Working Through Daunting Drought Decisions

Shaye Koester  00:02

Hey, hey, it’s Shaye Koester and I’m your host for the Casual Cattle Conversations podcast where we connect you to ranchers and beef industry enthusiasts who can help you build a more profitable operation and improve your lifestyle.  Are you looking for a community of ranchers who support and challenge you to be more profitable and proactive? Then sign-up for our monthly RancherMind events. RancherMinds are mastermind events for ranchers to come together once a month and find solutions for their own and the industry's challenges.   Stay connected by following @cattleconvos on Instagram, Facebook and Twitter and never miss an episode or event update by signing up for our newsletter on casualcattleconversations.com/newsletter.   If you get value out of this episode or any episode drop a comment or tip me by using the link in the show notes.  With that let’s see who our guest is today and connect you to a new resource to improve your own operation and lifestyle.  Alrighty, folks, let's listen to our episode today. We are going to be talking about some drought management techniques with none other than Burke Teichert. Now this episode was originally premiered around June of 2021 so that would be last summer. It was originally only available to my premium subscribers and patrons at the time, but because it's been a year, and I'd really like to share Burke's wisdom with you all. Here it is. So with that, let's hear what Burke has to say about what ranchers can do for drought management strategies.  All right. So just to get started, you've been on the show before, but can you give a brief background of your ranch management experiences?

Burke Teichert  02:10

It's hard to know where to start, I guess I grew up on a family ranch in Western Wyoming. Right on the very west edge, and we owned property in Utah, Idaho and Wyoming. Utah, Idaho property was strictly range land country and Wyoming was basically our winter hay base. It was a irrigated, irrigated land in Wyoming and 6200 feet elevation was the lowest elevation. So it was cold and it was snowy. So I sort of grew up that way on a family ranch and then after two degrees in ag economics I spent a little time in the AI industry. After that, the rest of my career has basically been in ranch management. I did a lot of stuff for Ag Reserves, Inc, which is probably better known as at least the ranching part that are known as Deseret Ranches. Which included also the Rex ranch in Nebraska and some ranches in Wyoming and Montana, Utah, and it all started in Nebraska for me there. I mean, I had 10 years before that. I was doing ranch management. But my I guess my careers with Deseret began in Nebraska and the company just kept adding to me over time. Finally, I guess they decided they'd give me enough to call me a vice president but that didn't change my responsibilities much except they were just bigger.

Shaye Koester  03:59

Well, thank you for sharing. I mean, I know you went into further detail on that on your episode that was put out a year ago. So we don't really need to go into more detail there. But I know you have a lot of experience with drought management. And unfortunately, that's what a lot of producers are facing right now. And it's too late to be proactive with it. But what are some options that they can do now since there's not enough grass?

Burke Teichert  04:33

Destock them. The quicker the better. I'm actually managing a couple of ranches in Wyoming and we're caught right in the middle of that right now. We had pretty good  April rain but we didn't have May rain except for a shower or too. If you don't get rain in May in that part of the world, you're just not going to grow as much feed. It doesn't matter what happens in June and July. You're not going to grow as much as you would have if you had good May rain. It's a fairly large ranch, but we're in the throes of setting aside all dry cows, all late calving cows, and trying to package them up in lots that will enable us to sell them a little better. But we've got no choice but to sell them, and so some of them were pretty good cattle, too. They're just instead of calving in April they calved in May, or instead of calving in May, when they were supposed to gather them. They were maybe calving in June. We just bought the ranch and because some of the cows were April calvers and some of the cows were May calvers we're taking all the late calvers off of each of those groups, and they'll be up for sale. But, to me, the best drought management tool is to destock and as soon as you recognize you are drier than normal gonna produce less hay than normal, begin to destock. Have them prioritized. Know which ones are going to go first. And for most of us, it's going to be cows that we thought were going to calve and then they either didn't because they aborted or they lost their calf at calving time or one thing or another. So the dry cows go first, then after that, in my mind, late calvers or older cows, cows with less time left in their lives for your ranch, or cows that just aren't quite as good. You know, you need to prioritize them according to your own desires. But prioritize. Know what group of cattle you can get next and I like to have them set aside so I can go get them fairly easily. I'll  put them in a market pasture until you get rid of. So take good care of them. They're your next cash flow. So take good care. So you're not selling junk. Try to have them in pretty good shape, if you can.

Shaye Koester  07:09

Thank you for that. So what would be from an economic standpoint, what are the long term and short term impacts from the destocking option,

Burke Teichert  07:19

There are both negatives and positives naturally to destocking. Oftentimes, when you're to the point you need to destock local market prices sometimes aren't as good, especially if you're trying to sell pairs or bred animals because everybody else is in same circumstances you are. They don't have feed either. And, and so that market sort of collapses now that, you know, if it's just an open cow, she was going to be a cull anyway and you're just trying to get them sold quicker. That's not quite so bad. That market will hold up pretty good. But bred cows, late calving cows, cows with calves at side, they're just there. They're a little tougher because they've got to usually got a go a ways to find the market. So that's the downside is when you're caught there, it's usually kind of in a bad situation. And then after that, if you reduce numbers very much you have to rebuild. And you have to rebuild with usually extra help or retention or selling  less females. I'm probably different than most ranchers, I expose an awful lot of heifers, calve a lot of heifers and sell a lot of bred cows. Well, I'm not going to be able to sell as many bred cows, because I've got to build the numbers back. But you have to wait till it rains again before you can do that. But still, you have to restock eventually. So that's not always the funnest thing to do. And every animal you retain is an animal you can't sell. So that's some of the downside. You know, the upside is maybe you clean up your herd a little bit, maybe have a better herd on the other side. And then like I say the quicker you begin to destock, the less you have to destock. Does that make sense? You start earlier, you don't have to get rid of as many. If you wait too long, you can end up having to get rid of a lot. Now some people will try to buy feed. They go out and pay, what I call ridiculous prices to try to rent pasture. I think feeding your way through a drought or trying to rent pasture in the midst of a drought is really a tough way. I think you're better off selling animals and putting the cash in the bank. Work with your tax accountant and figure out how you can you know how you can make that work. Usually there's some forgiveness in the tax system, but I don't remember all the ways that you can bank that cash and then, you know, then buy cows back later on or keep cows, which to keep more cows, as you need to rebuild your numbers. But anyway the quicker the better, though.

Shaye Koester  10:30

Okay, so that's something that producers can do now. But on the more proactive side, you did mention that, you know, at least in your area, if you don't get rain in May, that's the sign that you're going to have to start destocking for drought. But what are some other proactive management practices that producers can implement?

Burke Teichert  10:55

I don't think there are other good ones, you know, other proactive things, are to go out at lease more pasture or buy hay or something, you know, to feed your way through. You just, you severely damaged your land if you try to keep more cows than it has the capability to carry. And so it's sell them or feed them. And I guess in my mind, I prefer to sell them rather than to feed them. There are people who feed them and make it work you know, and I guess I'd allow that. Some short term, pasture leasing or feeding, in some cases will make sense. And I know some people that do that, but boy they're very cautious in the way they do it. And they make it work, but they know their marketing plan. They know their economics and then they can make it work to temporarily feed cows, but oftentimes, they already have ahead of time maybe maybe stored a feedbank, you know, extra hay or whatever, so they could do that. Normally they're not necessarily feeding in the summertime, for example the ranch I'm talking about having to destock a little bit. We would, if we grow more grass we can get through the summer, okay? The problem is getting through next winter. But normally we like to graze and we're on a ranch that we can graze in the wintertime. But as the feeds all gone at the end of summer, winter comes and cows have to eat something, and that's where some hay feeding might make sense for some folks. We're gonna try to avoid that.

Shaye Koester  12:46

Okay, so what are some other mistakes producers make when they're managing in the midst of a drought?

Burke Teichert  12:53

Well, I think just that they don't start to destock quick enough. I don't know that there are other mistakes. Except that that compounds itself, you know, compounds moves forward and cascades into other mistakes and the other mistakes being that they end up over grazing, hurting the land, so it takes it longer to recover than if they lightened the stocking rate on it. And they manage their grazing in a much better way, if they get that they get the numbers reduced to where they where they fit the remaining feed base. So I'd say the biggest mistake they make in addition to not selling on time is that just that itself results in over in overstocking in which you don't go very far being overstocked before your overgrazing and hurting individual plants and and then slowing the long term recovery of the range just isn't going to recover as quickly if it's been overgrazed as if it has.

Shaye Koester  13:55

Well thank you very much for sharing that. And so kind of switching gears a little bit. What about on the opposite spectrum in yours when it's too wet? How do you manage those

Burke Teichert  14:09

Most of my management career has been in the western part of the United States from West Nebraska on further west and I've never experienced too wet. I'd love to have that opportunity sometime you know we would never complain about moisture even when it's snow which isn't very much fun sometimes. We just learn to love moisture in about any form. But you know, I don't know Shaye how well I can answer that question. Too wet you know, yeah, calving time. If you're muddy and yucky, that's got to be not very much fun. But then I'd choose to calve on later date too. So, but I guess I can vaguely remember time is calving time that we were, we were too wet back in the day when I was trying to calve in February and March. You'd get snow and rain and you know what but then it thaw and get muddy and messy and but yeah, I just say pick a good calving time. And then you can minimize that problem and pick a good calving time. Too much moisture, and you can probably get feed that's washy. Feed quality's not quite as good. But you're going to grow a lot of it. And so if you can kind of gauge the maturity, right, when you turn onto it, to try to let it get a little more mature. So it's not quite so washy. Probably going to be a little better off.

Shaye Koester  16:02

Okay, so what are things producers can do to better understand what resources they always have available on their operation?

Burke Teichert  16:11

Just become a good observer. So you, you know, it's probably not a very nice thing to say, but you probably don't deserve to be a rancher, if you don't know what you got on hand. You know, you just need to know what's there. How many acres but what the resource base is? How many irrigated acres, how many dry land acres, you know, what do you harvest hay from? What do you not harvest hay from? And, and how much are you going to have this year, just sort of have a way to observe and get a sense of what you have in terms of plant growth rates and those kinds of things. So you can project forward. It's mainly observation and measurement. And actually, there are a lot of measuring techniques to measure forage availability. But a person with a good eye and good experience of paying attention sees that almost as well as you can measure it, probably need to make yourself some notes though. It's easy to forget what we've been through in the past and what we have right now. And so how do we compare this year with previous years? We need to learn how to do that with some accuracy. How does this year compare with previous times? Are we better than are we poorer them? And by how much?

Shaye Koester  17:39

Well, thank you very much. I mean, you answered all the main questions I had kind of right away. And right off the bat. Is there anything else you'd like to add today?

Burke Teichert  17:50

Oh, I don't know, pray for rain. We sure need rain. And this drought is a, it's pretty big. It's covering a lot of the United States, particularly as we get, you know, west of Nebraska and West and you know, and going south, it's kind of the same, the same areas, the South and the Southwest are dry, dry. They're just a few areas that are kind of hovering around normal, but they're very few and very small. So it's a lot of drought. One thing I might add is that if there's a big sell down in cows, and I think there will be as a result of this. Plus other things are causing that right now. And we come out the other side of this prices are going to be pretty rosy. So select the group of cattle to sell and the group of cattle to keep that you can capitalize on the good prices that will be on the other side. Because I think I think they will be their thinking count on that. And I like to retain young animals that can stick around a while, because I think we're gonna have good prices on the other side.

Shaye Koester  19:09

Well, thank you very much, Burke, I appreciate you have been on.

Burke Teichert  19:13

Okay. Thank you much. Yes.

Shaye Koester  19:15

Well, thank you. I really appreciate it. It's always good to talk to you and appreciate everything you have to share.

Burke Teichert  19:22

Well, I think we can over complicate this drought thing. You know, it's just simple. We just have to we just have to beat it to the punch. I mean, and we're not going to do that. But we got to be right behind it. You know, once we know we're in drought, we got to destock. And you can like say you you can do other things to feed your cattle. You can lease pasture. You can buy hay or you can overgraze. I don't like any of those options. You know, because you're trying to rent pasture in the middle of a drought is pretty easy to see. $50 to $60 a head month and that doesn't work. It gets expensive real fast to do in the drought. So, I just like to say I think we can overcomplicate it, that just just means we just got to make the choices to destock. But you can work around with purchased hay and leased pasture but if you've been conservatively stocked in the past, you can even graze it just a little harder, but not very much. Yeah, I think the toughest part is just our mindset, just, you know, it always hurts to destock, you know, emotionally it does. Mentally it does. We don't want to do that. And we just, I just think business or ranching is such that you need to know well in advance what you might do if drought comes because you know, it's going to sooner or later. So when it comes, what are we going to do?

Shaye Koester  20:58

Absolutely. I mean, you have to have those plans, you have to know what resources you have, you have to know what finances you have. And that's a wrap on that ones, folks. Thank you, Burke for sharing all of your input experience and advice. It's always a pleasure to have you on the show. And thank you to everyone for hopping on and listening today. If you got some value out of this, be sure to drop a comment on one of my social media posts or wherever you're listening. I'd love to hear your input and advice and really just meet you. I'd like to really get to know my listeners, too with that. Have a great day.