Date of Award:

1977

Document Type:

Thesis

Degree Name:

Master of Science (MS)

Advisor/Chair:

Frank E. Busby

Abstract

The operating costs for farms and ranches in the United States have increased 81 percent between 1970 and 1976. Calf prices over this same period have fluctuated dramatically and have fallen from a high of $58/cwt in 1973 to a low of $2 6/ cwt in 1975. Since 1973, the increasing operating costs have exceeded the returns gene rated by the low calf prices and have left operators in a negative financial position. This case study has shown that the operator has increased both the scale and efficiency of his operation through improved lives tock husbandry and range improvements , yet has been unable to keep up with the increase in operating costs.

A res t rot at ion grazing system and associated range improvements were implemented in 1970 on the summer mountain range. The resultant increase in forage prod uction allowed a 45 percent increase in the breeding herd. The meadow hayland and crested wheat grass pastures were also improved to provide winter and spring forage for the increased number of cows. The calf crop weaned and average weaning weights increased from 86 percent and 347 pound s i n 1970 to 93 percent and 363 pounds i n 1976. The total pounds of calf weaned increased 60 percent between 1970 and 1976.

The tremendous increase in beef production was offset by the rampant increase in op e rating costs. The net return in 1970 was $2 , lOo but dropped to a loss of - $3,671 i n 1976. However, had the operator not increased the level of production while the operating costs increased, his net loss in 1976 would have been - $24 , 718 . Although the net returns a re negative , the increase in returns over the base level of production is positive. The internal rate of return and net present worth of the grazing system and its associated improvements was 25 percent and $95 ,027 respectively.

TI1 e operator has been successful in developing his range and livestock resource and increasing calf production. It is paradoxical that the increase in returns above the base production have rendered the improvements economically profit able yet the combination of increasing operating costs and low livestock prices have produced a negative return from 1974 through 1976.

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Life Sciences Commons

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