Sarah Lloyd
Wisconsin has an opportunity to keep more replacement dairy heifers in the state and support grass-based systems as an economic and ecological opportunity. Raising dairy heifers on well managed pastures can improve soil health, water quality, and biodiversity.1 In addition to ecological benefits, heifer grazing offers cost savings to graziers, supporting viable farm enterprises. Animal health and performance is on par if not improved for heifers raised in managed grazing systems, supplying dairy farmers with successful replacements for their milking herd.2
Dairy farming is changing rapidly in Wisconsin
The dairy landscape is shifting rapidly in Wisconsin with a trend towards fewer, but larger farms. Many small- and mid-sized dairy farmers are closing shop on milking enterprises and selling off dairy cows, in part due to high input costs and low milk prices. This trend often results in transition of acres from pasture and dairy rotations to row crops, worsening ecological outcomes. Also, increasing numbers of heifers from larger herds are shipped longer distances, often interstate, to be raised from post-weaning to pre-fresh/pre-calving, in large-scale confinement operations.3
Dairy heifer grazing: The value proposition
Dairy heifer grazing can be a viable strategy for all sized farms and provide ecosystem services. Well-managed pastures, often referred to as management-intensive rotational grazing (MIRG), can provide high value and low-cost forage for ruminants.4 The reduced input costs of heifer grazing compared to confinement systems with TMR feed regimens can increase dairy farm profit margins. Also, connecting dairy farmers with custom heifer graziers opens the possibility for new, more local enterprises that tap into animal husbandry expertise of those who may be exiting milking operations and avert the transition of pastures and dairy crop rotations (such as alfalfa and small grains) to annual row crops, keeping more continuous cover and perennial system on the land. As well, building a more localized heifer replacement system reduces the climate impact and animal stress of shipping heifers long distances, and may reduce the risk of spreading bird flu (H5N1), found in some dairy herds, now leading to greater regulation of interstate cattle shipping and milk testing.
Thinking at the watershed level
The University of Wisconsin-Madison based Grassland 2.0 project, in collaboration with the the community-led Eau Pleine Partnership for Integrated Conservation (EPPIC) watershed group, has been working in the Cloverbelt Learning Hub to bring together heifer graziers and farmers considering grazing heifers, county staff, UW Extension and USDA Dairy Forage Research staff to explore the opportunities and challenges of establishing dairy heifer grazing at the farm level and also the watershed level and beyond. The group has used the Grassland 2.0 decision support tools, SmartscapeTM and GrazescapeTM to model scenarios in priority watersheds. For example, the group has modeled a shift in over 4000 acres of row crop land to well managed pasture in the Fenwood Creek, showing that this transition could meet short-term goals for water quality improvement (see Smartscape map above).
Building viable farm enterprises
Along with ecological benefits, economic analysis shows cost savings for farmers raising dairy heifers in MIRG and potential profit for custom heifer grazing enterprises. The approximate cost of raising a heifer seasonally (assuming 180 days of grazing) in a managed grazing system is $0.99/head/day, compared to $2.50/head/day in a confinement system, a savings of $1.51/head/day.5 An operation with 100 heifers over a 180-day grazing season could save $27,180. A custom heifer grazier, raising 50 heifers for another farm (cost of $.99/head/day), charging the going rate (say $2.50 head/day) could cover costs and net $16,308 over the grazing season. At $3.00/head/day, the net return to the custom operator would be $21,708.
| Farm transition scenario | Acres and # of heifers in operation (1 ac/heifer during grazing season) | Profit/Savings from dairy heifer rearing operation (180-day grazing season) |
| Dairy farm going out of milking –> transition to custom dairy heifer grazing | 100 | $27,180 |
| 200 | $54,360 | |
| 500 | $142,200 | |
| 1000 | $284,400 | |
| Current cash-grain operator –> transition to custom dairy heifer grazing | 300 | $81,540 |
| Current dairy farm –> transition from confinement to grazing their own replacement dairy heifers | 190 | $51,642 |
This work also includes consideration of transition costs and return on investment (ROI). Our estimates show a 5-year or less ROI, even when not counting on USDA NRCS or other cost share.6
Building a Dairy Heifer Supply Chain
The Cloverbelt group has also undertaken development of a logistics model for a dairy heifer supply chain. We have been using a 38% replacement rate in our calculations. What are the size of the groups of heifers being raised? What is the cadence of when “sending farms” would deliver their animals to custom graziers? There are several operational models that may work well for different sending farms and custom operators, depending on what part of the heifer lifecycle might be the best fit.
From an animal performance perspective, bred heifers may be easier to successfully raise on pasture, because their metabolic needs are more stable than younger animals that are growing into reproductive age. Some custom heifer graziers concentrate on raising bred heifers, receiving animals at about 13 to 15 months of age and raising them until about 40 days “pre-fresh”/ before the date of calving. Other custom operations may feel comfortable with the younger, pre-bred heifers and managing nutritional intake more intensively and/or supplementing with grain to meet animal needs and meet client farm expectations. The timing and age of animals are an important consideration as we build out the aggregated model of scaled dairy heifer grazing across multiple operations.
Engaging with brands and the dairy industry to support transitions to heifer grazing
Another key area of engagement in the scaling of dairy heifer grazing is with dairy brands, processors and the dairy industry as a whole. The market forces that can support and incentivize these transitions is also critical. Many dairy brands, processors, and the dairy industry as a whole have made ambitious GHG commitments. Dairy Management Inc. (the national dairy check-off that dairy farmers are required to pay into) for example has made a net-zero by 2050 commitment and DMI and National Milk Producers Federation (NMPF, the advocacy organization of the cooperatively owned dairy processors, which handle 75%+ of the milk that moves in the United States) have initiatives that are working in the supply chains to support on-farm reductions of greenhouse gas emissions and other ecological impacts.7 Grassland 2.0 has been engaging with partners to understand the monitoring, reporting, and verification (MRV) of heifer grazing activities that would need to be established to meet the dairy industry on the paths they are developing. This is an area where further work is being planned.
Unlocking opportunities for watershed-based transformation
Building on the work that is on going in the Cloverbelt, Grassland 2.0 is pushing forward with a “scaling model.” We have identified the components listed below as key to be mobilized and coordinated in scaling work. It is important to note that these different “gears” of change do not follow in a linear progression. They are interdependent and place- and context-dependent. Some may spin at different speeds at different times. The farmer and technical service provider focused components (represented in blue in the figure below) form the core work. We also identify the need for interaction with market-based action (represented in green), as well as the importance of animal performance research (in orange) to support and inform the endeavor as the research base gets established, specific to dairy heifers.
Engaging farmers and technical service providers
- Building relationships between “sending”/client farms and custom heifer graziers
- Exploring enterprise and operational models to ensure profitability
- Supporting custom heifer graziers with technical support in grazing and forage production for animal performance, facilitating opportunities for peer-to-peer learning
- Aligning cost share for transition to managed grazing systems and activating risk management tools
Building market pull and incentives for scaling dairy heifer grazing
- Connecting with the dairy industry and brands, exploring connections to product environmental goals
- Modeling greenhouse gas emissions, water qualitym and biodiversity impacts of getting heifers on grass and establishing Measurement, Reporting, and Verification (MRV) protocols
- Modeling forage and crop land use and manure management across the sending and receiving watersheds, investigating the “import” and “export” of nutrients and ecosystem services
Supporting scaling with animal performance research
- Collating and mobilizing animal performance research resources
Expected outputs from these efforts will continue to lay the foundation for an expanding dairy heifer grazing industry in the state and region. If we take the two Wisconsin areas that Grassland 2.0 is engaged with specifically on heifer grazing, there are 97,645 cows in herds over 500 cows, according to the 2022 US Agricultural Census. Just taking these larger farms that would be more likely to send heifers to custom operations, they will need over 37,000 replacement heifers every year. There is plenty of room to build heifer grazing as a viable option for the supply of these replacements.
| Farm data (2022) | Dairy farms | Cows (all herd sizes) | Cows in herds >500 | Replacement heifers needed for >500-cow herds (using 38% rate) |
| Cloverbelt (Marathon County, WI) | 353 | 65,598 | 36,302 | 13,795 |
| Northeast WI (Shawano, Oconto, Winnebago, Outagamie counties) | 360 | 104,541 | 61,343 | 23,310 |
Looking at the statewide opportunity for dairy heifer grazing connected with the larger farms, the 2022 USDA Ag Census reports 615 farms with 500 cows or more for a total of 706,794 milking cows. If you take the 38% replacement rate that would be 268,582 heifers each year needed. A 20% adoption rate would be 53,716 grazed heifers. A 50% adoption would be 134,291 grazed heifers. If you conservatively figure you can either save (for someone raising their own heifers on grass) or profit (for a custom heifer grazier) $1/head/day, grazing dairy heifers in Wisconsin at 20% adoption is a $19,606,340 value proposition. This number does not include all the economic activity of all supplies and other expenses circulated through the economy, that currently may be leaving the state as farmers ship heifers afar to be raised.
In the Cloverbelt we have been building a scenario around a transition of 4000 acres, that would support 4000 heifers. If we extrapolate out the milk production from these heifers that would be raised and enter dairy herds as lactating animals, this work could result in over 100 million pounds of milk, using an assumption of 27,000 lbs/cow/year for the milkshed, that could reach processors and product lines. It will be important to not only think like a watershed but also a milkshed when building the opportunities for valuation and monetization of the ecological and other benefits of this production system change of moving heifers on to well managed pasture.
Grassland 2.0 has been working with farmers, nutritionists, agency technical assistance providers, and researchers to scale dairy heifer grazing in the Upper Midwest as part of place-based, strategic action to build regenerative dairy systems. This document is a summary of several years of collaborative work. The focus on dairy heifer grazing emerged from community conversations in the Cloverbelt Learning Hub in central Wisconsin and these ideas are being developed with farmers, nutritionists, and staff from county, USDA, non-profits and the University of Wisconsin-Madison.
Endnotes
- Dietz, C.L., Ruark, M.D., Jackson, R.D., Sanford, G.R., 2024. Soil carbon maintained by perennial grasslands but lost in field crop systems over 30 years in a temperate Mollisol according to longitudinal, compaction-corrected, full-soil profile analysis. Communications Earth & Environment 5, 360 and Rojas-Downing, M. M. et al.. 2017. Resource use and economic impacts in the transition from small confinement to pasture-based dairies. Agricultural Systems. 153:157-171.
- Kalscheur, KF, Camisa Nova, CHP.; Jaramillo, D, and Brink, GE. 2024. Win-win for dairy farms: Heifers raised on pasture reduce cost and produce more milk at first lactation. IGC Proceedings (1993-2023). 74. Ongoing research at the University of Wisconsin-Madison’s Marshfield Agricultural Research Station with the USDA Dairy Forage Research Center is assessing the performance of grazed heifers compared to those reared in confinement fed with Total Mixed Ration (TMR) systems. The research team is replicating a smaller study showing that when entering a confinement milking herd, heifers raised on MIRG had higher dry matter intake and milk production in the first lactation.
- Results from the WI Department of Agriculture, Trade & Consumer Protection’s 2024 Dairy Producer Survey show 37% of herds of 1000+ cows “have cows/calves raised outside of Wisconsin”. States reported were CO, IA, KS, MN, NE, ND.
- Oates, L.G., Undersander, D.J., Gratton, C., Bell, M.M., Jackson, R.D., 2011. Management-intensive rotational grazing enhances forage production and quality of subhumid cool-season pastures. Crop Science 51, 892-901 and Paine, L.K., Undersander, D., Casler, M.D., 1999. Pasture growth, production, and quality under rotational and continuous grazing management. Journal of Production Agriculture 12, 569-577.
- Rudstrom, M., Chester-Jones, H., Pas, Imdieke, R., Johnson, D., Reese, M., Singh, A., 2005. Comparison of economic and animal performance of dairy heifers in feedlot and pasture-based systems. The Professional Animal Scientist 21, 38-44. Calculations based on analysis of UMN farm management database FINBIN by Grassland 2.0 collaborator Jim Munsch.
- Grassland 2.0 worked with FoodSystem 6 to analyze cash flow and return on investment of several scenarios, as well as developing options around EQIP bridge loans and revenue balancing strategies.
- See https://www.usdairy.com/sustainability/environmental-sustainability/net-zero-initiative, on-farm production is considered upstream from the processing or manufacturing of the dairy product, so it is classified as Scope 3. A joint effort, led by DMI and NMPF is the F.A.R.M. program that has a new (v.3) of their Environmental Stewardship standard https://nationaldairyfarm.com/dairy-farm-standards/environmental-stewardship/ Processors can have their farmer suppliers track environmental stewardship practices, with the goal of aggregating this data to make Scope 3 claims on products.