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Economic outcome of feedlot cattle production under different scenarios

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  • Santos, Glauber dos
  • Botelho, Fabrício Jordão
  • Meneghel, John Marcos de Moraes
  • Fausto, Daiane Aparecida

Abstract

Due to market demands, beef cattle producers are increasingly professionalizing the activity, aiming for greater profitability, improved management, and standardization of the final product. This study aimed to analyze the economic viability of a cattle feedlot with a capacity of 1,000 head of cattle and three annual feedlot cycles of 90 days each, as well as to analyze scenarios with variations in the main indicators that influence the economic outcome of the activity (feed price; price per arroba of beef; production scale; minimum attractive rate of return). The data used were collected on a property located in Paracatu, Minas Gerais, during 2017. The activity of feedlotting beef cattle using the method of acquiring lean cattle and selling finished cattle proved to be economically viable, but with some risk due to the seasonality of the market value of some parameters, such as the price per arroba of beef and also the value of the main inputs that make up the feed (corn and soybeans). Conversely, increasing the scale of feedlot cattle production by 20% had a very positive impact on the Net Present Value, which was an important factor and can be applied during unfavorable market conditions.

Suggested Citation

  • Santos, Glauber dos & Botelho, Fabrício Jordão & Meneghel, John Marcos de Moraes & Fausto, Daiane Aparecida, 2018. "Economic outcome of feedlot cattle production under different scenarios," Revista IPecege, University of Sao Paulo, vol. 4(3).
    • Handle: RePEc:ags:ipeceg:386294
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