Submitted to: American Forage and Grassland Conference Proceedings
Publication Type: Proceedings
Publication Acceptance Date: 1/21/1998
Publication Date: N/A
Citation: Interpretive Summary: Stocking rates imposed on pastures have a major impact on the economic stability of any forage-based beef cattle operation. Heavy stocking can provide high gain per acre, but heavier grazing intensities require increased inputs of fertilizer, grazing management, and weed control to maintain pasture growth and sustainability. Success in obtaining monetary yreturn with high stocking rates and pasture expenses may depend on economic condition of cattle markets. Hypothetical cattle markets, representing high and low markets, were established to evaluate buying medium-framed steers at 500 lb weights and selling at 800 lb weights. Different scenarios were evaluated that represented high, intermediate, and low stocking and pasture expenses. Trends in return above pasture expenses for high cattle markets indicated that high stocking rates and pasture expenses have the most potential in providing high return per acre during high cattle markets. For low cattle markets, the trends in return above pasture expenses indicated that low pasture expense is necessary to offset costs associated with animals (health, hay, and feed). Reducing stocking rates and pasture expense during low cattle markets is a possible option in minimizing financial risk.
Technical Abstract: Economic success and stability of any cattle operation depends heavily on the stocking rates imposed on pastures. The impact that stocking rates has on monetary return, however, likely depends on the economic condition of the cattle market. Hypothetical markets were established for buying steers at 500 lb weights and selling at 800 lb weights. High and low cattle markets were calculated by setting buying costs and selling prices at $100/cwt and $84.00/cwt for the high market, and $60/cwt and $50.00/cwt for the low market, respectively. Return above pasture expenses was examined for high and low markets with high stocking (.75, 1.0, and 1.25 acres/ steer) and pasture expenses ($85.66/acre), intermediate stocking rates (1.5, 2.0, 2.5 acres/steer) and pasture expenses ($40.58/acre), and low stocking rates (3.0, 3.5, and 4.0 acres/steer) and pasture expenses ($17.94/acre). Return per acre for the high cattle market generally increased with increases of stocking rate, even as pasture expenses increased. Although return per acre above pasture expenses for the low cattle market did not exhibit steady increases with stocking rate, stocking rate and pasture expense could be reduced with either slight increases or minimal losses in return. Reducing stocking rates and pasture expense during low cattle markets is a feasible option in minimizing financial risk.