“No. You missed that,” Scott Johnson says, correcting a caller. He and his wife, Jean, were traversing a part of eastern Colorado on one end of a long-distance struggle with cell service. The caller had entirely missed the point Scott made about holistic management. It is much more than grass.
The template of holistic management laid over the Johnson family’s Flying Diamond Ranch, Scott explains, is a collaboration of moving parts. It considers the harsh seasons of Colorado’s semiarid eastern plains and the sustainability of the ranch’s composite Angus herd. It is management of predatory coyotes, of spring calving and scrutiny of meat markets. Most of all, it is family — this one taking its first steps into a sixth generation with five grandchildren, four born in 11 months.
“Do you follow my way of thinking?” Scott asks. “If our ROI [return on investment] is great, but someone is maimed, we wouldn’t be real proud [of our performance]. We will give up profit for safety or harmony,” he says. “The focus is on the whole. If we’re not getting along as a family, if we’re not safe, then the rest of this really doesn’t matter,” he explains. “It’s its entirety. Its wholeness. Its balance. Not perfection. But, bottom line, [we are] profit-oriented. Business is business.”
The Flying Diamond’s clean and highly viewable website uses six words to articulate holistic management: “Ranching with family. Working with nature.”
BORN ON A CATTLE DRIVE
Flying Diamond is 112 years in the making. Charlie Collins, Scott’s great-grandfather, fell in love with the land when, as a teen in the late 1800s, he trailed cattle near the banks of Big Sandy Creek on a drive from Mexico to Montana. By 1907, Collins had moved his family from Kansas to Kit Carson, where the ranch is still headquartered today.
The ranch is dominated by a shortgrass and sand sage landscape. Thick riparian areas border the Big Sandy and Horse creeks, tributaries of the Arkansas River. Culls are based on a female’s ability to wean a calf every year beginning at age 2 and succeed in 13 inches of precipitation and temperatures running the scale from below zero to above 100ËšF.
The cattle winter on corn circles in Kansas and Nebraska. “We like to rest our pastures during the winter. It’s healthier for our grass to have the cattle off and let it rest, and get a little more growth,” Jean says. Scott adds, “Having cattle on cornstalks, our day-to-day chores slow down a little bit in the winter. We can give family a little breather.”
Flying Diamond is an operation run by a family of type A personalities, Scott allows. “We’re not real chitchatters. We socialize. We have good times. We want to maintain excellent family relations. But, we’re not sitting around drinking a lot of coffee.”
GENERATIONS MANAGE TOGETHER
Scott and Jean anchor the Flying Diamond’s fourth generation. Their four adult children represent its fifth. Ownership is based on a meritocracy. The more a family member contributes, the more they own.
Jen Livsey, married to Jay, is the oldest. She is a Princeton University undergraduate and the first female graduate from the King Ranch Institute for Ranch Management. She recently opened Eastco Group, a livestock and drought insurance business. Jen oversees the rotational-grazing plan and analyzes purchase and lease opportunities.
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Will and Lauren Johnson live full-time on the ranch. A Marine Corps veteran, Will is CEO of Flying Diamond Ranches Inc.
Myles Johnson and his wife, Katie, live in Idalia, Colorado, where Myles is the K through 12 superintendent of schools. Myles is the ranch’s administrative officer, managing compliance, meetings and corporate records. Katie is a certified public accountant and manages the ranch books.
Charlie Johnson and his wife, Kaitlin, live in Kit Carson. He is chief operating officer (COO) of Flying Diamond Ranches Inc. He partners with Jen in livestock and drought insurance.
Business is organized around communications—face-to-face, weekly conference calls and a monthly executive committee meeting. Quarterly board meetings are a newer function Kirk Samuelson, Scott’s cousin, brought to the ranch. Samuelson served as COO of Fortune 500 Kiewit Corp., in Omaha, until he retired. He and Scott are cochairmen of the board for Flying Diamond. Quarterly board meetings are formal. “Ten years ago, I was the dictator,” Scott admits. “Now, no one is comfortable with that. When we talk about family harmony, that’s not to suggest there aren’t red faces and pounding on the table.”
The board meetings are to play a role in the ranch’s vitality. “You go to workshops, and you hear horror stories,” Jean says. “Families won’t talk to each other. Ranches divide. That is a threat. How do you keep a 100-year-old ranch together for the next generation?”
The board meetings have a start-stop time and a structured agenda. They often include talks by outside experts. Assignments are given before the meeting—budgets, range management, cattle movements, fertility testing and branding, selling bulls, commodity markets and new market opportunities. “There is an element of accountability brought into the operation that we didn’t have before,” Jean says. “You are held accountable. What did you say you were going to accomplish? Did you do it?”
AGREEMENT IS KEY GOAL
Flying Diamond’s meetings are collaborative. The goal is consensus. “At the end of the day, we want to come up with a compromise we can all live with. This is a new concept for us,” Scott explains.
New is a continuing education standard. Time spent in continuing education is measurable and reported quarterly toward an annual goal of 300 hours. Safety is one component. Jean is the ranch’s safety officer. She has organized horse- and cattle-handling courses. “We specifically do safety training, communicate safety and track safety by hours per year.”
Calving runs from March through May. “We try to mimic nature,” Scott says. “We calve when the deer and the antelope and the elk calve.” Cows graze on spring grasses and not supplemental feed, and the calves generally miss late-season blizzards. Predation is better managed. Calves invite coyotes in the dark of winter. Coyotes have a wider menu in the spring, when the ranch’s wildlife also is giving birth.
“Deer and antelope spend zero dollars, and their offspring have a 50 percent survival rate,” Jen told ColoradoBIZ in a February article about Flying Diamond Ranch. The goal of the ranch, she explained, is to improve the odds of survival among the calf crop but mimic nature to lower production costs.
And here, an example of holistic management: “Our guys aren’t out in blizzards. The weather is better for the calf and better for us,” Scott says.
PATH TO PRODUCTIVITY
Cattle graze only 5% of the ranch’s ground at any one time. Nearly 200 miles of single-strand electric interior fence mark paddocks typically less than 300 acres in size. Cattle graze in some paddocks no more than three days in a growing season. Stocking rates once ran 40 acres per cow/calf unit. Today, it is 30 acres per unit. “We are able to run 30% more animals. Maybe we’ll be able to get to 20 acres per cow/calf unit with more intensive grazing,” he says.
Scott traces his land-management practice to several days spent 35 years ago with Allan Savory, the guru of grazing lands holistic management. Savory’s notion was to move cattle frequently—as bison moved themselves—by way of intensive, human-directed management.
Flying Diamond has laid out 20 miles of water pipeline with the assistance of Natural Resources Conservation Service’s Environmental Quality Incentives and Conservation Stewardship programs. Seven wells pump water to 23 stock tanks. The family has an eye to tightening its grazing practices—that cattle would graze no more than 1% of the ranch’s acreage at any one time.
Few ranches are as intense, Scott says. “Everything gets more intense the more intense we get. More monitoring, quicker moves. We are not know-it-alls. But, it can be a big benefit to the resource and a big benefit financially.”
ONE GENERATION TO THE NEXT
Holistic management is one of many parts. Flying Diamond Ranch has won its share of acclaim for this approach as the recipient of the Colorado Leopold Conservation Award and regional Environmental Stewardship Award, the latter partially sponsored by the National Cattlemen’s Foundation.
Awards recognize achievement. Flying Diamond Ranch tests new futures. Its organic cuts, for example, are finding customers in San Francisco. As a member of its advisory committee, Jean learns how the College of Agricultural Sciences at Colorado State University studies water conservation, sustainability, even urban farming. But also, meatless meat.
“It sounds like science fiction to us, but maybe it’s something that’s coming,” says Jean, not setting aside opportunity perhaps born of a petri dish. The future does not discourage Flying Diamond Ranch. “We’re bullish on agriculture,” Scott says.
The Flying Diamond Ranch evolves and grows and shifts for a time beyond Scott and Jean, and perhaps beyond Jen, Will, Myles and Charles—from today to a time for five grandchildren: Collins, Sofia, Clint, Stella and Henry, growing up among the hills of Colorado’s plain.
One generation builds on another. “We think,” Scott says, “that future is pretty bright.”
Where are Your Costs?
Here is a PDF of the
Where are you at.
This study by Whitney Bowman, Dustin L. Pendell Ph.D. and Kevin L. Herbel can be found at the Kansas State University AgManager.info website. Review and summary by Aaron Berger, Nebraska Extension Educator.
Whitney Bowman together with Dr. Dustin Pendell and Kevin Herbel recently published a paper that highlighted the differences between 71 different producers with cow-calf enterprises that are part of the Kansas Farm Management Association. The paper examined both returns over variable costs and returns over total costs in 2014-2018. The authors broke out participants in the study into three groups of high-, medium- and low-profit producers. Here are differences that stood out between producers from the data when looking at returns over total costs.
- Differences in costs between operations significantly outweighed revenue differences. High-profit operations spent $259.93 less per cow than low-profit operations in this study.
- High-profit operations generated more revenue per cow, $152.32, than low profit operations.
- Major differences in costs between high profit and low profit herds were found in feed expense. High-profit herds spent a total of $418.66 per cow on grazed and harvested feed, while low-profit herds spent $543.92. This is a difference of $125.26 per cow!
- Labor, depreciation, machinery and interest expenses were all lower on a per cow basis for the high-profit operations than the low-profit operations. High-profit producers spent on average $100.95 less on these items than low-profit producers.
- High-profit operations generated on average an annual positive net return to management of $60.53 per cow, while low-profit operations had a negative return of -$351.72 to management over the five year period.
The Kansas Farm Management Association cow-calf enterprise data provides insights into the differences between high-, medium- and low profit producers. Participants in the data set have the necessary production and financial records to know what their production costs are and then can use that information to make management decisions to improve profitability. In this data set, producers who aggressively controlled costs while producing more pounds of calf to sell per cow than their competitors were the most profitable. Good production with cost control differentiated the most profitable producers from those that were the least profitable.
A one page sample budget titled Estimated Annual Cow Costs for Nebraska 2019 is a tool that can be used to help producers to begin to estimate what their own cow costs are. Good accounting and record keeping can help producers track their costs and know their cost of production.
For producers interested in learning more about this topic, a Unit Cost of Production Workshop is scheduled for February 5 & 6 at the Cedar Creek Church which is in the Burwell area. For more information contact Aaron Berger at 308-235-3122.
Interviews with the authors of BeefWatch newsletter articles become available throughout the month of publication and are accessible at https://go.unl.edu/podcast.