Cow–calf producers have faced tough times for the last several years, says Ron Gill, Texas Cooperative Extension livestock specialist based in Stephenville, and they aren’t over yet.
“The challenges we’re facing right now include the continued impact of the drought, higher production costs, changing markets and governmental intervention,” Gill told producers during the recent North Texas Cattle Conference at the Texas A&M Research and Extension Center in Plano. “But, there are probably not two of you in here who are in the same boat, so take what I say with a grain of salt.”
Due to the ongoing drought, Gill says, the worst thing weather-wise would be a cold, wet winter, because cows are not in ideal body condition.
“There will be a continuing downward spiral in reproductive efficiency because of nutrient challenges,” he says. “Cows need to rebuild condition, but how do you manage that on limited forage resources and high production costs?”
With drought, pasture recovery is the key, and Gill says if producers haven’t destocked by now, the ground will be slow to recover.
Water is another concern for drought-stricken areas.
“More people are selling out where I live right now due to lack of water rather than lack of forage,” Gill says. “Cow-calf producers might take this time to develop wells, fence water access or expand reservoir capacity. There might be EQIP money available to assist you.”
Higher Production Costs
“Why do you own as many stock as you do? Is it an arbitrary number? Is it for tax purposes? Do you have them because you like to look at them? Really evaluate your situation,” Gill says.
Feed costs are rising, the competition for grain is escalating at a higher rate than anticipated, the pasture and hay situation has deteriorated, and even without the current high gas and diesel prices, fuel expenditures on most small operations are astronomical.
“With fertilizer, some dealers are talking about a ‘pre-order’ or ‘pre-pay’ situation, but I don’t know if it will actually happen,” Gill adds. “We have great cattle prices, though, and that has never happened before in a drought.”
Right now, he says, there’s a four-year window to re-invest in any depreciable asset related to production agriculture, versus two years.
“But, also think about replacement stock — if you do sell out, what will it cost you to get back in?”
Changing Markets and Governmental Intervention
“BEV, QSA, NHTB, NAIS — it’s like an alphabet soup. Are all these things intervention or assistance?” Gill says. “For Japan and Korea, age verification is the issue, and for the European Union, beef must be hormone free.”
As for the national animal identification system, he says, “it’s beat in the head right now, but I don’t think it’s dead.”
“I think the government will let us fail on our own and then make it mandatory,” he says.
So, with all that in mind, what should cow-calf producers concentrate on? Pasture recovery, cow herd productivity and cost control, according to Gill.
Pasture recovery considerations include, adjusting stocking rate, controlling weeds, renovating pastures, if needed, considering resting or deferring pasture and overseeding,” he says.
For herd productivity, look at body condition scores, overall health, reproductive diseases and herd biosecurity.
“Controlling costs can start by making efficient use of all you inputs, for example, testing soil or forages to know accurately how to fertilize or supplement feed,” he says.