<b>By DOUG SCHMITZ<br>
Iowa Correspondent</b> </p><p>

AMES, Iowa — For beginning Iowa cattle producers and those lacking the capital for expanding pasture acres, there may now be a viable option for them in custom grazing, in a new joint venture between the Iowa State University Extension Service, ISU’s Iowa Beef Center and Practical Farmers of Iowa (PFI).</p><p>
“Custom grazing arrangements can help the younger, or undercapitalized, producers get into the cattle business,” said Joe Sellers, an ISU extension livestock specialist in Chariton, Iowa, about the contract grazing project, in which the grazier provides grass and management but doesn’t own the cattle. “Well-grazed pastures can compete with other land uses on southern Iowa farms.”</p><p>
Funded by a $25,000 grant from ISU’s Leopold Center for Sustainable Agriculture’s Ecology Initiative, one of the goals of the project is to encourage grass-based livestock production – which Jeri Neal, who heads the Ecology Initiative, said would help diversify the Iowa landscape and protect natural resources.</p><p>
“Use of land for grazing aids in keeping soil and water where it belongs,” she said, adding there’s a growing profit potential for Iowa grasslands which is driven primarily by increased consumer demand for grass-fed beef and dairy products. “Grass-based agricultural systems also help preserve nutrients and sediments, reduce water loss and increase biodiversity opportunities for more profitable business ventures.”</p><p>
Last spring, the Iowa Beef Center, ISU extension and PFI surveyed 50 producers in Iowa and northern Missouri who currently have livestock grazing under some form of custom grazing contract. The team gathered the information about the characteristics of custom grazing operations, which included management practices, rates being charged and what items were included in custom grazing rates.</p><p>Sellers said the survey identified characteristics of custom grazing in Iowa, developed into three fact sheets entitled Custom Grazing Survey 2007, which summarized findings from the survey and potential growth areas. He added that an additional fact sheet on contracts would be forthcoming.</p><p>
The first fact sheet included demographics and management practices; the second included stocking rates, fees and services; and the third, strategies and implications.</p><p>
Carl Neifert, former ISU extension livestock specialist, was hired to help Sellers develop and conduct the survey, and summarize the information.</p><p>
“We identified some people involved in custom grazing from extension, NRCS (the USDA’s National Resources Conservation Service), PFI and producer input,” Sellers said. “The majority surveyed are located in south-central Iowa and north-central Missouri, where most of the cows and grazing land is located.”</p><p>
Sellers said another goal of the survey was to determine the role custom grazing played in those operations of producers surveyed – whether operations planned to continue custom grazing, and what key components operators felt should be included in such an operation.</p><p>
“We wanted to identify the current practices, fees and services for custom grazing cattle in Iowa, and identify areas for potential expansion in this industry,” he said. “With high-price grains, forage-based beef management may have some added benefits.”</p><p>
The survey included three basic operations: cow-calf custom graziers with a year-round feeding component; cow-calf custom graziers with summer only (which had the shortest grazing seasons); and stockers with calves or yearlings on a summer-only grazing season.</p><p>
“Most contract grazing agreements in Iowa are for cow-calf operations, not stocker grazing, and most are two-party agreements (landowner/operator and cow owner), rather than three-party agreements (landowner, operator and cow owner),” Sellers said. “Other states (i.e., Kansas) seem to have more extensive stocker (calf and yearling) contract grazing.”</p><p>
As a result, he said, few grass finishers were included in the survey.
“It appears most grass finishing in Iowa is done as a sole proprietor, owner/operator, business and does not include custom-hired grazing services,” he said. “But this may be a potential area of growth.”</p><p>
In the end, Neal said, smart management and a focus on forages could help Iowa producers take advantage of this opportunity, and custom grazing arrangements could open the door for new and younger farmers. For landowners who don’t own livestock, she added that leasing the land to graziers could also be profitable.
Sellers said the project includes an evaluation of existing grazing arrangements, distribution of tips and examples of good contracts to landowners and graziers and facilitating of networking among producers for successful business arrangements.</p><p>
“Most people currently involved in custom grazing have all the customers they can support with their current pasture base and are not looking to expand,” he said. “But they might be interested in expansion if more pasture acres were available.”</p><p>
According to the survey, cattle owners interviewed lived anywhere from two to 1,500 miles from the custom-grazed pasture. Most stocker owners were in a 150- to 750-mile radius, and most summer-only cow-calf owners were located within 100 miles.
Of those surveyed, cattle owners lived in 16 counties in Iowa and in nine other states.</p><p>
The survey added that pasture acres used for custom grazing were located in 11 counties, predominately in southern Iowa and four counties in Missouri. The size of operations ranged from 20-4,000 acres, with most of the operations interviewed in the 200- to 750-acre category.</p><p>
In addition, the survey said the length of custom-grazing leases varied by the type of operation. For stocker operations, 50 percent were one-year-at-a-time leases, and 38 percent were one group at time. For summer-only cow-calf operations, 73 percent of leases were one year at a time. For cow-calf operations with a year-round feeding component, 64 percent were continuous until one party ended the lease, and 24 percent were one year at a time.</p><p>
The survey showed most custom graziers working with cow-calf operations – about 70 percent – were paid on a monthly basis and 26 percent were paid quarterly or annually. With stocker operations, 60 percent of custom graziers were paid monthly.
Of the 50 producers surveyed, 25 percent received an up-front partial payment, with the remaining balance paid to them at the end of the grazing season. Most of these arrangements also included some form of incentive pay in the agreement. The survey also stated the grazing season was between March 15-Dec. 1, with most grazing occurring between April 15-Nov. 1.