An Economic Analysis of Stockpiled Fescue

Farm Business Management Update, June 2001

By Bill Whittle

Stockpiling fescue, the practice of accumulating growth in the field for winter grazing, is a well-researched management tool for feeding cattle during much of the winter. Typically, stockpiled fescue is of higher quality than grass hays and provides high quality feed to beef cattle at a reasonable cost. Yearly variable cash expenses to maintain a cow range from $180 to over $500, with feed costs representing the bulk of these expenses. Practices that reduce this expense keep money in the cattleman's pocket.

The decision to use stockpiled fescue is generally based on the availability of fescue fields. Stockpiled fescue is not a separate grazing operation, but an add-on to an existing forage program that utilizes the unique production and quality characteristics of fescue. Management is based on the following time-tested management rules-of-thumb adjusted for a specific farm situation:

1. Apply 75 pounds of nitrogen in early August to grazed or mowed field.
2. Withhold all grazing until after hard frost.
3. Stockpiled fescue typically makes 1 _ - 2 tons of hay equivalent feed allowing one acre to provide grazing for one cow for 120 days or 4 cows for 30 days.
4. Grazing from Nov 1-Jan 30 has minimal reduction in forage quality.
5. Stockpiled fescue does not reduce spring hay or early summer grazing.
6. Stockpiled fescue works best if you limit access by controlled grazing.

A method of evaluating the feasibility of a program such as stockpiling fescue is the use of partial budgeting. A partial budget allows you to look only at the change being considered. It gives you a process to work through the financial and management consequences the change will have on your operation. As you consider a change, you would identify every item associated with the change that might influence the farm and then quantify the effect by assigning dollar amounts to each.

If the field already has a productive use such as hay or spring grazing, a reasonable practice is to attribute to the add-on Stockpiled Fescue only those expenses that are needed for stockpiling and grazing. These expenses include nitrogen, spreading costs, additional lime, and perimeter and temporary internal cross fencing if not already in place.

Consider the winter feeding program for a 30-cow herd. The farmer typically makes hay and feeds it starting in early November, throughout the grazing period. The feeding system choices available to the farmer are to feed hay as in the past or to feed stockpiled fescue for a 90-day winter grazing program.

Assumptions:

1. 30-cow, spring calving herd
2. Cows require 29 lbs. of good quality hay per day for 90 days (10% waste), which equals 43 tons for 30 cows.
3. Farm Business Management budget hay production, harvest, and storage cost of $47.00/ ton.
4. 30 cows require a minimum of 22.5 acres. A 10% extra grazing capacity = 25 acres.
5. Nitrogen for stockpiled fescue: 75 lbs./acre at $0.30/ lbs. + $5.50/acre spreading charge = $28.00/ acre.
6. _ ton lime per acre / year. Lime: _ ton x $20/ton spread = $10.00.
7. Controlled grazing labor: 10 minutes per day for 90 days = 15 hours of labor. At $8.00 per hour = $120.00 for extra labor or $4.00/cow for the grazing period.
8. Perimeter fencing is in place. Temporary fencing is built.

The partial budget below considers the changing from a traditional hay system to feeding stockpiled fescue. The budget shows a net advantage of $951 for the 30-cow herd for stockpiled grazing over feeding hay. Another way to look at the advantage of stockpiled fescue is that there is a reduction in winter feed costs of $31.70/cow or savings of $38.04/acre.

PARTIAL BUDGET

Change Being Considered: Typical Stockpiled Fescue vs. Hay (30 Cow Herd)
(1)	Added Receipts
	Cows receive better nutrition (a benefit, yet unknown value)	$
	Total Added Receipts		$
(2)	Reduced Costs
	Hay (1.43 Tons / cow at $47.00/ton or $67.21/cow)	$2,021
	Labor for feeding hay (a benefit, yet unknown value)	$
	Total Reduced Costs		$2,021
(A)	Added Receipts + Reduced Costs			$2,021
(3)	Reduced Receipts
	None known	$
	Total Reduced Receipts		$
(4)	Added Costs
	Nitrogen (75 lbs.+ spreading)	$700
	Lime (1/2 ton at $20/ton)	$250
	Labor (10 min/day for 90 days)	$120
	Fencing-permanent and temporary
	Total Added Costs			$1070
(B)	Reduced Receipts + Added Costs		$1070
(C)	Net Difference Due to Change (Line A - Line B)				$ 951.00 or $31.70 / cow or $38.04 / acre

Contact the author at wwhittle@vt.edu

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