Use of Irrigated Use of Irrigated Pastures and Economics Pastures and Economics

of Establishment and of Establishment and GrazingGrazing

Jerry D. VoleskyJerry D. VoleskyRange / Forage SpecialistRange / Forage Specialist

West Central Res. & Ext. CenterWest Central Res. & Ext. Center

461 West University Drive461 West University Drive

North Platte, NE 69101North Platte, NE 69101

(308) 532-3611 ext. 147(308) 532-3611 ext. 147

jvolesky1@.unl.edujvolesky1@.unl.edu

Richard T. ClarkRichard T. ClarkInterim HeadInterim Head

Department of Agricultural EconomicsDepartment of Agricultural Economics

102 H.C. Filley Hall102 H.C. Filley Hall

Lincoln, NE 68583-0922Lincoln, NE 68583-0922

(402) 472-3401(402) 472-3401

rclark3@.unl.edurclark3@.unl.edu

Planning ConsiderationsPlanning Considerations

• Grazing forage and/or hay needs.Grazing forage and/or hay needs.• Use within your operation.Use within your operation.• Site selection - livestock fence and Site selection - livestock fence and

water development.water development.• Forage type and establishment.Forage type and establishment.• Economics.Economics.

Management ConsiderationsManagement Considerations

• Seeding and establishment.Seeding and establishment.• Livestock fence & water Livestock fence & water

development.development.• Irrigation.Irrigation.• Fertilization.Fertilization.• Grazing management.Grazing management.

Forages for Irrigated PastureForages for Irrigated Pasture AnnualsAnnuals

WheatWheat MilletMilletTriticale / ryeTriticale / rye SudangrassSudangrassOats / barley Oats / barley SorghumSorghumTurnipsTurnips S X S hybridsS X S hybridsAnnual legumesAnnual legumes CornCornCS / WS annual grasses (e.g. ryegrass, crabgrass)CS / WS annual grasses (e.g. ryegrass, crabgrass)

Irrigated Cool-Irrigated Cool-Season Perennial Season Perennial

ForagesForages

Irrigated Cool-Season Irrigated Cool-Season Perennial GrassesPerennial Grasses

Species and Variety Species and Variety Evaluation – North Evaluation – North

PlattePlatte

Species and Variety Evaluation – North PlatteSpecies and Variety Evaluation – North Platte

SpeciesSpecies CommentsComments

Tall fescues & Tall fescues & FestuloliumFestulolium

High production; good summer High production; good summer growth; livestock performance?growth; livestock performance?

Intermediate Intermediate wheatgrasseswheatgrasses

High production; poor summer High production; poor summer growth.growth.

OrchardgrassesOrchardgrassesModerate to high production, Moderate to high production, good summer growthgood summer growth

Smooth & Meadow Smooth & Meadow bromegrassesbromegrasses

Moderate production; moderate Moderate production; moderate summer growth; persistentsummer growth; persistent

Production range (2003): 5.1 to 8.7 tons/acreProduction range (2003): 5.1 to 8.7 tons/acre

Species and Variety Evaluation – North PlatteSpecies and Variety Evaluation – North Platte

SpeciesSpecies CommentsComments

Creeping foxtailCreeping foxtailModerate production, excellent Moderate production, excellent summer growthsummer growth

TimothyTimothyLower production; poor summer Lower production; poor summer growthgrowth

Perennial ryegrassesPerennial ryegrassesLower production; high quality, Lower production; high quality, good summer growth; good summer growth; persistence?persistence?

Virginia wildrye & Virginia wildrye & Alaska bromeAlaska brome

Lower production, poor summer Lower production, poor summer growth; persistence?growth; persistence?

Production range (2003): 5.1 to 8.7 tons/acreProduction range (2003): 5.1 to 8.7 tons/acre

Irrigated pasture mixture: Example 1Irrigated pasture mixture: Example 1

SpeciesSpecies lb / acre Seeds / ft lb / acre Seeds / ft2 2 Cost/acreCost/acre11

OrchardgrassOrchardgrass 55 75 75 $7.50$7.50

Smooth bromegrassSmooth bromegrass 33 9 9 $3.75$3.75

Meadow bromeMeadow brome 55 9 9 $12.50 $12.50

Creeping foxtailCreeping foxtail 11 17 17 $6.50$6.50

AlfalfaAlfalfa 22 10 10 $4.00$4.00

TotalTotal 16 16 120 120 $34.24 $34.24

11 November 2003 Prices. November 2003 Prices.

Establishing Irrigated Pasture

Irrigation Management

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

North Platte (19.60" annual)

Torrington (13.82" annual)

Average monthly precipitation North Platte and Torrington.Average monthly precipitation North Platte and Torrington.

Irrigation Irrigation ManagementManagement • Irrigation: 16 - 20“ /growing season (North Irrigation: 16 - 20“ /growing season (North

Platte). Irrigation + rainfall: 32 – 36“.Platte). Irrigation + rainfall: 32 – 36“.

• Crop water use: 0.20 to 0.35 inches/day.Crop water use: 0.20 to 0.35 inches/day.

• Applications at higher frequency (5 - 12 Applications at higher frequency (5 - 12 days); lesser amounts (0.50” – 1.00”).days); lesser amounts (0.50” – 1.00”).

• Generally applied after a paddock has Generally applied after a paddock has been grazed.been grazed.

0

1

2

3

4

5

6

7

Apr May Jun Jul Aug Sep Oct

Rainfall Irrigation Total

Monthly rainfall and irrigation water on cool-Monthly rainfall and irrigation water on cool-season perennial grasses, North Platte, 2002.season perennial grasses, North Platte, 2002.

8.75” 26.75” 35.50” 8.75” 26.75” 35.50”

• Seasonal-split applications: 50% early Seasonal-split applications: 50% early spring, 25% in summer, and 25% in fall.spring, 25% in summer, and 25% in fall.

• Spoon-feeding split applications.Spoon-feeding split applications.• Applications timed with forage-need.Applications timed with forage-need.

Fertilization

Forage yield response up toForage yield response up to200 to 250 lb N / acre.200 to 250 lb N / acre.

Grazing ManagementGrazing Management

• At least 5 to 6 pastures (paddocks).At least 5 to 6 pastures (paddocks).• 28 to 35 day rest periods.28 to 35 day rest periods.• Flexibility in pasture movements, Flexibility in pasture movements,

haying, stocking.haying, stocking.

Rotation Grazing:Rotation Grazing:

.Livestock waterLivestock water

7 day grazing and7 day grazing and28 day recovery28 day recoveryperiod / paddockperiod / paddock

Pivot HeadPivot Head GatesGates

Example Example paddock paddock arrangement arrangement under a center under a center pivotpivot

Using stubble height as a guide for paddock moves.Using stubble height as a guide for paddock moves.

Effect of clipping stubble height on fall tiller density of 3 irrigated, cool-season perennial grasses, North Platte, 2002.

Grazing Strategies for Cool-Grazing Strategies for Cool-Season Perennial Irrigated Season Perennial Irrigated

PasturePasture

Grazing StrategiesGrazing StrategiesJan Feb Mar Apr

May

Jun Jul Aug Sep Oct Nov Dec

Pairs (season-long)

Pairs Yearlings(Range)

Pairs Cows or Calves

(Range)

No use - stockpile

Grazing StrategiesGrazing StrategiesJan Feb Mar Apr

May

Jun Jul Aug Sep Oct Nov Dec

Yearlings (Group 1)

Yearlings (Group 2)

Pairs CalvesWean: cows range

Yearlings CalvesNo use - stockpile

Grazing StrategiesGrazing Strategies

Jan Feb Mar AprMay

Jun Jul Aug Sep Oct Nov Dec

Yearlings (lead)Pairs

Pairs (follow)

Drought Reserve and/or Hay

Economic ConsiderationsEconomic Considerations

• Pasture establishment and development costs

• Annual operating costs for grazing and maintaining pasture

• Valuing the production and comparison to other alternative uses

• Impact on farm program payments• Evaluating irrigated pasture in a system

First-year seeding and pasture establishment costs for a 130-acre pivot.1

Item Cost/acre

Seed $36.00

Burn-down herbicide $13.64

No till-drill seeding $12.00

Nitrogen 30 lb/ac N @ $0.23/lb $ 6.90

Fall irrigation water (3 inches) $10.95

1 Assumes an August seeding following a summer annual forage crop.

Seeding & establishment total $79.49

First-year fencing and livestock water development costs for a 130-acre pivot

Item Cost/acre5-pasture cross-fencing(Energizer & 6600 ft. 2-wire HTE @ $0.58/ft1) $31.75

Perimeter fencing (10,560 ft. 2-wire HTE

@ $0.41/ft.) $47.10

Livestock water(tank, hydrant & 1320 ft. pipeline @ $1/ft.) $15.46

Fence and livestock water total $94.31

Seeding & establishment total $79.49

Grand total $173.801Allows about $300 for energizer

Annual fertilizer and irrigation costs for a 130-acre pivot pasture

Item Cost/acre

N fertilizer (200 lb/ac @ $0.23/lb) $46.00

P fertilizer (50 lb/ac @ $0.13/lb) $10.50

Irrigation water1, labor & move cattle $81.00

Annual O & M on fence & water $12.00

Total annual operating costs $149.50

Total operating and amortized costs for 130-acre pivot pasture—No land, overhead or management

costs (long recovery)

Item Cost/acre

Total operating costs $149.50Stand establishment (amortized 25 years @ 5% annual interest) $5.64Fence and livestock water development (amortized 25 years @ 5% annual interest) $6.69

Grand total annual cost excluding land etc. $161.83

Total operating and amortized costs for 130-acre pivot pasture—No land, overhead or management

costs (short recovery)

Item Cost/acre

Total operating costs $149.50Stand establishment (amortized 5 years @ 5% annual interest) $18.36Fence and livestock water development (amortized 5 years @ 5% annual interest) $21.78

Grand total annual cost excluding land etc. $189.64

Value of AUM• Rental value

– @ $20/Cow-calf pair. CC pair = 1.4 AUMs so that translates to $14.29/AUM

– @$30/CC pair = $21.43/AUM

• Feed value based on drylot feeding of Alfalfa diet– Hay only @ $90/ton = $1.14/hd/day for a dry cow

or $0.95/aud or $28.50/AUM (dry cow = 1.2 AU)

Value of AUM• Pounds of gain for yearlings

– Research at North Platte over 3 years

– Yearlings averaged 1.75 lb/head/day for about 150 days or about 668 lb/acre

– In some years did see 2 lb/head/day gain for the 150 days or about 800 lb/acre

Value of Gain(1.75 lb/hd/d) for E.WY & W. NE Prices 1992-2001

• Value--May = $88.77/cwt x 6.06 cwt = $538– Interest cost for 5 months @ 5% = 11

• Total Cost of steer onto grass = $549• Value Sept/Oct = $75.44/cwt x 8.66 cwt = $653• Gain in value = $653 - $549 = $104/hd

• Value of gain/pound = $104/260 = $0.40/lb

Value of Gain(2 lb/hd/d) for Average Prices 1992-2001

• Value--May = $88.77/cwt x 6.06 cwt = $538

– Interest cost for 5 months @ 5% = 11• Total Cost of steer onto grass = $549

• Value Sept/Oct $73.51/cwt x 9.06 cwt = $666• Gain in value = $666 - $549 = $117/hd

• Value of gain/pound = $117/300 = $0.39/lb

Gross return comparisons

aAssumes 10 AUMs/acre and pair requires 1.4 AUMs/month for grazing period.

Other Crop ComparisonAlternative Operating

cost/acre B-E Price

Alfalfa @ 5 t/ac $170 $34/ton

CP Corn 180 bu $268 $1.49/bu

CP dry edible beans @ 19 cwt/acre

$200

$10.53/bu

Sugar beets-20 t/ac $365 $18.50/t

1Costs include use related depreciation on equipment and irrigation system

Short-term net returns

Alternative Price/value Gross/ac Net/ac

Graze yearlings

Gain @ $.35-0.50 (1.75lb/d)

$234-334

$70-170

Alf hay @ 5t/ac $50-$90/t $250-450 $50-250

Corn 180 bu $1.90-$2.50/b $285-375 $83-182

Dry beans @ 19 cwt/acre

$15-$20/cwt

$285-380

$85-180

Sugarbeets $28-$36/t $560-720 $195-355

Pasture and the Farm Program• Two types of standard payments

– Direct payment (DP)– Counter cyclical payment (CCP)

• Both are based on the base acreage in the farm and the payment yield

• Base is your historical base that existed prior to the new bill or your updated base which depends on actual plantings 1998-2001

Pasture and the Farm Program

• Neither base figure will be impacted by irrigated pasture unless you had some in the 1998-2001 time period and then only if you update.

• Payment yields are as you had prior to 2002 bill or as you update based on 1998-2001

• Makes no difference what you plant. Still get these payments if available

Loan and Loan Deficiency Payment (LDP)

• Must have crop to receive so in times of low corn and wheat prices, growing another crop e.g. irrigated pasture will impact your payments

• Loan rates– Corn & sorghum--$1.98 will drop to $1.95 in 2004– Wheat--$2.80 will drop to $2.75 in 2004

• Remember, if LDP is in effect, prices for these commodities are low!

Evaluating irrigated pasture in a cow-calf system

1. Use partial budgeting procedure2. Estimate number of cows to be carried with

and without irrigated pasturea) Examine forage requirements and availability by

time periodb) If irrigated pasture fills a shortage in your forage

availability the number of animals should be affected

3. Estimate the change in costs of cow-calf enterprise due to the irrigated pasture

Evaluating Irrigated Pasture in a Cow-calf System

4. Estimate change in total returns WITH the irrigated grass

– May increase number of cows that can be carried in total

– May increase productivity of cows (weaning rates and/or weaning weight)

– May reduce costs of heifer development

5. Compare the change in returns to change in costs see if irrigated pasture pays its way.

Evaluating Irrigated Pasture in a Cow-calf System

6. If change in returns exceed change in costs then adding an irrigated pasture may make sense

7. Also look at cash flow of developing pasture

a) Can I cash flow the establishment costs?

b) What about costs of expanding cow operation if that is involved?

THANK YOU!

(More discussion at the Bull-Pen session this evening)