EVALUATING LIVESTOCK ENTERPRISES WESLEY TUCKER AGRICULTURE BUSINESS SPECIALIST

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1 EVALUATING LIVESTOCK ENTERPRISES WESLEY TUCKER AGRICULTURE BUSINESS SPECIALIST

2 Tucker Farms Tunas, MO

3 MU Extension since 2001 My job is to help you make more money

4 SET UP FOR FAILURE I just inherited/bought 200 acres What can I do with it to make money? Compare all the different livestock enterprises available for a grass farm

5 SET UP FOR FAILURE

6 ENTERPRISES Cow-calf Stockers Goats Sheep Dairy Fescue Hay Alfalfa Hay Commodity vs. Value Added

7 COOL-SEASON GRASSES Forage Yield April June August October

8 LIVESTOCK OR HAY? Are you willing to be on call for your livestock 24/7 365 days a year? 2:00 AM to bottle a lamb Pulling a calf in freezing rain Getting a call at work that your cattle are on the highway Issues are never a convenient time Is a livestock sitter available? Will you forgo overnight trips & vacations Can you handle the lows of life

9 FEEDING PREFERENCES Forb Goats Sheep Goats & sheep can decrease weeds Browse Grass Grass Cattle Forbs

10 COW-CALF Everyone Loves Cows

11 COW-CALF Can take care of themselves Very forgiving of poor management Low labor requirement Better the design the less labor needed 5 8 hours/cow Free calf

12 COW-CALF Stocking rate 3 to 5/acres per cow What s that free calf costing you? Only selling the calf 500# calf Maintenance doesn t pay very well 1200# maintenance Capital requirements $8,000 to $10,000/cow

13 COW-CALF How many calves do you get to sell? Weaning % 80 to 85% Heifers Retained 15% 100 cows = 70 calves + some cull cows 70 must cover the maintenance of all 100

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19 Cash Generation vs. Wealth Accumulation

20 STOCKERS

21 STOCKERS Maintenance vs. Growth Get paid for what you put on Stocking rate 1 stocker/acre No longer a free calf Cash requirements Good or Bad No longer year round Price slide Grass is more valuable

22 STOCKERS Greater management required Not as forgiving Can t check them once a week need daily contact - 1 ½ hours/calf More health risks Paid $1000/stocker and it dies (1 to 2% death loss) 100 cows 85 calves (or 70) 100 stockers 95 to 99 calves More price risks Have to protect yourself

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25 $50 to $100/stocker What if market prices drop? Size Do you have enough to protect yourself?

26 Cows: 3 to 5 acres = -$50 to 3 acres & -$50 = -$150/acre Stockers: 1 acre = +$50 to 1 acre & +$50 = +$50/acre Cows: 80 to 85% weaning percentage Stockers: 95 to 99% selling percentage Requires more management Most part time producers have to stick with cows

27 MOST PROFITABLE = MOST FLEXIBLE COW-CALF & STOCKER Forage Yield April June August October

28 FEEDING PREFERENCES Forb Goats Sheep Goats & sheep can decrease weeds Browse Grass Grass Cattle Forbs

29 SHEEP & GOATS

30 BENEFITS OF SHEEP & GOATS Can utilize weeds/brush with grass Have 1-2 lambs/kids per pregnancy Goats: 150% to 170% Sheep: +25% Stocking rate 2 to 5/acre (stay to the lower end) 7 to 8/cow Higher weaning % + more per acre

31 SHEEP & GOATS Requires minimal facilities Easier to handle than 1200# cows For many a huge plus Goats can get paid for brush control Requires more MANAGEMENT Labor 1.5 to 2 hours/doe/ewe 8 goats/cow = 16 hours labor vs. 5 to 8/cow Can lose money with poor management

32 The Big Three Parasite control Fences Predator control SHEEP & GOATS

33 Sheep vs. Goats SHEEP & GOATS Sheep Increased survivability (+25%) Better parasite resistance Little easier to keep contained Goats Higher prices Can utilize more brush Used for brush control Smaller so run more per acre

34 Select Ethnic Market Dates (type of meat varies with date) Muslim Jewish Christian Ramadan Id-al-Fitr Id-al-Adha Passover Western or Roman Easter Eastern or Greek Easter Christmas US Independence Day Mexico Independence Day

35 ECONOMIC COMPARISON Cattle 1 cow-calf unit/3 ac 85% calf crop 500 lb. weaning weight 425 lbs. weaned/3 ac 142 lbs./ac $1.75/lb. $ gross/3 ac $ gross/ac Goats 8 goat/kid units/3 ac 150% kid crop 60 lb weaning weight 720 lbs. weaned/3 ac $1.95/lb. $ gross/3 ac 240 lbs./ac $ gross/ac

36 ECONOMIC COMPARISON Sheep 6 ewe/lamb units / 3 ac. 175% lamb crop 80 lb. weaning/selling weight* 840 lbs. produced/3 ac. $1.48/lb $ gross/3ac. 280 lbs. produce/ac $ gross/ac *May require supplemental feed from weaning to selling depending on forage supplies and quality

37 GRASS BASED DAIRY

38 GRASS BASED DAIRY More labor & management $200 to $400/cow Can consider seasonal 2 to 3 hours in the barn Stocking rate 1 cow/acre Focus is on the forages

39 GRASS BASED DAIRY More capital required More investments in buildings & equipment Total capital = $6,000/cow Generates $3,000 gross income/acre Beef: $8,000 to $10,000/cow generates $200 gross income/acre

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42 FESCUE HAY

43 FESCUE HAY NO LIVESTOCK Don t even have to do anything No machinery No labor Very little management Very little return Get what you get & don t throw a fit 2 to 3 tons/acre $75/ton

44 NUTRIENT VALUES 1000 lb bale of grass hay 25 lb of N 7.5 lb P 2 O 5 20 lb K 2 O 30% 100% 100% N - $5.32 P 2 O 5 - $4.12 K 2 O - $11.00 Total = $20.44 N=$0.71, P=$0.55, K=$0.55

45 ALFALFA HAY

46 ALFALFA HAY More Management Cut every 30 days If not it ll cost you Fertilizer requirements Not as forgiving More labor Probably won t be using custom operators More capital expense - $350 to $450/acre Do you have a market for high quality hay? 5 tons/acre $200/ton

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49 HAY THAT PAYS

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54 FARMLAND VALUES IN NEIGHBORING STATES, 2011* USDA/NASS $/acre Cropland Pasture All land & bldgs Missouri Kansas Arkansas Iowa Illinois *Livestock facilities affect average for all land & buildings

55 WHY HAVEN T I BOUGHT EVERY FARM IN THE COUNTY??? Payments Payments Payments Value Isn t Realized Until Sold Separate Enterprises

56 RESOURCES - ONLINE MU Budgets Missouri Alternatives Center Acknowledgments Mark Kennedy Jodie Pennington Ron Plain Joe Horner Ray Massey Tim Schnakenberg 56

57 CONTACT INFORMATION