Ranch Values and the Federal Grazing Fee

Abstract

Past analysis of the impacts of higher federal grazing fees on ranch values have been purely speculative due to the absence of observations on sales of Western cattle ranches under a wide range of fee levels. An income approach to ranch value determination is described here in which numerous parameters affecting value can be varied. Solutions attained under different grazing fees are capitalized into the net present value of a potential ranch investment. Substantial decreases in ranch revenues and ranch values can occur with large fee increases in cases where public land forage comprises a large share of a ranch's annual forage supply.