Increasing profits: more than just live weight, ex farm gate

By Bob Shepherd, Principal Extension Officer, DAF Charters Towers.

The gross value of beef sold tells only part of the story of the economic performance of a cattle business. The other side of the equation is costs. Apart from current interest rates on farm debt, most costs continue to rise. All beef producers have pruned costs over the decades – less labour; only strategic use of supplementary feeding; not over-fencing or over-watering the property; selling cattle early in a drought; etc - the list goes on and is very long.

However, while this trend continues, other things are occurring that challenge the long-term economic performance of many properties, most notably deterioration of land condition. The biggest single driver of land condition is not grazing systems (continuous, rotational, or cells), it is stocking rates! If stocking rates exceed the carrying capacity of the property in the majority of years – land will degrade irrespective of grazing system. (Grazing systems is a discussion for another day)

To see where any given property sits in regards to stocking rates versus carrying capacity, go to the “Forage” website https://www.longpaddock.qld.gov.au/forage/ and request a “Regional comparison ground cover” report, enter a “lot on plan” and your email address, then send. In 10 minutes it will be in your inbox. When it comes back, look at the graph at the bottom of page 2. The following graph is an example.

The red line is the selected property line. If it is above the 50-percentile line, stocking rates have been matched to carrying capacity. If the red line is below the 50-percentile line, stocking rates have exceeded the carrying capacity of the property, indicating that there is a strong chance that it is degraded.  For the property in the graph above, it was heavily grazed from 2000 to 2012, then lightly stocked from 2013 to 2019. What happened in 2012-13? – the property changed hands and reduced the stocking rates, so not all is lost if country has been hammered! Please read on.

Doing an annual forage budget is the safest way of matching stocking rates to carrying capacity. There has been miles of information on forage budgeting, so it won’t be covered here. But what are the economic benefits of forage budgeting? Consider the following five examples:-

1.      Dry season supplementary feeding costs

Lack of protein is one of the main drivers of the requirement to feed supplements during the dry. Pastures at all stages of growth store most protein in the leaves and least in the stems & stalks. Overgrazing early in the dry quickly removes all the leaf out of the pasture, forcing cattle to eat low protein stems – the management response – more supplementary feeding ($$$$$). Doing a simple forage budget at the end of the growing season (first round muster) and making a modest reduction in stocking rates (10 to 15%), will mean the leaf in the pasture will be sufficient to carry the balance of the cattle until the end of the dry season. The end result – less dry season supplementary feeding. Running out of pasture completely, and feeding hay to cattle is an extreme example high-cost dry season management which could have been averted by forage budgeting.

 2.      Expression of superior genes through the breeder herd

There is a lot of publicity about increasing animal production by buying genetically superior bulls. Increasing the percentage of breeders that re-conceive during lactation is one big benefit that is exciting for producers. But this can only occur when there is sufficient pasture available through the whole dry season for breeders to calve in body condition score 3 or better and the breeder herd is disease-free.  The take home message is “genes will not express themselves if nutrition is inadequate.” How is diet quality maximised? – do a dry season forage budget and over-sow pastures with legumes.

 3.      Increasing density of native woody plants

There is a direct relationship between woody plant density (tree basal area per hectare) and pasture growth. To complete the story, trees do increase the protein content of grasses under their drip-line – particularly leguminous trees such as brigalow, gidgee, bauhinia, etc. But the reduction in yield most often far outweighs the increase in protein content. There is a range of woody species that are thickening. Currant bush is increasing at a dramatic rate on the low to moderate fertility land types (eg silverleaf & narrowleaf ironbark, box and northern brigalow) while eucalyptus species are the main offenders on the higher fertility land types (eg red basalt and loamy alluvials). Long-term measurement of increasing tree density has shown that pasture yield can decline by up to 2.0% per year. Doing the maths using only 1.0% annual reduction in pasture yield compounds to 23% reduction over a generation (25 years). On high fertility land types (alluvial, basaltic and acacia scrub soils), the reduction in carrying capacity is proportional, ie a 23% reduction in carrying capacity. But on low fertility soils (the vast majority of the Upper Burdekin country) the reduction is even worse, as a higher proportion of what is grown is required to provide ground cover at the end of the dry season. On the very lowest fertility soils with high tree densities, there may effectively be no grazing available in most years.

 What is the solution? As woodland thickening is occurring primarily in uncleared land (remnant vegetation), broadscale clearing is not an option. There is provision in the Vegetation Management Act to thin remnant vegetation if it can be proven that it has thickened. If a permit is granted, the cost of mechanically or chemically thinning can be very high (up to $500/ha), so the economics are borderline at best. Concentrate on those paddocks that are showing early signs of thickening (ie most of the thickening is tree seedlings, small saplings under 2.0m high and currant bush with grass still growing through the clump), and use fire. For most species, fire suppresses native trees and shrubs, it does not kill too much. To ensure there is sufficient fuel to carry a hot fire at the end of the dry season, do a forage budget so that 1500 to 2000kg (dry weight)/ha of pasture is on-hand in late November. Most years the land will struggle to grow this amount of pasture, but after a season like the current one, it is possible – take advantage of it. Plan for the fire:-

·        Pre-burning planning

o   Forage budget to determine a stocking rate will ensure the required fuel loads are there at the time of the fire

o   Firebreaks in place

o   All equipment is serviceable

o   Local rural brigade available

·        The burn

o   Paddock destocked

o   Permit on-hand

o   The right day (wind speed, humidity, dryness of fuel, etc)

o   Equipment & personnel on-hand

·        Post-fire management

o   Determine if the area is suitable for over-sowing with legumes (if yes, see 5. below)

o   Lock-up the paddock for full wet season spell (pasture competition helps supress recovery of woody plants; grazing removes the pasture competition and gives the woodies a free kick, largely negating the benefits of the fire)

o   Do a forage budget for the following dry season

4.      Managing exotic woody weeds

Woody weeds have a similar effect on reducing pasture production as the increasing density of native woody plants, except the rate of increase is often faster. Depending on the weed species, their density and their susceptibility to a range of treatments, fire may be one of the options. There are a few golden rules with woody weed management:-

·        Start with the paddocks that are most lightly infested and work (over the years) towards the paddocks with the densest infestations last.

·        Adopt an Integrated Pest Management (IPM) approach ie use the full range of treatments available; for example, biological agents, fire, herbicides, machinery and strong competition from pastures ie light stocking rates

·        Understand the weaknesses of the weeds being managed eg years to reach reproductive maturity, longevity of seeds in/on the soil, susceptibility to herbicides, root-suckering ability, susceptibility to fire, etc

Consider the following examples:-

·        Isolated weeds – Spot treatment with herbicides (residuals if registered for that species)

·        Dense woody weeds with little pasture growth possible even in wet years - Mechanical control is probably the best option, unless the actual weed is combustible at certain times of year eg dense rubber vine will carry a hot fire when severely moisture stressed, even when pasture yields are low to non-existent. For dense infestations where it is still possible to walk through the plants eg parkinsonia, calotrope or prickly acacia, basal bark or cut-stump spraying is also worth considering and alleviates any difficulties with managing fires.

·        Scattered infestations – if the species is susceptible to fire eg rubber vine, lantana, bellyache bush and parkinsonia, do a few back of the envelope calculations to compare the costs of spot spraying, mechanical treatment and fire.

Follow the guidelines for use of fire as outlined above for native woody thickening (including the use of forage budgets). However, consider one important difference. Fire residency time (duration that the fire is around the base of the plant) is often more important than fire intensity. So, a slow moving back-burn with a modest fuel load will give a better kill rate on rubber vine, lantana and parkinsonia (and possibly other species). These fires are easier and safer to manage than a fast-moving, intense front-burn.

Recognise that some woody weeds are not susceptible to fire – most notably, chinee apple. Therefore, use other methods; burning is a forlorn hope for controlling chinee apple and a waste of good pasture! As with all activities that cost money, make an informed decision on weed management by talking to others (producers that have walked the walk, researchers and extension officers) and work to a budget.

 5.      Over-sowing legumes

Few investments in the beef industry yield as high returns for the dollar spent as over-sowing with legumes. Consider how much introduced legume exists in the paddock before over-sowing. A few scattered plants (one or two in each area 5m x 5m) will set more seed if given a chance, than what can be thrown out of a plane; and the cost will be zero $s). In continuously and heavily grazed paddocks these legumes may have quite a large base and root system, but little top growth (like a carrot). All they need is a full wet season spell to allow growth and maximum seed-set. But keep the cattle out until mid-June as many of them are late flowering/seeding eg the stylos. Grazing over winter will allow some seed to fall and some to be grazed and carried around the paddock by livestock.

If over-sowing of legumes is required, ensure competition from the existing pasture is suppressed, either by burning or heavy grazing. Once again, a forage budget will ensure that sufficient fuel is on-hand to burn the paddock for an ash seedbed, or to determine the appropriate stocking rate to take the pasture down to a lower level than would normally be desirable at the end of the dry season. This is a ‘once-off’ in the paddock to be over-sown. If the paddock was grazed down, dramatically reduce numbers at last round muster, but leave a few head in the paddock to keep a lid on the competition as the legumes establish. If the paddock was burnt, put a few head in to achieve the same result. Keep an eye on what the cattle are eating as the summer progresses. Usually, they will preferentially select the palatable grasses, not the legumes while the grasses are green.

Conclusion

Each of the five examples above will have major economic and environmental benefits for all beef businesses in the Upper Burdekin. Some are long-term (generational), some are short-term (less than 3 years). As land values increase, the possibilities for purchasing more country diminishes. However, the options for doing something at home, becomes more feasible, particularly with current high cattle prices. Discuss the options around the kitchen table with the family and make a few informed decisions on the way forward. The Dalrymple Landcare Committee offers a free Forage Budgeting Service; to register, go to:- https://www.dalrymplelandcare.org.au/forage-budgeting-service