Tag Archives: ranch

Selecting Land

My good friend, Greg Judy, who actually has a Youtube channel to which you can subscribe for his interesting and informative videos about farming/ranching and a whole host of other topics related to profitable cattle and sheep farming, has offered up some key points for considering land purchases for your specific goals.

Greg’s check list when selecting a farm.

The check list really hasn’t changed in considerations for the purchase throughout history.

Cato’s list has more detail and although he uses the word ‘folly’ in what other people build (like barns for livestock), it can be used in your favor should you need a new or nice home or are considering a dairy operation or some such. Yet, the basic consideration is, does my operation actually require the use of a high maintenance, taxable building which sits empty most of the year.

Buying undeveloped land may seem less expensive, but bear in mind the high cost of making it livestock worthy (or whatever it is you will use your land for). Perimeter fencing is expensive made even more so if hiring a bulldozer to clear the fence rows first is necessary.

As we get older, land which may be more expensive yet closer to a hospital or at least a sealed road will likely become more important.

If you are so fortunate to find a reasonably price parcel in the location important you, with limited buildings, then don’t wait because someone else will buy it. Desirable parcels of property are snapped up very fast. My observations of looking for properties, indicates that poor properties are offered at ridiculous prices just hoping for someone to bite; quality, in-demand properties will sell immediately and land auctions are becoming more popular due to immediate sell and they are bringing a premium price.

If the neighbours aren’t interested in the property and it has been languishing on the market, that is a red flag that something is wrong – do in depth research. Oftentimes, it can be high taxes, poor production values, swampy land, no water, low rainfall, the lay of the land requires constant maintenance (i have a 160 like that, every little rain causes my deep watergaps to blow out, fighting encroaching brush is an annual and long days event)

My personal search requires:

  1. enough acreage in one block location with minimal perimeter (in other words more squarish, not nooks and crannies. one property online had 11 miles of perimeter to maintain yet enclosing only 1700 acres!)
  2. A nice home which has been built with finishes which stand the test of time. Too many homes from the 80s and 90s and so faddish inside, it needs to be completely gutted and redone. May be better to tear it down and start again. Not out of the range of possibility, just be sure you aren’t paying twice for a new home.
  3. Live water with no or little flood plain.
  4. Located on a sealed road with minimal traffic
  5. Near infrastructure to livestock auctions and other supportive ranch venues
  6. Warm winters, warm winters, warm winters – did i mention warm winters?!
  7. Minimal timber and very little brush.
  8. I would like to not be close enough to neighbors to hear or see them, but within 2 hours of a major airport.
  9. Price is critical – i’m not rich – the ranch i buy must find a way to pay for itself or at the least provide a good rate of return. This is nearly impossible in today’s environment where there is very little low risk good investment. Land is in too expensive for its productive value.

Intentional Beef Producer

Robert Wells, Livestock Consultant with the Noble Research Institute offers his idea of 8 characteristics successful, intentional producers share.

For the full article go to: Do You Possess the 8 Characteristics of an Intentional Beef Producer? as published in the January 2020 issue of Noble News and Views.

To keep me focused, i like to reduce the lengthy description of characteristics to 8 bullet points.

  1. Understand the importance of recordkeeping. The key is to keep records that are meaningful and that you will use to make management decisions. Identify key production and economic metrics you can use to monitor your operation.
  2. Know animal nutrition management can make or break an operation. The feeding program can account for 40% to 60% of the total annual cost of maintaining a cow in most operations. Match the cow’s time of highest nutrient requirements – early lactation or around 2 months of calf age – to the time of year when the pastures supply the highest-quality and quantity forage of the year.
  3. Know when and how to market calves. Determine the type of animal you will sell and when you will sell it. No matter how large your outfit is, it can still benefit from selling in a market that has more cattle similar to yours.
  4. Have a defined outcome for the ranch breeding program. Make sure the calving season is as tight as possible, ideally 60 days or less. If you are a commercial producer, consider the value of heterosis and the advantages built into a well-defined and thought-out crossbreeding program. Identify which individuals which will help reach your goals.
  5. Have a comprehensive herd health program. Work with your veterinarian to develop a comprehensive vaccination and herd health program. If you do not have documentation, you cannot prove how your cattle were immunized.
  6. Optimize stocking rate and pasture management. Forages in various paddocks need appropriate rest periods. A cost effective grazing principle is to use standing dormant forages instead of hay during the dormant season.
  7. Develop a ranch management calendar. The management calendar should include the following dates: bull turn-in and pickup (hence subsequent calving dates), weaning and marketing dates, when to work calves for vaccinations, when to conduct breeding soundness evaluations (for bulls, cows, and heifers). Evaluate and plan the grazing program, knowing that changes will be necessary as the year progresses.
  8. Remain flexible. Above all else, an intentional producer will learn to be flexible, since so many variables are out of one’s control. Having a plan, working the plan, but pivoting as needed.

Mineral Tub

Many people can really problem solve – oftentimes, problem solving happens using tools at hand and at the moment.  May not be perfect, but the creativity involved in taking mental inventory of what tools you have with you and laying them in such an order no where close to what they are designed for illustrates the amazing thought processes of the human mind.  Truly, that is not an accident but a purposeful design of our Creator.

Well, with that lead in, you’d think i would share something just truly amazing and complex, yet it’s not.  Simply using junk we have around the barn fashioned in such manner to solve a problem i personally have.  Our 3 compartment mineral pans are somewhat heavy and certainly cumbersome, so i choose to never pick it up to move it.  Obviously, if there is kelp, salt, and phosphorus inside totally negates that proposition.  I had made a previous drag design, but it would only last about 16 months.  Hoping this new design will last much longer.

For years, we’ve been using a 3 compartment mineral tub.  In mine, i use YPS free salt, Thorvin Kelp, and Agri-Dynamic‘s Grazier’s Essential in the 1:2 ratio (Ca-Ph).*  All free choice.

Although the mineral tubs empty are not super heavy, they are bulky and awkward to lift and load and if there is any product still inside, it’s virtually impossible for me to load it.  So, years ago, i came up with a way to move it without lifting it instead by dragging.  After about 3 years, i’ve given up with the first method i invented because it kept failing about once a year and i’d need to rebuild it, so, i came up with a new plan.  Simpler and easier to replace or repair should the need arise.

  • i purchase the salt from ……, the kelp from Welter Seed & Honey, and the Calcium-Phosphorus mix from Agri-Dynamics north Missouri representative Shan Christopher
  • MISSOURI DEALERS/DISTRIBUTORS

    Rafter C. Ranch, Distributor

    Shan Christopher1441 SE Hwy 116

    Polo, MO 64671

    816-519-8512

    sjdchris@greenhills.net

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I cut a flat piece of old plastic  from a trashed calf feeding trough.  the flat piece is slightly larger in diameter than the mineral tub so that i can bolt it through the sidewall of the tub onto the plastic.  i cut old baling belts for the straps and use carriage head bolts so it will pull smoothly.

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I still use a short chain with a large ring at one end and a heavy duty carabiner clip on the other for quick hookup.

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Bolt old pieces of baler belts from the mineral tub to the plastic drag.

Mineral tub kelp

Mineral tub with salt

Mineral tub with Phosphorus

No One Owes You A Living!

 

The world, including the US, does not owe you a living. Or as Dave Ramsey would say, “You Are NOT Entitled To Anything“. If you dream to make a widget and insist that everyone must support you in your dream and insure that you make a full time living making that widget, then i fear you may be sorely disappointed.  Especially, if your widget making imposes on others’ freedom and property rights.

There are very few, if any, financially successful people with no debt and have, or are building wealth, working only one job.  Often the most successful have at least 2 or 3 other gigs on the side going.  (Even Warren Buffet has several unrelated income streams going!)  When you are in your teens, twenties, and even into thirties, you have energy, vision,  and motivation that enable you to put in 10-16 hours a day, 6 days a week.  This allows you to save, build equity, and work towards your dream job if you aren’t already doing that.  When you are older and that energy level drops, hopefully those side gigs are the money invested which are then working for you rather than you working for it.

I recently wrote a blog which told of the near impossibility of a person to get into farming or ranching these days.  This is largely due to the out of balance cost of land vs its productive value.  However, it is not yet impossible to farm and build wealth – even without incurring massive debt!  It may take longer, however.  And, i know of absolutely no one – young or old, in the present or in the past- who can farm or ranch (or any other business for that matter) full time without some sort of side gig.  Read stories of old timers – they were blacksmiths, carpenters, mechanics, traders, transportation specialists, suppliers; any skill they could put to use for pay was engaged.  Wives farmed alongside their husbands, raised the children, and often had a couple side gigs as well.  (Yes, i know that many women are farmers and ranchers, i am one, but also raised my own children, managed the household, and help with the farm.)  It is the same today – if you want to farm (or start any business for that matter) you’d better put a sharp pencil to how you’ll put food on the table and a roof over your head.  Don’t incur debt and make sure you have some savings.  (a borrower is always slave to the lender).  Operational farm debt is as bad as school loans.  Debt for building  a depreciating asset may be the worst of all!  What if something happens to you?  make sure you have plenty of life insurance!  Liability, maintenance, disease, accident associated with buildings and machinery are expensive and ongoing.  Once debt is incurred for a single purpose gadget, you have to keep it going or you may default or leave your family with a ball and chain which seldom adds value (it may actually devalue) to your property. Better yet, don’t go into debt.

Keep your paying job and save your money before you buy a single acre or cow or gadget. Many ranchers today are leasing both land and cattle which can be a great way to get started with very little investment or risk.  Best book i’ve read on this is Greg Judy’s book, No Risk Ranching.  Maybe you won’t have the exact same opportunities that Greg has, but use your imagination – maybe you’ll have to move – as Allan Nation, founder and former editor of Stockman Grass Farmer, used to say, “Everyone has an unfair advantage.”  Figure out yours and put your best foot forward.

Many farmers today still abide by the ways of Earl Butz to ‘get big or get out’ and we now have such an abundance and overproduction of all products that prices continue to slide.  Yet, the mantra continues to be ‘produce more’  and use the economy of scale to maximise profits.  That may good to a point, but the cost to the environment has been substantial by farming ‘fence row to fence row’  and with government subsidies now firmly entrenched there is less risk of a ‘failed crop’ resulting in going broke regardless of debt load or lack of wise financial planning.

I’m not espousing a return to farmers falling out due to the vagaries of weather, political machinations, or burdensome regulations.  Without subsidies, food, fiber, energy prices could soar to the level of parity and the consumer would certainly cry ‘foul’.  But, we all must remember that the economic  rule of supply and demand may cause us to consider better management practices.

There is the concept of focusing on profit rather than production.  If it is possible to make more money producing 120 bushel corn to the acre rather than 200 bushels to the acre, would that be something to consider?  what is the cost to the land and quality of life to produce 200 and even 300 bushels to the acre?  Can i do a better job of regenerating and improving the soil i have to increase pounds, bushels per acre and lower cost as well?  There are a lot of opportunities and new/old practices to learn – the hard part is keeping it simple and CHANGE!  This is a head issue – don’t be a stiff necked people.

Speaking of quality of life – how have you organised your dream?  does it enhance and edify others?  or detract from the lives of others?  is it sustainable?  is it regenerative?  can you keep doing this for the next 60 years?   If not, it’s not sustainable and you had better have a plan in place for the future, less strong, less energetic you.  Will your model rely on unpaid labor of yourself or your family?

Happy Planning!

 

Proverbs 6:

1My son, if you have put up security for your neighbor, have given your pledge for a stranger, 2if you are snared in the words of your mouth, caught in the words of your mouth, 3then do this, my son, and save yourself, for you have come into the hand of your neighbor:  go, hasten,a and plead urgently with your neighbor.

4Give your eyes no sleep and your eyelids no slumber; 5save yourself like a gazelle from the hand of the hunter,blike a bird from the hand of the fowler.

6Go to the ant, O sluggard; consider her ways, and be wise. 7Without having any chief, officer, or ruler, 8she prepares her bread in summer and gathers her food in harvest.

9How long will you lie there, O sluggard? When will you arise from your sleep? 10A little sleep, a little slumber, a little folding of the hands to rest, 11and poverty will come upon you like a robber, and want like an armed man.

12A worthless person, a wicked man, goes about with crooked speech, 13winks with his eyes, signalsc with his feet, points with his finger, 14with perverted heart devises evil,
continually sowing discord; 15therefore calamity will come upon him suddenly; in a moment he will be broken beyond healing.

16There are six things that the LORD hates, seven that are an abomination to him:
17haughty eyes, a lying tongue, and hands that shed innocent blood, 18a heart that devises wicked plans, feet that make haste to run to evil, 19a false witness who breathes out lies, and one who sows discord among brothers.

 

Old, Stupid, and Lazy?!

I know I promote Dave Pratt and his Ranching for Profit video blogs a lot and, even though i don’t agree with him on many points, there are a lot of good points he eloquently describes which are applicable to any business – not only ranching.

I’ve ’bout got my hobby farm to the ‘old, stupid, and lazy’ stage, but gracious, how could i attract anyone to cover for me if they thought i was needing someone old, stupid, and lazy ?  😀

Here’s another great one!

Cheapest Ranch to Buy Part 2

The second part of Jim Gerrish‘s excellent article and how to not only make your farm or ranch more profitable, but also improve soil, grazing, water, and wildlife.Building electric fence in rough countryJim Gerrish

In most locations, single-wire electric fence and water facilities are the main costs for improved grazing management.

What is the cheapest ranch you will ever buy? Part II

For a fraction of the cost of purchase, most ranches can make improvements that sometimes double their carrying capacity.

Jim Gerrish 1 | Aug 12, 2019

In Part 1 of this series, I made two fundamental assertions: The first was that time management of grazing period and recovery time is the primary determinant of pasture productivity. The second is that we should be assessing ranch output and profitability on a per-acre basis not on the per-animal basis commonly used in the ranching industry.

I ended that article with the observation that increasing pasture or range production by 40% would be more profitable than trying to increase individual animal productivity by 40%.

My 40% is not a magic number. It is simply the example I am using. I do that partly because of the commonly held idea that producing a 700-pound calf must be more profitable than raising a 500-pound calf. The other reason I am using 40% is because that is also a common level of increase in pasture productivity we see when ranchers implement management-intensive grazing (MiG).

MiG is the term I use to describe an approach to grazing management that is more intensive than the set-stocking or slow rotations common in the ranching industry. Our objective is to shorten the period of time any piece of pasture or rangeland is exposed to grazing animals. If we do this, the potential recovery period is always significantly extended. This is the key component of time management I have been referring to.

When we build subdivision fencing across the landscape of the ranch, we are not only subdividing space, we are also subdividing time.  Each time we make a smaller pasture increment, we reduce the amount of time the stock will be on that increment. That has a tremendous, and for some ranchers, an almost unbelievable change in the vigor and productivity of the pasture. With shortened grazing periods, we can more tightly control every aspect of the soil-plant-animal relationship. That is the component missing from almost all of the grazing management research of the last 100 years.

What is this management of time worth down on the ranch?

As mentioned above, the average increase in carrying capacity we see among our ranching clients adopting MiG and making investments in stock water development and subdivision fencing is about 40%. We have numerous clients who have doubled their carrying capacity. We have a few who have gotten less than 40%. All of this is the product of more effectively managing the period of time cattle are allowed to be in a particular area. On rangeland we usually work toward having that time period no more than 7-10 days. On productive pasture, we keep the length of the grazing period to no more than 3-4 days.

What does it cost to install all that fence, pipelines and tanks?

Every ranch is different, so of course the answer is that it depends! For example, is there already a good well on the property or do we need to drill a well? Is there already a pipeline network on the property that we can spur off of? Are there existing fences that are in reasonable locations that can be used in the new management scheme? These are the components that can make a difference. Here are examples from a couple of recent projects we have designed and which the ranchers implemented.

Jim GerrishA dozer pulling in water line.

Livestock water typically is the most limiting resource for managed grazing, but it is far cheaper than land.

Twice the ranch

On an 8,000-acre ranch in the Nebraska Sand Hills, we started a ranch that had 15-20 existing pastures with low-output windmills that allowed them to only carry 20-60 cows in each pasture. With a 7.5-mile pipeline project, 20 new stock tanks, and more than 20 miles of two-wire electrified high-tensile fencing, the ranch was split into about 60 permanent pastures with a stock-water supply system that allows 600-800 cows to be run in a single herd. The project cost was about $400,000 when we include the rancher’s labor contribution to the construction project. That is a big chunk of money, but on a per-acre basis it is only $50 per acre. In three years’ time, this ranch doubled its carrying capacity and the infrastructure investment was paid off in the third year.

That means they essentially bought another ranch for $50 per acre, while the cost to go out and actually purchase another ranch would have been $1,000 per acre, plus closing costs and added taxes.

Might double

Another recent project on a 30,000-acre ranch racked up an infrastructure development cost of about $1.1 million. That is a per-acre cost of about $36. Projecting a 40% increase in carrying capacity has the project paid off in year four. With a 40% increase in carrying capacity, the equivalent per acre purchase price is $90 per acre. I am confident this ranch will also experience a doubling of carrying capacity in 3-5 years, so the payoff rate should be accelerated. Why do I expect this ranch to double carrying capacity? Because the ranch is presently very under-supplied with stock water and much of the ranch is rarely even being grazed.

Remember the title on the article: “What is the cheapest ranch you will ever buy?”

It is the one you acquire by more effectively managing grazing and recovery time on the ranch you already own.

Read part one of this story here. Gerrish is internationally known grazier, grazing consultant and consultant. Find him at http://www.americangrazinglands.com.

 

Cheapest Ranch You Can Buy Part 1

Written by my friend, Jim Gerrish, for Beef Producer magazine:  This is Part 1

What is the Cheapest Ranch You Will Ever Buy?

Cows grazing Nebraska SandhillsAlan Newport
Changing the way we graze can dramatically alter the value and production of a ranch.

What is the cheapest ranch you will ever buy? Part 1

The value of grazing management cannot be overstated, author says.

Jim Gerrish 1 | Aug 09, 2019

Whenever a group of ranchers get together, sooner or later the conversation will turn to whose place just got sold and what did it bring. There will be some head shaking and bemoaning how you just can’t afford to buy another ranch or help your kid get started on a new place.

In much of the country, the price of ranch land is driven by non-ranching factors. People are paying way more for the recreational value or the view from the ranch than what livestock production can afford to pay.

There generally is a common-knowledge guide for how many acres it takes to run a cow in any neighborhood. Most people seem to believe this is a predetermined stocking rate that is determined almost entirely by the amount of rainfall received in any given year. The truth is, environment determines only the upper limit of the carrying capacity potential of a ranch. It is the ranchers grazing management that determines how much of that potential is actually realized.

The plain and simple truth of the matter is most ranches in the US are managed in a way that generally captures less than half of the biological carrying capacity of the ranch. The two primary ingredients for producing beef are sunshine and water. Most ranches are ineffective at harvesting these two “free” inputs. While sunshine and rain water are free ingredients, the landscape we use as our solar panel and water catchment is not free.

If we decide we need to increase the beef output on our ranch by 40% to generate the revenue flow we need to make a living, how might we go about doing that?

One obvious way is to buy another ranch that is 40% the size of our current holdings. If our current ranch is worth $1,000/acre and we have 1,000 acres, we would need to buy 400 more acres at $1,000 to get 40% more grazing capacity. That would be $400,000 outlay, plus there would be closing costs, an increase in taxes, and so forth.

The failed approach the ranching industry has taken has been the quest to increase output per individual cow by 40%. Rather than having cows that wean 500 pounds, let’s have cows that wean 700 pounds. The number of articles published in the last five years showing the folly of this approach is astounding. Go to the winter cattle production meetings and every one of them seems to feature a university researcher now showing big cows decrease ranch profitability, not the other way around.

A less obvious way to increase stocking rate is to get 40% more production out of every acre we currently own or control. Unfortunately, a lot of mainstream ranchers can only think of adding irrigation or more fertilizer or tear up the native range to plant some foreign wonder-grass. Is that really all we can do?

What if we found a way to capture more solar energy and water on every acre? How could we do that and what might it cost?

Let’s step back and ask why are most ranches operating at less than 50% of their biological carrying capacity? The simplest answer is there is too much bare ground. Bare ground doesn’t capture solar energy and make cow feed. Bare ground allows water to run off or set on the surface and evaporate. Why do most ranches have too much bare ground? Because cattle stay too long in the same place and pasture and rangeland are not allowed adequate recovery time to maintain plant vigor.

In 40 years of commercial ranching and grazing research I have learned the primary determinants of range and pasture productivity are:

  1. The amount of time stock are allowed to be on a particular piece of ground
  2. The time allowed for recovery

That local common-knowledge guide for how many acres it takes to run a cow is fundamentally flawed because it is based on management that completely ignores the role of time management on the nature of our soil health and plant community.

For the last 50 years the ranching industry and community focused on the animal and animal genetics, which misses the point that it is the land base controlled and the productivity of that land that drives ranch profitability, not individual animal productivity.

On a commercial ranch, most of our production costs are land-based costs, not animal-based costs. This is the reason why increasing the productivity of an acre of grazing land by 40% will always have much more impact of bottom line profitability than will increasing individual cow productivity by 40%.

Next week: Learn how to get that ranch production increase of 40% or more.

Gerrish is internationally known grazier, grazing consultant and consultant. Find him at http://www.americangrazinglands.com.