As Paul Beck speaks at numerous cattlemen meetings, the topics covered make it clear that Arkansas is a cow/calf state. As such, “we have to plan research that's applicable to most cattlemen,” said Beck, a University of Arkansas Extension animal scientist. “A lot of people hear what I have to say about stocker cattle operations and (how they can) apply to the cow/calf producer as well.
“Whenever we look at profitability — what economists call enterprise budgets — of cow/calf herds, there's usually a net loss of $100 per cow,” said Beck at the Livestock and Forestry Branch Station field day outside Batesville, Ark. “Much of that $100 loss could be made up through changes in marketing and by adding value to the calves through (things like) backgrounding and selling pre-conditioned cattle.”
A traditional way to cover such losses is to add value by retaining ownership and selling larger animals instead of freshly weaned calves.
Most calves in Arkansas, as in most of the Southeast, are weaned in the fall. That means one can expect “a pretty good decrease in the annual price of these calves if sold at weaning. One of the easiest ways to make money as a stocker producer is to buy low and sell high — catch an upward trend in the market. By buying cattle in the fall or retaining calves weaned in the fall, you'll sell into a spring market at what is normally a higher price.”
Also, producers must have the lowest cost of gain possible, whether with forages or blending of byproduct feeds. But to get the low cost of gain normally requires a lengthy grazing period.
As the fall grazing period is longer than spring's, Beck urges cattle producers to consider changing grazing periods. “If you have cattle put out in November for 100 days through mid-March, you'll put more gain on those calves than those put out in March that then have to be moved in May. That's a 60-day grazing period compared to 100 days.”
Some of the cheapest pasture available is Kentucky 31 fescue, a perennial cool-season forage. Beck urges caution when selecting forages for cattle with different nutritional requirements. “We can get acceptable production and not have to spend a lot of money. That's not true with stocker cattle. It's cheap to raise an acre of Kentucky 31. It's a stable plant. You can mismanage Kentucky 31 and it won't disappear from the pasture. However, the downside is you don't get acceptable production with stocker cattle grazing Kentucky 31.
In one study, Beck and colleagues have looked at tillage.
“There are three types where we went as cheap as possible or with an involved conventional tillage route. That runs from about $50 to $120 per acre just to plant and get it established. Adding in the fertilizer makes it an expensive resource.
“The benefit is if we get good fall grazing — which isn't automatic every year — that means good fall and spring gains. It can lead to about 500 pounds of gain per acre. That helps offset the cost of the cattle and establishment of the grass every year.”
A serious downside to Kentucky 31 fescue is it contains endophytes that produce alkaloids. These result in decreased blood flow to the extremities, making it difficult for cattle to regulate body temperature. As a result, they can't reduce heat load in summer or retain body heat in winter. This can lead to death, extremities falling off and other problems.
The biggest cost to stocker producers, though, is the reduction in performance with the Kentucky 31. “These fungal ergot alkaloids enable the tall fescue to be highly persistent in harsh conditions.”
Enter a relatively new resource: novel endophyte fescues. “Endophytes have been discovered that don't produce, or produce very little, ergot alkaloids. These novel endophytes have been promoted to combine the advantages of plant persistence with the increased animal performance of fescues not containing the endophytes.”
Included in Beck's tests are two types of novel endophyte fescue (Max Q and HiMag 11), Kentucky 31, and a small grain (wheat and rye) treatment. “For the last couple of years, we stocked these pastures with 1.5 calves per acre in the fall.”
The researchers were able to begin grazing almost two months ahead of time on the tall fescue compared to the annual. That's two extra months “we wouldn't have had to feed a calf normally weaned in October.”
At the end of grazing the first year the cattle were pulled off because they ran out of grass in the tall fescue pastures on Dec. 23. The small grains pasture was able to hold cattle through Jan. 23.
“We got 98 grazing days with the tall fescue compared to 72 grazing days with the small grains.”
Beck and colleagues stocked all pastures with 2.5 calves per acre in the spring of each year. The first year of the study, the cattle began grazing on March 17 and were able to graze the tall fescue through July 8.
“We had 113 grazing days with the Kentucky 31 and novel endophyte fescue compared to 56 grazing days with the small grains. We didn't have nearly as good a wheat pasture during the second year of the study.”
Cattle were put out on the tall fescue pasture — both novel endophyte and Kentucky 31 — on Nov. 4. It was early December before cattle were put on either the small grain treatment or ryegrass treatment.
For all these treatments, grazing ended on Jan. 6. That meant 63 grazing days on the tall fescue and only 35 days on the small grains and ryegrass.
“That was one of those years when establishing annuals, we couldn't get them up and growing. Everything seemed against us. When looking at the average daily gain, we probably shouldn't have even tried to utilize winter grazing with the small grains.”
In spring of the second year, the study began on March 18. Cattle were able to graze the fescues until June 6.
“With the small grains, our normal pull-off date — and it worked out about the same every year — was from early to mid-May. That provided 55 days of grazing.”
When looking at average daily gain during the first year, the fall calves on Kentucky 31 gained 1.2 pounds per day. “That's not too bad. It only costs $67 per acre to fertilize the Kentucky 31.”
But the calves on the novel endophyte fescues gained 1.75 pounds per day. “So we lost a half pound of gain in the winter when everyone claims the effects of the endophyte are much lower.”
Calves on small grain pastures gained nearly 2.5 pounds per day — an “excellent” performance.
In the spring, calves got a pound less gain per day on the Kentucky 31 than on the novel endophyte fescues and small grains. “It begins getting hotter in the spring and the calves can't handle the heat as well. That 1 pound loss is a tremendous difference.”
In the fall the second year, the cattle had a 1.4-pound daily gain on Kentucky 31. With nothing to compare to, “many folks would be pretty pleased with this. Looking at the novel endophytes, calves gained over 1.9 pounds per day. Once again, because it was a poor year for small grains, calves on that gained only about a pound daily.”
In the spring, there was a pound of difference in average daily gain between the Kentucky 31 and novel endophyte tall fescue.
“We got between 2 and 2.5 pounds per day gain with the small grains and ryegrass. That indicates the quality of those pastures. But without the good fall grazing, we didn't have enough gain to make up for the cost of establishing the pasture.”
Individual animal performance is very important in offsetting the costs of animal ownership. But there are also costs associated with pastures. “So you must look at gain per acre when making a decision to change management or pasture.”
In the first year, the Kentucky 31 showed 461 pounds of gain per acre. “That's pretty close to what we normally see with small grain pastures. A lot of years, we see 400 to 500 pounds gained per acre. Only in an exceptional year do we see 600 pounds of gain.”
With the novel endophytes, “because we're able to graze them longer and put a relatively high amount of gain on the calves, we were able to get nearly 825 to 830 pounds of gain per acre. That's tremendous.”
In the second year, because of poor grazing in the fall, cattle on Kentucky 31 only gained 125 pounds per acre. Gains on small grains were about 300 pounds per acre. The ryegrass and novel endophyte fescues showed gains of around 500 pounds per acre.
Now in the third year of the tests, “we can predict the Kentucky 31 (cattle) will gain about half a pound less per day than (those on) the novel endophytes. Research in Georgia and Alabama and other spots have shown the same.”
Cattle on the MaxQ novel endophyte tall fescue gained about 2 pounds per day. But last summer a major drought stressed pastures. Some of the HiMag11 novel endophyte tall fescue was reduced to less than a 50 percent stand. So, last fall, calves on the HiMag gained only about 1.75 pounds. That's better than the Kentucky 31 but “wasn't nearly as good as if they'd had a full stand of novel endophyte fescue.”
For the first 28 days of the test this spring it's been unseasonably warm. The cattle on the Kentucky 31 have gained only .27 pound per day. “They just look bad. They weren't gaining anything yesterday. (With dded stress and heat loads) it isn't uncommon to lose a calf from the Kentucky 31 pastures. That's a very big detriment when grazing high-dollar cattle.”
The HiMag11 and MaxQ cattle gained about 1.5 pounds and 2.1 pounds per day respectively. Cattle on small grains and ryegrass gained over 3 pounds per day.
“So the performance on the annuals is excellent and should be for the next two or three weeks. But remember, you're dealing with only a short period in the spring to offset the costs.”
Gain per acre last fall was only 199 pounds on the Kentucky 31 compared to 270 pounds on the MaxQ, small grains and ryegrass.
The last three years have included a good small grain year, a bad small grain year and a dry, open year. The study has been conducted in many conditions that provide the same story: “Kentucky 31 isn't very good stocker forage. And looking at the numbers, annuals are as productive for stocker cattle as anything you can plant. But with a perennial, the cattle will gain about 2 pounds per day — comparable to the cattle on annuals. There's a huge advantage to that.”
During the first year when researchers began looking at profit per acre — assuming about $67 for pasture costs on the Kentucky 31 plus all the expenses of cattle ownership — the cattle on Kentucky 31 profited only about $5 per acre. The small grains made about $1 per acre. The novel endophytes showed a profit of about $150 per acre.
So, “although it costs about $230 per acre to plant (a novel endophyte fescue), if you can spread the expense over several years you can pay it off pretty quickly.”
During the second year, a horrible year for small grains, “we were still able to make $40 to $50 profit per acre with the novel endophyte fescues. That's compared to losses of $81 per acre with small grains and $150 per acre with Kentucky 31. Ryegrass showed a profit of about $10 per acre.”
The planting cost of $230 per acre for novel endophyte assumes a producer will get about $100 worth of hay off the pastures in the first year. Averaging just the first two years shows about a $95 per acre profit.
Looking at old class notes, Beck came across this: “If you expect an improvement to be permanent, do it over 20 years.”
Using a 6 percent discount rate over 20 years (so future dollars will reflect what they're worth currently), the novel endophyte pasture will still owe the producer $140 at the end of the second year. At the end of the third year, it owes about $54.
“But by the end of the fourth year, we've paid for establishing the pasture. At the end of 20 years, the cumulative net return from the operation is $840. That's about $1,100 from profit on the cattle to pay for pasture improvements.”
Beck says to go from a tall grass prairie to a bermudagrass — even with good management in western Oklahoma — never pays for itself. Most of the time replacing a permanent stand of grass with another will never show a true profit.
“In my mind, getting the change paid for in four years is a dramatic example of how much better this new technology is for stocker cattle — especially compared to Kentucky 31. You've got the advantages of high performance and low cost of pasture because it's a perennial. That takes care of the disadvantages of Kentucky 31 (it's cheap, but lacks high performance) and the small grains (which provide high performance, but are expensive).”