July 19, 2002

NDSU Ecnomists Develop Spreadsheets for Cow Herd Drought Management Alternatives

Drought conditions in much of southern North Dakota mean that cattle producers are faced with critical decisions relating to their beef cow breeding herd, according to a North Dakota State University livestock economist.

"Producers suffering the most extreme drought conditions probably have the fewest alternatives," says Tim Petry of the NDSU Extension Service. "A major decision facing producers is deciding whether to try to save the genetic base that has taken years to build or to sell the herd. Both hauling livestock to feed and hauling feed to livestock are expensive, so producers need to evaluate all options available to them."

To help producers compare alternatives, Petry and Dan Nudell, an agricultural economist at NDSU’s Hettinger Research Extension Center, developed several downloadable spreadsheets in Microsoft Excel format. Anyone wanting to use the spreadsheets should go to the NDSU Extension Service livestock economics Web page at http://www.ag.ndsu.nodak.edu/aginfo/lsmkt/livestock.htm and click on "Cow-Calf Drought Management Spreadsheet".

Six different spreadsheets are available. Each shows a hypothetical example with a column for producers to put in numbers for their unique situation.

The first spreadsheet is a 2002 beef-cow cost and return budget projection for a "normal" weather situation, which should be used as a comparison with the drought management alternatives The spreadsheet titled Alternative 1 can be used to analyze the additional costs of grazing small-grain crops, hayland, and Conservation Reserve Program (CRP) land on, or adjacent to, the ranch. Alternative 2 analyzes hauling cattle to leased pasture outside the drought area. Alternative 3 looks at the costs of drylotting cow-calf pairs with purchased and/or homegrown feeds. A spreadsheet called "rations" allows users to compare alternative rations. Alternative 4 analyzes the changes in revenue and costs from selling cow-calf pairs now and buying back bred cows or pairs next year.

A spreadsheet called "FEEDVAL-A Spreadsheet for Evaluating Value of Alternative Feeds" developed by Animal Scientists at several land-grant universities is also available on the Livestock Economics Web site.

"Realistically, most producers will decide on a combination of the alternatives rather than just one," Petry says. "Some of the less productive cattle may be sold, others grazed on available forages, and some, like early-weaned calves, may be drylotted. These decisions are extremely difficult and should be thoroughly analyzed."

Producers with existing loans should discuss the alternatives with their lender. Those deciding to sell cows or calves should contact the market operator well in advance of the sale, Petry advises. That’s because cow-calf pairs or lightweight calves are unique market classes and this is a non-traditional time to market cattle.

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Source: Tim Petry, (701) 231-7469, tpetry@ndsuext.nodak.edu
Editor: Tom Jirik, (701) 231-9629, tjirik@ndsuext.nodak.edu