Category: Grazing

Testing New Futures

Testing New Futures

Holistic Ranch Management More Than Grass

Dan Miller
By  Dan Miller , Progressive Farmer Senior Editor

“No. You missed that,” Scott Johnson says, correcting a caller. He and his wife, Jean, were traversing a part of eastern Colorado on one end of a long-distance struggle with cell service. The caller had entirely missed the point Scott made about holistic management. It is much more than grass.

The template of holistic management laid over the Johnson family’s Flying Diamond Ranch, Scott explains, is a collaboration of moving parts. It considers the harsh seasons of Colorado’s semiarid eastern plains and the sustainability of the ranch’s composite Angus herd. It is management of predatory coyotes, of spring calving and scrutiny of meat markets. Most of all, it is family — this one taking its first steps into a sixth generation with five grandchildren, four born in 11 months.

“Do you follow my way of thinking?” Scott asks. “If our ROI [return on investment] is great, but someone is maimed, we wouldn’t be real proud [of our performance]. We will give up profit for safety or harmony,” he says. “The focus is on the whole. If we’re not getting along as a family, if we’re not safe, then the rest of this really doesn’t matter,” he explains. “It’s its entirety. Its wholeness. Its balance. Not perfection. But, bottom line, [we are] profit-oriented. Business is business.”

The Flying Diamond’s clean and highly viewable website uses six words to articulate holistic management: “Ranching with family. Working with nature.”

BORN ON A CATTLE DRIVE

Flying Diamond is 112 years in the making. Charlie Collins, Scott’s great-grandfather, fell in love with the land when, as a teen in the late 1800s, he trailed cattle near the banks of Big Sandy Creek on a drive from Mexico to Montana. By 1907, Collins had moved his family from Kansas to Kit Carson, where the ranch is still headquartered today.

The ranch is dominated by a shortgrass and sand sage landscape. Thick riparian areas border the Big Sandy and Horse creeks, tributaries of the Arkansas River. Culls are based on a female’s ability to wean a calf every year beginning at age 2 and succeed in 13 inches of precipitation and temperatures running the scale from below zero to above 100ËšF.

The cattle winter on corn circles in Kansas and Nebraska. “We like to rest our pastures during the winter. It’s healthier for our grass to have the cattle off and let it rest, and get a little more growth,” Jean says. Scott adds, “Having cattle on cornstalks, our day-to-day chores slow down a little bit in the winter. We can give family a little breather.”

Flying Diamond is an operation run by a family of type A personalities, Scott allows. “We’re not real chitchatters. We socialize. We have good times. We want to maintain excellent family relations. But, we’re not sitting around drinking a lot of coffee.”

GENERATIONS MANAGE TOGETHER

Scott and Jean anchor the Flying Diamond’s fourth generation. Their four adult children represent its fifth. Ownership is based on a meritocracy. The more a family member contributes, the more they own.

Jen Livsey, married to Jay, is the oldest. She is a Princeton University undergraduate and the first female graduate from the King Ranch Institute for Ranch Management. She recently opened Eastco Group, a livestock and drought insurance business. Jen oversees the rotational-grazing plan and analyzes purchase and lease opportunities.

More Recommended for You
Will and Lauren Johnson live full-time on the ranch. A Marine Corps veteran, Will is CEO of Flying Diamond Ranches Inc.

Myles Johnson and his wife, Katie, live in Idalia, Colorado, where Myles is the K through 12 superintendent of schools. Myles is the ranch’s administrative officer, managing compliance, meetings and corporate records. Katie is a certified public accountant and manages the ranch books.

Charlie Johnson and his wife, Kaitlin, live in Kit Carson. He is chief operating officer (COO) of Flying Diamond Ranches Inc. He partners with Jen in livestock and drought insurance.

Business is organized around communications—face-to-face, weekly conference calls and a monthly executive committee meeting. Quarterly board meetings are a newer function Kirk Samuelson, Scott’s cousin, brought to the ranch. Samuelson served as COO of Fortune 500 Kiewit Corp., in Omaha, until he retired. He and Scott are cochairmen of the board for Flying Diamond. Quarterly board meetings are formal. “Ten years ago, I was the dictator,” Scott admits. “Now, no one is comfortable with that. When we talk about family harmony, that’s not to suggest there aren’t red faces and pounding on the table.”

The board meetings are to play a role in the ranch’s vitality. “You go to workshops, and you hear horror stories,” Jean says. “Families won’t talk to each other. Ranches divide. That is a threat. How do you keep a 100-year-old ranch together for the next generation?”

The board meetings have a start-stop time and a structured agenda. They often include talks by outside experts. Assignments are given before the meeting—budgets, range management, cattle movements, fertility testing and branding, selling bulls, commodity markets and new market opportunities. “There is an element of accountability brought into the operation that we didn’t have before,” Jean says. “You are held accountable. What did you say you were going to accomplish? Did you do it?”

AGREEMENT IS KEY GOAL

Flying Diamond’s meetings are collaborative. The goal is consensus. “At the end of the day, we want to come up with a compromise we can all live with. This is a new concept for us,” Scott explains.

New is a continuing education standard. Time spent in continuing education is measurable and reported quarterly toward an annual goal of 300 hours. Safety is one component. Jean is the ranch’s safety officer. She has organized horse- and cattle-handling courses. “We specifically do safety training, communicate safety and track safety by hours per year.”

Calving runs from March through May. “We try to mimic nature,” Scott says. “We calve when the deer and the antelope and the elk calve.” Cows graze on spring grasses and not supplemental feed, and the calves generally miss late-season blizzards. Predation is better managed. Calves invite coyotes in the dark of winter. Coyotes have a wider menu in the spring, when the ranch’s wildlife also is giving birth.

“Deer and antelope spend zero dollars, and their offspring have a 50 percent survival rate,” Jen told ColoradoBIZ in a February article about Flying Diamond Ranch. The goal of the ranch, she explained, is to improve the odds of survival among the calf crop but mimic nature to lower production costs.

And here, an example of holistic management: “Our guys aren’t out in blizzards. The weather is better for the calf and better for us,” Scott says.

PATH TO PRODUCTIVITY

Cattle graze only 5% of the ranch’s ground at any one time. Nearly 200 miles of single-strand electric interior fence mark paddocks typically less than 300 acres in size. Cattle graze in some paddocks no more than three days in a growing season. Stocking rates once ran 40 acres per cow/calf unit. Today, it is 30 acres per unit. “We are able to run 30% more animals. Maybe we’ll be able to get to 20 acres per cow/calf unit with more intensive grazing,” he says.

Scott traces his land-management practice to several days spent 35 years ago with Allan Savory, the guru of grazing lands holistic management. Savory’s notion was to move cattle frequently—as bison moved themselves—by way of intensive, human-directed management.

Flying Diamond has laid out 20 miles of water pipeline with the assistance of Natural Resources Conservation Service’s Environmental Quality Incentives and Conservation Stewardship programs. Seven wells pump water to 23 stock tanks. The family has an eye to tightening its grazing practices—that cattle would graze no more than 1% of the ranch’s acreage at any one time.

Few ranches are as intense, Scott says. “Everything gets more intense the more intense we get. More monitoring, quicker moves. We are not know-it-alls. But, it can be a big benefit to the resource and a big benefit financially.”

ONE GENERATION TO THE NEXT

Holistic management is one of many parts. Flying Diamond Ranch has won its share of acclaim for this approach as the recipient of the Colorado Leopold Conservation Award and regional Environmental Stewardship Award, the latter partially sponsored by the National Cattlemen’s Foundation.

Awards recognize achievement. Flying Diamond Ranch tests new futures. Its organic cuts, for example, are finding customers in San Francisco. As a member of its advisory committee, Jean learns how the College of Agricultural Sciences at Colorado State University studies water conservation, sustainability, even urban farming. But also, meatless meat.

“It sounds like science fiction to us, but maybe it’s something that’s coming,” says Jean, not setting aside opportunity perhaps born of a petri dish. The future does not discourage Flying Diamond Ranch. “We’re bullish on agriculture,” Scott says.

The Flying Diamond Ranch evolves and grows and shifts for a time beyond Scott and Jean, and perhaps beyond Jen, Will, Myles and Charles—from today to a time for five grandchildren: Collins, Sofia, Clint, Stella and Henry, growing up among the hills of Colorado’s plain.

One generation builds on another. “We think,” Scott says, “that future is pretty bright.”

Animal Unit Months

Here’s more math for figuring out how to feed our livestock while making a good living on leased pasture. Even if math isn’t your strong suit, we take it one step at a time so that it’s as easy as it can be.

AUM Breakdown

Animal Unit Months

Figuring pasture use rates by Animal Unit (AUM) is more common in the western United States where it is the basis for public lands leased to ranchers for their stock. The nice thing about this method is that it makes it easy to plug numbers into a formula to give you a good idea of how many animals you can feed for how long. The formula factors in pasture quality, and the market price of hay so that you can come up with something fair to both parties.

An Animal Unit Month (AUM) is the amount of forage required to sustain a 1,000 pound cow with her calf at her side for 30 days. That works out to about 26.1 pounds per day. Forage requirements for all the other classes of livestock are shown in relationship to that 1,000 pound cow and her calf.

Here’s the formula:

Number of Animal Units x Average Hay Price Out of the Field Per Ton x Pasture Quality Factor = Rate Per Head Per Month

Pasture Quality Factor(Note: This formula works well for irrigated pasture, but may over-estimate non-irrigated, arid range rental rates where there is less forage and very little infrastructure.)

Here’s an example of what the formula looks like using a 1200-pound cow with her calf, during a time when hay is going for $10o per ton, and you’re hoping to rent an excellent grass and legume pasture:

1.20 AU x $100/ton x .20 Quality Factor = $24/AUM

From here the landowner and prospective lease can negotiate price based on expectations for management of the pasture, past experience, water and fence infrastructure and other requirements.

Don’t like that formula?  Here’s another option:

Hay Value Per Ton / 8.5 Rule of Thumb Forage Equivalent x Animal Unit = Rate Per Animal Unit Per Month

Using the same cow-calf pair and hay price, here’s that formula in action:

($100 per ton/8.5) x 1.2 = $14.12 per AUM

This is also just a starting point and depending on the result may point out whether you’ve over- or under-estimated the value of your hay.

Sharing Profit and Risk

If you intend to graze Stocker Cattle, establishing a rental rate based on pounds gained means that the landowner and the lease share the profit if there is one, and the risk if gain isn’t as great as expected. If you’re considering this method, you’ll have to have base values for the cost of gain, the expected gain, how long the animals will graze, and the per animal costs for caring for them through the grazing season.

All of the formulas I found for this method start with a Pasture Charge per Head per Month, also called a Seasonal Cost.  None of them told me where they got that number, but they all started with $10.  So starting with that as my full disclosure, we’ll go through this figuring process.

Pasture Charge Per Head Per Month x Number of Months = Seasonal Cost

$10 x 6 months = $60 per head

We use this as our base and then we divide by the pounds of gain we expect. This will change depending on the kinds of animals you’re running, grazing management, health and parasite load of the livestock and forage quality. This is where the risk sharing comes in. Let’s say that we think our stock will gain 200 pounds each while they’re on pasture.  Now our formula looks like this:

($10 x 6) / 200 pounds = 30¢ per pound of gain.

Thirty cents per pound is our break-even price and if the animals all gain 200 pounds each, that’s what the landowner gets. If the stock gain more, say 240 pounds, here’s what the landowner gets per animal:

240 x .30 = $72 per head

But if the animals only gain 175 lbs each, the landowner gets less money per animal:

175 x .30 = $52.5 per head

2019 Nebraska Cow-Calf Pair and Stocker Rental Rates

Recent findings published from the Nebraska Farm Real Estate Market Highlights 2018-2019 indicate changes in cow-calf and stocker monthly rental rates trended slightly lower when compared to 2018 (Table 1). Nebraska monthly grazing rates represent a typical fee for one month of grazing during the summer. Many leases run for a five-month grazing season subject to annual weather conditions.

The University of Nebraska-Lincoln Department of Agricultural Economics annually surveys Nebraska land professionals including appraisers, farm and ranch managers, and agricultural bankers. Results from the survey are divided by rental rate class and summarized by the eight Agricultural Statistics Districts of Nebraska (Figure 1).

Reported rates for cow-calf pair and stocker from the Nebraska Farm Real Estate Market Highlights include by district the average, high third quality, and low third quality. The range in these averages reflect the differences in the quality of the grazing land. Features influencing the quality of the grazing land might include the mix of the forages present during the growing season, livestock water sources, fencing upkeep, and general market competitiveness for the area.

To determine a cow-calf pair rental rate for a five-month period, the monthly rate for a district would be multiplied by five to calculate the seasonal rate. For example, the Central District average cow-calf pair monthly rental rate of $50.70 multiplied by five would be $253.50 per cow-calf pair for the 2019 grazing season.  This rate would vary depending upon the district of the state and provisions considered as part of the lease.

Negotiations on contractual terms for the grazing season include considerations on the landlord and tenant’s willingness to provide fencing maintenance, weed or brush control, and monitoring or providing water. Depending upon the willingness of either party to maintain, control, or provide these resources as part of the lease, the final rental rate may vary accordingly as panel members noted.

In addition, panel members also reported on the need for reviewing leases to account for different kinds of weather-related disasters such as flooding or drought. Reviewing these provisions by the appropriate agency or organization providing disaster assistance ensures compliance on grazing land in the case of an adverse weather event.

Survey results shown and discussed in this report are findings from the University of Nebraska–Lincoln 2019 Nebraska Farm Real Estate Market Survey. Complete results from the survey may be found at the Nebraska Farm Real Estate website: http://agecon.unl.edu/realestate.

Please address questions regarding preliminary estimates from the 2018-2019 Nebraska Farm Real Estate Survey to Jim Jansen at (402) 261-7572 or jjansen4@unl.edu.

Jim Jansen, (402) 261-7572
Agricultural Economist
University of Nebraska-Lincoln
jjansen4@unl.edu

Jeff Stokes, (402) 472-1742
Professor, Agricultural Banking and Finance
University of Nebraska-Lincoln
jeffrey.stokes@unl.edu

 

Interviews with the authors of BeefWatch newsletter articles become available throughout the month of publication and are accessible at https://go.unl.edu/podcast.

AG Talk – quote for grazing. Keep it Simple

Don’t seed or fertilize anything. Buy a couple of OBriens reels, poly wire and step in pigtails (Kencove Fence) and a good solar fencer. Max investment $1,600.00, utilize high stock density grazing to get this 10 year dormant grass back in shape.

You don’t need fertilizer if your grazing properly with daily moves allowing for the required amount of rest. 30 days is not enough rest, your going to run out of grass. A 30 day rotation is fine for one turn, but then every subsequent turn after that will get faster. Meaning your grass was not rested enough to re-graze. You eventually exhaust the root reserves and its just like driving a truck 50 miles a day and only putting in enough gas for 30 miles of driving at the end of each day. Its only a matter of time and your going to be out of gas, The grass is the same way, its fuel tank (root reserves) must be refueled to full capacity before you return to graze again or your going to run out of grass.

You will likely have lots of waste (trampled grass) in this 10 year dormant grass, that should not be viewed as a problem. That trampled grass is what feeds the mini critters in the soil, and they are needed to recycle all the manure urine and trampled grass back into new vigorous grass growth naturally. Fertilizers Herbicides, Insecticides all work against the soil microbes and drastically reduce the presence of Earth Worms as well. Cows, grass and fencing to control their grazing is all you need.

And here is the hardest part, put all the seed fertilizer herbicide and equipment money in the bank and leave it there. You can not buy your way to prosperity. The best place you can spend money is by buying a good style cafeteria mineral feeder and keep it stocked with the 11 different minerals (less than $200,00 worth of minerals) keep it supplied as they consume the minerals. It will change often as far as what they need.

Then stand back and let the Cows do the work for you. The goal is to extend the grazing season as long as you can. It gets better in time as your learning curve progresses. Spend time observing your stock, what they are doing and what is happening in your grass as it improves.

Clovers will come back naturally as will other grasses that may not be there now. Every day you don’t feed hay is like putting those dollars directly into your pocket. Those Canadian Thistles are like Candy to a Cow, mine eat them to the ground, high Calcium makes them a treat to a Cows appetite.

The seed bank is already in the soil it just needs hoof action to kick it into the growth mode. If bragging rights are important to you then you should be warned the learning curve is not straight up. The learning curve is actually an inverse curve, you will make mistakes, its sort of like jumping off a cliff. But hang in there and be brave because most people bail out just before they would have started to make some noticeable gains at the bottom of the learning curve.

With persistence and some self discipline you will be a winner. Just let the Cows do their thing they will show you how its done. Fence control, proper rest of the grass with water and minerals are all you need. All else is just like recreational tillage. There is nothing so useless as doing efficiently that which should not be done at all “Pete Drucker”

If you have problems or questions as you progress let me know, there is usually a simple solution to any problems that arise. E-mail is good, and good luck with the grazing, don’t let anybody convince you it will never work!! Prove them wrong