Development of rice and cattle operations in the "high Savannah" portion of the Llanos Orientales of Colombia

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Title:
Development of rice and cattle operations in the "high Savannah" portion of the Llanos Orientales of Colombia
Physical Description:
4, 11 leaves : maps ; 37 cm.
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English
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s.n.
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Subjects / Keywords:
Agriculture -- Economic aspects -- Llanos (Colombia and Venezuela)   ( lcsh )
Llanos -- Colombia   ( lcsh )
Rice -- Colombia   ( lcsh )
Cattle -- Colombia   ( lcsh )
Genre:
non-fiction   ( marcgt )
Spatial Coverage:
Colombia
Venezuela

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General Note:
Caption title.

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Source Institution:
University of Florida
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
oclc - 730234732
ocn730234732
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AA00007170:00001


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DEVELOPMENT OF RICE AND CATTLE: OPERATIONS IN THE
"HIGH SAVANNAH" PORTION OF THE LIANOSS
ORIENTALES OF COLOMBIA


This report is based on a very preliminary estimate of the production
potential which could be expected in the high savannah region of the Llanos
Orientales of Colombia as a result of the construction of an all-weather
road, sbme schools, medical clinics, other service areas, an ICA experiment
station and an active extension service. The report draws on the educated
judgement of a number of soils, livestock and crop specialists who are
familiar with the area. With the exception of the FAO soils study of the
Llanos which was used to determine area of influence and propping potential,
no other published sources of information were used.

The estimates of yield potential are not extravagant, nor should ithe
rate of development be unrealistic. Cost estimates for the rice and cattle
operations are probably less firm than the other estimates, but should be
ample for the levels of production anticipated. Costs of the public capital
construction projects have been based on recent budget values from the
various ministries and should be reasonably accurate.

Description of the Project and Project Area

The project area includes about 1,000,000 hectares on the high, level
savannah portion of the Llanos Orientales of Colombia lying south of the
Meta River and east (and northeast) of the Metica River at Puerto Edpez,
Meta. Included are portions of the Department of Meta and the Comisarlla of
Vichada. The region is a rather narrow belt extending about 300 kilometers
from Puerto Edpez, The eastern limit coincides with the extent of the. FAO
soils survey.

The primary feature of the project is the construction of an all-weather
road east from Puerto Ld~pez and includes a bridge over the Man~acaclas River
at Puerto Gai~tin. The proposed road would follow the route of the present
trail toward Puerto Carrelho. Several penetration roads have also been proposed
(see map). In order to.attract the required number and quality of people
to the. region, the project also calls for the construction of 21 schools and
5 medical clinics. The other major item of capital investment is a large,
well staffed experiment station which is considered essential owing to the
nearly complete lack of crop and livestock information in this part of Colombia.

Livestock Production

Present agricultural production in the project area is limited exclusively to
extensive livestock raising. Average stocking is at about one head per 10
hectares. Little or no management is used with many of the cattle not even
receiving salt. The usual practice is to ship 3 1/2 year old steers (or bulls
as castration is not widely practiced) to the piedmont near Villavicencio for
fattening prior to being marketed for slaughter in Bogo~td. The low calving rates
(about 40 percent at weaning) and high adult mortality (about 6 percent) preclude
any herd buildup except by purchasing additional females. However, the extremely
low costs and absence of taxes (as very little of the land is titled) still yield
good incomes for the owners.








-2


Most of the owners live either in Bogotd or Villavicencio and visit their
ranches only once or twice a year. The use of light planes for thi~s purpose
is as common as jeeps, and the ranch that has any motorized vehicle is rare.
The ranches are usually staffed by a foreman and his family and a few cowboys!
Most food is produced on the ranch, although a few supplies are breogght in by
truck or horseback. Holdings are large, usually exceeding 4,000 hectares, and
many have 20,000 to 30,000 hectares.

Littleis known about population growth in the area, but it is probably
increasing only very slowly, and the density at the present time is estimated
at about one-half person per square kilometer. Under the present conditions
of isolation, the population and production of the area would not be expected
to change very rapidly.

The addition of reliable transportation to the area can have a major
impact on the livestock industry. Technology is presently available to raise
the calving percent to 65 percent and drop mortality to 5 percent even without
the use of improved pastures nor complicated management. But under the present
system of absentee owners there is little incentive to undertake more intensive
production. And few owners will live on the land so long as transportation and
service facilities are lacking.

Much of the increased livestocki production will result from the importation
into the area from outside. However, the estimates of production used in this
report are based solely on buildup from the present herd. In this sense, the
rate of growth is very conservative, even though it is based on maximum increase
in the herd. That is, 80 percent of the heifers are held back during the growth
period. But steer and cow sales still increase rapidly.

Three "systems" of livestock production are included in this report. The
first is the presently used system except that salt has been budgeted for it.:
The assumptions for this system are: 1) 40 percent calf crop at weaning,
2) 6 percent adult mortality, 3) replacing 17 percent of Ithe cow herd annually,
and 4) steer sales at 4 years of age.

The second system includes improved practices but the use only of the
native pasture. The improved practices involve the feeding of mineral supplement,
vaccinations, the use of medicines, dipping, and the controlled breeding season.
The assumptions are: 1) 65 percent calf crop at weaning, 2) 5 percent adult
mortality, 3) replacing 17 percent of the cow herd annually, and 4) steer.and
heifer sales at 3 years of age.

The third system is the same as the second except that about 800 hectares
of improved pasture per 1000 cows is included. The pasture is used 3 months
for flushing the cows before breeding, 3 months by the calves after weaning, and
6 months for fattening the stock before sale. ]Production assumptions are:
1) 80 percent calf crop at weaning, 2) 3 percent adult mortality, 3) replacing
17 percent of the cow herd annually, and 4) steer and heifer sales at 2.1/2 years
of age.








-3


Only the third system produces "fat" cattle for sale. However, the
same per head value was used for all systems, so particularly the present
system is somewhat over-valued.

The schedule of developarent of these systems is as follows assuming the
road and other works would be constructed during 1969 and 1970.. Herd
building ~, sales, costs and returns are shown in the attached tables.

Percent of Area in:

Year Present System Intermediate Advanced

1970 100
1971 85 10 5
1975 45 40 15
1980 and after 20 55 25

Of the 1,000,000 hectares included in the project area, about half are
level, natural grass savannah and another 100,000 hectares are rolling
savannah. Creeks, rivers and forests account for about 200,000 hectares and
the remaining 200,000 hectares is suitable for rice production, but presently
in native grass. The present cattle herd on the 1,000,000 hectares is
estimated at about 100,000 head of which 47,500 are cows. It was assumed that
the portion of the herd on the rice lands would remain unchanged, so the herd
involved in the buildup numbers about 60,000 of which 28,500 are cows.

Rice Production

There is a concentration of about ,200,000 hectares of moderately fine to
fine textured soils, moderate to poorly drained lying in the eastern part of the.
project area (see map). These soils appear tdo be very well adapted for the
production of rice. There is ample rainfall for several months following the
dry season to obtain excellent production~91thout irrigation. Double cropping
would be possible but would probably require some irrigation as the dry season
approaches. Although there is ample surface and ground water for irrigation,
double cropping was not included in the estimates. Therefore, if the percentage
in this report appears high, this is easily off-set by the exclusion of the
double cropping potential.

It was estimated that after completion of the road, one percent of the area,
or 2,000 hectares would come into production annually, for 5 years. Thereafter;
5 percent or 10,000 hectares would come into production annually for 15 years,
or until 80 percent of the potential land was producing rice.

Rice is one of the highest valued crops for which a potential in the
region is known. For this reason, it can be expected that this will be the first
crop to be grown extensively. But other crops can and will be grown on a much
higher proportion of the soils. Therefore, the full value of crop production as
reflected by single crop rice is almost certainly well under valued.

The total quantity and value of rice production as well as costs of
production are shown in the attached tables.








- 4


Project Works

The major works of the project include a bridge over the Manacacias River
at Puerto Gaitbn estimated at 6 million pesos, (there is already one under
construction at Puerto Lbpez), and about 820 kilometers of all weather road
estimated at 123 million pesos (see map). The purchase of land for an
experiment station and the construction of suitable buildings is estimated
at 8 million pesos. The construction of 6 five room schools and 15 two i
room schools is estimated at 1.5 million pesos. The cost of constructing
and equipping one 8 bed clinic and 4 medical clinics without beds is estimated
at 2 million pesos.

Total capital cost for these works is 140 million pesos or about 8.6
million dollars. It is realized that the school and medical facilities are
minimal, but the present sparse population hardly justifies an elegant plant
at this time. However, it is anticipated that the availability of even these
initial facilities will begin to attract more and more people to the area.
And with the influx of people and business, other supportive services and
supplies can be expected to follow.

Benefit-Cost Analysis

The present worth in 1970 of the stream of net benefits to farmers and
ranchers in the area discounted pt 12 percent over a 30 year period from
1970 to 2,000 is 2,150 million psos. The discount rate used happens to
correspond to the usual interest rate granted by the Caja Agraria. However,
it can also be considered as a 6 percent rate over a 6 percent annual
inflationary trend. Discounted two more years to 1968, the value is 1,714
million pesos. Based on a loan of 10 million dollars or 163 million pesos
granted in 1968, thle benefit-cost ratio would be about 10.5 to one.

Taking into consideration the conservative nature of many of the estimates
of production, it appears that a project of this nature would have an extremely
attractive payoff. No consideration has been takdh of Eiy secondary benefits,
nor of additional economic activity in the serrania, south of the major zone
of influence. On the other hand, no costs have been included for additional
expansion of the initial facilities, nor for their operation and maintenance.
But the great expansion of economic activity in the area should provide more
than adequate financing for these items as they are required, particularly after
the first 5 to 10 years. Additionally, a total loan of 10 million dollars would
leave 1.4 million dollars or about 20 million pesos to take up some of the slack
during the earlier years of the project.











Herd Composition and Sales on 21,120 Hectares Using Enproved System
without Improved Pastures




1. Production coefficients


65% calf crop at wearing
5% adult mortality
Steers sold at 3 year of age.


2. Composition for 21,120 hectares fully stocked


Numbers
Females
2,010

653
620
588
4,526


Animal Units
2,010
100

930
1,176
4,216


Class
Cows
Bulls
Calves
1 2 years
2 3 years
Totals


Males

100
653
620
588


3. Sales


Class


Number

588
246
242
14
1,090


Steers
Heifers
Cows
Bulls
Total


4. Steer and heifer sales are 0.41 head per cow compared with 0.17 under present average
system where all heifers are needed for herd replacement.











Herd Composition and Sales on 21,120 Hectares Using Improved System
with Improved Pastures





1. Production coefficients


Animal Units

3,105
103

1,810
1,433
6,451


Males


103
1,242
1,205
1,170(qjyr)
7,051


80% calf crop at weanaing
3% adult mortality
Steers sold at 2.5 years of age


hectares fully stocked


2. Composition for 21,120


Number s
Females

3,105

1,242
1,205
1,170(f43yr)


Class

Cows
Bulls
Calves
1 2 years
2 3 years
Totals


3. Sales


Class


Number

1,170
643
434
18
2,265


Steers
Heifers
Cows
Bulls
Total


4. Steer and heifer sales are 0,58 head per cow compared with 0.41 without improved
pastures. Sales per 100 hectares are 8.6 and 3.9 head of steers and heifers respect
tively. The present system and stocking rate produces less than one head per 100
hectares annually.
















1. Production coefficients

40% calf crop at wearing
6% adult mortality
Steers sold at 4 years of age.


2,112


Average Present Herd Composition and Sales in the Llanos


2. Composition for


1,000 cow herd


Number s
Females
1,000

200
188.
177
166


Animal Units
1,000
50

282
354
332
2,018


Class
Cows
Bulls
Calves
1 2 years
2 3 years
3 4 years
Totals


Males

50
200
188
.177
166


3. Sales


Class
Steers
Heifers
Cows
Bulls
Total


Number
166

106
7
279


4. At present average stocking rate of 10 hectares per head, this herd would be using
21,120 hectares. This, therefore, is considered the basic land unit.











Cost of operations and Machinery inventary for 200 hectares of rice


1. Equipment inventglry

Tractors (2) Nufield $66,000 ea
Combine (1) Ferguson 400-7
Disk plow (1) Apol~o TE-23
Disk harrow (1) Apolo K-16
Spike tooth harrow (1) 3 sections
Fertilizer spreaders (2) $7,000 ea
Drill 18 Sma~t (1)
Jeep (1) 6.5 value
Total inventary


2. Annual repair and maintenance


$132,000
330,000
14,500
11,600
4,000
14,000
22,500
40,000
$568,600


Tractors
Combine
Disk plow
Disk harrow
Spike tooth harrow
Fertilizer spreaders
Drill
JeeP
Total


$ 48000
10,600
800
400
200
200
500
1,000
$17, 700


3. Costs


Puel
Oil and lubrication
Repaims and maintenance
Machinery depreciation 20%
Interest on machinery ((1,5 12%)
Fertilizers and pesticides (w/applic)
Seed
Labor
Management
Sub-tdal '
Contingency
Total costs


$ 3,500
50
17,700
115,000
34,000
420,000
96,000
24,000
36 000
746,700
53,300
% 800,000










Annual Costs and Pastures of- Improved System with Improved Pastures -
Fully Stocked




1. Size and Stocking

21,120 hectares
3,100 cows
6,450 animal units


2. Costs (1968 pesos)


Item


Value


/ 112,000
25,000
80,000
25 ,000
99,000
161,000
273,000
a 124,000
160,000
16,000
15,000
60,000
100,000
72 000
9 1,322,000
1591000
1: 1,481,000


Minerals
Salt
Vaccine s
Medicines
Worming and dipping
Bull depreciation
Fence, water development
Improved pasture
Labor
Food
Fuel and lubricants
Repairs
Depreciation
Manager ($6,000/mo.)
Sub-total
Interest 12%
Total


3. Sales


Unit
Value

$2,150
1,800
1,200


Total
.Value


Class


Number

1,170
643
434
2,247


Steers
Heifers
Cows


$2,516,000
1,157,000
521,000
$4,194,000


Totals


Per
Cow Hectare


Total


Total income
Expenses
Net income


,1 4,194,000
1,481,000
Z,401,000


$1,352
477
$ 875


r/ 198.5
70.1
;P 128.4











Annual Costs and Pastures of Improved system without Improved Pastures -
Fully Stocked




1. Size and stocking

21,120 hectares
2,000 cows
4,200 animal units.


2. Costs (1968 pesos)


Value

S76,000
17,000
54,000
17,000
67,000
109,000
76,000
8,000
10,000
40,000
25,000
54 000
''`553,000
66 000
r 619,000




Unit
Value


Item


Minerals
Salt
Vaccines
Medicines
Worming and dipping
Bull depreciation
Labor
Food
Fuel and lubricants
Repairs
Depreciation
Manager ($4,500/m8.)
Sub-total
Interest. 12%
Total


3. Sales


Total
Value

$1,264,000
443,000
290,000
$1,997,000


Class


Number

588
246
242
1,076


Steers
Heifers
Cows


$2,150
1,800
1,200


Totals


Per
Cow Helctare


Total

1,997,000
619,000
y! 1,378,000


Total income
Expenses
Net income


:/998
309
t 689


S94,5
29 3
4; 65,2










Growth in Cow Herd and Sales from 600,000 Hectares


Sales in number of head

Year Cow Herd Steers Heifers Sub-total Coves Total

1970 28,500 4,731 4,731 3,021 7,752
1971 28,500 4,731 -4,731 3,021 7,752
1972 28,500 4,731 4,731 3,064 7p795
1973 28,500 5,503 295 5,798 3,109 i,8,907
1974 28,960 5,290 252 5,542 3,166 8,708
1975 29,187 5,389 272 5,661 30198 8,859
1976 29,435 5,545 305 5,850 3,343 9,193
1977 29,774 7,661 1,103 8,764 3,490 12,254
1978 31,323 7,176 1,006 8,182 3,68Q 11,863
1979 32,265 7,490 1,067 8,557 3,808 12,365
1980 33,245 8,006 1,176 9,182 3,930 13,112
1981 34,489 8,288 1,235 9,523 4,164 13,687
1982 35,740 9,919 1,794 11,713 4,410 16,123
1983 37,817 9,994 1,805 11,799 4,674 16,473
1984 39,615 10,595 1,925 12,520 4,909 17,429
1985 41 r.415 11,323 2,069 '13,392 5,167 18,559
1986 43 ,793 11 ,87 6 2,189 14 ,065 5,455 19 ,520
1987 45,963 12,814 2r960 15,774 5,736 21,510
1988 47,951 13,502 3,454 16,956 5,994 22,950
1989 49,879 14,157 3,577 17,734 6,249 24,028
1990 51,987 14,680 3,695 18,375 6,522 24,897
1991 53,960 15,778 5,077 20,855 6,784 27,639
1992 55,330 16,611 6,347 22,950 6,958 291916
1993 56,206 16,848 6,390 23,238 7,077 30r315
1994 57,140 17,217 6,451 23,668 7,202 30,870
1995 58,201 17,445 6,511 23,956 7,340 31,296
1996 59,052 18,217 7,830 26,047 7,456 33,503
1997 59,330 18,499 8,437 26,936 7,490 34,426
1998 59,330 18r499 8,437 26,936 7,490 34,426
1999 59,330 18,499 8,437 26,936 7,490 34,426
2000 59,330 18,499 8,437 26,936 7,490 34,426











Has.
Annual Value of Sales from Total 1,000,000 and Costs for Cattle
and Rice Operations
(Millions of Pesos).


Value of Sales
Cattle Rice Total


Costs
Cattle Rice


Net Income to Farmers
Cattle Rice Total


Total

4.8
12.8
21.7
30.0
38ol
46,2
88,6
129.2
169.8
210.1
250.5
292.3
333 .3
374.1
414.8
455,6
496.5
537.3
'578.1
618.8
659.6 .
660.4
660.9
661.3
661.7
662.1
662.4
662.5
662.5
662.5


Year

1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000


17.0
17.0
17.1
19.2
18.9
19.1
19.6
25.9
24.8
25.8
27.2
28.2
33,0
33.5
35.4
37.4
39.1
43.0
45.6
47.5
49.3
54.3
58.6
S59.4
60.4
61.2
65.4
67.2
67.2
67.2


17,0
28.4
39.9
53.4
64.5
76.1
171.6
253.9
328.8
405.8
483.2
693.2
793.0
888.5
985.4
1.082.4
1.407.1
1.525.0
1.641.6
1.757.5
1.873.3
1.878.3
1.882.6
1.883.4
1.884.4
1.885.2
1.889.4
1.891.2
1.991.2
1.891.2


4.8
4.8
5.7
6.0
6.1
6,2
8.6
9.2
9.8
10.1
10.5
12.3
13.3
14.1
14.8
15.6
16.5
17 .3
18.1
18.8
19.6
20.4
20.9
21.3
21.7
22.1
22.4
22.5
22.5
22.5


12.2
12.2
11.4
13.2
12.8
12.9
11.0
16.7
15.0
15.7
16.7
15.9
19.7
19.4
20.6
21.8
22.6
25.7
27.5
28.7
29.7
33.9
37.7
38.1
38.7
39.1
43,0
,44Y7
44.7
44.7


12.2
15.6
18.2
23.4
26.4
;a9.9
83.0
124.7
159.0
195 .7
232.7
400.9
459.7
514.4
570.6
626.8
910.6
987.7
1.063.5
1.138.7
1.213.7
1.217.9
1.221.7
1.221.1
1 .222 .7
1.223.1
1 .227.,0
.1.228.7
1.228.7
1.228.7


11.4
22.8
34.2
45.6
57.0
152.0
228.0
304.0
380.0
456.0
665.0
760,0
855.0
950.0
1.045.0
1.368.0
1.482.0
1,596.0
1.710.0
1.824.0
1.824.0
1.824.0
1.824.0
1.824.0
1.824.0
1.824.0
1.824.0
1.824.0
1,824.0


8.0
16.0
24.0
32.0
40,0
80.0
120.0
160.0
200.0
240.0
280,0
320.0
360.0
400,0
440.0
480.0
520.0
560.0
600.0
640.0
640.0
640.0
640,0
640.0
640.0
640.0
640.0
640.0
640.0


3.4
6.8
10.2
13.6
17.0
72. P
108.0
144.0
180.0
216.0
385.0
440.0
495.0
550.0
605.0
880.0
962.0
1.036.0
1.110.0
1.184.0
1.184.0
1.184.0
1.184.0
1.184.0
1.184.0
1.184.0
1.184.0
1.184.0
1.184.0


67.2 1.824.0 1.891.2


22.5 640.0 662.5


44.7 1.184.0 1.228.7










Rice Production Value, Costs and Net Income
from 200,000 Hectares

Net
Value Costs Income
Area Yield Prod Million Million Million
Year 100 H-as T/H. 100 Pesos Pesos Pesos

1970-
1971 2 3 6 `~11 .4 8 3 .4
1972 4 3 12 22.8 16 p 6.8
1973 6 3 18 34.2 24 10.2
1974 8 3 24 45,6 32 13.6
1975 10 3 30 57.0 40 17.0
1976 20 4 80 152.0 80 72.0
1977 30 4 120 228.0 120 108
1978 40 4 160 304.0 160 144
1979 50 4 200 380.0 200 180
1980 60 4 240 456.0 240 216
1981 70 5 350 665.0 280 385
1982 80 5 400 760.0 320 440
1983 90 5 450 855.0 360 495
1984 100 5 500 950.0 400 550
1985 110 5 550 1,045.0 440 605
1986 120 6 720 1,368 480 888
1987 130 6 780 1,482 520 962
1988 140 6 840 1,596 560 1,036
1989 150 6 900 1,710 600 1,110
1990 160 6 960 1,824 640 1,184
1991 160 6 960 1,824 640 1,184
1992 160 6 960 1,824 640 1,184
1993 160 6 960 1,824 640 1,184
1994 160 6 960 1,824 640 1,184
1995 160 6 960 1,824 640 1,184
1996 160 6 960 1,824 640 1,184
1997 160 6 960 1,824 640 1,184
1998 160 6 960 1,824 640 1,184
1999 160 6 960 1,824 640 1,184
2000 160 6 960 1,824 640 1,184




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