Production Paradigm

March 26, 2012 10:17 AM

The major shift in higher corn and feed prices is forcing producers to grow cattle on grass longer, said Derrell Peel, Oklahoma State University livestock economist, at Dow AgroSciences’ New Age of Forage seminar in January.

That doesn’t mean we’re moving to 100% grass-fed beef production, he explained. Instead, cattle will need to stay on pastures longer and go into the feedyards heavier to keep break-evens in check. Peel said the market signals will do that and provide opportunities for cow–calf and stocker operators with adequate forage. That is why the value of gain on forage is higher now than ever before.

"For the last four to fi ve decades, because grain was cheap, we have based production on ‘How can we get cattle to use more grain?’" he said. "For the coming decade, we are saying, ‘How can we produce higher-quality calves with the least amount of grain?’"

Major shifts will occur due to higher grain prices, says Jeff Geider, director of the Institute of Ranch Management at Texas Christian University. Producers will have to take a total resource management system approach to their operation, and forage production is the engine that drives the livestock industry. Producers will need to:

¦ determine which forages are adaptable to their currant grazing program and environment.

¦ find which "nontraditional" forage species can be introduced at comparable cost.

¦ manage the proper utilization of forage, adjusting stocking rates and livestock species.

¦ determine the types of grazing schemes that will optimize production.

¦ establish rotational grazing systems and allow pastures a resting period.

It’s not just corn prices that have increased—cattle prices are at record highs as well. Geider warns that doesn’t automatically translate into profi tability. "You still need to know where you are at. That starts with a realistic inventory of the farm and ranch, then developing detailed budgets and a clear management plan to allow for adaptability," Geider says.

"Sustainability will be a function of economic feasibility," he says. "Prolonged periods of grain- and haybased supplemental feeding will increase production costs. Farm and ranch overhead will continue to be a major component of cost of production." With these challenges come opportunities, he adds. "With a systems approach to total resource management, farms and ranches can capitalize on economically competitive forage-based livestock production."

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