Farming Magazine - August, 2014

COLUMNS

Beef: An Alternative Approach to Grass-Fed Beef Production in the Northeast: Part II

By Daniel Hudson and Joe Emenheiser


Photo by Jevtic/thinkstock.com.

In the last issue, we documented the staggering cost of cow-calf systems in Northern Tier states and suggested that grass-fed beef systems (or any beef system for that matter) would probably be much more profitable if feeder-sized animals were purchased from states where winter is shorter and therefore production costs are much lower. If it is such a good idea, why do so many beef producers in the Northeast use a cow-calf production system instead of shipping in feeders? Here are a few common objections producers have to this "alternative" system, followed by responses.

Objection 1: My customers want a local product, produced entirely on my farm.

Response: If this is your only objection, do a little homework to see how your customers respond to your idea of changing your operation and the underlying rationale. We cannot speak for everyone, but our observations suggest that most consumers of value-added products want to know who is raising their food; that the production practices are humane and generally make sense; and that the animals have not received certain feeds or pharmaceuticals that they (the consumer) are not comfortable with.

Objection 2: My cows are really special, and I doubt that I can purchase the type of feeder animal that I need to maintain the quality that I get using the animals that are currently raised on my farm.

Response: If you're raising wagyu (for a product like Kobe beef), wildebeest or water buffalo, this is probably true. It's also true that Holstein steers are probably not what you're looking for if you want your grass-fed product to have a well-marbled carcass at 18 months of age.

However, if you have standard beef breeds or crosses on your farm, you could likely find equivalent animals elsewhere. Genetic evaluation tools like expected progeny differences (EPDs) exist to make this search more objective. Finally, while genetics are important, poor-quality beef is more often the result of suboptimal management or slaughtering at the wrong point in the growth curve.

Objection 3: The cost of trucking animals more than 600 miles would eat into my profits.

Response: The choice here is between paying for large volumes of hay to feed the brood cow and paying about $50 per animal to truck them in. When feeder animals are purchased in 50,000-pound truckloads (called potloads), the efficiency of transportation is maximized. Let's say you find a 50,000-pound load of steers averaging 800 pounds at a cost of $1.50 per pound live weight. The animals would cost a total of $75,000. Assuming the 800-pound weight average, 62 animals would fit on the truck. Trucking them 680 miles to your home at $4 per loaded mile, the cost would be $2,720, which amounts to $44 per animal. The total cost of these animals delivered to the farm would be $77,720.

If you chose to raise 50,000 pounds of feeder animals, and your true costs of production were $1.80 per pound - which is a reasonable estimate for many producers in New England - it would cost you $90,000. While the $12,280 difference is attractive, the real value is in the fact that you can:

  • finish about twice as many animals per acre on your farm if the brood cows are gone;
  • have fewer groups/classes of animals to manage;
  • devote more land to grazing and less to hay production; and
  • devote more time, energy and resources to improving production efficiency and carcass quality during the finishing phase.

Objection 4: Trucking animals around the country is not environmentally sustainable. They should all be produced locally.

Response: This should be looked at from the standpoint of energy/fuel/carbon and soil quality.

  • Energy/fuel/carbon - In Northern Tier states, even excellent pasture managers often need to feed stored feed 200 days out of the year. To make enough hay to feed a brood cow for 200 days requires about 8.7 gallons of fuel. In contrast, by using pasture stockpiling, an excellent pasture manager in Virginia can reduce their hay feeding duration to about 60 days, which would require about 2.6 gallons of fuel per brood cow.

    At 6 miles per gallon, it would take 113 gallons of fuel to get a potload from Shenandoah, Virginia, to Waterford, Vermont, which amounts to about 1.8 gallons per steer. Feeding the cow in Vermont requires about 8.7 gallons of fuel, whereas bringing the feeder from Virginia requires a total of about 4.4 gallons (including the fuel used to produce the hay for the brood cow). Feeding brood cows in the Northeast uses a lot more fuel per animal than the alternative model.

  • Soil quality has been a hot topic in recent years. Pastures and hayfields can have excellent or terrible soil quality, depending largely on management. All other things being equal, a well-managed pasture should have better soil quality than a hayfield. Direct deposition of manure, trampling of refused forage into the soil, and shifts in soil micro and macroorganisms seem to improve soil quality rather than degrade it.

Objection 5: It just isn't humane or natural to put a bunch of cattle on a truck and haul them 700 miles. Something about it just doesn't seem right ... it smacks of the commodity market mentality.

Response: Consider almost any livestock management practice: Most can be done in either a humane or inhumane way. People have always moved animals from point A to point B, whether it's been to find better pasture, to get the animals to a transportation hub, or to get them closer to higher-value markets. On one end of the spectrum, it could be a farmer prodding a cow down the road to town with a stick, and on the other it could be cowboys moving thousands of cattle hundreds of miles on a cattle drive.

While on the topic of what's natural, it's worth considering just how many bovine animals, apart from human interference, would be in a state like Vermont during the winter. Probably none. Wild bovine animals migrate to places where they can find enough food to survive. It could just as easily be argued that overwintering brood cows in the Northeast is not natural.

While many consumers and grass-fed beef producers have an understandable disdain for certain aspects of the commodity market, it seems wise to remain open to adopting good practices from various sources as we become aware of them.

Conclusion

There are many approaches used to produce beef in the Northeast, but farms that include cow-calf production often struggle to be profitable. Winter is long, cold and expensive for livestock producers. Unless they have access to extremely high-value niche markets, the main opportunities that farmers have to increase profitability are to reduce costs or increase the number of animals sold per year (assuming they already have a positive bottom line). While there's nothing wrong with pursuing such high-value markets, it's important to ask ourselves whether the local food movement has failed when most locals cannot afford the products.

Sourcing quality feeder animals from outside the farm is one approach that can both reduce costs and increase the number of animals sold under current market conditions, but it comes with a different set of risks and challenges that need to be managed. These include:

  • Making sure you are getting healthy animals that have been bred and managed to match your production system and markets.
  • Sourcing animals consistently and maybe developing a relationship with several producers from outside the area.
  • Pre-shipping and post-arrival management to maintain the health of purchased animals.
  • Developing a management program that will keep finishing time reasonably short while maximizing quality.

Daniel Hudson is an agronomist with the University of Vermont Extension. Joe Emenheiser is a livestock specialist with the University of Vermont Extension.