arg ed was l*|g w ith th e v a r i a t i o n
b e in g betw een I* and 5ig »
The re d u c tio n i n r a t e s o f i n t e r e s t charged f o r borrow ed c a p i t a l
has been b ro u g h t ab o u t l a r g e l y by th e p a tte r n s s e t b y such le n d in g o rg a n ­
i z a t i o n s a s th e F e d e ra l Land Bank and th e P ro d u c tio n C re d it A s s o c ia tio n .
A nother f a c t o r re d u c in g i n t e r e s t r a t e s i s t h a t a s an a re a becomes more
s e t t l e d and e s ta b lis h e d i n c u l t u r a l p a t t e r n s th e r a t e o f i n t e r e s t charged
on r e a l e s t a t e lo a n s g e n e r a lly te n d s to d e c li n e .
A nother i n t e r e s t i n g f a c t o r to p o in t o u t was t h a t i n th e l a s t
tw e n ty -fiv e y e a rs th e number o f so u rc e s from w hich ra n c h e rs borrowed was
re d u c e d .
I n 1921* th e ra n c h e rs had borrow ed from a t o t a l o f seven d i f f e r e n t
ty p e s o f le n d in g a g e n c ie s and p r i v a t e p a r t i e s .
I n 19l*0, a l l o f th e lo a n s
w ere o b ta in e d from th r e e ty p e s o f le n d in g a g e n c ie s .
I n a l l th e y e a rs up to
191*8 th e l o c a l banks had been th e so u rc e o f th e l a r g e s t p e rc e n ta g e o f th e
lo a n s .
I n 191*8 th e F e d e ra l Land Bank was th e p r in c ip a l le n d e r b o th i n
• 62 *»
t o t a l amount lo an ed and number o f lo a n s .
Along w itfi th e tr e n d tow ard a re d u c tio n o f le n d in g a g e n c ie s th e r e
has been a ten d en cy tow ard th e c o n s o lid a tio n o f lo an s and a lth o u g h th e re was
c o n s id e ra b ly l e s s d e b t i n 19W th a n i n I 92lj. th e amount p e r lo a n was la r g e r
i n 19l*0 th a n i n 1921+.
In 1921+ th e a v erag e ra n c h e r who was i n d e b t had
borrow ed from 2 . 5!+ d i f f e r e n t le n d e rs w h ile i n 191*0 th e av erag e was 1 . 3 8 ,
and i n 191*3 o n ly one o f th e f i v e ra n c h e rs who had lo a n s had borrowed from
more th a n one le n d e r .
C osts
For p u rp o ses o f a n a ly s is th e o p e ra tin g c o s ts a re i n term s o f
1935-39 d o l l a r s and th e t o t a l o p e ra tin g c o s ts have been b roken down in to
seven c a te g o r ie s .
They are*
(1 ) Paid L ab o r*
This in c lu d e s a l l la b o r fo r w hich a c tu a l wages
were p a id i n c ash and a ls o in c lu d e s th e c o s t o f b o a rd in g any o f
th e h ir e d la b o r e r s to whom b o ard was fu rn is h e d i n a d d itio n to
w ages.
This does n o t in c lu d e wages f o r th e o p e r a to r o r unpaid
fa m ily la b o r e r s , o r th e c o s t o f t h e i r b o a rd ,
(2 ) Feed, S a l t and M in erals P urohaeedt
This in c lu d e s a l l f e e d s ,
s a l t , o r m in e ra ls n o t produced on th e ra n c h , and w hich a re pur­
ch ased .
(3) G eneral E xpenses*
This in c lu d e s a l l ite m s such a s g a s, o i l ,
f u e l , sm all t o o l s , hardw are, day to day r e p a ir s and m isc e lla n e o u s
s u p p lie s t h a t a re p u rc h a se d .
This ite m does n o t in c lu d e a n y th in g
l i s t e d i n any o f th e o th e r c a te g o r ie s j liv e s to c k p u rc h a se s) o r
m ajo r b u ild in g r e p a i r s and new c o n s tr u c tio n w hich were d e p re c ia te d
— 63 —
TABLE X II. AVERAGE OPERATING COSTS PER ANIMAL UNIT
ON TWENTI-ONE CATTLE RANCHES IN SOUTHEASTERN MONTANA, 192W+8
(Computed on Index B a s is o f 1935-39 » 1 0 0 )-^
I e a r
O p e ratin g C ost
1921*
1929
19l*0
191*8
I
1 .26
%
2.1*6
$
2 .88
i ■
1.8 7
.23
•1±3
.5 1
.96
1 .0 1
1 .1 5
I*.5 6
6.1 6
.78
1 .1 2
1 .8 5
1.51*
1 .1 3
1.1*1*
2 .0 1
2.27
.93
1.1 8
1 .8 2
1.97
I n t e r e s t P a id on Debt
1.71*
1 .0 3
1 .3 2
.51
T o ta l O p eratin g C o sts
7.08
8 .8 1
lii.9 5
15.28
P a id Labor ^
^
Feed, S a l t and M in eral P urchased "
G eneral Expenses 2 / !*/
Leases
Taxes
3/ 6/
D e p re c ia tio n on B u ild in g s and M achinery
------
I / See Appendix B, T ab le I I f o r c o s ts i n a c t u a l d o l l a r s .
2 / In c lu d e s c o s t o f b o ard in g h ir e d la b o r .
3 / Indexes u sed d e riv e d from A g r ic u ltu r a l S t a t i s t i c s , 191*8 and
o th e r y e a r s . Op. C i t .
------- ----------------------------V In c lu d e s p u rc h a se s o f g a s , o i l , sm all t o o l s , liardvrare and
o th e r g e n e ra l s u p p l i e s .
5 / Index on le a s e s was computed by u sin g h a lf th e in d e x number
Tor ta x e s and h a l f th e in d e x f o r la n d v a lu e , a s th e c o s t o f
l e a s e s te n d to v a ry i n r e l a t i o n w ith th e s e two f a c t o r s . No
e x a c t in d ex f i g u r e s w ere a v a i l a b l e .
6 / D e p re c ia tio n was f ig u r e d b y p u ttin g b u ild in g and m achinery
v a lu e s on a 1935-39 in d ex b a s i s and d e p r e c ia tin g b u ild in g s a t
k% p e r y e a r , and m achinery a t 10* p e r y e a r .
7 / A c tu a l d o l l a r f i g u r e s w ere u sed h e re .
6U
on a lo n g tim e b a s i s .
(I*.) L e a a s s i
T his in c lu d e s a l l cash le a s e s o r p e rm its f o r u se o f
la n d .
(5 ) T axes:
T his a p p lie s to th e ta x e s p a id on a l l r e a l e s t a t e o r
p e rs o n a l p ro p e r ty u sed i n th e o p e ra tio n o f th e ra n c h , t h i s does n o t
in c lu d e any income ta x e s .
(6 ) D e p re c ia tio n *
T his in c lu d e s a l l d e p r e c ia tio n on r e a l e s t a t e
and m achinery t h a t i s n o t c o n sid e re d as cash e x p e n d itu re .
(7 ) I n t e r e s t P aid on D ebt*
This in c lu d e s a l l i n t e r e s t p aid on
d e b ts w hich a r e in c u rre d i n th e o p e ra tio n o f th e ra n c h j payments
on th e p r in c ip a l a re n o t in c lu d e d . I n t e r e s t f ig u r e s a re i n a c tu a l
d o l l a r s a s no s u ita b le means co u ld be a r r iv e d a t f o r p u ttin g
i n t e r e s t p a id on an in d ex b a s i s .
The o p e ra tin g c o s t on th e ra n c h es s tu d ie d show a v e ry d e f i n i t e
upward tr e n d .
The t o t a l o p e ra tin g c o s ts i n each o f th e f o u r y e a rs s tu d ie d
show an in c r e a s e above th e p re v io u s y e a r s tu d ie d .
By 19ltS, th e t o t a l oper­
a t i n g c o s t was 118# g r e a t e r th a n i n 1921*, th e f i r s t y e a r f o r which re c o rd s
w ere a v a i l a b l e .
P aid la b o r a s a c o s t f a c t o r i n th e o p e ra tio n o f th e ra n c h es in ­
c re a s e d i n amount t i l l i t h i t i t s peak i n 19W a t $2.88 p e r anim al u n it* b y
I 9I48, th e c o s t had d e c lin e d to $ 1 .8 7 .
In 1929 p a id la b o r re p re s e n te d th e
l a r g e s t s in g le e x p e n d itu re , i t was th e second m ost im p o rta n t e x p e n d itu re
i n 1921* and I 9I4O, b u t i n I 9I18 la b o r a s an e x p e n d itu re i n r e l a t i o n t o th e
o th e r seven c o s t f a c t o r s had dropped to f o u r th p la c e .
The d ro p i n th e la b o r
c o s t from 19W to 19W may be acco u n ted f o r by two d i f f e r e n t f a c t o r s 1
65
TABLE X I I I .
TRENDS IN RELATIVE INPUTS OP VARIOUS PRODUCTION ElVCTORS
( 192U r e p r e s e n ts th e b a se y e a r and e q u a ls 100$) t /
T e a r
O p e ra tin g C osts
191+8
192b
1929
I9h0
P aid Labor
%
100
%
195
%
228
Feed. S a l t , and M ineral Purohased
100
186
222
1+17
G eneral Expanses
100
lilt
1+51
610
L eases
100
ia
237
197
Taxes
100
127
178
201
D e p re c ia tio n on B u ild in g s and M achinery
100
126
196
212
I n t e r e s t P a id On Debt
100
59
76
29
T o ta l O p e ra tin g C osts (W eighted)
100
121+
213
218
l / Cost o f In p u t f a c t o r s computed on in d ex b a s is o f 1935-59 = 100
66 —
( I ) W ith th e g r e a t In c re a s e I n amount o f la b o r sav in g m achinery used by
th e ra n c h e r th e r e fo llo w e d a re d u c tio n I n amount o f la b o r u s e d ,
(2 ) The
s i t e o f th e ra n c h es have In c re a s e d from 519 anim al u n i t s t o 1*28 anim al
u n i t s , and i n a cc o rd w ith some s tu d ie s made b y S aunderson, th e maximum
e f f i c i e n c y i n c a t t l e ra n c h o p e ra tio n seems t o be betw een IjDO to 500
The c o s t o f fe e d , s a l t and m in e ra l h as shown a cont I nous in o re a s e
during the four years studied.
greater than In 192iu
The amount spent for feed in 19ljS was 517%
In spite of the increase in amount spent for feed,
in relation to the other costs, feed has always been of small importance.
In a l l b u t 19l|S fe e d r a te d se v e n th (o r l a s t ) ; i n I 9I48 fe e d r a te d s i x t h
among th e seven o o s t ite m s .
A breakdown o f e x p e n d itu re s i n t h i s c a te g o ry
showed t h a t ro u g h ly 60% o f th e t o t a l was s p e n t f o r c o n c e n tra te s (soybean o r
c o tto n s e e d cake o r p e l l e t s ) , 20% f o r s a l t and m in e ra l, and 20% f o r g r a in
and h a y .
This in c re a s e d e x p e n d itu re f o r fe e d s a ls o in d ic a te s t h a t th e
ra n c h e rs a r e becoming more c o n sc io u s o f th e v a lu e o f s a l t , m in e r a ls , and
p ro te in .
There was o v er a 50% in c re a s e i n th e number o f ra n c h e rs feed in g
s a l t and m in e ra ls betw een I 92I4. and I 9I48.
General expenses have shown the greatest overall increase of any
o f th e seven expense ite m s .
The in o re a s e h as been g r e a t e s t b o th from th e
s ta n d p o in t o f d o l l a r s and e m its and i n r e l a t i o n to o th e r e x p e n se s.
In
192U, g e n e ra l expenses acco u n ted f o r lU.5% o f th e t o t a l o p e ra tin g c o s ts ,
2 8 / S aunderson, M .H., Some M a te ria ls R e la tin g to L iv esto c k and
Land V a lu a tio n , u n p u b lish e d mimeographed material found in 'bho Montana S ta te
College Library, p . 16.
- 6? in 19W t h i s had r i s e n t o 30*7# and i n I 9I48 g e n e ra l expenses re p re s e n te d
o f th e t o t a l o p e ra tin g cost*
The t o t a l r i s e i n d o l l a r s and c e n ts
p e r anim al u n i t was $5 *1$ w hich a cc o u n ts f o r 59# o f th e t o t a l r i s e i n
o p e ra tin g c o s ts betw een 192k to 19W *
One o f th e l a r g e s t s in g le item s o f
expense in c lu d e d i n g e n e ra l expenses was f o r g a s , f u e l and o i l (e x c lu d in g
t h a t u sed f o r n o n -ran c h b u s in e s s ) .
The amount s p e n t f o r g a s , f u e l and o i l
i n 19l*8 was #1 .2 5 p e r anim al u n i t a s compared w ith 17 c e n ts i n 1921*, an
in c re a s e g r e a t e r th a n th e e n t i r e amount o f g e n e ra l expenses i n 1921*.
O th er m ajor ite m s o f g e n e ra l expense have been m achinery r e p a i r s , hardw are
and em ail t o o l s .
The amount o f money p e r anim al u n i t s p e n t f o r le a s e s in c re a s e d
up u n t i l 191*0 th e n dropped by 20# i n 19i|8.
Looking back a t F ig u re 7 ,
we f i n d a d e f i n i t e c o r r e l a t i o n betw een th e tre n d s i n c o s t p e r anim al u n i t
o f le a s e d g r a s in g , and th e a c tu a l amount o f le a s e d g ra z in g .
The re d u c tio n
i n le a s e d g ra z in g betw een 191*0 and 19i*8 a cc o u n ts f o r th e r e d u c tio n i n c o s t
o f le a s e s p e r anim al u n i t .
A nother f a c to r acco u n tin g f o r th e v a r i a t i o n
i n th e amount p a id f o r le a s e s was t h a t th e number o f a c r e s o f g ra z in g p er
anim al u n i t was h ig h e s t i n I 9I4O and showed th e same p a t t e r n o f y e a r to y e a r
v a r i a t i o n a s was shown i n amount p a id f o r l e a s e s .
The amount o f ta x e s p a id p e r anim al u n i t showed a c o n s is te n t r i s e
i n each o f th e fo u r y e a rs s tu d ie d .
In view o f th e in c r e a s in g amount o f
in v e stm e n t p e r anim al u n i t found a t th e b e g in n in g o f th e c h a p te r t h i s f a c t
i s n o t s u rp ris in g .
In a d d itio n to th e in c r e a s e in t o t a l in v e stm en t th e
r a t e o f th e ta x e s a ls o showed a r i s e .
Between 1921* and I9i*8, th e t o t a l
in v e stm e n t p e r anim al u n i t in c re a s e d by $1*# w h ile th e amount o f ta x e s p a id
68
TABLE XIV. PERCENTAGE BREAKDOWN OP THE AVERAGE OPERATING COSTS
ON TWENTY-ONE CATTLE RANCHES IN SOUTHEASTERN MONTANA, IgRik-I4S
( Computed on Index B asis o f 1935-39 - 100)
Ye a r
O p e ratin g Cost
1929
19ii0
19148
%
1 7 .8
2 7 .9
%
1 9 .2
2
1 2 .2
3 .2
h .8
3.1t
6 .3
G en eral Expenses
lit. 3
13 .1
3 0 .7
ll0 .3
L eases
1 1 .0
1 2 .7
12 .3
1 0 .1
Taxes
1 5 .9
l6 .it
13.5
11+.9
D e p re c ia tio n on B u ild in g s and M achinery
1 3 .2
1 3 .lt
12 .1
1 2 .9
I n t e r e s t P aid on Debt
2 lu 6
1 1 .7
8 .8
3 .3
100.0
1 0 0 .0
100.0
1 0 0 .0
192U
P aid Labor } J
Feed, S a l t and M ineral P urchased
T o tal
l / In c lu d e s o o s t o f b o a rd in g h ir e d la b o r .
2 j In c lu d e s g a s , o i l , sm all t o o l s , hardw are, r e p a ir s and m is c e ll­
aneous s u p p lie s .
3 / Based on a c tu a l c o sts* n o t in d e x e d .
— 69 -
p e r anim al u n i t in c re a s e d 101$ .
A com parison betw een th e c o s t o f le a s e d g ra z in g p e r anim al u n i t
and th e c o s t o f owned g ra z in g p e r anim al u n i t would be i n t e r e s t i n g to make
a t th is p o in t.
U n fo rtu n a te ly how ever, i n many o f th e re c o rd s th e r e has
been no breakdown made betw een th e p e rs o n a l p ro p e r ty ta x , and th e r e a l
e s ta te ta x .
B ecause o f t h i s an a c c u ra te com parison was n o t p o s s ib le , b u t
from th e in fo rm a tio n a v a ila b le i t would a p p e a r t h a t th e c o s t p e r anim al
u n i t o f owned g ra z in g was two to th r e e tim e s more ex p en siv e th a n an an im al
u n i t o f le a s e d g ra z in g , i f ta x e s , i n t e r e s t on d e b t, and r e tu r n s to c a p i t a l
in v e s te d were ta k e n i n t o c o n s id e r a tio n .
The c h arg e f o r d e p r e c ia tio n has more th a n doubled i n th e p a s t
tw e n ty -fiv e y e a r s .
The main f a c t o r re s p o n s ib le f o r t h i s in c r e a s e was th e
e n la rg e d in v e stm e n t i n m achinery.
As most o f th e b u ild in g s on th e ran ch es
have been th e r e f o r tw e n ty -fiv e y e a rs o r m ore, d e p r e c ia tio n on th e b u ild ­
in g s was no lo n g e r th e m ajo r ite m .
On th e o th e r hand, a t l e a s t f i f t y p e r ­
c e n t o f th e in v e stm e n t i n m achinery has been made w ith in th e p a s t f iv e
y ears.
A nother im p o rta n t f a c t o r was w ith th e in c re a s e d a c re a g e o f deeded
la n d th e r e has been a la r g e in c r e a s e i n f e n c e s .
I n 19I48, fe n c e s acco u n ted
f o r a b o u t 18$ o f th e d e p r e c ia tio n c h a rg e .
The f i n a l ite m o f c o s t to be c o n sid e re d was th e i n t e r e s t p a id on
d e b t.
T h is ite m o f c o s t showed th e g r e a t e s t f l u c t u a t i o n o f any c o s t ite m ;
i n r e l a t i o n t o o th e r c o s t ite m s .
I n t e r e s t on d e b t was th e l a r g e s t s in g le
ite m o f c o s t i n 192k and th e s m a lle s t one i n 19k8.
As was se e n e a r l i e r i n
th e c h a p te r , th e amount o f d e b t te n d s to f l u c t u a t e w ith economic c o n d itio n s
i n g e n e r a l, th e p r o d u c tiv ity o f th e ran g e la n d (w hich i s l a r g e l y d eterm in ed
- 70by th e amount o f r a i n f a l l ) , and th e number o f y e a rs th e ra n c h has been i n
th e hands o f th e ow ner.
These f a c to r s i n tu r n were re s p o n s ib le f o r th e
amount o f i n t e r e s t p a id on th e d e b t.
The o p e ra tin g c o s ts on th e ra n c h e s s tu d ie d showed a d e f i n i t e
upward tr e n d .
The t o t a l o p e ra tin g c o s t in c re a s e d 2h% betw een 192h and
1929} 89% betw een 1929 and 19U0j and, 5% betw een 19U0 and 19U8.
in c r e a s e i n t o t a l o p e ra tin g c o s ts betw een 192it and 191*8 was 118%.
The t o t a l
The
g r e a t in c r e a s e i n o p e ra tin g c o s ts o c c u rre d betw een 1921* and 191*8 , c h ie f ly
b ecau se o f th r e e main changes*
f r e e la n d .
( I ) The a lm o st com plete d is a p p e a ra n c e o f
(2) The change i n ty p e o f c a t t l e m ark eted .
(3 ) The change
from h o rse powered m achinery to t r a c t o r powered m ach in ery .
S in c e th e
g r e a t e s t change i n th e s e th r e e f a c t o r s o c c u rre d betw een 1929 and 19l*0 ,
th e r i s e i n o p e ra tin g c o s ts w ere th e g r e a t e s t d u rin g t h i s p e r io d .
Income
D e f in itio n s o f V ario u s Types o f Incomes
Because th e r e a r e s e v e r a l d i f f e r e n t ty p e s o f incom es t h a t m ight
be c o n sid e re d i n e v a lu a tin g a r a n c h e r 's b u s in e s s , th e ty p e s o f incomes
s tu d ie d and d is c u s s e d i n t h i s t h e s i s a r e d e fin e d below:
(1) G ross Cash Income:
T h is in c lu d e d a l l income d e riv e d from
th e s a l e o f l i v e s t o c k , liv e s to c k p ro d u c ts , o r c ro p s produced on
th e ra n c h .
The o n ly expense t h a t has been d e d u cte d i s t h a t s p e n t
f o r th e p u rc h a se o f liv e s to c k f o r b re e d in g o r fe e d in g p u rp o se s.
(2) Net Cash Income:
T h is i s th e g ro s s cash income minus o p e ra t­
in g expenses (ex p en ses enum erated i n th e s e c tio n on c o s t s ) ; i t
does n o t in c lu d e an y payment f o r th e o p e r a t o r 's o r fa m ily la b o r
71
and management.
I n t e r e s t p a id on la n d d e b ts i s in c lu d e d , b u t
p r i n c i p a l payments on lo a n s a r e n o t .
The n e t cash income re p re ­
s e n ts th e amount o f c ash th e o p e r a to r and h is fa m ily w i l l have
to l i v e on and pay o f f th e p r i n c i p a l o f any d e b ts he may have.
(3) Net Ranch Income:
T h is i s th e n e t c ash income p lu s o r mi mi a
any change i n i n v e n t o r i e s .
The same s e t o f p r ic e s was u sed f o r
in v e n to ry v a lu a tio n s i n b o th th e opening and c lo s in g in v e n to r ie s
i n any one y e a r , so t h a t in v e n to ry changes a r e th e r e s u l t o f
v a r i a t i o n s i n p h y s ic a l q u a n tity and q u a l i t y , and a r e n o t due to
v a ria tio n s in p ric e s .
Net ra n c h income r e p r e s e n ts a c t u a l p ro ­
d u c tio n o f w e a lth , (e x c lu d in g th e v a lu e o f ite m s used i n fa m ily
l i v i n g ) produced b y th e ra n c h i n a n y one y e a r .
(U) Net R eturns to Fam ily Labor and Management:
T h is i s th e n e t
ra n c h incom e, minus a ch arg e f o r r e t u r n to c a p i t a l in v e stm e n t.
The c h arg e f o r th e r e t u r n to c a p i t a l in v e stm en t i s f ig u r e d a t th e
r a t e o f i n t e r e s t t h a t th e same amount o f c a p i t a l a s in v e s te d i n
r e a l e s t a t e , li v e s t o c k , and th e ra n c h o p e ra tio n i n g e n e ra l would
r e t u r n i f lo a n ed o u t a t going r a t e s o f i n t e r e s t i n any one y e a r .
The n e t r e t u r n to fa m ily la b o r and management r e p r e s e n ts th e
amount o f money e a rn e d by th e o p e r a to r and h is fa m ily i n r e tu r n
f o r t h e i r own la b o r and management i n any one y e a r .
(5) Net R eturn to Management:
T h is i s th e n e t r e t u r n to fa m ily
la b o r and management minus a c h arg e f o r th e u n p aid la b o r o f th e
o p e r a to r and h is fa m ily .
Labor c h a rg e s have been made a t th e
g o in g r a t e p a id f o r ranch la b o r i n th e re s p e c tiv e y e a r s .
Net
72
r e tu r n to management re p r e s e n ts above and beyond a l l e x p e n se s,
e a rn in g s o f th e c a p i t a l in v e s te d and u n p aid la b o r .
This re tu rn
i s o f te n spoken o f as th e n e t p r o f i t o r pure p r o f i t .
In t h i s s tu d y , no allo w an ces were made f o r home-grown and used
p ro d u c ts .
I t was r e a l i s e d t h a t on th e s m a lle r ranches t h i s was an im port­
a n t ite m , b u t on th e l a r g e r ra n d ie s th e v a lu e o f t h i s r e t u r n was r e l a t i v e l y
s m a ll.
A r e tu r n f o r fa m ily l i v i n g d e riv e d from th e ran ch was n o t fig u r e d
b e ca u se o f la c k o f a d eq u a te i n f o m a tio n i n th e re c o rd s on w hich t h i s stu d y
was b a se d .
A s tu d y by E. E. P e te rs o n , showed t h a t on a ty p i c a l P la in s c a t t l e
ran ch th e v a lu e o f fa m ily l i v i n g d e riv e d from th e ran ch av erag ed
f o r th e
p e rio d o f 1929 th ro u g h 19145« f S /
The a n a ly s is o f Income t h a t fo llo w s i s on th e b a s is o f a c tu a l
p r ic e s and has n o t been a d ju s te d to an in d e x b a s i s .
An a n a ly s is o f income
f ig u r e d on a long tim e b a s is i s c o n sid e re d s e p a r a te ly i n a s e c tio n e n t i t l e d
" S e t Income Computed on a lHormaI1 P rio e R e la tio n s h ip B a s is ."
G ross Income
The p rim ary so u rc e o f income on a l l o f th o ran ch es s tu d ie d , in
a l l o f th e y e a rs was from th e s a l e o f b o e f c a t t l e .
Only i n 192lt d id th e
s a l e s o f b e e f c a t t l e a cc o u n t f o r lo s s th a n 9 0 ^ o f th o t o t a l incom e.
192U th e income by so u rc e s was made up a s f o llo w s :
In
b e e f c a t t l e 85$, hogs 8 $ ,
and o th e r so u rc e s (w hich in c lu d e d liv e s to c k p ro d u c ts , h o r s e s , and c ro p s)
29/ P e te rs o n , B. B ., O rg a n iz a tio n , Income, and A djustm ents on a
T ypioal P la in s C a ttle Ranch, u n p u b lish e d m a n u sc rip t, .,ontana SJake C o lle g e ,
November 1945, P* %7*
-
13 -
aocounted f o r 1% o f th e t o t a l Incom e.
In none o f th e o th e r y e a rs s tu d ie d
s in c e 1921). have ho%s amounted to as much as *5# o f th e t o t a l income,
In 1929# b e e f c a t t l e made up 95/» e f th e t o t a l income w ith sheep
a c c o u n tin g f o r ab o u t 1.5"%, and a l l o th e r so u rc e s 3 .5 > .
th e income was from b o e f c a t t l e ,
In I 9I4O, 91% o f
from sh e e p , 2f= from Government A.A.A.
payments and th e r e s t came from o th e r s o u rc e s .
The income i n I 9I48 was
96% from b e e f c a t t l e , 2 . 5% from g ra in and a l f a l f a seed and th e rem aining
1 , 5% from o th e r s o u rc e s .
Two o f th e ran ch es i n th e p a s t have had some a d d itio n a l income
from th e "dude" b u s in e s s .
A lthough i t i s re c o g n ise d t h a t "dudes" made
some d if f e r e n c e in o p e ra tio n s on th e s e ra n c h e s , i n t h i s s tu d y , income
from " d u d e s " , o r any o th e r n o n -ran ch e n t e r p r i s e o r s e c u r i t i e s were n o t
c o n s id e re d , and a l l expenses f o r "dudes" w ere deducted i n f ig u r in g c o s ts .
This was n e c e s s a ry i n o rd e r to m easure a l l o f th e ran ch es on th e same b a s is #
The r i s e i n a c tu a l g ro ss income shown i n Table XV can la r g e ly
be a t t r i b u t e d to two p r in c ip a l f a c t o r s .
The f i r s t f a c t o r i s th e v a r i a t i o n
i n p r ic e s re c e iv e d by th e ra n c h e rs f o r th e p ro d u c ts th e y s o ld .
second
f a c t o r i s th e in c re a s e i n th e number o f anim al u n i t s o f b e e f c a t t l e s o ld
i n r e l a t i o n to th e number o f anim al u n i t s o f liv e s to c k ru n .
The in c r e a s e
i n g ro ss income p e r anim al u n i t betw een I 92I4. and 1929, and th e n a g ain
betw een I 9I4O and I 9I18 w ere p r im a r ily
caused by th e f i r s t f a c t o r .
The
in c r e a s e i n g ro ss income betw een th e y e a rs 1929 and I 9I1.O was p rim a rily
th e r e s u l t o f th e second f a c t o r .
The p r ic e o f b e e f c a t t l e was 52% h ig h e r in 1929 th a n i n 1921}*
This in c r e a s e in p r ic e i s th e p rim ary cau se o f th e in c re a s e i n g ro s s
TABLE XV. AVERAGE RANCH INCOME PER ANIMAL UNIT
ON TWENTY-ONE CATTLE RANCHES IN SOUTHEASTERN MONTANA, I 92U-I48
(A ctu al Income)
Ye a r
1921+
1929
G ross Cash Income
$
13.61
$
$
26. 11+ 3 1.55
I
76.92
Cash Expenses 3 /
8 .I4I
11.14
1 5.18
29.76
N et Cash Income
5 .2 0
l k 73
1 6 .3 7
1+7.16
• 50
1+.96
1 .7 7
1.7 8
N et Ranch Income
5.7 0
19.69
Net R etu rn t o C a p ita l In v e s te d
6.91+
N et In v e n to ry Change
N et R eturn to Fam ily Labor and Management
Unpaid Fam ily Labor
N et R eturn t o Management
8 . 21+
- 1 . 21+ 11.1+5
191+0
191+8
18.11+ 1+8.91+
9 .8 9
22. 11+
8 .2 5
26.80
2 .1 9
2 .7 7
3 .5 7
6 .2 9
- 3.1+3
8 .6 8
!+.68
20.51
l / See Appendix B, Table I I f o r break-dow n o f t o t a l cash e x p en se s.
- 75 income betw een 192 k to 1929* a ls o o f im p o rtan ce was th e f a c t t h a t th e re
was a 3# in c r e a s e i n th e number o f anim al u n i t s o f b e e f c a t t l e s o ld i n
r e l a t i o n to th e t o t a l number o f anim al u n i t s o f liv e s to c k r u n .
The p r ic e o f b e e f c a t t l e i n 19W was 18# low er th a n th e p r ic e o f
b e e f c a t t l e i n 1929$ how ever, th e g ro s s income p e r anim al u n i t was $5 .^ 1
h ig h e r p e r anim al u n i t i n 19W th a n i n 1929*
This r i s e i n income was
l a r g e l y th e r e s u l t o f an in c r e a s e o f o v e r 12# i n th e number o f anim al
u n i t s o f c a t t l e s o ld i n r e l a t i o n to th e number o f anim al u n i t s o f liv e s to c k
ru n , t h i s f a c t o r was shown i n F ig u re 8 *
The in c r e a s e i n g ro s s income from I 9I4O to 191*8 has l a r g e ly been
th e r e s u l t o f th e f a c t t h a t th e p r io e o f c a t t l e was 225# h ig h e r i n 191*8
th a n i n 19W*
Changes and Trends i n N et Inoome
The n e t oash income f o r th e ran ch es fo llo w ed th e same p a tte r n of
in c r e a s e t h a t was found f o r th e g ro ss incom e.
n e t income was betw een 19l|0 and I 9I48.
The g r e a t e s t in c r e a s e i n
D uring t h i s tim e th e in c re a s e i n
g ro ss income was 11*1*# w h ile t o t a l o p e ra tin g c o s ts were up o n ly 96# .
Thus
w ith such a fa v o ra b le r e l a t i o n s h i p betw een p r ic e s and c o s t s , th e n e t cash
lnoome was 188# g r e a t e r i n 19l*8 th a n i n 191*0 .
The s m a lle s t in c r e a s e in n e t income o c cu rred betw een 1929 and
I 9I4O.
D uring t h i s p e rio d th e c o s ts in c re a s e d b y 33# w h ile th e g ro ss income
in c re a s e d o n ly 21#.
11#.
The r e s u l t was t h a t in c r e a s e in n e t income was o n ly
The in c r e a s e i n expense t h a t o c c u rre d betw een I 929 and I 9I4O, d e s p ite
th e f a c t t h a t th e d o l l a r had 22# more p u rc h a sin g power i n I 9I4O th a n i n 1929
*• 76 «•
was l a r g e l y th e r e s u l t o f two fa c to rs *
d is a p p e a ra n c e o f f r e e la n d .
( I ) H igher la n d c o s ts due to th e
(2) In a s tu d y made by Saunderson i t was
found t h a t th e expenses on ra n c h es o p e ra tin g on a c o w -ca lf b a s is would ru n
ab o u t 5QI h ig h e r th a n ran ch es s e l l i n g th r e e - y e a r - o ld s t e e r s .2 2 /
The
d if f e r e n c e i n c o s t due to th e age o f c a t t l e m arketed i n th e s e two y e ars
would p ro b a b ly in c r e a s e th e c o s ts o f o p e r a tio n b y 20 to 2$%.
The in c r e a s e i n n e t cash income betw een 192U and 1929 was 183^.
T h is in c r e a s e i n n e t income i s due to a la r g e in c re a s e i n g ro s s income and
a r e l a t i v e l y sm all in c r e a s e i n o p e ra tin g c o s t s .
In v e n to ry in c r e a s e s were o f r e l a t i v e l y m inor im p o rtan ce ex cep t
i n 1929 when a &L.96 in v e n to ry in c r e a s e was re c o rd e d .
A la r g e p e rc e n t o f
th e in v e n to ry in c r e a s e i n each o f th e f o u r y e a rs was i n th e p ro d u c tio n o f
fe e d c ro p s .
As a r e s u l t o f th e la r g e in v e n to ry in c re a s e i n 1929, th e n e t
ra n c h income was g r e a t e r i n 1929 th a n i n 19U0.
The lo w e st n e t ran ch
income was i n 1921* and th e h ig h e s t i n 191*8.
As th e n e t r e t u r n to c a p i t a l in v e s te d i n 1921* was g r e a t e r th a n
th e n e t ran ch incom e, th e r e tu r n s to fa m ily la b o r and management i n t h a t
y e a r was a minus q u a n tity .
Due l a r g e l y to th e in c r e a s e i n in v e stm e n t p e r
anim al u n i t betw een 1929 and 19l*0 th e n e t r e tu r n s to fa m ily la b o r and
management was 50% g r e a t e r i n 1929 th a n i n 191*0.
The n e t r e t u r n to fa m ily
la b o r and management i n 191*8, even though th e in v e stm en t was d ouble t h a t
o f 19l*0, was 131*# g r e a t e r th a n i n any o f th e o th e r y e a rs s tu d ie d .
30/ S aunderson, M .H., Some M a te ria ls R e la tin g to L iv esto c k and
Land V a lu a tio n , Op. C i t . , p . 3.
”
77
The r e t u r n to management a f t e r a l l f a c t o r s were c o n sid e re d
shows t h a t th e most p r o f i t a b l e y e a r was 19U8 and th e l e a s t p r o f i t a b l e
was 192b.
These extrem es a r e l a r g e l y th e r e s u l t o f two f a c t o r s t
(I)
P r ic e s and (2) The r e l a t i o n s h i p o f th e number o f an im al u n i t s o f c a t t l e
s o ld to th e number o f an im al u n its o f li v e s t o c k ru n .
The y e a r 1929 was
more p r o f i t a b l e th a n 19b0 becau se p r ic e s were h ig h e r, ex p en ses lo w er, and
th e amount o f in v e stm e n t p e r anim al u n i t was l e s s .
Net Income Computed on a "Wormaltt P r ic e R e la tio n s h ip B asis
When th e in fo rm a tio n p re s e n te d i n T ab le XIV i s p la c e d on a long­
tim e norm al p r ic e r e l a t i o n s h i p b a s i s , (u s in g a s t h i s b a s i s th e p r ic e le v e l
o f 1935-39) a s shown i n T able XVI, a number o f i n t e r e s t i n g f a c t o r s a re
b ro u g h t o u t:
(1 ) The h ig h p r o f i t s r e a l i s e d i n 19b8 were to a la r g e e x te n t th e
r e s u l t o f a f a v o ra b le r e l a t i o n s h i p betw een p r ic e s p a id and p r ic e s
r e c e iv e d .
T h is i s i l l u s t r a t e d by th e f a c t t h a t on th e b a s is o f
1935-39 d o l l a r s , t h a t th e n e t income i n 1948 was lo w er th a n i n
any o th e r y e a r s tu d ie d .
(2 ) Under a norm al p r ic e s i t u a t i o n (assum ing t h a t th e 1935-39
p e rio d was a p e rio d o f norm al p r ic e r e l a t i o n s h i p s ) th e ra n c h e rs
o p e ra tin g a s th e y d id i n 1948 w ould have had a n e g a tiv e r e tu r n
to fa m ily la b o r and management.
These o b s e rv a tio n s s tim u la te some q u e s tio n s w hich a r e unansw erable
on th e b a s is o f t h i s s tu d y b u t m ight be o f i n t e r e s t i n some f u tu r e stu d y :
( I ) Can th e ra n c h e rs d e s p ite t h e i r g r e a t l y in c re a s e d in v e stm en t
TABLE m .
AVEFACBf HASCH IKCOSE PUfi AKIMAL KBIT
OS TKBBTT-OBB OATTLS SASCBBB IS SOSTHLASTEIffl K3MTAHA, 192lr^
(Baeed on Index o f 1935-39 * 100)
Year
192U
1929
I9 b 0
19b0
$
l b . 37
$
1 8 .7 0
$
2 6 .5 1
$
2 2 .1 3
Gaah !Cxpenee
6.6?
8 .6 5
lb .9 0
15.33
Ifet CSaeh Inecew •
7 .7 0
1 0 .0 5
11.53
7 .1 0
14.28
l.b 9
/V.3 3
l b . 78 1 3 .0 2
.5 2
7 .6 2
8 .1 1
1 0.76
!*.91
- 3 .1 b
3 .0 3
1.71
1 .0 8
• b .8 5
Oroee Caeh Tnoom
S e t Inventory OhanrjO
.5 3
Ket Ftenoh Xneoew
8 .2 3
S et Return to Capital Invested
b .6 5
S et Return to P n slly Labor and ISanagewent
3 .5 8
Unpaid Fteally Labor
1 .5 5
S et Return to *,Smagesient
2 .0 3
b .7 b
?.Tj
1 0 .0 b
1 .8 1
7,7?
3 .2 3
79
be a b le to o u t o p e ra tin g c o s ts s u f f i c i e n t l y I n th e f u tu r e to be
a b le to o p e ra te p r o f i t a b l y In a p e rio d o f "norm al" p r ic e r e l a t i o n ­
s h ip s ?
(2 ) Was th e re a so n f o r low n e t income when f ig u r e d on an in d e x
b a s is b e ca u se th e ra n c h e rs te n d ed to p u t more in p u ts i n t h e i r
o p e ra tio n s i n o rd e r t o make more p r o f i t s when p r ic e s re c e iv e d
in c re a s e d f a s t e r th a n p r ic e s p a id ?
Or was th e re a so n t h a t i n
tim e s o f h ig h g ro s s incomes th e ra n c h o r s d id n o t work a s h ard
o r t r y to maximize t h e i r e f f ic ie n c y ?
Or i s th e re a so n a combin­
a tio n o f th e s e f a c to r s ?
C onclusions
On a lo n g -tim e b a s i s (b a se o f t h e 19)9-39 p r ic e l e v e l ) th e amount
o f in v e stm e n t p e r anim al u n i t has r i s e n
i n th e p a s t tw e n ty -fiv e y ears*
The c h ie f f a c t o r s in c r e a s in g th e amount o f th e in v estm en t w ere a 155?» i n ­
c re a s e i n th e t o t a l a c re s o f deeded la n d , and a 28% In c re a s e i n th e v alu e
o f l iv e s to c k p e r anim al u n it*
D uring th e same p e rio d o f tim e th e amount
o f d e b t p e r anim al u n i t has d e c re a se d 37% and th e amount o f d e b t p e r d o l l a r
o f in v e stm e n t has d e c re a se d from 19 c e n ts i n 192)4 to 3 c e n ts i n 19lj8*
Mie
p e rc e n ta g e o f ra n c h e s having some d e b t in c re a s e d from 79^ i n I 92I4. to a
h ig h o f 86% I n 19hP, by 19)48 o n ly 26^ o f th e ra n c h e rs had any debts*
D uring th e tw e n ty -fiv e y e a r p e rio d , expenses have gone up 1182%, th e m ajor
in c r e a s e s were in g e n e ra l s u p p lie s , ta x e s and d e p r e c ia tio n .
The o n ly ex­
pense ite m t h a t showed a re d u c tio n was i n t e r e s t p a id on d eb ts*
On an a c tu a l d o l l a r b a s i s , th e m ost p r o f i t a b l e y e a r by f a r was
19)48, and th e l e a s t p r o f i t a b l e y e a r was I 92I4*
The n e t c a sh income was
*
80
«*
h ig h e r I n 19W th a n I n 1929» b u t due to a la r g e In c re a s e I n in v e n to ry
I n 1929» th e n e t ra n c h Income was l a r g e r i n 1929 th a n i n 19I4.O.
The
iaoet im p o rta n t f a c t o r a c c o u n tin g f o r la r g e income i n I 9J4S was t h a t p r ic e s
re c e iv e d mere th e h ig h e s t i n h i s t o r y , and p r ic e s p a id had n o t r i s e n a s
f a s t a s th e p r ic e s re c e iv e d .
- 81
PART V.
SlMtiUflr Aim FDTUHB PROSPECTS
C r i t i c a l A p p ra is a l o f th e Study and Methods Used
The p r in c ip a l o b je c tiv e o f t h i s s tu d y was to f i n d th e changes
t h a t had ta k en p la c e i n c a t t l e ra n c h in g I n th e P la in s re g io n o f s o u th ­
e a s te r n Montana s in c e 192h and th e o r g a n is a tio n o f th e s e c a t t l e ran ch es
i n I 9I48.
The method o f approach was to fo llo w up s im ila r ra n c h in g s tu d ie s
t h a t had been made i n th e p a s t c o v erin g a s e r i e s o f tw en ty -o n e ranches
lo c a te d i n th e area*
Each one o f th e ra n c h es was v i s i t e d and com plete
b u s in e s s re c o rd s w ere o b ta in e d f o r th e y e a r 19lt8.
On th e b a s i s o f a r i t h ­
m e tic a l a v e ra g e s th e group o f ra n c h e s w ere compared a g a in s t s im ila r re c o rd s
f o r th e same ran ch es f o r th e y e a rs 19W , 1929 and 1924*
T his method of
a n a ly s is had some s e v e re l i m i t a t i o n s , th e sam ple was to o sm all to be
s t a t i s t i c a l l y r e l i a b l e i n a l l m a tte r s and th e ran ch es c o n s t i t u t i n g th e
sample w ere d e f i n i t e l y above a v erag e i n e ls e and i n a l l p r o b a b ility were
b e t t e r managed th a n th e a v erag e o f a l l ran ch es i n th e area*
Of w hat v a lu e i s th e study?
In a p a p er a p p e a rin g i n th e J o u rn a l
o f Farm Economics, E. 0* Heady p o in ts c u t t h a t th e p rim ary s te p s i n s o lv in g
problem s i n farm management are*
o r optimum.
( I ) To fo rm u la te o r e s t a b l i s h th e i d e a l
(2 ) D eterm ine th e e x te n t and th e re a so n why th e e x is t in g s t a t e
d i f f e r s from th e i d e a l o r p r a c t i c a l optimum.
(3 ) E s ta b lis h th e a p p ro p ri­
a te means and p ro v id e th e c o n c re te q u a n t i t a t i v e d a ta w hich s e rv e s a s th e
b a s is o f a c tio n f o r g e ttin g from th e " e x is tin g * to th e "optim um ." 3 1 /
3 l / Heady, B .O ., "Models i n Farm P ro d u ctio n Economics R esearch ,"
J o u rn a l o f Farm Economics, V o l, XXX, No. 2 , May I 9I48, p . 2 0 ? .
- 82 The work i n t h i s p a p e r i s o f such a n a tu r e a s to p ro v id e a b e t t e r under­
s ta n d in g and to se rv e as a b a s is f o r th e " e x i s tin g s t a t e , " a s o u tlin e d
ab o v e, i n c o n n e c tio n w ith f u tu r e stu d y i n ra n c h management in s o u th e a s te rn
M ontana.
The c h ie f v a lu e o f t h i s stu d y i s more f o r a b e t t e r u n d e rsta n d in g
o f c a t t l e ra n c h in g i n s o u th e a s te r n M ontana, and as a b a s i s f o r f u tu r e
s tu d y th a n as an end i n i t s e l f o r a s o lu tio n o f any s p e c i f i c problem .
S u H T P n .ry
D uring th e p a s t tw e n ty -fiv e y e a r s , b e a rin g i n mind th e lim i t a t i o n s
o f th e d a ta due to th e sm all number composing th e sample and th e u se o f
a v erag e s i n a n a l y s i s , th e fo llo w in g changes and tre n d s w ere a p p a r e n tt
(1 ) The amount o f c o n tr o lle d la n d u sed by th e ra n c h e rs has
in c re a s e d by 159^*
The m ost Im p o rta n t in c re a s e i n s i s e has come
ab o u t th ro u g h th e p u rc h a se o f more la n d , much o f which was f o r ­
m erly owned i n sm all uneconom ical t r a c t s by h o m estead ers.
(2 ) The e r a o f f r e e la n d and u n c o n tro lle d u se o f th e P u b lic
Domain has come to an en d .
The ra n c h e rs now have a fir m e r and
more c e r t a i n c o n tr o l o v er th e la n d th e y u se th a n a t any o th e r
tim e i n th e h i s t o r y o f th e c a t t l e ra n c h in g in d u s tr y i n Montana.
(3 ) W ith a more c e r t a i n c o n tr o l o f th e ra n g e , th e ra n c h e rs a re
more concerned w ith th e way th e range re so u rc e s a r e u t i l i s e d and
have reduced t h e i r s to c k in g r a te s *
(U)
D uring th e p a s t tw e n ty -fiv e y e a r p e rio d th e r e has been a
s h i f t from th e m a rk e tin g o f th r e e y e a r o ld s to e r s t o th e m ark et­
in g o f c a lv e s and y e a r lin g s .
In 192U th e ra n c h e rs m arketed 213
63
pounds o f b e e f p e r anim al u n i t o f llv e s to o k run* b y 19it8 t h i s
had in c re a s e d to 332 pounds o f b e e f p e r anim al u n i t o f liv e s to c k
ru n .
(5 ) B reeding p r a c t i c e s have s h if te d from b re e d in g on common ran g e
w ith o th e r h e rd s to b re e d in g i n p r iv a te p a s tu r e s .
This change
has h e lp ed in c r e a s e th e p e rc e n ta g e o f c a l f c ro p .
( 6 ) L i t t l e change was found i n fe e d in g p ra c tic e s * th o s e u s u a lly
b e in g d eterm in ed l a r g e ly by y e a r to y e a r v a r i a t i o n s i n th e w e a th e r.
(7 ) F ig u red on th e b a s is o f c o n s ta n t p r ic e s a t th e 1935-39 le v e l
th e amount o f in v e stm e n t p e r anim al u n i t has in c re a s e d Sbfa in
th e p a s t tw e n ty -fiv e y e a r s .
The c h ie f f a c to r s c a u sin g t h i s i n ­
c re a s e w ere a 155^ in c r e a s e i n deeded la n d , and a 2Bf» in c r e a s e
i n th e v a lu e o f liv e s to c k p e r an im al u n i t .
( 8 ) The amount o f d e b t p er anim al u n i t has d e c re a se d by 37^ i n
th e l a s t tw e n ty -fiv e y e a r s .
Only
o f th e ra n c h e rs had any
d e b ts in 19W . t h i s was th e s m a lle s t p e rc e n ta g e f o r any y e a r o f
th e s tu d y .
(9 ) F ig u red on th e b a s i s o f th e p u rch asin g power o f th e d o l l a r i n
1933-39, th e o p e ra tin g o o e ts f o r each o f th e y e a rs s tu d ie d were
h ig h e r th a n f o r th e p re v io u s y e a r s tu d ie d .
During th e e n t i r e
p e rio d in p u ts in c re a s e d by 118??, th e m ajor I n c re a s e s were i n
g e n e ra l s u p p lie s , ta x e s and d e p r e c ia tio n on m achinery and b u ild in g s .
The o n ly in p u t ite m t h a t showed a d e c re a se f o r th e p e rio d was
i n t e r e s t p a id on d e b ts .
• Si; -
(10) The m ost p r o f i t a b l e y e a r f o r th e ra n c h e rs d u rin g th e s tu d y
was 19W» and th e l e a s t p r o f i t a b l e was 192U*
The m ost im p o rta n t
f a c t o r a c c o u n tin g f o r th e h ig h income i n I 9I48 was t h a t p r ic e s
re c e iv e d had r i s e n f a s t e r th a n p r ic e s p a id by th e ra n c h e rs .
P ro s p e c tiv e CIianges and Problem s f o r F u tu re Study
One o f th e m ost im p o rta n t tr e n d s s tu d ie d i n t h i s t h e s i s was th e
tr e n d tow ard th e m a rk e tin g of c a lv e s .
W hile th e tre n d tow ard a co w -calf
b a s i s o f o p e ra tio n a p p ea rs to be th e m ost p r o f ita b l e a t th e p r e s e n t tim e
d u rin g a p e rio d o f fa v o ra b le ran g e c o n d itio n s , from a lo n g -ru n s ta n d p o in t
a o o w -calf o p e ra tio n i n th e P la in s i s v e ry v u ln e r a b le .
The g r e a t weakness
o f t h i s system i s t h a t d u rin g a s e r i e s o f d ro u g h t y e a rs t h a t a r e c h a r a c te r ­
i s t i c o f th e r e g io n , th e o n ly way t h a t a ra n c h e r has t o re d u c e h i s l i v e ­
s to c k numbers i s to l i q u i d a t e p a r t o f h is b re e d in g h e r d .^ S / T his i s
w hat happened to many o f th e ra n c h e rs who w ere o p e ra tin g on a co w -calf
b a s is i n th e t h i r t i e s .
Banohers who a r e ru n n in g s t e e r s and spayed h e i f e r s
i n a d d itio n to t h e i r b re e d in g h e rd a r e a b le to red u ce s to c k in g r a te s
q u ic k ly w ith o u t a s s e r io u s ly a f f e c t in g t h e i r f u tu r e e a r n in g s .
For th e s e re a so n s some o f th e more f a r - s i g h t e d o p e ra to rs may
s h i f t to t h e m ark etin g o f long y e a r lin g s o r p o s s ib ly two y e a r o ld s .
A
tr e n d i n t h i s d i r e c t i o n may q u ic k ly d e v elo p i f th e n e x t c o u p le o f y e a rs
/
j
sh o u ld be below norm al i n r a i n f a l l .
A nother f a c t o r t h a t may cau se a s h i f t back t o th e m ark etin g o f
o ld e r c a t t l e i s th e r a p id ly in c r e a s in g demand f o r more b e e f on th e P a c if ic
C oast caused by a r a p id ly expanding p o p u la tio n t h e r e .
3 2 / Jo h n so n , M. B ., Op. C it.
This in c r e a s e i n
*
85
m
demand h as a lre a d y been f e l t In aome p a r ts o f Montana i n th e form o f an
in c re a s e d demand f o r f in i s h e d beef*
U n lik e c a t t l e going E a s t m ost of
th e c a t t l e headed f o r th e C oast m ust be f in i s h e d and re a d y f o r s la u g h te r
a s th e r e i s no g r e a t f a t t e n i n g a re a i n th e West l i k e th e C o rn -B e lt.
I
A t th e p r e s e n t tim e i t does n o t a p p e a r t h a t t h i s demand w i l l
g r e a t l y a f f e c t th e ra n c h e rs i n s o u th e a s te r n Montana b e ca u se m ost o f th e
ra n c h e rs i n th e a r e a have l i t t l e o r no so u rc e o f home-grown fe e d a s id e
from th e ran g e and a few hay meadows w ith w hich to f i n i s h c a t t l e a t a
r e l a t i v e l y young a g e .
A re d u c tio n i n th e p r ic e of w heat r e l a t i v e to o th e r
g r a in s , (m ain ly c o m ) , and b e e f c a t t l e , t h a t would make th e fe e d in g of
w heat to c a t t l e more p r o f i t a b l e would do much to encourage th e f in i s h in g
o f more b e o f c a t t l e i n s o u th e a s te r n Montana f o r shipm ent to th e P a c if ic
C o ast.
A nother f a c t o r t h a t oould change th e type o f c a t t l e produced i n
th e a re a w ould be th e developm ent o f th e proposed i r r i g a t i o n p r o je c ts on
th e Tongue and Powder R iv e rs .
W ith th e developm ent o f th e s e proposed
p r o j e c t s , and th e s e c u rin g o f a r e l i a b l e su p p ly o f home-grown fe e d , i t
would become p o s s ib le t o f i n i s h more th e c a t t l e i n th e a r e a b e fo re
sh ip p in g them t o m a rk e t.
Land Tenure and Use
P ro b ab ly th e m ost im p o rta n t change t h a t has ta k e n p la c e i n th e l a s t
tw e n ty -fiv e y e a rs i s th e in c re a s in g c o n tr o l th e ra n c h er h as o v e r th e ran g e
he u s e e .
This c o n tro l h as r e s u l t e d from two f a c to rs *
( I ) Use o f th e
P u b lic Domain has been p la c e d on a le a s e o r p erm it b a s i s .
have more th a n doubled i n th e amount o f deeded la n d .
(2 ) The ra n c h es
— 86 •
The q u e s tio n o f mtiiether th e ranchos w i l l te n d to c o n tin u e to
in c r e a s e i n s i z e in th e f u t u r e , and i f so a t what r a t e w i l l th e y in c r e a s e
i n s iz e w i l l depend to a la r g e d e g re e on w hat p o lic ie s th e government
fo llo w s in th e f u tu r e a d m in is tr a tio n o f th e range#
I f th e government
sh o u ld d e c id e t o s e l l p a r t o f th e P u b lic Domain t h a t i s now b ein g used
u n d e r th e T aylor G razing A c t, th e a c re a g e o f deeded land on th e ran ch es
s tu d ie d would te n d to in c r e a s e ; th e r e would p ro b a b ly b e v e ry l i t t l e i f
any in c r e a s e i n anim al u n i t s run i f t h i s sh o u ld happen a s th e ran g e i s
c a r ry in g ab o u t w hat i t should a t th e p re s e n t#
I f th e government should
c o n tin u e t o a d m in is te r i t s range a s i t i s d o in g a t p r e s e n t l i t t l e change
would p ro b a b ly o ccu r i n u se o f th e ran g e e x c e p t to v a ry li v e s t o c k numbers
i n a c c o rd w ith c lim a tic changes#
In re g a rd to a c q u ir in g more deeded la n d o th e r th an from th e fe d ­
e r a l governm ent, th e tr e n d i n th e p a s t tw e n ty -fiv e y e a rs w i l l p ro b ab ly
c o n tin u e b u t a t a v e ry g r e a t l y reduced r a t e .
P r a c t i c a l l y a l l of th e sm a ll
uneconom ical hom estead t r a c t s t h a t co u ld be purchased have a lre a d y f a l l e n
in to th e hands o f th e ra n c h e r s .
The o n ly rem aining so u rc e o f la n d t h a t
may be pu rch ased i s th e p o s s i b i l i t y t h a t many o f th e sm all ran ch es ru n n in g
l e s s th a n a 150 anim al u n i t may be fo rc e d o u t o f b u s in e s s i f a n o th e r s e r i e s
o f y e a rs when p r ic e s f o r b e e f b e g in to f a l l tow ard a more "norm al" l e v e l .
A pproxim ately 75# o f th e ra n c h e s in s o u th e a s te r n Montana a r e o f l e s s than
150 anim al u n i t s in s i z e 5 5 / which i s c o n sid e re d to bo ab o u t th e minimum
s iz e o f ranch t h a t i s cap a b le o f y ie ld in g a "minimum Com jbrtn s ta n d a rd o f
3 3 / Compiled from U n ited S ta te s Census o f A g r ic u ltu r e , 19^5#
- 87Of oourso some of th e ra n c h es w i l l p ro b a b ly combine w ith o th e r
u n i t s t h a t a r e to o s m a ll, and w i l l form an econom ical u n i t ; th e r e f o r e n o t
a l l o f th e s m a lle r ran ch es t h a t s e l l o u t w ill go to th e l a r g e r a lre a d y
e s ta b lis h e d ran ch es such as th o s e t h a t composed t h i s s tu d y .
F u tu re H et Income E x p e c ta tio n
One th in g t h a t a p p ea rs c e r t a i n i s t h a t th e n e t income re c e iv e d
by th e ra n c h e rs i n I 9I46 re p r e s e n ts an a l l tim e h ig h and w ill n o t c o n tin u e
a t i t s p re s e n t l e v e l .
P r ic e s re c e iv e d b y th e ra n c h e rs i n th e f u tu r e w i l l
u n d o u b ted ly d ro p , b u t p r ic e s p a id b y th e ra n c h e rs have a ten d en cy to drop
much more slo w ly .
The sq u eezin g a c tio n caused by t h i s s h i f t i n p r ic e
r e l a t i o n s h i p w i l l te n d t o remove much o f th e p re s e n t day h ig h n o t incom e.
A b ig q u e s tio n c o n fro n tin g th e o p e ra to rs i n th e f u tu r e w ill be
how to m eet th e in c re a s e d f ix e d c o s ts b ro u g h t on by in c re a s e d in v e stm en ts
i n la n d and m achinery i n th e f a c e o f f a l l i n g p r i c e s .
The answ er to t h i s
q u e s tio n w i l l be i n a la r g e degree up to th e in g e n u ity o f th e managers In
re d u c in g t h e i r v a r ia b le c o s ts to th e minimum and o p e ra tin g a t t h e i r maxi­
mum p o s s ib le e f f i c i e n c y .
Some f a c t o r s t h a t w ill h e lp them do t h i s a re
t h a t as a r u le th e ra n c h e rs a re r e l a t i v e l y f r e e from d e b t a t the p re s e n t
tim e .
They have th e f ir m e s t c o n tr o l o v er th e la n d re s o u rc e s t h a t th e y
u se s in c e ran ch in g was s t a r t e d i n M ontana, and due to a more c o n s e rv a tiv e
u se o f th e ra n g e in th e p a s t te n y e a r s , th e ran g e i s more p ro d u c tiv e th a n
i t has been f o r a good many y e a r s .
p . 18.
Vfhils th e e x a c t v a lu e o f th e s e f a c to r s
3 h / S aunderson, M. H* R ead ju stin g Montana *s A g rle u ltu r e . Op. C it.
— 88 —
a r e n o t known, and a r e p r a c t i c a l l y im p o s s ib le to m easure, th e y do re p re ­
s e n t f a c t o r s o f reduced r i s k s which have alw ays p lag u ed th e ra n c h e rs i n
th e p a s t .
These p o s s ib le f u tu r e tr e n d s t h a t have been d is c u s s e d b r i e f l y
h e re i n th e l a s t few pages may c r e a te problem s t h a t w i l l c o n fro n t th e
ra n c h e r i n th e f u t u r e .
On th e b a s is o f t h i s s tu d y , what w i l l happen i n th e
f u t u r e and how th e s e problem s w i l l be so lv e d w ith th e g r e a t e s t b e n e f it f o r
th e ra n c h e r and s o c ie ty i s n o t a n sw e ra b le .
a s th e b a s is f o r f u tu r e ra n c h in g s t u d i e s .
These problem s m ight w e ll s e rv e
— 89 —
APPENDIX A
TABLE I . INDEXES OF PRICES PAID AND RECEIVED
BY MONTANA RANCHERS IN 192k, 1929, 19kO, and 19k8.
(B ase P e rio d J a n u a ry 1935 » December 1939 ■ 100)
Y ea r
Item
192k
1929
19k0
19k8
A lf a lf a Seed
95
117
80
182
B eef C a ttle
89
191
123
3k8
G rain
125
108
73
2kk
Hay
109
126
58
189
77
78
88
90
Lamb
lk 2
158
108
29k
Sheep
175
189
Ilk
221
M isc. P ro d u cts
13k
133
93
270
Item s S o ld V
H orses
In v e stm en ts and PurchasesV
Equipment and S u p p lie s
120
123
99
168
Farm M achinery
101
100
100
160
Feed
131
13k
9k
2k6
I n t e r e s t P aid
131
118
98
91
L eases
132
131
100
153
R eal E s ta te
Ik k
135
102
190
Taxes
120
128
89
136
Wages
Ik l
153
107
367
Source —
D ata Compiled From:
l/
7/
H alcrow, H. G ., and G re e r, P . J . , Op. C l t .
A g r ic u ltu r a l S t a t i s t i c s , 19k8, Op. C i t .
90
APPENDIX B
TABLE I I . AVERAOS OPERA.TINO COSTS PER AKIMAL UNIT
ON TWENTY-ONE CATTLE RANCHES IN SOUTHEASTERN MONTANA, 1921*-146
(A ctu al C o sts)
Ye a r
O p e ratin g C osts
192U
1929
191*0
191*8
1 .7 9
3 .7 7
3 .0 8
6 .3 7
.3 0
• 57
.1*8
2.1*0
1 .2 1
l.U l
I*. 51
10.35
L eases
.9 3
1.1*7
1 .8 5
2 .3 5
Taxes
1 .5 6
1.81*
2 .0 1
3 .0 0
D e p re c ia tio n on B u ild in g s and M aohinery
1.2 8
1.3 3
1 .9 3
4 .1 9
I n t e r e s t P a id on Debt
1.7U
1.03
1 .3 2
.51
Total Operating Cost
8.1,1
11.1*2
15.18
29.67
P a id Labor i /
Feed, S a l t and M ineral P urchased
G eneral Expenses t /
\ J In o lu d e s c o s t o f b o a rd in g h ir e d la b o r .
2 / In o lu d e s p u rch ases o f g a s , o i l , sm all t o o l s , hardw are and
o th e r g e n e ra l s u p p lie s .
91 BIBLIOGRAPHY
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MONTANA, B u i. 265, June 1932, Montana S ta te C o lle g e , A g r ic u ltu r a l
E xperim ent S t a t i o n , Bozeman, M ontana.
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Mimeo. C ir c u la r $ 1 , A p ril 1949, Montana S ta te C o lle g e A gri­
c u l t u r a l E xperim ent S ta t i o n , Bozeman, Montana.
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in g th e round t a b le d is c u s s io n o f t h a t problem a t th e m eeting o f
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CATTLE RANCH, November 1945, U npublished M an u sc rip t, Montana
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92
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M ontana.
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L ib ra r y , Montana S ta te C o lle g e , Bozeman, Montana.
S aunderson, M .H., and C h itte n d e n , D.W., CATTLE RANCHING IN MONTANA, B u i.
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O ffic e , W ashington, D.C.
- 93
ACKNOWLHmKSNTS
The a u t h o r w is h e s t o e x p r e s s h i s t h a n k s and a p p r e c i a t i o n t o
Dr* M* M* K e ls o f o r h i s a s s i s t a n c e , c o u n s e l a n d e n c o u ra g e m e n t th r o u g h ­
o u t th e s tu d y .
T hanks i s a l s o d u e t o M r. Roy B. Hufflman a n d M r. Gene
P ay n e f o r t h e i r s u g g e s t i o n s a n d e d i t i n g o f t h e m a n u s c r i p t ; t o D r. H .G .
H a lo ro w f o r h i s s u g g e s t i o n s a n d h e l p on some o f t h e t e c h n i c a l p r o b le m s ,
a n d t o t h e g e n e r o u s c o o p e r a t i o n o f t h e r a n c h e r s who s u p p l i e d t h e i n f o r ­
m a tio n t h a t made t h i s s t u d y p o s s i b l e .
M a rth a R ic e f o r t y p i n g t h e m a n u s c r i p t .
R e c o g n itio n i s a l s o d u e t o M rs.
MONTANA STATE UNIVERSITY LIBRARIES
762 1
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