Title: Cow-calf vs. stocker operations
Full Citation
Permanent Link: http://ufdc.ufl.edu/UF00095092/00001
 Material Information
Title: Cow-calf vs. stocker operations an identification of leverage points in North Florida cattle systems
Physical Description: 21 leaves : ; 28 cm.
Language: English
Creator: Zimet, David J
Gladwin, Christina H
Spreen, Thomas H
Donor: unknown ( endowment ) ( endowment ) ( endowment )
Publisher: Agricultural Experiment Stations, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 1983
Copyright Date: 1983
Subject: Beef cattle -- Florida   ( lcsh )
Genre: bibliography   ( marcgt )
non-fiction   ( marcgt )
Spatial Coverage: United States of America -- Florida
Bibliography: Includes bibliographical references (leaf 21).
General Note: "Paper prepared for the Third Annual Farming Systems Research Symposium, Manhattan, Kansas, October 31 - November 2, 1983."--Cover.
Statement of Responsibility: by David J. Zimet, Christina H. Gladwin and Thomas H. Spreen.
 Record Information
Bibliographic ID: UF00095092
Volume ID: VID00001
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: oclc - 433049893

Full Text

Cow-Calf vs Stocker Operations: An
Identification of Leverage Points in
North Florida Beef Cattle Systems


David Zimet, Christina H. Gladwin, and Thomas Spreen*

Paper prepared for the Third Annual Farming Systems Research Symposium,
Manhattan, Kansas, October 31 November 2, 1983.

*David Zimet is a research assistant and Ph.D. candidate, Christina H.
Gladwin is an assistant professor, and Thomas Spreen is an associate
professor in the Food and Resource Economics Department, Institute of
Food and Agricultural Sciences, University of Florida, Gainesville,
FL. The authors are grateful for the help and advice of Lawrence
Halsey, extension director of Jefferson County, the farmers in Jefferson
who gratiously gave their time and effort to this project, and for funds
provided by National Science Foundation grant BNS8218894 awarded to
Christina Gladwin and by the Institute of Food and Agricultural Science,
at the University of Florida.

Cow-Calf vs. Stocker Operations: An
Identification of Leverage Points in
North Florida Beef Cattle Systems


David Zimet, Christina H. Gladwin, and Thomas Spreen


Florida agriculture, it is felt by some including the state legis-

lature, can benefit from an increase in the pounds of beef sold by

Florida cattlemen and the increased finishing and slaughter of cattle in

Florida. The present study, a necessary first step towards a Florida

farming systems project focused on beef cattle, was initiated to evalu-

ate the beef production potential of cattlemen and farmers in North-West

Florida, an area considered particularly important because of its abil-

ity to support cool season pastures and produce other crops used as

cattle feed. Given these goals, the research focused on farmers' beef

cattle systems and decisions made by producers. Two decisions were

modeled via hierarchical decision models (HDM's). The first was the

decision of whether or not to impose controlled breeding or a limited

breeding season on the cow herd. The second was the decision between

holding stocker calves and backgrounding, i.e. holding calves from 400-

500 pounds until they reach weights on the threshold of a finishing

program (700 to 800 lbs.), or holding a brood cow herd. The model of

the second decision identifies scale of operation and capital to buy

calves, the availability of temporary winter pasture, the riskiness of a

stocker operation, and the need for cash (from calves) throughout the

year to be the key factors in making the cow/calf vs. stocker operation

decision. They are thus the important leverage points in any attempt to

improve traditional beef cattle systems in North Florida. The paper

thus shows the usefulness of hierarchical decision models by an FSR&D

team attempting to identify and categorize leverage points in the

farming system as being amenable to manipulation by either a FSR/E team

designing new technology or an FSIP team proposing structural changes.

Cow-Calf vs. Stocker Operations: An Identification of
Leverage Points in North Florida Beef Cattle Systems

Farming Systems Research and Development (FSR&D) has been charac-

terized as a holistic approach to improving the standard of living of

the farm family. It treats the farm family as a simultaneous consump-

tion and production unit. The family consumes farm products as well as

using income generated from those products for purchasing inputs and

consumption items (Norman and Gilbert, 1982). In production, the family

is treated as the main source of labor and management. Exactly how the

farming systems philosophy is applied in a project, however, depends not

only upon actual farm circumstances in a region but also upon the

approach to applied work of the professional practioners involved.

To date, two approaches have surfaced as predominant schools of

thought. They are Farming Systems Research and Extension (FSR/E) and

Farming Systems Infrastructure and Policy (FSIP).

FSIP is more 'macro' than FSR/E. Since it deals with policy, the
variables it treats are mainly outside the farm gate and involve
more social scientists and economists than agro-biological scien-
tists . as a means of more accurately predicting farmer
responses to different policy stimuli.

FSR/E is more 'micro' in scope and deals mostly with conditions
inside the farm gate. Because it is concerned with technology
generation, evaluation and delivery, more agro-biological scien-
tists are involved and methodology is heavy in on-farm biological
research with relatively little time devoted to surveys.

Taken together . FSR/E and FSIP comprise a complete development
concept termed here FSR&D (Hildebrand and Waugh, 1983).

Although the differences between the two approaches are clear, they

share some similarities. Both approaches have the primary goal of

FSR&D, to improve the well-being of the farm family. To attain this

goal both use survey techniques to ascertain the on farm status quo as

regards production/management techniques. This situation is viewed by

both as the starting point for improvement. Both FSR/E and FSIP iden-

tify the farmers' perception of their problems as well as the "major

points of leverage" (Collinson, 1982, p. 22) for intervention by the

FSR&D multidisciplinary teams. The "points of leverage" are interven-

tion points in the system which the team believes can be manipulated so

as to better exploit the biological potential of the system in a way

compatible with the goals and resources of the farmer.

The points of leverage must be categorized (FSR/E vs. FSIP) as well

as identified. Categorizing the points of leverage is necessary in

order to promote effective and efficient problem resolution. More

specifically, if a problem at root is structural, i.e., leading to

structural change in agriculture, an FSR/E approach will not resolve it,

but can only resolve the satellite, technical problems. Because an FSIP

approach can deal with a structural problem, it is necessary to know

where the FSIP and FSR/E teams should put their efforts. Furthermore,

the identification and categorization should occur at the "ex-ante

evaluation" (Collinson, 1982) or diagnostic stage rather than at the

"ex-post evaluation" stage in order to be more efficient.

The distinction between FSIP and FSR/E is not the only focus of

debate that has emerged in the FSR&D literature. Recent debates have

also focused on the use of intensive or extensive surveys for identi-

fication of points of leverage as well as seasonal constraints, tradi-

tional production strategies, and socio-economic factors. The sondeo as

promoted by Hildebrand is the most salient example of the latter and the

system used by ICRISAT exemplifies the former (Hildebrand, 1981; Ryan,

1977). CIMMYT's use of an initial informal survey and a follow-up

formal survey takes a middle ground (Winkelman and Moscardi, 1982;

Collinson, 1982: 21-25). In terms of cost, there is little difference

between ICRISAT's intensive surveys and CIMMYT's extensive surveys

(Mclntire, 1983). Both kinds of survey approaches are probably much

costlier, however, than a sondeo (Hildebrand, personal communication).

A modification of the sondeo methodology to more closely approach

Collinson's use of exploratory and verification surveys is what is

promoted here. Unlike the CIMMYT approach, however, which focuses on

factual data regarding technical aspects of production, we believe it is

the understanding of the farmer--what motivates him and how he perceives

his problems, environment, and farming system--that is the critical

aspect of attaining the goal of improving the standard of living of

farmers. A method of analysis which is compatible with the modification

of the sondeo to approach the intensity of the CIMMYT method and which

can also be used to identify and categorize points of leverage is use of

hiearchical decision models (HDMs) (Gladwin, 1976, 1979, 1983; Franzel,


The purpose of this paper is therefore twofold. First, we will

show how to categorize FSIP vs. FSR/E points of leverage within a par-

ticular farming system, the beef cattle farming system in Jefferson

County, N. Florida, at the diagnostic phase of a farming systems pro-

ject. Again, categorization of points of leverage is important because

it is necessary to allocate the resources of personnel and funds to

FSR/E and FSIP teams so that farmers' problems can be solved in a cost-

effective way. Second, we will demonstrate the usefulness of hierarchi-

cal decision models at the diagnostic stage of a farming systems project

by modeling farmers' decisions as regards beef cattle production. As

will be seen, the main limiting factor to increasing the occurence of a

potentially more profitable method of production is scale of opera-

tion. Scale in this case is a structural factor amenable to policy

change only by a policy-oriented FSIP approach. FSR/E interventions

will be much less important for N. Florida beef cattle producers than

FSIP interventions, in this case.


Florida has a large beef cattle subsector. A high proportion of

the calves born in the state, however, are shipped out of state for

backgrounding, finishing, and slaughter. Ultimately, most of the beef

consumed in the state is shipped-in from other states. Therefore, in

1982, the Florida legislature made a special allocation to the Institute

of Food and Agricultural Sciences (IFAS) to study the Florida beef

cattle industry. The focus was to find ways to increase the pounds of

beef sold by Florida cattlemen and consider the feasibility of increased

finishing and slaughter of cattle in Florida.

In the southern part of the state, operations which produce calves

and sell them g-Ibh immediately after weaning predominate. (Herds of

this type are henceforth called cow/calf herds.) The calves are gener-

ally born in the spring and are sold in late fall or early winter. The

brood cows are maintained over the winter. The calving and sales occur

when they do because soil and climatic conditions prevent the production

of sufficient quantities of the high quality cool weather forages which

would permit the calves to make low-cost average daily gains over the


In comparison, the cool weather forages can be produced in North

Florida, especially in the Panhandle. North Florida, however, does not


"background" (i.e. bring them from weights of 400-500 Ibs to 700-800

lbs.) as many calves as it potentially could. Some of the reasons for

the divergence of potential and actual production are:

1. Weak market linkages--South Florida producers usually deal
directly with out-of-state backgrounders and markets;

2. The high capital requirement for backgrounding a sufficient
number of calves to make backgrounding worthwhile;

3. Lack of finish to slaughter facilities in North Florida; and

4. The competition between brood cows and stocker calves in North
Florida for high quality forage.

In keeping with the goals of the state legislature, it was decided

to investigate the potential for backgrounding more calves in North and

West Florida. Toward this goal, work in Jefferson County, North

Florida, was initiated. It was decided to develop an open-ended ques-

tionnaire so as to obtain, in the farmers' own words, knowledge of

farmers' goals and constraints and problems limiting adoption/adaptation

of the beef production "package." In order to ensure that the "right"

questions were asked in the questionnaire, several weeks were spent in

the field talking to farmers, county extension personnel, and other

experts. In addition, discussions were held with University of Florida

-staff and faculty. A preliminary questionnaire was developed and then

tested in the field. This questionnaire was revised based upon further

discussion with experts and the test experience.

The Study Area

Jefferson County, Florida, is located in North Florida, bordered on

the north by Georgia and the south by the Gulf of Mexico. It encom-

passes approximately 605 square miles of which about 40% is in commer-

cial crop and livestock production (excluding timber); its 1980 popula-

tion was about 10,000. The northern part of the county is rolling crop,

range, and forest land while the southern part is low, swampy, and

supports little commercial farming.

In Jefferson County, cattle operations are an important aspect of

agricultural activities in that county. Most of the cattle sold (in

terms of numbers or pounds) are sold by large producers. The emphasis

of the survey was on smaller producers (Table 1). The survey sample

does not accurately reflect the county in terms of the average number of

animals per producer in the county, but it is fairly accurate in

describing what is done by the average or median producer in the

county. In addition to the 28 beef producers interviewed, two former

beef producers were interviewed.

Agroclimatic Conditions in Jefferson County

The soils of the northern part of Jefferson County contain a cer-

tain amount of clay. (This is also true for an entire strip of the

Panhandle along the Georgia border. In terms of soils the region is

more a part of Georgia than a part of Florida.) The clay enhances the

moisture retention of the soil which in turn permits the planting or

seeding of cool weather crops in September and October. This is a key

aspect of the North Florida livestock production pattern because a

series of cool weather pastures and forages--rye, ryegrass, oats and

clover--can be planted and grazed. Frequently these crops are seeded in

row crop fields after the latter have been harvested. Another fre-

quently used planting technique is to over-seed permanent pasture with

winter and early spring pasture (henceforth called winter pasture).

Another important feature of the winter pasture seeding is that often

crops are planted in conjunction with each other--ryegrass with oats,

rye with ryegrass, rye with clover, etc. This method of diversifica-

tion, because of different moisture and temperature tolerances of the

crops, affords some risk protection against crop failure.. Also, if

inoculated, the clover reduces the chemical nitrogen requirement. No

matter what the specific method of seeding and the specific crop combin-

ation used, the objective of the producers is to "keep things green year

round" so as to minimize the purchase of feed and fiber.

In sum, because of the combination of soil and climate, high qual-

ity winter pastures can be grown in Jefferson County (and in the entire

Panhandle). These pastures permit good maintenance of brood cows over

the winter. They also permit backgrounding of weanlings over the

winter. Stockers of the winter backgrounding program can then be sold

in the spring. Indeed, because of this situation there are two board

sales held in Jefferson County--one in Monticello and the other in

Waukeenah--in early May.

Crops in the Beef Cattle System

In terms of acres the size of operation varies considerably; the

average size is 815.8 acres with a range 23-8,300 acres. Not surpris-

ingly, this is somewhat larger than the average acreage for all farms in

Jefferson County as reported in the 1978 Census of Agriculture (506

acres) since an average farm which produces beef, whether or not it does

so in conjunction with commercial crops, tends to be larger than the

average farm which produces no beef. Furthermore, if the two largest

farms are deleted from the sample the average would be 457.7.

Only four of eight farms with large herds (more than 150 head) do

not also produce crops for commercial purposes. In fact, both cattle

and commercial crops are produced on 13 of the 28 farming operations.1

The 13 beef producers producing crops commercially have an average of

165 acres in commercial crops (with a range of 5-900 acres), an average

145.8 acres (with a range of 12-400 acres) in summer or permanent pas-

ture, and an average of 207.9 acres (with a range of 10-645 acres) in

winter pasture. The land in winter pasture, as previously noted, is

often devoted to other crops in the spring and summer so that total

crop-acres exceed the total of physical acres available. Several pro-

ducers, however, let their winter pasture turn to crab grass for grazing

during the summer.

Fifteen of the beef producers surveyed (54%) produce no commercial

crops; these "livestock only" or exclusively beef operations are hence-

forth distinguished from so-called "mixed" operations. (Some, however,

rent cropland to other producers.) These farmers, on average, have

228.8 acres in permanent pasture (with a range of 0-1,300 acres) and

110.0 acres in winter pasture (with a range of 0-500 acres). Two of the

four producers who have no winter pasture buy hay and one buys feed as

well to carry their herds through the winter. The other two make hay

and buy feed for this purpose. The calves of the producer with no

permanent pasture are fed corn and feed during the summer and graze corn

stubble in the early fall.

The major difference between mixed and livestock only operations is

that the production of commercial crops does seem to cause another

ISee footnote c, Table 1.

difference in cropping pattern. The mixed operations have, on average,

a greater amount of land in winter pasture than they do in summer pas-

ture. This increases the total production of the cropland which is used

for winter pastures. The situation of the producers who produce only

beef is reversed. There is another important difference. Only four of

the 15 livestock operations rent land. Of these four, two rent all land

for the entire operation. Nine of the 13 mixed operations, however,

rent land. Although data are not available, it appears that much of the

rented land is used for crops, not for grazing. In summary, 69 percent

of the producers of commercial crops rent land, while only 27 percent of

those producing only beef rent land.

Herd Composition

The distribution of herd size by type of operation is presented in

Table 1. Types of operations include so-called cow/calf, stocker, and

cow/calf with stocker operations. A cow/calf operation has a brood cow

herd and the calves produced are sold upon weaning or soon afterwards.

The calves usually weigh just under 400 pounds. Stocker calves are

those that have been weaned and are raised to weights between 700 and

800 pounds. If there is no brood cow herd, the calves are purchased.

The process of raising stockers is called "backgrounding." A cow/calf

with stocker operation is one which has a brood cow herd and backgrounds

their offspring and/or purchased calves. The average number of brood

cows owned by all cow/calf producers surveyed is approximately 102 cows

(with a range of 14 to 390 head). Mixed operations have 93 cows

(ranging from 14 to 350 head) compared to livestock only operations with

average inventories of 111 cows (ranging from 15 to 390 head). Thus,

livestock only operations have approximately 20 percent more breeding

stock than mixed operations.

Focusing on those operations that stocker, the average number of

stocker calves produced annually by mixed operations with stockers

(either raised and/or purchased) are greater, on average, than livestock

only operations. Mixed stocker operations produce an average 353 head

(ranging from 35 to 896 head) versus 314 head (ranging from 180 to 470)

from livestock only stocker operations. If the largest herd is

excluded, the average of the mixed stocker operations drops to 275

head. The average for all who produce stockers is 342 head (range of 35

to 896 head). Although stocker operations are clearly bigger than

cow/calf operations in this sample (as in the Southeast U.S.), cow/calf

operations outnumber cow/calf with stocker operations which in turn

outnumber stocker only operations, for reasons which are discussed next.

Using Decision Tree Models to Design and Evaluate
Technological Recommendations for Beef Cattle Operations

The information summarized above was synthesized with information

gathered in a more informal way, in order to develop hierarchical deci-

sion tree models of the individual producer's choice of type of opera-

tion, i.e., the cow/calf versus stocker decision. Before this specific

case is presented, however, a short discussion of hierarchical decision

models and their use is given by using another, less complex, decision.

A hierarchical decision model is a technique to identify and place

key decision criteria into a logical framework, in order to predict

actual historical choices of individuals. The criteria (denoted by

< >) form questions which can be answered by either a yes or a no, each

response leading to a different path or branch. The goals or reasons

motivating the decision comprise the first level of criteria. Usually

only one reason or goal is necessary to move on to the constraints, all

of which much be passed, in order to do the activity in question. The

constraints form the second level of criteria. Each branch ultimately

leads to an outcome or choice (denoted by CO ).

How do producers perceive their situation? What do they believe to

be their most important problems, and what are the constraints, from the

producers' point of view, to overcoming them? The answer to these and

related questions are important for the design of successful programs

and projects which are intended to assist the producer. One methodology

which lends itself to answering these questions is the one used for the

present study. The draft questionnaire was designed only after some

time was spent with the producers learning their "language" and gaining

an appreciation for their production systems and problems. After some

revision of the questionnaire, a somewhat formal, open-ended question-

naire which asked questions about management practices was adminis-

tered. Thus insight was gained as to how producers make decisions and

what they "key" on. Such insight is useful not only to policy makers,

but also to those who design programs and projects and those who attempt

to evaluate the effectiveness of same.

The Decision to Adopt Controlled Breeding

One of the elements of the IFAS beef "package" for cow/calf opera-

tions is the use of so-called controlled breeding, i.e., a limited

breeding season of 3-4 months instead of 6-7 months duration. This is a

key recommendation upon which efficient exploitation of other recommen-

dations depend. For example, implantation of growth stimulants depend

upon a short, predictable calving season. Yet a large minority of

producers do not impose a limited breeding season on their herds,

perhaps dooming the entire IFAS "package to failure or at least to

only limited success. Why don't farmers use this basic management

tool? If the reasons were known, could anything be done to improve the

situation? The answer to the latter question depends, of course, upon

the reasons for non-adoption. It is exactly in this type of problem

area where the methodology of HDM's excels.

A decision tree for the imposition of controlled breeding on a

brood cow herd is presented in Figure 1. Each of the criteria is a

factor mentioned by the producers. Indeed, of the 10 producers who

could have used a controlled breeding program but didn't, five stated

that they were satisfied with the present calving rate and saw no need

to improve it. According to another farmer, controlled breeding would

not improve the calving rate. Two producers stated that they did not

have enough pasture to separate bulls and cows. One producer wanted

more consistent cash income throughout the year, while one did not have

the know-how to impose controlled breeding.

Upon reading the decision tree in Figure 1, Collinson's "points of

leverage" can be found amongst the reasons for and constraints against

imposing controlled breeding. Analysis indicates where further work

needs to be done to remove obstacles to more widespread use of con-

trolled breeding. It can also be determined whether more resources need

to be devoted to technology generation by the FSR/E subteam or infra-

structural change by the FSIP subteam.

Examples from the decision to impose controlled breeding show

this. If farmers are not satisfied with their calving rate and are not

sure whether.or not controlled breeding would improve the situation, an

FSR/E program could be set up to experiment with calving rates. As

regards constraints, some producers said that they do not have enough

pasture to keep bulls separate from cows, the basic requirement of

controlled breeding. Both FSR/E and FSIP type activities could improve

the situation. FSR/E activities could aid in research to make pastures

more productive. Research can be conducted to determine optimum pasture

carrying capacities, in terms of pounds of calf sold, when bulls are

kept separately from cows. A possible FSIP-related activity is a pro-

gram to assist farmers in pasture rental. Another possibility is a

bull-rental program whereby a research center or institution rents bulls

to farmers for 90 day periods. Such a program already exists in Alabama

and is being run by the Tuskeegee Institute. Presently a request for

such a project on a limited scale has been presented to Heifer Project

International by Florida A&M University. Obviously, FSR/E and FSIP

activities are complementary: an FSR/E effort coupled with a Tuskeegee

Institute type program could be made to test whether conversion from

open breeding to controlled breeding over a three to four year period

would or would not result in an appreciable loss in calf crop.

The Cow/Calf vs. Stocker Decision

In Florida as in other Southeastern states, raising stockers is

potentially more profitable than owning a cow/calf herd (Ross et al.,

1983). Yet more producers have cow/calf herds than stockers.

Obviously, from these producers' point of view, there are disadvantages

and/or constraints to owning a stocker operation. These are represented

by the first criterion and the criteria on the left hand path of the

tree. Again, these criteria, as well as those on the right hand side,

can be viewed as leverage points capable of being manipulated by the

FSR&D teams, in order to increase the number of stocker operations in N.


The first criterion or leverage point is scale of operation, a

barrier to entry to backgrounding stockers (Criterion 1). Scale is

important because returns per animal are low and marketing costs per

animal, especially hauling animals to and from the farm, are greater,

the fewer the animals. Several farmers claimed that hauling fees with

less than half a truckload of animals (i.e., 25-30 animals) are exces-

sive. The size requirement is translated into a capital constraint by

farmers because a sufficiently large number of calves must be purchased

for a stocker operation to be profitable.

There is another, perhaps more critical, reason that scale of

operation is important. Backgrounding feeder cattle is an intermediate

step in the production of high quality beef. The next step in the

production process is intensive feeding of the animals in a confined

feedlot. Current production practices in feedlots call for lots of

uniformly-sized feeder cattle numbering approximately 40. A back-

grounding operation is expected to market lots of 40 uniformly-sized

cattle. A small producer may find it impossible to produce 40 uniformly

sized cattle. If so, he will probably face a price discount, reducing

the profitability of the backgrounding operation.

There are several things that can be done by an FSIP team to alle-

viate the problem of scale. Through institutional programs, special

loans can be made available to producers who would be willing to back-

ground if they had the capital to purchase sufficient numbers of

calves. Furthermore, a program of cooperative purchase of stockers for

backgrounding and their eventual sale as feeder calves could be devel-

oped. Alternately a more formal cooperative situation could be devised.

The services provided by the cooperative could take several forms,

but the most important would be to serve as a clearinghouse of informa-

tion to allow assembly of uniform lots of weaned feeder cattle. Farmers

with excess land willing to produce high quality forage and others with

feeder cattle presently not able to break the size barrier alone could

be matched. The forage producer would take possession of the animals

but ownership would not change. The forage producer would be paid based

on pounds of weight gain. At the end of the backgrounding period the

cooperative could serve as a bargaining agent for the sale of the cattle

to feedlots. The cooperative could also assist in the acquisition of

sufficient capital, supply of inputs such as fertilizer, seed, and feed

supplement, and in the maintenance of a staff of veterinarians, agrono-

mists, and other specialists to provide technical know-how. Clearly,

the development of cooperatives and the establishment of special loans

fall under the realm of FSIP.

The production of high quality winter forage is another critical

aspect of backgrounding (Criterion 8). It is here that the FSR/E team

has an important role to play since no policy can change this technical

requirement. At present, for example, the North Florida Farming Systems

Project is working with beef producers to establish perrenial peanut

pastures. These pastures are being over-seeded with wheat or rye for

winter grazing (North Florida Farming Systems Team, 1983). By devel-

oping more flexible feed and forage subsystems, FSR/E can be instru-

mental in mitigating the production risks (Criteria 6A and 6B) and

increasing the profitability of holding stockers. Reducing the produc-

tion risks of stockers is important because farmers testify that the

risks of stockers are greater than those of a cow/calf operation. The

greater riskiness of stockers is due not only to the greater fluctuation

in stocker prices than weanling prices but also to the dependence of

stocker weight gain--the critical factor in a successful backgrounding

program--on variable weather conditions.

There are other reasons besides scale, risk, and availability of

winter pasture which inhibit or prevent producers from running stocker

operations. A producer must know how to run a successful backgrounding

operation (Criterion 7). Most producers, especially those from a farm

background, have a reasonable understanding of animal health and nutri-

tion needs. Producers who originally lack this knowledge can obtain it

easily from a number of sources. Marketing know how is another

matter. There are two marketing aspects related to the management of a

stocker herd. First, the right kind of animal must be purchased; and

second, the animal must be sold. The former is critical as animals that

will gain weight efficiently are keys to success. The ability to

purchase such animals has been described as a learned art which is not

just "picked-up." Being able to produce an adequate supply of temporary

winter pasture (Criterion 8) is also critical. If a producer has a

winter backgrounding program he must be able to produce such pasture in

a timely fashion in order to get good weight gains. Thus the producer

must ask himself whether he has enough time, the proper machinery and

equipment, and the know-how to plant combinations of rye, ryegrass, oats

and clover. If he can't do so, he should not do winter backgrounding.

Traded-off against these disadvantages of a stocker operation,

however, are the advantages of greater profitability and greater flexi-

ability. The stocker operator can change the size of his herd, depending

on anticipated market conditions, and available time and pasture,

depending on cash cropping decisions. The cow/calf operator, however,

invests a good deal of time and management in his breeding program,

trying to develop a brood cow herd that does well under the conditions

on his farm. He is therefore reluctant to sell-off part of his breeding

stock in a bad year and decrease herd size, unlike the stocker oper-

ator. Similarly, increasing herd size in the short run is also more

difficult for the cow/calf operator, because finding the "right" brood

cows or raising own heifers of good quality is a long-run proposition.

If a producer has none of the above motivations to run a stocker

operation or if he cannot meet the requirements of such an operation, he

should not background calves. In Figure 2, such producers would pass to

the cow/calf branch (right hand side) of the decision tree.

Like the stocker operation, a cow/calf operation has certain advan-

tages and disadvantages. The major disadvantage is that it is less

profitable than a stocker operation of sufficient size (e.g.> 25

head). In addition, cow/calf operators, more so than stocker operators,

justifiably believe they will lose money for approximately three years

while starting up the operation. While heifers mature, management

experience is gained, and a production system is established, they lose

money. In contrast, stocker operations lose money maybe for two years

while managers gain experience and establish a production system. Thus

Criteria 3 and 9 ask if the producer believes he can sustain such losses

until he eventually earns a profit.

As viewed by the producers interviewed, a cow/calf operation does

have some advantages. Because brood cows are owned for more than a

short time while income is generated from their calves, the cows are

viewed as a form of savings (Criterion 10). They can also serve as

collateral on loans as well as a source of capital. Another advantage

is that the calves can be sold at almost any stage in their development,

whereas stockers should be kept for a certain amount of time until they

reach a profitable weight. Even under the most constrained situation

(i.e., calves are held until weaning and controlled breeding is used),

calves are available for sale during a long three to four month period

as compared to a few weeks for stockers. Further, the potential sale

period of calves when controlled breeding is not imposed is approxi-

mately twice as long. Thus, there is greater potential for more consis-

tent cash income from a cow/calf operation (Criterion 12). Cow/calf

operations, however, are not necessarily profitable. Nor do all pro-

ducers find the advantages of a cow/calf operation to be attractive.

Yet some have brood cow herds, because they think that beef cattle are

the only or least-cost way to use the land and not lose their agricul-

tural tax exemption (Criterion 11).

Results and Summary of Research

Results of fitting this model to a first set of farmers in Jeffer-

son County show that only seven of 23 farmers decide to raise stockers;

whereas 15 farmers decide on a cow/calf herd. (These data match those

of Table 1 because we had insufficient data on three plantation owners

and one farmer, of a total of 11 farmers with stocker herds in Table 1,

to put their data down the tree in Figure 2). Results thus suggest that

limiting factors to potentially-profitable backgrounding operations in

North Florida include:

*scale of operation, or capital to buy a sufficient number of

calves (Criterion 1)

"know-how to run a stocker operation (Criterion 7), and

*riskiness of a stocker operation (Criterion 6), and

"ability to make enough temporary winter pasture to get good gains

on stockers (Criterion 8).

In sum, profit-motivated small producers who do not have the cash or

credit necessary to buy enough calves for backgrounding opt for the

less-risky cow/calf alternative. Producers with enough credit or capi-

tal accumulated to buy enough stockers will do so only if their cow herd

will not suffer from competition with stockers for scarce resources such

as winter pasture. Given these decision criteria, it is understandable

that the traditional beef cattle production system of the limited

resource farmer in North Florida is a cow/calf operation without con-

trolled breeding.


The case presented shows that an intermediate level of survey

intensity can be used to discover and analyze the farmers' environment

and problems as perceived by the farmers themselves. This perspective

can be analyzed by using hierarchical decision models as a way to iden-

tify leverage points for FSR&D team intervention. These intervention

points can be classified into those in which structural factors pre-

dominate, indicating a greater FSIP effort, and those in which technical

factors predominate, requiring a greater FSR/E effort. When structural

factors are critical, FSR&D teams must present policy makers with new

policies and ideas. For example, increasing pasture productivity by


itself is not going to cause an increase in backgrounding of stocker

calves in North Florida. New policies such as "cooperative stocker

marketing," would have to be in effect before the many small producers

who presently have cow/calf herds would be able to switch to the poten-

tially more profitable stocker operations.


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Table 1. Number of Producers Interviewed by Size and Type of Operation.

Mixed Livestock Only
Herd Sizea
Herd Size Cow/calf Stocker Cow/calf Cow/calf Stocker Cow/calf
only only with stocker only only with stocker

< 50 3 1 10
75-99 1
100-124 1 1 1 1
125-149 1
150-174 Ic
175-199 Ic
S250 1 2 1 1 2

aFor the cow/calf only operations the herd size is determined by the
number of brood cows. For the cow/calf with stocker operations size is
determined by the number of stockers.
bThis group includes one farmer who purchases young dairy bull calves
and raises them to about 600 pounds. He is excluded from discussion
related to brood cow management. It also includes another producer who
is just starting out and is presently raising his potential brood cows.
CThere is one producer who operates a cow/calf herd and a stocker
herd. When necessary he is treated as two producers in this report
since herd management practices differ.



no (20)
yes (3)

yes (10) I no (10)


es (2) no (8)

yes (3)

no (5) :.


yes (2)

.. .- I

no (1)

17 cases


Don' t

6 cases

no (1)

yes (16) '- I
yes (15) no (1)

yes (13) nn (2)

yes (13) no (0)

13 cases

4 cases

The Decision to Impose Controlled Breeding on a Brood Cow Herd.

Figure I.


1 1

yes (12) no (11)


-- no (3)
yes 3
yes (3) I

yes (6) i
6A no (0)
yes no
(12) 6B
yes no (1)


yes no (2)
(9) -
yes no (2)



yes (14) no (2)

10 11
yes no '
I Cow/calf I Don't
(13) (1) raise
V 12 beef
yes no
lI (1)

(3) no (10)
SK 1 11

Figure Cow/calf versus stockbr decision.


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