Break-even forage production: Is your pasture paying its way?

Is your pasture paying its way? This is a question I have heard lately with regards to changing input costs. Before your cattle hit the field, here’s a quick way to check if your pasture covers its costs. Let’s run the numbers:

Suppose you fertilize a sub-irrigated meadow on cool- or warm season grasses. Let’s assume after we fertilize, this will boost our forage yield by 0.75 a ton per acre. Let’s assume hay is valued at $60 a ton, that extra 0.75  tons is worth $45 an acre, so you must spend less than that on fertilizer to break even. If hay prices rise to $100 a ton, your break-even fertilizer investment increases to $75 an acre.

But that’s just yield. In continuous grazing systems, livestock typically harvest only 25 to 35% of the forage, the rest is lost through trampling, fouling, or things of that nature. This dramatically eats into your return on your investment.

To get your money’s worth, combine fertilization with good grazing management, with things like rotational grazing across at least four paddocks. This not only improves forage utilization, it helps cover those fertilizer costs. Here’s a quick formula, if your total cost per acre is $100 ($X), and your hay value is $60 a ton (Y), then: Break-even yield = $100 ÷ $60 or X÷Y or roughly 1.67 tons per acre.

Make sure you’re getting that much forage after accounting for utilization. If you’re falling short, consider cutting costs, boosting efficiency, or renting extra grazing ground to balance the budget.

For additional information about this topic go to beef.unl.edu.

Shannon Sand is an agricultural economics Extension educator with the University of Nebraska.