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RESOURCE & RISK MANAGEMENT

RESOURCE & RISK MANAGEMENT

The current drought illustrates the extreme difficulty bison producers’ face in maintaining a healthy balance of animals on their pastures and rangelands. Overgrazing is always a consideration, even in years of “normal” moisture throughout most of the North American ecosystem. When dry weather, or an extended drought, settles in, ranchers must be proactive to adjust their stocking rates to protect their pastures. An overgrazed pasture may require years of recovery time, particularly in the semi-arid regions of the country,

Without corrals as an option, bison producers would simply have to de-stock during dry periods by sending their animals to slaughter. Drought conditions obviously impact all livestock sectors, however bison producers face additional challenges because of the nature of the business. Replacement animals are not as readily available as they are with domestic livestock.

Corrals Help Small Producers Maintain Economic Viability

Farmers in the United States have historically brought their livestock into corrals in the winter, and prior to slaughter. In fact, finishing in corrals (regardless of the feed composition) can actually help small producers be economically viable.

For example, if a land base has a carrying capacity of one animal “unit” (cow and calf) per 30 acres, it will require more than 60 acres to bring an animal from birth to slaughter at 27 months of age in a purely pasture-based model. However, by moving some of those animals into a finishing facility prior to slaughter, a rancher eases the grazing impact on their pasture land, and keeps the growing grass for use by the mother cows and their new calves, where nutrition is most vital.

Also some small producers who farm and raise their own feed can utilize the lower quality grain they produce by feeding it to their own livestock vs. taking a lower price at the elevator. Farmers and ranchers need options in order to stay viable and sustainable.

BUDGETING

Included in this web page is a bison production budget. The budget summarizes the receipts, costs, and net returns of a bison cow-calf operation in which the offspring are sold for slaughter. This sample budget should help ensure that all costs and receipts are included in your calculations. Costs and returns are often difficult to estimate in budget preparation because they are numerous and variable. Therefore, you should think of this budget as an approximation and then make appropriate adjustments in the “Your Estimate” column to reflect your specific production and resource situation. More information on the use of livestock budgets can be found in “Agricultural Alternatives: Budgeting for Agricultural Decision Making.” More information on the use of crop budgets can be found in ” Budgeting for Agricultural Decision Making.”

You can make changes to the interactive PDF budget file for this publication by inputting your own prices and quantities in the green outlined cells for any item. The cells outlined in red automatically calculate your revised totals based on the changes you made to the cells outlined in green. You will need to click on and add your own estimated price and quantity information to all of the green outlined cells to complete your customized budget. When you have completed your budget, you can print the form using the green Print Form button at the bottom of the form. You can use the red Clear Form button to clear all the information from your budget when you are finished.

In addition to slaughtering costs, the rates charged by individual plants and USDA inspectors is $60 per hour for the inspection with a three-hour minimum per animal for a cost of at least $180. The symbol used for non-amenable species is triangular in shape, which easily distinguishes it the traditional circular USDA symbols used for meat and poultry slaughter plants

Initial Resource Requirements

Land: 25–40 acres

Labor: 400–500 hours

Capital:

Livestock: $20,000–35,000

Buildings, equipment, and fencing: $35,000–40,000

Total capital invested: $55,000–75,000

RISK MANAGEMENT

You should carefully consider how to manage risk on your farm. First, you should insure your facilities and equipment. This may be accomplished by consulting your insurance agent or broker. It is especially important to have adequate levels of property, vehicle, and liability insurance. You will also need workers’ compensation insurance if you have any employees. You may also want to consider your needs for life and health insurance and if you need coverage for business interruption or employee dishonesty. For more on agricultural business insurance, see ” Agricultural Alternatives: Agricultural Business Insurance .” For more information on farm liability issues, see ” Agricultural Alternatives: Understanding Agricultural Liability .”

Second, check to see if there are multi-peril crop insurance programs available for your crop or livestock enterprises. There are crop insurance programs designed to help farmers manage both yield risk and revenue shortfalls. However, individual crop insurance coverage is not available for all crops. Whole Farm Revenue Protection (WFRP) provides a risk management safety net for all commodities on your farm under one insurance policy. You can buy WFRP alone or with other buy-up level (additional) federal crop insurance policies. Coverage levels range from 50 to 85 percent of your expected revenue or whole farm historic average revenue (based on your 1040-F information), whichever is lower. For more information concerning crop insurance, contact a crop insurance agent or check the Extension Crop Insurance article.

ENVIRONMENTAL IMPACTS

In the normal course of operations, farmers handle pesticides and other chemicals, may have manure to collect and spread, and use equipment to prepare fields and harvest crops. Any of these routine on-farm activities can be a potential source of surface water or groundwater pollution. Because of this possibility, you must understand the regulations to follow concerning the proper handling and application of chemicals and the disposal and transport of waste. Depending on the watershed where your farm is located, there may be additional environmental regulations regarding erosion control, pesticide leaching, and nutrient runoff. Contact your soil and water conservation district, extension office, zoning board, state departments of agriculture and environmental protection, and your local governing authorities to determine what regulations may pertain to your operation.

THE BOTTOM LINE

Bison have evolved though the centuries to efficiently harvest nutrients from the grasses and forage native to the North American ecosystem. Bison ranchers today work to accommodate those natural behaviors as much as possible. And, in fact, the National Bison Association Code of Ethics is aimed at assuring that “buffalo will always be buffalo.”

A few large producers have thousands of animals spread across vast landscapes. But the average producer in the United States maintains a herd of fewer than 35 animals. Large or small, bison producers across the country strive to consistently supply the market with nutrient dense, quality meat from humanely and naturally raised animals. Regardless of finishing protocols, low-fat, high protein bison meat is proven to have strong nutritional benefits.

This partnership between ranchers and their customers is the key factor that will provide an incentive for continued restoration of the bison species on the privately owned lands of North America.