The Value of Genetic Information in a Whole-Chain Traceability System for Beef

An animal traceability system can help control disease, improve food safety, improve production practices and provide enhanced marketing opportunities. However, attempts to establish a beef traceability system in the U.S. has faced resistance from many beef producers. Some of the reasons for resistance were cost, lack of confidentiality, and lack of accuracy of the system. Moreover, those who incurred the costs would not necessarily have received the benefits of such a system. This study evaluates the costs of a whole chain traceability system and compares them to the benefits of a traceability system in improving feed efficiency of cattle. We determine the cost saving from purchasing a higher proportion of high-­‐efficiency cattle using the information available in the whole chain traceability system. We also determine the benefits that should be shared among cow/calf, stocker and feedlot operators to motivate them to adopt such a system. Results show that while cow/calf producers would bear most of the cost of a traceability system, they would also receive the least benefits. To make participation in a traceability system profitable for cow-­‐calf producers, the results indicate that $20 per head additional income should be transferred to the cow/calf and stocker producers. This additional income transfer will cover the costs of whole chain traceability system and also provide additional profit that will motivate the cow/calf and stocker producers to participate in such a system. The feedlot also gains a net cost saving of $19 per head after transferring the additional income and paying its own traceability cost. Thus, by reducing feeding cost, a whole chain traceability system that provides information about the feeding efficiency of cattle can provide additional profit to the cow/calf, stocker and feedlot operators even after covering the costs of implementing the traceability system.