Grazing bermudagrass pastures with stocker cattle is an important activity within 100 miles of Ardmore, Okla. Synthetic nitrogen (N) is commonly used by producers to supply the N requirements of their pastures. Typically, N accounts for about 40 percent of the annual total cost of maintaining bermudagrass pastures in the region; however, N costs have been trending higher over the past few years. In fact, between the years 2000 and 2007, the price of N increased by more than 120 percent (USDA). These higher prices have weighed heavily on farm profitability.
To address the issue of increasing N prices, Noble Research Institute researchers have investigated two alternative systems that utilize N-fixing legumes to supply N to bermudagrass pastures. One system uses a mix of annual legumes that are interseeded annually into bermudagrass (noted here as BG/C). The other system requires establishment of a grazing-tolerant variety of perennial alfalfa (BG/A). A randomized and replicated grazing experiment was conducted during the summers of 2008 and 2009 to measure stocker cattle performance and to determine the economic potential of the BG/C and BG/A systems relative to the conventional system of supplying bermudagrass pastures with synthetic N (BG/N).
We used 12 3.5-acre fields of bermudagrass at the Noble Research Institute's Pasture Demonstration Farm for this study. These fields have been intensively managed for decades and contain a healthy stand of Midland bermudagrass. In the fall, the fields were mowed, and those assigned to legume treatments were seeded with a drill. The BG/C seeding rate was 11, 8 and 5 pounds per acre of pure live seed of hairy vetch, crimson clover and arrowleaf clover, respectively. The BG/A seeding rate was 6 pounds pure live seed of a grazing-type alfalfa. The first year, the alfalfa failed to establish adequately. Alfalfa was re-established the second fall with adequate stand establishment. One hundred pounds per acre of actual nitrogen (as urea) was applied to the BG/N fields in the spring prior to grazing.
The fields were each continuously stocked with four preconditioned stocker steers averaging approximately 525 pounds at turn-out. These steers were shrunk and weighed every 28 days during the grazing season. Fields were grazed as long as there were 1,000 pounds per acre of forage dry matter available. Each field was managed independently of the other fields.
The relative economic value for each of the nitrogen management systems was determined by calculating the expected costs and revenues for each system. Only the costs of production variables that varied by system were considered, including quantity of nitrogen and nitrogen application, legume seed and seed establishment, herbicide and herbicide application, and the cost of operating capital. Due to a stand failure in 2007, alfalfa was re-established in 2008. The two-year costs for establishing the perennial alfalfa were prorated over an expected stand life of five years.
Feeder cattle futures prices were used to determine the expected beginning and ending values of the cattle based on the observed placement and termination dates for each system. In addition, expected prices for the 2010 production year were used for all inputs, including nitrogen fertilizer, herbicides and legume seeds. A price of 45 cents per pound was used for N (46 percent urea). An interest rate of 8.5 percent was used to calculate opportunity cost of capital and to calculate the prorated establishment cost for the BG/A system. Current custom rates for N and herbicide application and no-till drilling were taken from a report published by the Oklahoma Cooperative Extension Service (Doye and Sahs).
Cattle performance measures and economic calculations from the experiment are reported in Table 1. Forage availability was greatest in the nitrogen-fertilized treatments. Increased forage production resulted in a longer grazing season for the BG/N fields. The annual legume system (BG/C) exhibited improved forage crude protein concentration. Interestingly, this did not translate into improved steer average daily gain. The cost advantage realized by the BG/A system implies that producers who switch from a synthetic N system to the perennial alfalfa system can expect to reduce their annual pasture management expenses by 40 percent. Expected net return favors the BG/N system, but further analysis of the data indicates that producers would be indifferent between the BG/N and the BG/A systems at a N fertilizer price equal to 61 cents per pound. As a point of reference, the November 2008 price of 46 percent urea in the NF service area was 65 cents per pound. Due to the high cost of annual seeding and the relatively low production, the BG/C was not economically competitive in this experiment.
Our preliminary conclusion is that synthetic N fertilizer at current prices is more profitable than legumes. However, this would not be true at fertilizer prices that we observed in the recent past. Total gain per acre, driven largely by grazing days, is a major factor in determining profitability. We plan to continue this experiment in the future.
Doye, D., and R. Sahs. 2008. "Oklahoma Farm and Ranch Custom Rates, 2007-2008." Oklahoma Cooperative Extension, Current Report CR-205-0308.
U.S. Department of Agriculture. "Agricultural Prices 2009 Summary." National Agricultural Statistics Service. Pr 1-3(09). Found at: usda.mannlib.cornell.edu/usda/nass/AgriPricSu//2000s/2009/AgriPricSu-08-05-2009.pdf [Accessed, Nov. 15, 2009].