The “fee” for federal grazing rights never reflects the economic value of the land. The government has no more business picking the winners and losers in the cattle business than it does in any other industry.
The losers and winners were already picked when people acquired deed to water access land. Without it, no access to water, all the grazing land on the planet doesn’t mean squat. For extra credit, look up how much of Nevada is Federal Land. I think you will be surprised.
The government doesn’t pick winners and losers. It sells stuff to buyers willing to pay. And yes, it DOES reflect the value of the land, since it competes with private land.
The obvious downsides are you have to bring in the cattle well before slaughter to switch them to a different feed. The other downside is that you have losses of cattle. Plenty of cow carcasses littering the landscape in Nevada.