STABILIZING FARMING BY SHIFTING WHEAT

LAND TO GRASS IN THE NORTHERN

GREAT PLAINS
With Particular Emphasis on Annual Effects
LLOYD E. JONES*
Federal Crop Insurance Corporation

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

Introduction
AGRICULTURAL production and income vary greatly in the
f t dry-land areas of the northern Great Plains. Drouths often
cause low yields and sometimes complete crop failures. The develop-
ment of a system of farming capable of stabilizing and bolstering
farm income against such hazards has long been a problem faced
by farmers and agricultural technicians. With the favorable pre-
cipitation of the last decade, many people are now inclined to
minimize the climatic limitations of the area. On the other hand,
past experience should indicate that stable farming systems on
dry land cannot be based on the favorable precipitation which pre-
vailed during the forties. The problem of alleviating or preventing
agricultural distress in the Northern Plains, such as that caused
by the drouth of the thirties, by adjustments in farming systems,
merits serious consideration.
Several million acres of virgin range and former cropland in dif-
ferent stages of vegetative recovery were broken and seeded to
wheat during the forties when weather conditions were favorable
and demand for wheat expanded. Future agricultural adjustment
programs will probably call for the retirement of a portion of the
land now in wheat. The chief alternative use for this land is perma-
nent or rotation grass for use as pasture and hay for livestock,
and to a more limited extent for commercial grass seed.
Wheat and livestock are both important sources of income on
many operating units in the Northern Great Plains. Wheat land is
often adjacent to, or interspersed with, range land. Although there
are scatterings of high grade wheat land in this area, much of it
would not be considered as number one quality. In such sections
livestock frequently offers good possibilities of bolstering and stabi-
* The research on which this article is based was conducted while the author
was with the Bureau of Agricultural Economics and was made possible by funds
provided by the Research and Marketing Act of 1946.
875
876 LLOYD E. JONES

lizing agriculture against the ruinous effects of prolonged dry

weather as well as against lower wheat prices. But to take full ad-
vantage of this alternative many farmers need more forage and
pasture.
The economic effects of replacing wheat with crested wheat
grass on farms in the Great Plains, particularly in southwestern
North Dakota, are explored in this paper. Crested wheat grass is

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

well adapted to the region. It withstands grazing well and provides
grass early in spring and in fall when most needed to supplement
native range. It is also resistant to drouth and cold.

Average Effects oj Adding Crested Wheat

The average effects of shifting land from wheat to crested wheat
grass on a wheat-cattle ranch, representative of southwestern North
Dakota, are shown by the farm budgets in Table I.
The operator of this ranch has already seeded 90 acres of his
wheat land to crested wheat grass. In addition to showing the
organization and income possibilities under both the former and
present systems, this table also includes an alternative ranch plan
in which the entire 280 acres of wheat land is seeded .to crested
wheat grass. These budgets, along with others showing the details
of year-to-year changes in reorganization, expenses, and income
necessary in changing from the former to the present and the
alternative plan, were included in the Western Section of USDA
Miscellaneous Publication 702. This progress report entitled "Will
More Forage Pay?-Economic Aspects of Using More Forage on
Farms" covered the first year's activities on a nation-wide study of
the opportunities for the profitable use of more grass and legumes in
farming systems. However, in Table I as well as elsewhere in this
paper net cash income under the high price level was calculated on
the basis of a parity ratio of 100 with an index of 200 for both prices
paid and received. This is somewhat less favorable but more realis-
tic than the 1942-46 price and cost levels used in Miscellaneous
Publication 702. Because of wartime price controls and the need
for expanding agricultural production, prices received were rela-
tively higher than those paid by farmers.
Slight increases in net cash income are indicated under both
the present plan and the alternative as compared with the former
(Table I). Because grass is less subject than wheat to the hazards
of drouth, a shift in the direction of more grass and the storage of
 SHIFTING WHEAT LAND TO GRASS 377

TABLE I. EFFECTS OF PERMANENT SEEDING OF WHEAT LAND TO CRESTED WHEAT

GRASB ON THE ORGANIZATION, PRODUCTION, AND INCOME OF A WHEAT-CATTLE
RANCH IN SoUTHWESTER NORTH DAKOTA

Former Plan Present Plan Alternative Plan

I
90 acres wheat All wheat and
and summer- summer-fallow
Item fallow land seeded land seeded to
Acres Pro- to crested crested
duction wheat grass wheat grass

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

Pro- Pro-
Acres duction Acres duction

Bmhela Bmhela Bmhe18

Crops and land use
Wheat 140a 1,526 956 1,140 - -
Summer-fallow 140 - 95 - - -
Corn 90 1,800 90 1,800 90 1,800
Oats 50 1,750 50 1,750 50 1,750
Barley 40 1,000 40 1,000 40 1,000
TlmS TlmS TlmS
Wild hay 800 100 800 100 800 100
Crested wheat grass hay - - 10 9 8~ 85
AUM'Se AUM'So A.UM'Sc
Private range 600 ~40 600 ~40 600 240
Crested wheat grass
pasture - - 80 115 248 449
Crested wheat grass
aftermath - - - 5 - 16
Grazing permits held - 1,080 - 1,080 - 1,080
Total 1,860 - 1,860 - 1,860 -
Inventory No. Inventory No. Inventory No
number sold number sold number sold
Livestock.
Cows 92 1~ 100 18 126 16
Heifers 2 yrs.
(replacements) 15 - 16 - !l0 -
Yearlings, heifers and
steers 78 60 85 66 107 84
Bulls s - 8 - 4 -
Horses 4 - 4 - 4 -
Hens 50 - 60 - 50 -
Dollars DoUars DoUara
Net cash income
With high price level d 6,298 6,420 6,500

a Wheat yield-7 bushels per acre on 60 acres, l~ bushels on remainder of wheat

land.
6 Wheat yield-l~ bushels per acre.
e Animals unit months of grazing.
d Based on a parity ratio of 100, with an index of 200 for both prices paid and
received.
378 LLOYD E. JONES

high-quality hay as a feed reserve would appear to reduce risk

and give greater stability to income. It is recognized that most
farmers would not be inclined to shift their entire wheat acreage
to grass. The alternative plan was developed as an extreme example
partly because the operator of this unit expects eventually to shift
his entire acreage of wheat to crested wheat grass and partly to
furnish a guide to those who would find it profitable to operate
somewhere between these two extremes.

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

Some sacrifice in income is to be expected, however, during the
three or four years which are required to establish stands of crested
wheat grass and to build up the necessary numbers of breeding
stock to utilize the increased acreage of grass. During these
intervening years the net cash income is likely to be less than under
the former plan. These temporary reductions in income are caused
by holding back from market more cows and breeding heifers to
build up breeding cow numbers, and by purchasing some additional
feed needed by increased livestock numbers before the crested
wheat grass is in full production. Additional cash expenses also
are incurred during this period. Crested wheat grass seed, which
is drilled in wheat stubble or summer-fallow during the fall, must
be purchased. Another bull must be added to service the additional
cows.
An examination of the three farm situations shown in Table I
indicates that operators of wheat-eattle ranches in this or compa-
rable areas in the Northern Plains can shift wheatland to grass with
very little change in income. However, precipitation varies greatly
in the Plains and farm production in anyone year may be well
above or below average. Low yields are frequent and complete
crop failures often happen. Moreover, in this region, years of suffi-
cient and insufficient rainfall do not generally occur randomly;
they tend to be grouped in a series similar to the drouth of the
thirties, followed by a run of years of ample rainfall such as the
forties, with no predictable sequence.
Several years may be required to rebuild depleted livestock herds
after a drouth. Hence, during those years immediat.ely following
one or more arid ones, even though range production is again aver-
age or above, cattle numbers and sales may be below. For these
reasons, in addition to budgets demonstrating farm performance
under average conditions, information as to the effect of variations
in weather on annual production, organization, and income is ap-
parently needed in appraising alternative systems.
 SHIFTING WHEAT LAND TO GRASS 379

Farmers who today adopt changes similar to those shown in

Table I may not face average conditions for several years. They
may encounter either a period of severe drouth and below-average
yields similar to the thirties, or a continuance of the favorable
precipitation of the forties with above-average yields, neither of
which approaches the average conditions.

Year-by-Year Effects of Adding Crested Wheat

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

One method of determining the annual and cumulative effect of
varying precipitation on farm organization and income for differ-
ent farming systems is to develop a series of annual budgets, in
which crop and range production are varied in accordance with ac-
tual conditions as they existed in the past. This method is used
here to show the relative effects of such shifts over a 14-year period
on both the former and the alternative system for the southwestern
North Dakota wheat-cattle ranch. Because crop and range produc-
tion were varied annually in accordance with actual county yields,
these budgets reflect changes in organization, production, and
income which might have been expected during the years 19~9 to
194~. During 19~9-4~ precipitation averaged 14.55 inches, less than
an inch below the 35-year average (1914-48). In the thirties, only
in 1930 and 193~ was precipitation above the 35-year average. On
the other hand, during the forties annual precipitation was well
above the long-time average.
In 19~9, the beginning year of the series, crop and range produc-
tion on this farm closely approximated normal or average condi-
tions. Inasmuch as livestock organization must be adjusted to crop
and range production, average livestock numbers were carried for
that year. Normal carry-over of feed reserves amounted to 100 tons
of hay under the former and 135 under the alternative plan, with
1,000 bushels of barley carried over under both systems. In addi-
tion to the high price level shown in the average budgets (Table I),
the annual budgets were also calculated on the basis of actual
prices and costs which prevailed during each year. 1
The year-to-year effect of drouth or favorable precipitation on
crop and range production and livestock numbers under both the
former and alternative systems are shown in Tables II and III.
In order to utilize the additional acreage of grass, breeding cow
1 For a discussion of the methodology, procedure, and price levels used in the
study from which this phase has been expanded see pp. 14 and 15 of "Will More
Forage Pay?-Economic Aspects of Using More Pasture and Forage on Farms."
 TABLE II. ANNUAL EFFECTS OF VARIATIONS IN CLIMATE ON THE ORGANIZATION AND PRODUCTION OF A WHEAT-CATTLE RANCH ~
IN SoUTHWESTERN NORTH DAKOTA UNDER THE FORMER SYSTEM, 19!19-42 00
0

Production
Item I Acres 1
19~9 1980 1981 1932 1988 1984 1985 1986 1987 1988 1989 1940 1941 1942
Bushels
Cropland
Wheat 140 1,428 1,540 864 2,07~ 680 ~8a 70 a 14a 878 288 2,114 1,624 2,856 8,458
Summer-fallow 140 - - - - - - - - - - - - - -
Corn 90 225 1,566 1,827 1,890 1,895 171 1,868 68 981 1,458 1,958 2,818 2,025 2,115
Oats 50 1,425 975 290 2,000 775 loa 615 580 510 580 2,615 1,485 2,505 8,780
Barley 40 856 896 240 1,596 872 8a 786 4 248 24 1,264 912 1,582 1,786 ~
Tons
Wild hay 800 128 68 42 105 68 68 75 72 69 87 117 102 117 16! S
AUM'S" ~
Grazing land ~
Private 600 252 252 215 262 222 154 218 157 185 248 258 268 288 289
Public 1,185 1,185 969 1,177 997 692 988 706 881 1,094 1,168 1,204 1,278 1,801 ~
0
Total 1,860 Z
Number l".J
Cattle rn
Inventory, January 1
Cows 92 9!l 92 92 92 68 46 52 50 65 78 81 92 92
Heifers 2 yrs.
(Replacements) 15 15 15 15 15 15 8 - 18 10 10 15 15 15
Yearlings 78 78 78 78 78 78 - 89 44 48 55 62 69 78
Calves born 78 78 78 78 78 58 89 44 48 55 62 69 78 78
Bulls 8 8 8 8 8 8 - 2 2 2 2 8 8 8
Annual sales
Cows 12 12 12 12 86 85 0 0 1 0 0 1 12 12
Others 60 60 60 60 60 125 0 19 82 81 88 45 52 60

a Cut for hay. Production listed in tons.

/) Animal unit months of grazing.

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

 TABLE m. ANNuAL EFFECTS OF VARIATIONS IN CLIMATE ON THE ORGANIZATION AND PRODUCTION OF A WHEAT-CATrLE RANCH
IN SOUTHWESTERN NORTlI DAKOTA UNDER THE ALTERNATIVE SYSTEM, 19~9-4~

Production
Item I Acres I
19!9 1980 1981 19S~ 1938 1984 1935 1936 1987 1988 1989 1940 1941 194i
Bushels
Cropland
Corn 90 i,0~5 1,566 1,8~71,890 1,395 171 1,868 68 981 1,458 1,958 ~,818 ~,Oi5 ~,115
Oats 50 1,4~5 975 ~90 ~,OOO7750 10 615 580 510 580 ~,615 1,485 ~,505 8,780 m
Barley 40 856 896 240 1,596 87~ 8 8760 4 248 ~~4 1,~64 91~ 1,5S~ 1,786 t:Il
~

Tom ~
1-3
Wild hay 800 1~8 68 42 105 68 68 75 7~ 69 87 117 10~ 117 162 ~

Crested wheat grass hay 8~ 44 80 24 40 16 16 84 8 ~8 86 44 88 17 5~

Z
c;::l
AUM'Sb
Grazing land ~
Private 600 ~5~ 252 ~15 ~6~ ~~~ 154 ~18 157 185 ~48 ~58 ~68 ~88 ~89 t:Il
trj
Public 1,185 1,185 969 1,177 987 692 988 706 881 1,094 1,168 1,204 1,~78 1,801 >-
Crested wheat grass 1-3
pasture ~48 472 47~ 408 489 414 288 409 294 845 455 484 501 529 541 t-I
Crested wheat grass >
hay aftermath 17 17 14 17 15 10 15 10 1~ 16 17 18 19 19 ~
Total 1,860 1-3
Number 0
Cattle ~
Inventory, January 1
Cows 1~6 126 1~6 1~6 1~6 99 68 71 69 87 104 I~I 126 126 ~
rJl
Heifers, ~ yrs. rJl
(Replacements) 20 20 20 20 ~O 20 10 0 ~O 29 20 25 20 20
Yearlings 107 107 107 107 107 107 0 54 60 59 74 84 108 107
Calves born 107 107 107 107 107 84 54 60 59 74 88 108 107 107
Bulls 4 4 4 4 4 4 0 2 2 8 4 4 4 4
Annual sales
Cows 16 16 16 16 48 58 0 0 0 9 0 16 16 16
Others 84 84 84 84 84 182 0 8~ 29 87 47 65 80 84 ~

II Cut for hay. Production listed in tons.

....00
b Animal unit months of grazing.

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

382 LLOYD E. JONES

numbers were increased from 92 under the former to 126 head

under the alternative system.
Because of severe drouth during the years 1933 and 1934, breed-
ing cows were reduced about 50 percent under both systems. By
1934 the drouth had become so acute that in addition to selling
breeding cows, it was necessary to dispose of that year's entire
spring calf crop and the herd sires. Only half as many two-year
old heifers as formerly were retained for replacement purposes. It

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

was not until 1941 that breeding cow numbers were restored to
normal; and cattle sales did not approach average proportions
until 1942.
Based on actual county yields and range conditions reported,
the conclusion is that wheat crops of 1934, 1935, and 1936 were
total failures except for a small amount cut for hay; whereas an
average annual production of 19 tons of hay and 342 ADM's of
grazing could have been expected during these three years from the
~80 acres of wheat land shifted to crested wheat grass. During the
remaining 11 years of the 1929-42 period, there were four additional
years when the annual wheat production was 630 bushels or less,
three years when the production ranged from 1,000 to 2,000
bushels, three when it varied between 2,000 and 3,000, and one
year when 3,458 bushels were harvested. Annual yields of wheat
and barley were less than 50 percent of the 14-year average in
seven years, or half the entire period. Oat Yields were less than 50
percent of the average in six years. But in only one year was the
yield of hay less than 50 percent of the 14-year average, and
annual range production as indicated by range condition reports
was at least 50 percent of the 14-year average throughout the en-
tire period. Average yield of wheat during the 1929-42 period was
about 22 percent, feed grains around 20 percent and sales of beef
from 15 to 16 percent less than the long-time estimates used in
developing the average budgets shown in Table 1_.
One of the difficulties inherent in livestock enterprises in this
area is the impracticability of utilizing to the fullest extent each
year's production of grass. The year 1935, although a favorable
year for grass, was preceded by two years of drouth which had made
it necessary to liquidate large numbers of cattle. Consequently,
less than 50 percent of the grass produced in 1935 was actually
converted to beef. With the exception of 1931 and the severe drouth
years of 1933 and 1934, less grass was consumed than was pro-
duced.
 SHIFTING WHEAT LAND TO GRASS 383

In the average farm plans portrayed in Table I, yearlings were

grazed for six months and sold at weights averaging 650 pounds
for heifers and 700 pounds for steers. In the drouth year of 1933,
only enough grass was available to supply the yearlings with a five-
month grazing period. In 1934 but four months' grazing was avail-
able. During 1931 there was only sufficient grass for a five-month
season. During these two years it was also necessary to lengthen

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

the winter feeding period for breeding cows and young stock. A
longer pasturage season was provided with the addition of crested
wheat grass, which supplies early spring grazing. During the re-
maining years of this period yearlings were carried on grass until
November 15, a 7!-month grazing period, and there was a surplus of
unused grass at the end of the season. It was estimated that during
the 14-year period actual selling weights of all yearlings ranged
from 560 to 768 pounds. During years when there was a surplus of
grass, average selling weights were 718 pounds for heifers and 768
pounds for steers.
The need for analysis beyond that provided by longtime average
budgets shown in Table I may be observed by comparing them with
the 1929-42 averages in Tables II and III. Although the period
1929-42 included 14 crop years, the average annual production
during this period was significantly less than the estimated long-
time production averages used in developing the budgets shown in
Table I.
Comparative returns under each system are shown in Tables IV
and V. The estimated income residuals shown in Table IV are based
on varying annual prices and costs actually received and paid by
farmers during the 14-year period. Table V is included to compare
the former and alternative systems, assuming a constant high price
level. A comparison of Tables I and V also provides an estimate of
the income to be expected from each system with the same price
level but with production based, on the one hand, upon long-time
average yields (Table I), and, on the other, upon annual ~rields
reported during the Period 1929-42 (Table V).
During the 14-year period, although annual income and produc-
tion varied widely under both systems, the former varied less under
the alternative plan. With actual prices during this period, net
cash income averaged $2,048 with the former and $~,144 with the
alternative system (Table IV). Under the former plan annual net
cash income ranged from a deficit of $1,797 to a net cash income of
$9,444, with four consecutive years in which cash expenses ex-
884 LLOYD E. JONES

ceeded cash income. Under the alternative system income ranged

from a deficit of $1,743 to a net cash income of $7,755, with only
two years in which cash expenses exceeded cash receipts. (Table
IV).
After deducting estimated expenses for family living and depre-
ciation from net cash income, there would have been nine years
under the former and eight years under the alternative system

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

when family living costs and depreciation exceeded net cash in-
come. This residual identified here as "income for savings and debt
payments" reflects that portion of the annual income a ranch
family would have left for payments on debts and income tax,
TABLE IV. AmmAL EFFECTS OF CLIMATIC VARIATIONS ON INCOME OF A WHEAT-
CATTLE RANCH IN SOUTHWESTERN NORTH DAKOTA UNDER THE FORMER
AND ALTERNATIVE SYSTEMS WITH ACTUAL PRICES

Y-I G_~moo~
_ _ _ Former IAlternative
I
Cash expenses Net cash income
Income for llavings
or debt paymenta4
Former iAlternative Former Alternative Former IAlternative
1929 $7,954 $8,090 $2,995 $2,760 $4,959 $5,881 $2,509 $2,881
1980 6.86~ 6,88i !l.,794 !l,56!l 8,568 8,8~0 1,~49 1,501
1981 !l,9M 8,785 !l,554 2,286 401 1,499 -1,590 - 49~
1982 8,668 8,286 2,815 2,109 1,848 1,177 - S26 - '97
1988
1984
!l,9!l0
8,458
8,!l40
4,989
2,091
1,984
1,944
2,4U
829
l,5!l4
1,296
2,568
-
- 871
845 878
678
1985 490 ~72 2,287 2,015 -1,797 -1,748 -8,727 -8,678
1986 1,077 1,769 1,722 1,598 - 645 171 -2,571 -1,755
1987
1988
2,808
1,880
1,840
2,472
2,514
2,125
2,270
2,211
- 211
- 295
- 480
261
-2,281
-2,197
-2,450
-1,641
1989
1940
4,440
4,699
2,951
4,788
2,784
2,475
2,252
2,264
1,706
2,2~4
699
2,519
- 165
825
-l,17!l
620
1941 8,506 7,788 2,891 2,688 5,615 5,100 8,582 8,067
1942 18,087 10,985 8,598 8,280 9,444 7,755 7,058 5,869
Average 4,550 4,466 2,50!! 2,S22 2,048 2,144 50 147

a Net cash income adjusted by subtracting estimated costa for del,)reciation and family living. An-
nualliving costs based on estimated $2,400 in 1942-46, adjusted by mdex numbers of prices paid by
farmers for all commodities bought for use in family maintenance, Agricultural Statistics, 1948, Table
667.

additional ranch investments, building up operating and cash

reserves, after paying for a stable, reasonably adequate level of
family living. Annual revenue for savings or debt payments,
although extremely low under both systems, averaged three times
as high under the alternative. However, income varied greatly
under both systems, from $7,058 in 194~ to a deficit of $3,7~7 in
1935 under the former, and from $5,369 to a deficit of $3,673 under
the alternative system (Table IV).
Largely because of decreasing prices, low crop yields, and the
heavy sales of breeding stock during drouth years, neither system
 SHIFTING WHEAT LAND TO GRASS 885

would have provided any accumulated income toward savings or

debt payments from 1931 to 1939. A rancher who began opera-
tions in 1929 would have required reserves either from savings or
loans of $10,265 under the former and $7,003 under the alternative
system, to maintain an adequate family living and to set aside a
reasonable amount for depreciation. As illustrated in Table VI,
under the former system accumulated income for savings or debt
paYments reached a total of $3,758 in 1930, followed by an accumu-

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

lated deficit of $10,265 by the end of 1939 and a surplus of $700 in
1942. Under the alternative system, a total of $4,382 was reached
in 1930, to be followed nine years later by a deficit of $7,003 and
in 1942 by a surplus of $2,053. Accumulated savings at the end

TABLE V. ANNUAL EFFECTS OF CLIMATIC VARIATIONS ON INCOME OF A WHEAT-

CATTLE RANCH IN SOUTHWESTERN NORTH DAKOTA UNDER THE FOllMER
AND ALTERNATIVE SYSTEMS WITH HIGH PRICES

=1Ym

19~9
1930
I G"".., ••I"~~
Form~lternative
$10,644
10,134
$10,757
10,044
I Cuh_.....

8,963
$3,758
3,684
I Net cash income

6,171
$7,004
6,410
Income for savings tJ
or debt payments

Former (Alternative Former Alternative Former Alternative

$4,07~ $6,57~ $3,807
8,406
$4, ~89
8,645
1931 6,8~0 8,547 4,149 8,631 ~,671 4,916 - 94 ~,151
198~ 12,~!l4 10,76!l 4,!l48 8,869 7,976 6,898 5,!l11 4, U8
1988 9,765 11,81!l 8,873 8,601 5,89!l 7,711 S,127 4,946
1984 10,509 15,168 8,141 8,988 7,868 ll,!l80 4,608 8,465
1985 715 397 8,600 3,178 -!l,885 -!l,776 -5,650 -5,541
1986
1937
1,944
8,6!l7
8,194
!l,967
!l,755
8,696
!l,557
8,887
-- 811
69 - 870
637 -8,576
-!l,834
-!l,U8
-8,185
1988 8,45!l 4,578 8,400 8,587 5!l 1,041 -!l,7l8 -1,7!l4
1989 9,803 5,79!l 4,479 8,688 4,8~4 !l,104 !l,059 - 661
1940 8,993 9,169 3,993 3,658 5,000 5,516 !l,~35 !l,751
1941 18,4~5 11,677 4,410 4,0!l4 9,015 7,658 6,!l50 4,888
194~ 16,890 13,080 4,8!l8 I 4,886 11,567 8,744 8,80!l 5,979
Average 8,4!l5 8,888 8,900 3,6!l8 4,5!l5 4,765 1,760 I !l,OOO

tJ Net cash income adjusted by subtracting estimated costs lor depreciation, and family living. An-
nual family living costs estimated at $!l,400 annually.

of the fourteenth year would have been higher by $1,353, or 193

percent, under the alternative system (Table VI).
On the other hand, the financial position of the operator of such
a ranch would have been much better throughout the 14-year period
had it been possible to operate under the constant price level
(Tables IV and V). Although cash expenses would have averaged
about 56 percent higher, net cash receipts would have averaged
in the neighborhood of 120 percent higher. Income available for
savings or debt payments would have averaged from $1,710 to
$1,853 higher under the constant price level (Table V).
886 LLOYD E. JONES

Effects of Different Levels of Precipitation

Table VII illustrates the variation in income under both systems
during periods of good and poor climatic conditions when income for
savings or debt payments was above or below the average shown
in Table I. In addition to enabling the operator to layaway finan-
cial and feed reserves in years of favorable precipitation, desirable
systems of farming should stabilize and provide as much cash in-

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

come as possible during drouth periods. In this area, a terrific
strain is placed on farm solvency during dry years. In many in-
TABLE VI. ANNuAL ACCUMULATIONS AVAILABLE FOR SAVINGS OR DEBT PAYMENT
ON A WHEAT-CATTLE RANCH IN SOUTHWESTERN NORTH DAKOTA UNDER THE
FORMER AND ALTERNATIVE SYSTEMS WITH ACTUAL AND HIGH PRlCESa

Former Plan-Before seeding Alternative Plan-All wheat

Year wheat and summer-fallow and summer fallow land
land to crested wheat grass seeded to crested wheat grass
Actual price High price Actual price High price
level level level level
19!19 $ 2,509 $ 8,807 $~,881 $ 4,289
1980 8,758 7,218 4,882 7,884
1981 2,168 7,119 8,890 10,085
198~ 1,842 1~,880 8,898 14,168
1988 997 15,457 8,015 19,109
1984 626 20,060 8,688 27,574
1985 - 8,101 14,410 15 2!l,088
1986 - 5,672 10,884 -1,740 19,905
1987 - 7,908 8,000 -4,190 16,770
1988 -10,100 5,287 -5,881 15,046
1989 -10,265 7,846 -7,008 14,885
1940 - 9,940 9,581 -6,888 17,186
1941 - 6,858 15,881 -8,176 22,024
1942 700 24,688 2,058 28,008

II Annual accumulations after deducting estimated family living costs and de-

preciation from net cash income. Annual living costs based on estimated $2,400 in
194!l-46. adjusted by index numbers of prices paid by farmers for all commodities
bought for use in family maintenance. Agricultural Statistics, 1948, table 667.

stances, accumulated savings, reserves of feed, and livestock inven-

tories which expanded in more favorable years, become seriously
if not totally depleted in an extended drouth period. Throughout
such periods any increase in income, however small, aids in allevi-
ating distress and provides some of the absolute necessities of family
living. During periods of drouth and low prices, many farmers
resort to milking cows normally kept for production of beef. Other
farmers, who are already milking some "red cows," will increase
the number milked. Although the returns from milking these cows
 SHIFTING WHEAT LAND TO GRASS 887

are small, the income helps to provide some of the necessities of

family living and to meet a portion of the more urgent cash ex-
penses at a time when cash receipts are extremely small.
Throughout the periods 1929-32, and 1933-38, income for sav-
ings or debt payments averaged higher under the alternative than
under the former system, a relationship similar to that prevailing
in the average budget. However, chiefly because of the extremely
favorable moisture conditions which resulted in exceptionally high

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

wheat yields, income under the former plan during the period
1939-42 was significantly higher than under the alternative system
(Table VII).
TABLE VII. EFFECTS OF PERMANENT SEEDING OF WHEAT LAND TO CRESTED WHEAT
GRABS IN STABILIZING INCOME ON A WHEAT-CATTLE RANCH.
SOUTHWESTERN NORTH DAKOTA, BY PERIODS, 19~9-4~.

Average annual income for savings on debt paymentstJ

Actual price level High price level
Period
Former Alternative Former Alternative
plan plan plan plan
I
1929-42 $ 50 $ 147 $1,760 $~,OOO
1929-82 460 848 8,082 8,541
1988-88 -1,990 -1,587 -1,174 149
1939-4~ ~,700 1,971 4,886 8,289

a Average annual income after deducting estimated family living costs and de-
preciation from net cash income.

Crop and range production varied considerably from period to

period. Wheat yields averaged 8.5 bushels per acre from 19~9 to
1942. Both precipitation and prices were favorable throughout
1939-42 when wheat averaged 18 bushels per acre. During the
period 1929-32 when wheat yielded 9.6 bushels, rainfall, although
not as favorable as in the years 1939-42, was much above the
drouth period of 1933-38 when mean production was less than
1.5 bushels per acre (Table VIII).
Inasmuch as crop and grass production closely approached
average in 1929-32 period, livestock numbers kept and sold were
the same as the average budgets shown in Table I. During the
period 1929-32, under actual prices, income for savings or debt
paYments would have increased from $460 under the former to
$848 under the alternative system.
Both farm production and prices were extremely low during the
888 LLOYD E. JONES

drouth years of 1933-38. Throughout this period wheat averaged

only 1.5 bushels, corn 10.1, oats 9.9 and barley 6.6 bushels. Native
hay averaged .24 ton per acre (Table VIII). Throughout the period
1933-38, cattle numbers averaged 34 percent less under both sys-
tems and yearling sales were 43 percent lower under the former
and 45 percent lower under the alternative plan than during the
more normal period of 1929-42. During this period, sales of grain

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

would have decreased from $243 to $49 while beef sales would have
increased $583 or 34 percent in shifting from the former to the
alternative system. After deducting family living and depreciation
costs from net cash income there would have been actual deficits
TABLE VIII. AVERAGE CROP YIELDS ON A WHEAT-CATTLE RANCH,
SOUTHWESTERN NORTH DAKOTA, BY PERIODS, 192H2.

Period Wheat Corn Oats Barley Native hay

I
BW/hels BW/hels BW/hels BW/hels Tons
192H2 8.5 16.8 25.7 19.0 .30
1929-32 9.6 20.8 28.8 22.4 .28
1933-38 1.5 10.1 9.9 6.6 .24
193H2 18.0 23.4 51.7 84.0 .41

under both systems. However, the deficit under the alternative

would have been $453 or 23 percent less than under the former
system. On the other hand, under the higher price level, there would
have been an actual deficit of $1,174 with the former, compared to
an income for savings or debt payments of $149 with the alterna-
tive system. This reflects the importance of livestock in stabilizing
farm income in poor years. Even though it may be necessary to
liquidate a large proportion of the herd in periods of prolonged
drouth, livestock provides the farmer with a reserve fund to meet
current farm operating and family living costs during years of crop
failures. Throughout the drouth period 1933-38, almost all of the
cash receipts for both systems were from livestock sales.
Because of favorable precipitation, crop yields were unusually
high during the period 1939-42. Although range productivity
averaged higher in 1939-42 than in the period 1929-32, actual
livestock numbers were less, due to the difficulty of expanding a
drouth-depleted herd. During the 1939-42 period the breeding cow
herd under the former system averaged 91 percent and under the
alternative 94 percent of the 1929-32 inventory. The number of
yearlings sold in the 1939-42 period under the former system aver-
 SHIFTING WHEAT LAND TO GRASS 389

aged 80 percent and under the alternative system 82 percent of the

1929-32 sales. Income available for savings or debt payments de-
creased 729, or 27 percent, under the alternative system, while cash
expenses were $327, or 11 percent lower, under the alternative sys-
tem.
Throughout the entire period 1929-42, the number of breeding
cows averaged 77 head under the former and 107 head under the
alternative system. Average sales of 46 yearlings under the former

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

and 64 under the alternative system were made throughout this
period. Net cash farm income would have been approximately five
percent higher under the alternative system.
Under the constant high price level there would have been the
same relationship between income under each system as existed
under the actual price level. Although cash expenses were greater,
net cash income would have been considerably greater under the
higher price level.
In developing these case studies, extremes have been used. It
is probable, however, that on lands materially better suited for
wheat in this area, the most stable organization in the long run
would be a combination of wheat and livestock, in proportions
dependent upon the acreage of good crop land available and on
the resources at hand for the development of a livestock enterprise.
In future years, even though it may not be advisable for a farmer
to retain all of his wheat land in this crop, a portion of his better
land kept in wheat may be a good risk year-in and year-out. Some
in this area may find it desirable to include crested wheat grass in
their crop rotations. It is difficult here to develop rotations capable
of maintaining soil fertility and soil structure and at the same time
to prevent wind and water erosion. Many now feel that crested
wheat grass may provide the basis for a desirable crop rotation.

Conclmions
Because of variable climatic conditions, agricultural produc-
tion and income differ greatly from one year to the next and some-
times from one period of several years·to another in the Great Plains.
This study examines the possibilities of reducing variation in farm
production and income, under weather conditions such as those
experienced in 1929-42, and over a longer period, by shifting
wheat land to crested wheat grass for livestock. The following con-
clusions from an intensive case study are considered applicable to
890 LLOYD E. JONES

many other operating units in the Great Plains, particularly south-

western North Dakota:
(1) During periods of average or below-rainfall, net cash income
of farmers would have averaged higher if less land had been devoted
to wheat, and more used for crested wheat grass for livestock. Due
to high yields of wheat with above-average rainfall in the forties,
net cash income would have been greater had little or no crested

Downloaded from http://ajae.oxfordjournals.org/ at New York University on July 11, 2015

wheat grass been grown. However, over the entire 1929-42 period
net cash income would have averaged higher with more of this
crop grown.
(2) A system of farming which included more crested wheat grass
for livestock would help to stabilize farm income and production,
both from one year to the next and from one period of several
years to another. In times such as 1934, 1935, and 1936, when
wheat was a total failure, crested wheat grass would yield some
feed and provide farmers with income from the sale of livestock
from current production, in addition to returns from liquidation
in cattle numbers.
(3) Following a drouth, several years may be required to rebuild
depleted livestock herds, during which time cattle numbers and
sales may be below the mean, even though range production is
average or above. This is one of the difficulties inherent in livestock
production in the region.
(4) The extent to which crested wheat grass is an economical
substitute for wheat can be decided only by additional analyses
of other farming situations. Factors that would need to be consid-
ered include the acreage of low-yielding wheat land, the resources
available for, and the inclination of the operator toward, develop-
ment of a livestock enterprise. Lack of water may be an important
limitation in some areas.