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Here’s the Impact of Fencing and Planning on Grazing Days and Profitability

By   /  January 27, 2020  /  3 Comments

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In November I shared thoughts on the economic importance of stockpiling grass. In that article, I made the case for building internal fence on a new property because of the economic value of the grass. Well, we did build the fences even though we were sick of fencing by November! This article covers what happened after we fenced.

You may recall that I estimated about 20 days grazing for 950 dry cows which would equate to ~$34K worth of hay we would not feed. My estimate was a bit off, so let me share the actual results.

Would you like your own chart to help you figure out Standard Animal Units? Click to download this one that Kathy Voth put together for you.

To refresh your memory, the measurement I use to calculate grass harvested is Stock Days per Acre (SDA). It is the amount of forage a 1000lb dry, pregnant cow will consume in one day or about 24lbs of dry matter. Stock Days per Acre is taught in Holistic Management and Ranching For Profit and there are tables to standardize all classes of livestock. The standardized value is called Standard Animal Unit (SAU). For example, a 1300lb dry, pregnant cow has an equivalency value of 1.23SAU. That is to say the 1300lb cow consumes 23% more per day than a 1000lb cow.

Stock Days per Acre (SDA) is similar to bushels of grain per acre if you were a grain farmer. A grain farmer measures how many bushels are harvested from each field. The number of bushels is divided by the number of acres in the field to get bushels per acre. The same can be done by a grazier. First the herd size must be calculated in SAU. Then, multiply by the number of days grazed, and divide by the number of acres in the paddock.

For example, let’s say we had 615, 1300lb dry, pregnant cows that grazed from Nov 20 – 24 on 34 acres.

To calculate SDA’s:  

(615hd X 1.23SAU) X 5days = 3,782SD

3,782SD / 34acres = 111SDA

Therefore, in this example, 111SDA were harvested from the paddock. This is similar to a grain farmer harvesting a certain number of bushels of grain per acre from a particular field. In terms of grain farming though, the farmer does not stop there. Normally a grain farmer will calculate the price per bushel when the grain is sold. Then they will figure out the revenue per acre. Graziers can do the same thing once they know the Stock Days per Acre and what one Stock Day is worth.

During the growing season and up to Oct 31, I use the custom grazing rate for my area to give one Stock Day a monetary value. I use custom grazing rates because it is the operator’s choice whether they custom graze someone else’s animals or graze their own. Starting November 1, I use the value of ‘normal’ winter feeding to assign a monetary value. I use November 1 because I believe most people can graze until the end of October without much planning.

Here is an example from our area:

Custom grazing rate – $1.25/day/pair

1 cow/calf pair (1300lb cow) has a SAU of about 1.8SAU (from the HM table)

Therefore, $1.25/pair / 1.8SAU = $0.69/Stock Day

If we harvested 111SDA from a paddock prior to Nov. 1 with a cow/calf pair, the value of that grass would be: 

111SDA X $0.69/SD = $76.59/ac

If, however, we harvested 111SDA after Nov.1 the value of that grass would be an expression of how much hay it was replacing.

In the case of our ranch this year, it costs about $2.10/day/dry cow to bale graze.

In this scenario, the value of one SD is:  $2.10 / 1.23SAU = $1.71/Stock Day

Which means, that 111SDA of grass after Nov. 1 is worth:  

$1.71/SD X 111SDA = $190/ac

Now let me share the actual results from our new property.

The property is about 520 acres and is half open, half dense willows with some large poplar trees. I estimated that if we crossed fenced the property into seven paddocks, which we did, there would be 20 days of grazing for 950 cows. Once it was fenced, we moved 615 dry cows into the first paddock. We added cows and took some away, finishing with 802 head on January 1st.

We harvested 125SDA to 175SDA in the first six paddocks. Grazing the last paddock was cut short by 15 days because we set out too many bales with net wrap removed. Our concern was for excessive spoilage if it was left out in the field unprotected until next winter.

This dry herd of cows began grazing stockpiled grass on the new property Nov. 20 and finished Jan.1 for a total of 41 days. If you recall, my estimate at the start of November was 20 days. OOPS! I have become quite cautious as the years go by. Last year, I estimated 90+ days of stockpiled grass only to be foiled the second week of December by three feet of snow in two days! This year we did not have excess snow which made the 41 days possible.

Over the course of the 41 days 43,376SD’s of grass was harvested. Since we would have been bale grazing if not grazing, the value of each SD was $1.71. That means we harvested $74,173 ($1.71 X 43,376SD) worth of grass from that property. Our cost to make this happen was less than $9K (fencing materials, labor, and winter water system). I think that is pretty cool!

Another way to look at this scenario is to consider the cost per day to feed each cow. The expense for this property was about $22,000 (rent, fencing, water development).* With the growing season included, we harvested 49,945SD.

To calculate the $/SD:
$22,000 for rent and infrastructure / 49,945SD = $0.44/SD

To find the cost to feed a cow for a day (Nov. 20 – Jan.1):
$0.44/SD X 1.23SAU = $0.54/day

Plus yardage (labour, truck, quad)
$0.54 + $0.05 = $0.59/day/cow

 

To find out how much was saved by grazing stockpiled grass:

$2.10/day (bale grazing) X 41 days = $86.10/cow

Subtract $0.59/day (stockpiled grass) X 41 days = $24.19/cow

Total savings per cow = $61.91

The season did not start out with much success expected. As mentioned in the November article, my first day at this ranch was May 28 so there wasn’t time to do any real planning. I just knew we had to get the cattle out clipping grass as fast as possible. Somehow it worked out. A cowboy friend of mine would say, “Sometimes every squirrel gets lucky and finds a nut!” I guess we got lucky.

Over all I’m pretty happy with our stock piled grass and the snow conditions allowed us to capitalize on it. The owners seem to be happy as well. In fact, I heard a rumor they want to keep me around for a while. LOL

*I know the fencing and water should be amortized, however, when we first started, every improvement had to be paid for with current revenue, not borrowed money.

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About the author

Tom, along with his wife Jan, started raising & direct marketing hogs, sheep, cattle, turkeys, & chickens in 1999, the same year they completed a Holistic Management course. Their operation slowly morphed into custom grazing cattle on rented land and Tom’s passion for managing grass grew in the process. Tom & Jan completed the Ranching for Profit school in 2003 and found the ‘missing piece’. Since then, Jan has fulfilled her dream of being a nurse & Tom is currently the Production Manager of a ranch in north east British Columbia.

3 Comments

  1. Paul Nehring says:

    water valves -99.90
    Poly Pipe for Waterline -1,574.75
    3/4 Quick coupler valves -346.90
    Hose clamps -68.67
    Insert Tee -16.35
    Insert elbow -2.07
    Insert elbow -0.69
    Insert coupling -4.32
    Insert male adapter -1.74
    Insert Tee -1.18
    Valves -56.97
    Yard hydrant -59.99
    Poly pipe -92.98
    Insert Tee for waterline -19.62

    Waterline total -2,346.13

    Barbed fence staples -74.00
    Bullnose insulators -88.00
    Cedar posts -359.60
    Cedar Posts -314.65
    cutout switch -13.50
    Energizer -785.00
    fence signs -7.50
    Gate handles -267.30
    High tensile wire -1,342.00
    High tensile wire -89.95
    Insulated wire -188.00
    labor 180 @ $13.00/hour -2340
    Lag pulley for fence -19.47
    on/off switch -15.00
    Pasture Pro post 54″ -930.60
    Pasture Pro post 66″ -2,015.50
    poly pipe for underground wire protection -129.98
    Post clips -112.00
    Post pounding -509.20
    Postage -101.25
    Rope for gates -376.00
    Sales Tax -295.78
    screws for fence insulators -15.98
    Splices -22.34
    strainers -208.00
    wood post insulators -86.40
    Total -10,707.00

    This, again was for 57 acres. 4 wire exterior on two sections, with 2 wire interiors.

    Does not include Winter Water system, which I included in my $15,000 figure, from previous comments.

    • Tom Krawiec says:

      Thx for your interest Paul. I should first point out that before a project is started, it’s efficacy is investigated. If the project will not pay for itself with increased revenue or decreased expenses in one year, it rarely happens. This attitude comes from my days as a custom grazier and training I received from Ranching for Profit. Now to your request.
      The following is the material list I ordered for the project. This is from an Excel Template I built. As you can see it did not paste perfectly.

      Fly By Night Ranching
      New Fence Materials Estimate
      5,291m of new fence
      Item Quantity Price SubTotal
      4-5″ posts X 7′ 327 $7.75 $2,534
      5-6″ posts X 8′ 24 $13.25 $321
      high tensile (meter) 10582 $0.16 $1,693
      insulators 726 $0.38 $276
      dry wall screws 1453 $0.02 $29
      tensioners 24 $6.00 $145
      gate handles 48 $9.25 $448
      Materials $5,446
      Cost Per Meter $1.03
      (Note: I did put in a cost for gate handles even though we build our own. I lie to see the savings because our home built ones cost less than $2 and do not break the first time an animal goes through a gate.)

      Here is my standardized template for building fence. It has been developed to make my life easy because labour always seems to be my greatest limiting factor. Early in my career, I realized that if everything was set up so a 12yr old could do it, ranching would be pretty easy. I often tell people they should try to ranch like a 12yr old. I’m always looking for ways to decrease my work not find more work, so anytime I hear someone say, “Oh it doesn’t take me very long”, my hackles go up. It is difficult to grow your business when you have a lot of tasks that ‘don’t take very long’! The reason I mention my mindset on this issue, is because I know many people will disagree with some of my fencing protocol. As an example, you mentioned that you should have only put one strand internal fence. I have gone to two strand because when grazing yearlings with one strand, regularly there would be one or two head in the wrong paddock. It would take 20-45min to get the animals back to the herd. Add that 30min up over 5-6herds over the course of a season and that is a lot of labour. Since I went to two strands rarely am I going to gather animals from another paddock.
      Fly By Night Ranching:
      Building Electric Fence
      1) Use 8’ X 5-6” pressure treated posts as end posts & gates pounded half way into the ground. Build gates 21’ wide.
      2) Use 7’ X 4-5” pressure treated posts as line posts pounded 3’ into the ground spaced 60’ apart.
      3) Install two high tensile wires placed at 45” and 28”.
      4) To tie off at the end post, use three insulators positioned so the wire does not contact the post. It is easiest if only one screw is installed in the side insulators so they can be turned when threading the wire. When making the final tie, do it as close to the post as possible and make 10-12 wraps. 10-12 wraps will hold when a moose or elk hit the wire at full speed.
      5) Tie the two wires together using a short piece of high tensile on the side where the flow of power begins. This will make the two wires act as one wire in relation to the flow of electricity.
      6) Place a tensioner on each wire 10’ from the end post where the electricity begins
      7) When installing a cutout switch, place the switch on the first post of the ‘fence leg’, not on the main line fence. Use double insulated wire for the tie in’s.
      8) Cut or break off all wire ‘tails’. Tail is good in the bedroom not when you’re fencing! This will help prevent shorts.
      9) Use double insulated wire & L-clamps when joining two sections of fence.
      10) Gate handles: cut 18” of insulated wire, tie a bow in the middle, strip 1.5” at each end, and then bend one end into a hook, the other into a circle. Cut bungee cord 2/3rds of the gate width.
      Supplies (buy PFI when possible because they are very good but half the price):
      -12 gauge hi-tensile wire -claw insulator
      -12 gauge double insulated wire -Kencove or Stafix single throw cut-out switch
      -Kencove electric bungee cord for gates -Kiwi or Daisy Online tightener

  2. Paul Nehring says:

    Even with the numbers you budgeted for the extra land and fence make sense in terms of reducing feed cost. You did nice job laying out your calculations for all of us to make sense of them. No doubt, there was a lot of hard work involved, executing the fencing plan–been there, done that, in a hurry to keep ahead of the cattle. Bonus earned and deserved, or at least some loyalty/job security from the owners.

    Can you layout, roughly, your fence/water expense? The last fence I built, in 2015, was on 57 acres, and was a bit complex, in that I had to completely fence off two neighboring sections with 4 wire fence to meet state law requirements. I also added double wire interior split fences–should have gone with single wire, but was leaving the option open for sheep. Water system was black poly pipe with spigots about every 150 feet. Total cost of the system on that 57 acres, including my labor valued at $13/hr, was just over $15,000. I even re-purposed some high-tensile fence from a previous fence job. I tracked every expense, thoroughly, including my time.

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