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:
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.
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 $38.04/acre.
|Change Being Considered: Typical Stockpiled Fescue vs. Hay (30 Cow Herd)|
|Cows receive better nutrition (a benefit, yet unknown value)||$|
|Total Added Receipts||$|
|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||$2,021|
|Total Reduced Receipts||$|
|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|
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