#14 Total Grazing Economics

Hello, I am Jim Elizondo from Real Wealth Ranching where our goal is to help you maximize your profitability while you improve your land the fastest.

Welcome back to another episode of Fat Cows, Fat Wallet podcast. I hope you are having a great week. And today we are going to talk about something that is not so much fun but is fundamental for your success, and this is economics. 

When I think about fun in my operation, this means being hands on. Being in the ranch, observing my cattle’s condition, my land, forage and taking decisions. This is the cool stuff for me. 

I don’t necessarily think that economics are fun but they are fundamental for your success and fortunately, I’ve known this since day 1.

They are absolutely necessary for the growth and scaling of your operation and they have definitely helped me along the way.

I’ve gotten better in this as years go by and I want to share this with you in this episode. I’m going to give you immense value. So try to pay close attention and try to listen with an open mind. It most likely will be contrary to what you have learned over the years, but I am confident that it will make a lot of sense to you.

So if you know somebody who is trying to improve their profitability in their operation, maybe they are just starting out or maybe they have hit a rough patch and they are thinking, “How can I make this work?”, introduce them to this podcast, please. I know that I can help them and I would love to help as many ranchers as possible to build an operation that they absolutely love.

We need to remember why we do certain things; I always try to start a new project with the end in mind. This allows me to plan ahead and structure my strategy, so I get to my goal as fast as possible without straying from it.

Before starting a new project, we need to make sure it pencils out, if it pencils out in paper and we consider all the different aspects involved we can then commit to this new project.

Before starting off with numbers, I promise I will keep it simple, let’s put some context in place.

Let’s start with things that we know or that you have learned so far from this podcast.

Number one: we know that total razing emulates nature, that it promotes a higher leaf to stem ratio in the regrowth. In other words, total grazing creates a leafier forage.

Number two: we also know that we achieve a much higher harvest efficiency with total grazing than with selective grazing or top grazing, however, you prefer to call it. 

Number three: a higher harvest efficiency means we also get more cow days harvested per grazing which gives us a longer rest period to our paddocks. This is what gives us a much higher production of forage while at the same time increasing our soil humus content the fastest.

Now that we have covered the context, let’s remove a key objection out of the way before we dive into the numbers.

And I know what you are thinking… you may be saying, “well, Jim, I don’t have the time to move poly braid fences when doing total grazing.”

So to answer that, yes it does take time to move the fences but bear with me. When you are moving the fences you can observe your cows' gut fill and manure to monitor how well they are doing and adjust the number of breaks and the sizes of them we give per day. This is so important! We need to be observant. So does it mean that you should be observing your cows at least once a day when you move them? Yes!

This time or labor it takes to do any type of controlled grazing is not wasted as it gives a very good economic return. 

Besides becoming a much better observer of the animals, you have the advantage of having them all together in a small area where any sickness or problem is easily spotted and, as we know, when you catch sickness when it's starting it is much easier to treat and cure an animal. I know that on extensive ranches we need to put in hours to get to see all the cattle and check on them, but I will not figure that out this time.

Now we are getting to the good part. Let’s talk numbers.

Do you agree it takes less time to check on 400 cows in a ¼ of an acre break than it would take to check them daily on 1,000 acres? Would it be better to check your cattle daily? Well, yes, it is much better.

Let’s figure $20 an hour and it takes 4 hours in total to put up the temporary fences and opening 4 breaks per day, which is the optimum number of breaks per day on average. 

So $20 an hour times 4 hours it takes to put up the temporary fences, means, we then have invested $80 per day with weekends giving a larger break on Saturday so on Sunday we do not have to work. This has worked very well for me and my students of Total Grazing all around the world for years now.

With practice, the time it takes to put on temporary fence and open the new breaks is reduced and there are many ways to make this job easier. Cattle become very calm and tame and learn to see you as the provider and they come to trust you which makes them much easier to train and handle. This has been our experience in many different environments around the world and it’s what my total grazing students report.

You may be thinking, well if I get a higher harvest efficiency then I will have less grass!

When you implement Total Grazing correctly, you have much longer rest periods.

We usually get double the forage produced and harvested per farm or ranch by doing this while the humus content continues to increase making for higher future productivity.

It now is a matter of how many acres and cattle you are managing. 

Let’s continue with the numbers

One person can usually take care of around 800 cow pairs but many times we do not have that many cattle or acreage. So, let’s figure that we normally had 200 cows and now can carry 400 cows, this means that by doing total grazing and investing $80 per day in labor allows us to increase by 200 cows. $80 per day divided by 200 cows puts the cost at $0.40 per cow only for labor.

Is this attractive? That’s why I like numbers!

If a rent per day of $1.20 is figured, we would make $1.20 minus the $0.40 of labor $0.80 per extra cow or $160 extra per day.

You know what the best part is? That this is in addition to the hay savings by feeding your cattle on stockpile in the Winter or dry season even when considering the minimal protein supplement some environments require when grazing on old stockpiled warm-season perennials. 

This usually saves from $100 to $200 per cow per year compared to full hay feeding. If you are one of my Total Grazing students, you are already realizing these savings and increased productivity!

What makes this sweeter is when we have cattle with adapted genetics, especially nutritional adaptation that allows us to increase stocking rate even higher with less supplement needed. We need to always keep in mind why we do this, we need to remember that we are regenerating our land for even higher productivity at lower costs in the future, we are building biological capital in our land and cattle! 

Wouldn’t you like to be already doing this? Increasing your stocking rate, your cattle health, calming them down noticeably, and enjoying your work at the farm knowing that your land is improving instead of degrading gives me a sense of well-being and satisfaction.

Recap,

1. Always start with the end in mind when starting a new project

2. Your time is valuable and investing it in Total grazing gives a good return, both monetary and in future productivity

3. It is much easier and more efficient to check on cattle under Total Grazing where you see them 1 to 4 times a day than under continuous grazing where you need to look for each, and every animal in a much larger paddock.

4. By using stockpiled forage instead of hay you can save from $100 to $200 per cow per year.

5. Total Grazing, by giving longer rest periods to every paddock allows you to stockpile forage in the area for Winter and the dry season.

 The online course for Total Grazing will soon be open for enrollment, so if you want to be the first to know and get an exclusive offer, you can join the waitlist by visiting https://www.rwranching.com/waitlist