Livestock production systems face multiple challenges under climate change. Traditional systems have to be evaluated with respect to their production as well as their climate mitigation potentials in the future. We investigated grassland-based livestock production options in the dry steppe region in south-western Russia and northern Kazakhstan using the dynamic global vegetation model (DGVM) Lund-Potsdam-Jena-managed Land (LPJmL). The analysis explicitly includes feed-backs between grazing animals and feed quality and quantity and its effects on biogeochemical flows under different management assumptions varying the amount of applied fertilizer and livestock densities. By calculating environmental impacts for a selection of management combinations according to different objectives, we can assess livestock-related GHG emissions of methane, nitrous oxide, and carbon dioxide, as well as nitrogen pollution to the environment. Results show that environmental conditions, even within this relatively homogeneous arid steppe region, do not only affect production potentials but also trade-offs between maximizing productivity and minimizing environmental impacts per product. This leaves an option space of achieving comparatively high production under low environmental costs.