Economic Feasibility Of The Cattle Feeding Industry In The Northern Plains And Western Lakes States
AbstractThe five-state study area of the Northern Plains and Western Lakes States, Minnesota, Montana, North Dakota, South Dakota, and Wisconsin, has adequate feed supplies and feeder cattle to markedly increase cattle feeding. Feed costs in these states have historically been lower than in the Southern Plains States. However, higher transportation costs appear to offset that advantage. Close access to slaughter plants in these states could offset that transportation disadvantage. Backgrounding of cattle appears to be quite profitable and cattle feeding, especially in larger sized feedlots, can be profitable. However, the cattle feeding industry has an increasing level of excess capacity. To be successful, new feedlots in the Northern Plains and Western Lakes States would need cost efficiencies to offset higher production costs, compared to Nebraska and Kansas, or would need to produce for a niche market unaffected by the lower operating costs of already established feedlots in the Central and Southern Plains States. Finally, a range of strategies are available in developing value-added cattle production in the Northern Plains and Western Lakes States. These strategies embody differing levels of capital investment, and involve different levels of risk and profitability.
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Bibliographic InfoPaper provided by North Dakota State University, Department of Agribusiness and Applied Economics in its series Agricultural Economics Reports with number 23199.
Date of creation: 1997
Date of revision:
cattle feeding; Northern Plains; economies of scale; cooperative ownership; entrance strategies; Production Economics; Agribusiness;
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- Stearns, Larry D. & Sell, Randall S. & Watt, David L. & Anderson, Vernon L., 1993. "Economics of Establishing a Beef Cattle Feedlot Using By-Products of Ethanol Production in North Dakota," Agricultural Economics Reports 23175, North Dakota State University, Department of Agribusiness and Applied Economics.
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