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Small Farm Beef Enterprises
Dr. John Comerford
Penn State Beef Specialist
To get cattle to do what you
want them to do takes a
knowledge of
• Animal Behavior
• Corral Design
• Proper handling techniques
How cattle perceive the world
• They have panoramic vision
Crowding Tub
• “Funnel cattle to working alley
Sweep Gate
• Solid sweep
• See-through
small alley
gates
Working Chute
• 20 feet long (22-26 inches wide: cows)
Direct Sales of Beef
1. Commodity Beef
a. Carcass size 300-400 lbs. for a side ($500-$700)
b. Grain fed
c. Lean
d. Young at harvest (under 20 months old)
e. No implants or sub-therapeutic antibiotics
2. High Quality Beef
a. Specialized breeding and management program
b. Heavily grain fed
3. Grass-Beef
Beef production is not the production of cattle !
It is the production of
FOOD!
Be a BQA Certified
Producer!
Consumer Preference and
Value of Beef
Sitz, Calkins, Umberger, Feuz -U of Neb., 2004
Denver (131 consumers) -Chicago (141
consumers)
• 1=extremely desirable; 5 = not at all desirable
Desirable characteristics of
beef
(1=extremely desirable; 5 = not at all desirable)
1. Freshness (1.23)
2. USDA Inspected for safety
(1.45)
3. Color (1.60)
4. Price (1.72)
5. Leanness (1.76)
6. High Quality Grade (1.79)
7. Tender (1.86)
8. Nutritional Value (2.20)
Desirable characteristics of
beef
(1=extremely desirable; 5 = not at all desirable)
9. Country-of-origin Labeling
(2.41)
10. Marbling (2.43)
11. Source assurance (2.56)
12. Environmentally friendly prod. (2.61)
13. Raised in Your region of the US
(2.64)
14. Convenience (2.66)
15. Fat Content (2.75)
16. Organic/natural (3.01)
The #1 Reason Consumers
Purchase Beef
Today’s Consumer
• More working couples
• More single person households
• Less knowledge about cookery
• More disposable income
• More health concerns
– “chemical issues”
– microbial issues
Positive Consumer attributes for
Grass-fed
1. Freshness
5. Leanness
8. Nutritional Value (fat, cholesterol, omega 3)
11. Source assurance
12. Environmentally friendly prod.
13. Raised in Your region of the US
15. Fat Content
16. Organic/natural
Calkins et al. , 2004
Management Is A Key Factor
• Early castration
– Prior to 7 to 8 months of age
• Implants
– Aggressive vs. Mild
– Androgens vs. Estrogens
• Intramuscular injections
• Nutrition
– Vitamin D supplementation
• Cattle handling
• Grass-fed beef can meet the needs
of many consumers
1. Local production – face to face with farmer
(source verification)
2. Smaller carcass size
(less total cost)
3. Beef you feel good about
(production verification)
4. BUT- it must TASTE good!
Storage and cooking
• Package and store adequately
• If frozen, freeze rapidly to prevent excess
purge which will make meat drier
• Thaw slowly in refrigerator or cold water
• Cook from room temperature
• DON’T OVERCOOK
– 150OF maximum (medium rare- medium)
Post-mortem aging
• Strive for 14 days (10 minimum)
• dry or wet aging
• May consider high temperature aging
– Hold at ambient temperature for 2 hours to
speed post-mortem glycolosis -- especially if
fat is less than .20 inches
External Fat
• A target of 0.3 - 0.4 inches is good
– Allows slower chilling and prevents strong
cross bonds between muscle filaments.
– Also demonstrates animal has adequate
energy for rapid growth and that muscle
tissue growth is stopping
Growth Rate
• Faster is better for palatability
• Strive for 2.0 lb/day for at least the last
100 days
– Improves calpain/calpastatin
– Animals will be ready for market at younger
age
Maturity
(animal age)
• Strive for < 24 months
– Less connective tissue cross linking
– Older animals are less tender
– Fewer problems with BSE regulations (cattle
are aged by dentition which is not always
precise)
Recommendations for producing
HIGH QUALITY Grass-fed Beef
Marbling Degree Pictures
Maturity
Click to add text
Marbling A B C D E
Abundant
Mod. Abund. Prime
Sl. Abund. Commercial
Moderate
Modest Choice
Small
Slight Select Utility
Traces Standard
Pract. Dev.
Can You Use Quality Grade to
Determine Palatability?
Odds of "Undesirable"
Overall
Marbling Flavor Tenderness Palatability
Prime 1 in 43 1 in 36 1 in 26
Up 2/3 Choice 1 in 39 1 in 22 1 in 19
Low Choice 1 in 12 1 in 12 1 in 7
Select 1 in 8 1 in 12 1 in 5
Standard 1 in 3 1 in 2 1 in 2
A maturity
Source: Smith et al., 1984
Cattle Need
100 DOF
to produce
beef with the
desired
flavor
Taste Panel overall acceptability
80
70
60
50
40
30
20
10
0
'77 '00 '01 83 '99 '93 '80
grass grain
Schmidt et al., 2003
Taste Panel Flavor
9
8
7
6
5
4
3
2
1
0
'77 '88 '00 '01 '78 '83 '99 '93 '80
grass grain
Schmidt et al., 2003
Fat/Cholesterol:
Is It Really an Issue?
•Cholesterol content will not be
different between grass-fed and grain-
fed beef.
•External fat will be trimmed equally
with grain fed..
So, Where does Grass-fed Beef Fit?
Budgeting Grass-Fed
Beef Production
Dr. John Comerford
Beef Extension Specialist
Penn State University
$Profit= $Returns - $Cost
Enterprise Costs
1.Opportunity Cost:
There is an alternative use
value and no cash cost
Enterprise Costs
2. Variable Costs:
a. Annual cash used to
produce one carcass
b. The purchase is “used
up”
Enterprise Costs
3. Fixed Costs:
Annualized value of fixed
resources
Steer
Four Costs
• Purchase price (800#X$.88) $704.00
• Trucking cost 5.00
• Death loss (1%) 7.04
• Interest (2% for 6 mo) 7.04
Total $723.08
Feed
• Minerals (.25#/d x 180d x $300/ton) $8.75
• Supplemental grain or protein ?
Total $8.75
Vet Costs
• Dewormer ($3.50/head X 2) $7.00
• Vaccinations 3.00
• Fly control 4.00
• Treatment (5% treated @$6/hd) .30
Total $14.30
Machinery Cost
• Calculate Stocking Rate:
Average weight while grazing=962#
(based on 1.8 lbs/day gain X 180 days)
Stock at 1.5 AU/acre=.64 acres/steer
.64 acres X $20/acre= $12.80
* Insurance, repairs, misc. cost $2.00
Other Costs
• Pasture fertility ($15.00/ac)x.64 $9.60
• Marketing costs
trucking 5.00
commissions
checkoff 1.00
Returns
(1 of 50 x75% recovered) 12.14
Total $18.14
Total Variable Costs
• Steer $723.08
• Non-steer $63.61
• Interest on non-steer $.63
• Total $787.32
Fixed Costs
1. Pasture establishment
($80/ac)/10 years)) X .64 hd $5.12
2. Fences for 4-paddock rotation
(40 ac base w/ 30 yr life)
Perimeter (1 mi @ $2/ft) $10,560
Interior (1/2 mi @$1/ft) $2640
Per steer cost $7.04
Fixed Costs
3. Water System
$2/acre X .64 acres $1.28
4. Land Charge
$2,000/acre X 2% X .64 ac $25.60
**$2,000/ac X 8% X 30 yr $112.71
5. Handling facilities, buildings, etc.
($10,000 /30 yr) / 40 acres X.64 acres
$5.33
6. Interest on fixed costs $.44
7. Total fixed costs $44.81
Returns
• 800 lb. steer x 1.8 lbs./day x 180 days
1124 lb. final weight
60% dress
674 lb. carcass
$1.20/lb.
Net returns $809.28
Net Returns
• Total costs= $832.13
• Total returns= $809.28
• Net Value = ($22.85)
• Breakeven value= $1.24/ lb carcass
Grain-Fed Steers
• Steer costs $723.08
Vet costs $14.30
Insurance, etc. $2.00
Yardage ($.40/hd/dayx140d) $56.25
Feed (7# DM/lb.X140dX3.2 #/d)@ $90/ton
$176.40
Interest $.61
Total $972.64
Breakeven
1250 lbs. X .63 dressing %= 787 # carcass
978.08/787= $1.24/lb.
Grass-Fed vs Grain-Fed
• There may not be much difference in cost
to produce beef
• Grass-fed is subject to more fluctuations in
cost
• Grass-fed marketing is intermittent
• Generally do not use cost aids such as
implants
• Less predictable performance
Ten Places to Find Free
Money in the Beef Business
1. Growth-Promoting Implants
Implant Economics:
One implant costs $2.74
Feedlot:
Average difference in weight gain= 56 lbs.
Advantage:
56 lbs. X $.90=$50.04
Return per implant= $47.30
Weaning weight:
Average difference in weaning weight = 17 lbs.
17 lbs. X $1.25/Lb. = $21.25
Return per implant= $ 18.51
2. Covering Hay Bales
Covering Hay Bales
Price of barn to store 100 bales= $12,000
Annual cost w/ 30 yr life= $400
Average edible portion saved=
(800 X .04) X $25.00/bale= $1.00/bale in loss
(800 X .30) X $25.00/bale = $ 7.50/bale in loss
Net savings = $650/ year
Plastic Wrap
Custom cost of wrapping = $5.00/ bale
TDN value of wrapped grass hay= 62%
TDN value of dry rained-on hay= 46%
Corn-equivalent value= $27.55/bale
$20.55/bale
$7.11/bale
3. Feeding Waste
Waste = 2.5 %
Waste = 40%
Feed Waste:
800 X 2.5% X $25.00/bale = $ .62
800 X 40% X$25.00/ bale = $10.00
800 X 8% X $25.00/bale = $2.00
Feeder cost = $750
($750-$150)/ $1.38= 434 bales to pay for it.
4. Controlled Calving Season
Controlled Calving Season
• Management time at calving
• Uniform groups to sell
• Nutritional program is most economical
• Breeding program can be enhanced
• More effective genetic comparisons
• Better pasture utilization
• More effective health program
• Management priorities are maintained
5. Castration of Male Calves
Castration:
Bull calves are worth $1.12 at 500 lbs.
Steer calves are worth $1.26 at 500 lbs.
Difference = $70 per calf
Alternatively:
Castration takes about 2 minutes, so the job
pays at the rate of
$2100 per hour
6. Having Enough
Bull Power
Yearlings: 15-20 cows
2-3 yr-olds: 25-35 cows
Mature bulls: 40-60 cows
Bull Power
One cow in heat per day for each 19-21 cows in the
herd.
60 cows = 3.2 cows in heat
A young bull probably cannot breed more than 2
cows in a day.
Lost breeding day:
21 days X 1.8 lbs./day X $1.25/ lb.= $47.25 per calf
Annual cost of a bull: ($1500/4 years)=$375/yr
Per cow cost for 20 cows= $18.75
7. Buying Good Bulls
$1200
$2000
Buying Good Bulls:
Cheaper Bull More expensive bull
$1200 $2000
Bwt EPD 2.0 2.0
Milk EPD 18.0 18.0
YR Wt. EPD 70 80
WWT EPD 30 42
12 lbs/calf X 28 calves/yr X 4 years X $1.00/lb.=
$ 1344
The true value of the second bull is $3340
8. Palpating the Cow herd
Palpating the Cow Herd
The average cow has an annual cost of $400
In 2004 the average cow sold a calf worth
$ 497.25 (a record return)
A cow left open this year and retained in the
herd must sell a calf worth $897.25 at
weaning in 2006.
9. Put a Black Hide on Them
In a 4-year average of feeder calf pools in
West Virginia and Pennsylvania, a calf sold
as “black” compared to the average of all
other calves (except Holsteins) had a value
that was $56.00 per calf higher.
10. Crossbreeding
X
To Take Advantage of Heterosis
The Value of Heterosis:
Starightbred population: 0
Crossbred calf: 8.5%
(500 lbs. X 8.5% X $1.12) = $47.60
Crossbred Cow/Crossbred Calf: 23.3%
(500 X 23.3% X $1.12) = $130.48
