Production & Marketing Photo courtesy of USDA-NRCS.

Transcription

1 Grass-Finished Beef: Production & Marketing Photo courtesy of USDA-NRCS. Livestock Webinar by NCAT Specialists Lee Rinehart and Jeff Schahczenski

2 This webinar is being recorded and will be posted to the ATTRA website, Look for it here after November 4, We will also post a PDF of the presentation 2

3 Production systems for grass-f inished beef Grass-fed vs. Grass-finished Overview of production systems Animal selection appropriate breeds and characteristics Cattle nutrition and pasture management Equipment, etc Photo courtesy USDA NRCS. 3

4 Considerations for managing grass-f inished cattle Appropriate genetics and good forage and animal management Consider low input and low maintenance animals over high producing animals Research suggests it takes 60 to 80 days longer (than conventionally-raised beef) to reach a market weight of 1,050 to 1,100 pounds and grade Select or better Consider converting grain fields into permanent pasture, and use cropped land for winter or summer annuals in rotation to maintain adequate forage base Photo by Lee Rinehart, NCAT. 4

5 Considerations for managing grass-f inished cattle Keep in mind the winter challenge, and use winter annuals, grass silage, alfalfa hay, and stockpiling of summer pasture for winter grazing Think in terms of how the farm or ranch can achieve long-term sustainability, economically and ecologically, by relying on forages instead of purchased or farm-grown grains And most importantly, have a market plan in place prior to starting Photo courtesy of USDA-NRCS. 5

6 Cow-calf Stocker Grass-finishing Overview of production systems Photo courtesy of USDA-NRCS. 6

7 Production variables Animal costs Purchase price Labor Veterinary costs Supplemental feed and/or mineral Interest Marketing costs Pasture costs Seed Fertility Equipment Baling costs for hay Labor Land costs Property taxes 7

8 Break-even software

9 Dual-purpose breed types Medium frame End weight 900 to 1,100 lbs Age at slaughter 16 to 24 months Early maturing Low maintenance requirements Animal selection 9

10 Breed types Angus Hereford Shorthorn Devon Dexter American Low-Line Images courtesy of 10

11 Breed types humid South Beefmaster Santa Gertrudis Brangus Braford Brangus. Image courtesy of Santa Gertrudis. Image courtesy of 11

12 Cattle nutrition and pasture management Ruminants are adapted to use forage because of microbes in their rumen. To maintain ruminant health and productivity, feed the rumen microbes, which in turn will feed the ruminant. Ruminant nutritional needs change depending on age, stage of production, and weather. 12

13 Cattle nutrition and pasture management Adequate quantities of green forage can supply most if not all the energy and protein a ruminant needs. Forage nutritional composition changes depending on plant maturity, species, season, moisture, and grazing system. Supplementation may be necessary when grass is short, too mature, dormant, or if animal needs require it (i.e., high-producing dairy animal). Excessive energy supplementation may reduce the ability of the rumen microbes to use forage. 13

14 Pasture management High leaf area index High plant density High plant diversity Plants vegetative throughout growing season Decrease in weedy or mature plants Less bare soil Cows happy and in good condition Forage legumes, Red clover. Photo by Mary Rinehart. 14

15 Grazing management Rotational system Allocate forage supply based on animal demand Ensure forage surplus when needed Maintain high forage quality Photo by A.E. Beetz. 15

16 Equipment and fencing Charger (energizer) and grounding rods High-tensile wire, 10, 12.5 or 14 gauge Tensioners and insulators Poly tape and poly wire for sectioning off paddocks Tools, including volt meters, crimping devices, lighting arrestors, and surge protectors Electric poly wire. Photo courtesy USDA NRCS. Posts, such as wood and steel (for permanent and corner braces), and step-in posts (temporary) 16

17 Equipment and fencing Water systems should be designed for ease of operation and maintenance Pump, a pressure gauge, piping and fittings, water troughs, and automatic watering valves Discharge of 5-8 gallons a minute and a supply pipe larger than 1.25 inches for replenishing the tank Pipe can be made from various kinds of plastic, i.e. black poly pipe Consider solar watering and freeze protection systems Homemade hydraulic ram pump. Photo courtesy Clemson University Cooperative Extension Service, Equip/ram.htm 17

18 Marketing overview The national market - size and growth Cost of production Price expectations Prof itability Labeling barriers Processing barriers Willingness to pay Photo courtesy USDA NRCS. 18

19 Small percent of organic market 19

20 Montana Organic Producers Cooperative,2007 (ATTRA, IP346) Inyo County, CA Feasibility Study, 2008 (ATTRA, IP347) Data sources Photo from the Montana Organic Producers Cooperative, by Karalee Bancroft. 20

21 Costs comparisons 21

22 Prices: Certif ied organic grass-f inished-direct markets Pricing a single certif ied grass-fed beef Lbs. Price/lbs. Total value Live animal weight 1,000 Tenderloin steak 13.2 $26.75 $ New York strip steak 15.4 $21.24 $ Rib-eye steak 26.4 $19.02 $ Stir-fry/cubes 8.8 $6.95 $61.16 Round roast 75.9 $6.37 $ Ground beef $5.90 $1, Total meat 330 $2, Based on average prices 22

23 Organic hamburger value-chain Producer sells burger to retailer - $1.26/lb Wholesaler sells burger to retailer - $4.54/lb Retailer sells burger to consumer - $6.99/lb 35% Organic grass-f inished hamburger value chain 47% Middle men Retailer 18% Producer 23

24 Processing needs assessment: What it costs Average cost for mobile = $233,000 Average costs for cut and wrap = $902,689 Combined = $1.1 million dollars Average pound/meat/year = 1.5 million ~.73 per lbs processed (capital costs) 24

25 Labels: A way to differentiate a product Commodity Natural Grass-finished Organic Local Combination Naturally-raised Image from 25

26 Processing needs: The challenge 26

27 Willingness to pay: Retailer survey results Important Characteristics for Livestock Products 27

28 Willingness to pay: Retailer survey results Willingness to pay 28

29 Summary Market is very small but growing very rapidly. Organic grass-finished beef seems profitable. Costs of production appear to be higher relative to commodity beef. Labeling confusion within USDA and for consumers is high. Processing availability at a reasonable cost is a barrier to market entry. Stationary processing is expensive. Mobile-processing is also expensive and may require a stationary facility. The willingness to pay sufficiently higher prices is problematic. 29

30 Thank you! Questions?