Overview of the Livestock

Industry

Chapter 2
 Value of Animal Agriculture
• 283 million U.S. consumers
– Also provide food to the export market
• Cash Receipts
=Revenue generated from the sale of animal
and animal products
• P.21 Table 2.1
• P. 23 Fig. 2.2
– Iowa Cash Receipts: 7,281,000
 Supply and Demand
• Price of animals and animal products
fluctuate
– Daily, weekly or monthly
– Prices are influenced by supply and
demand
• P. 25 Fig. 2.3
 Biological Lag Time
• P. 26 Fig. 2.4
Introduction to the U.S.
Beef Industry
 Introduction to the Beef
Industry
• Bos indicus
– Developed for tropical climates
• Bos taurus
– Developed for temperate climates
• Globally…
• P. 26 Table 2.4
– India has the highest cattle population
• Consumption is very low
– Japan is large consumer of world beef
 Introduction to the U.S.
Beef Industry
• Single largest money
generating Ag commodity
• Animal Ag accounts for 51% of
Ag receipts
– Beef Industry 19%

– Gross Income $35 Billion

– 31 states over 10,000 operations
– Produces 20% of the World Supply
 Geographic Location

• Cow calf operations

– Grass states
– Plains, Cornbelt, and Southeast
• Feedlot operations
– Texas panhandle, Central Plains states
– 7 state area
Feedlot Location
Environmentally Friendly

• Single largest user of grass lands

– 1.2 billion acres ~ 2/3 for grazing
– Western Plains, Cornbelt, and Southeast

• Grains
– Modest user of corn products
– Major user of corn by-products
Cow Numbers
Cow Numbers
 Production Segments
Cow-Calf Producer
– 33 million head of beef cows
• Fluctuates due to drought, beef prices, and land prices

• Seedstock
– 70,000 breeders, 10 AI companies
– Produce breeding cattle and semen

• Commercial Cow-calf
– 774,630 producers
– Raises calves to 6 to 10 months old (400 - 650
lbs.)
 Production Segments
• Stocker/yearling
– Feed cattle for growth prior to finishing in the feedlot
– Also used to grow replacements
– Oklahoma ~ wheat pasture
– Dakotas ~ summer grazing
– 500 - 900 lbs sell to feedlots

• Feedlot
– 44,000 lots becoming highly consolidated
• 1,781 with 1,000+ head
– Purchases animal at 850 lbs
– 1,250-1,300 lbs sold to packer
 Production Segments

• Packing
– 706 packers
– “The Big 3” ~ Tyson (IBP), Swift, Excel
– Purchases animal at approximately
1,250-1,300 lbs.

• Retailers
– 250 major grocery chains
 Dairy Industry
• World leader in production ( 9 million cows)
– 1% cows but 15% of world production
– 4.6% of human population

• Industry Segments
– Genetics
– Dairy Farms
• Avg size 100 range 30 – 5,000
• 9% account for ½ production
– Heifer Development
– Processing
Introduction to the U.S.
Dairy Industry
 Introduction to the U.S.
Dairy Industry
• P. 33 Table 2.8
 Dairy Industry
• Genetic Selection
– World leader

• U.S. Rankings: Number of Dairy Cows

1. California 1.77 Million
2. Wisconsin 1.24 Million
3. New York 652,000
4. Pennsylvania 558,000
5. Idaho 473,000
Geographic's changing
 Dairy Industry
• US Rankings: Milk Production
Annually
1. California 38.3 Million
2. Wisconsin 23.4 Million
3. New York 12 Million
4. Pennsylvania 10.7 Million
5. Minnesota 8.4 Million
 Dairy Industry

• Family milk cow to large dairies

– highly productive, specialized farms
– Dairy cow herd size varies from 30 to 5,000
cows

• Average Dairy:
– 100 milking cows, 30 dry cows, 30 heifers, and
25 calves
– Sell approximately 4,100 lbs milk/day
• 1.5 million lbs. milk/year
 Dairy Industry

• 70 % farms are large-scale (at least

100 cows)
• Today
– Approximately 1/3 less cows than 50 years
ago
– Average cow produces 19,951 lbs.
milk/year
• P. 36 Fig. 2.15
 Milk Consumption
• Beverage Market % share
Milk 11%
Soft drinks 29%
Coffee 9%
Beer 12%
Bottled Water 11%

• Factors Affecting Consumption

- Health concerns
- Not convenient outside of the home
- Not modern
- Considered for kids
Introduction to the U.S. Horse
Industry
 Horse Industry
• Modern horse was introduced to the Americas by
the Spaniards and colonists.
• Past: horses used for work
• Present: horses are used for recreational purposes
• World Horse, Donkey and Mule Numbers
– P. 37 Table 2.10
Introduction to the U.S.
Poultry Industry
Poultry Industry

P. 42 Fig. 2.18
 Poultry Industry
• Vertically Integrated

• Main segments of poultry industry:

– Broilers $13.9 Billion
– Eggs $4.3 Billion
– Turkeys $2.8 Billion
Introduction to the U.S.
Sheep Industry
 Sheep Industry
• Importance
– World ~ very high
• 1.1 Billion (2002)
– U.S. ~ very low
• 6.5 Million (2006)
• P. 44 Table 2.15
– Leading in Numbers and Production
1.China
2.Australia
 Sheep Industry
.35% sheep
Percent of total farm
revenue:

Considered a minor
51.5 % 48.0 %
species
- eligible for government
assistance
Sheep Industry Trends
 Sheep Industry
Products:

1) Meat ~ per capita consumption in US is

1 lbs vs. 50+ lbs in Australia/New Zealand

2) Wool ~ The value of wool has dropped

dramatically in the last 20 years due to cotton
and other textiles becoming more adapted to
trends in the industry.
 Sheep Industry
U.S. Rankings
1st SD IA
Ewes: TX 4th 8th
2nd WY
3rd CA

Market Lambs: C0
2nd CA
3rd TX
 Production Segments
• Seed stock ~
50+ breeds but less than 10 are
prominent

• Commercial ~
Farm flock: 50 head
Average western range 400+ had
per group.
 Production Segments
• Specialty ~
1) Lambs for ethnic populations
2) Direct marketing
3) Show lamb industry

• Feeding (Feedlot) ~
Most farm flocks feed what they
produce
Greatest feedlots close to us in CO
 Production Segments
• Packing ~
- Iowa Lamb Hawarden IA kills 20% of lambs
- 2 plants in Co,2 plants in TX, 1 in Detroit
- smaller ones in Chicago and east coast

Most plants sell carcasses instead of boxed like

beef industry.

Trend to sell boxed lamb

 Production Timeline
Farm Flock Range
Breeding (5mo.) Aug-Oct Dec - Jan
Birth Jan-Mar May - June
Birth weight: 12 lbs Avg.

Weaning Age60-90 d 100-120 d

Weaning Weight 60-70 55-65
 Production Timeline
Farm Flock Range
Feedlot: ADG .8 lb 75 days 100 days
Marketing: June – Aug Nov-Jan
6-8 mo 7-9 mo
125 lbs 120 lbs
Packer:
75% sold in Auctions 25% Packer direct
 Production Timeline
Current Prices:
Price per cwt. (100lbs)
Feeder Lambs: $90.00-100.00 (60lbs)

Market Lambs: $ 90.00-95.00

Cull ewes: $ 20.50-31.00

Replacement ewes: $ 50.00 – 100.00

commercial
Sheep Industry Concerns
1) Low consumption and decreasing
- Greater emphasis on ethnic population
- More affordable to blue collar population

2) Little Industry Coordination

New Slogan ~ “Meat Lovers Know”
Check off ~ partially paid by packers

3) Predators
23% lost in Western States - Range flocks
13% lost in Central States - Farm flocks
Introduction to the U.S.
Goat Industry
 Goat Industry

Three segments
1) Dairy – growing industry due to milk
demand and specialty cheeses
 Goat Industry
Three segments
2) Angora – largest industry in the U.S.
until mid 90’s loss of demand for hair
 Goat Industry
Three segments
3) Meat – fastest growing segment of the
industry
 Goat Industry
World 746 mil.

Asia 469 mil. 63.0%

Africa 223 mil. 30.0%
S. America 22 mil. 3.0%
Europe 17 mil. 2.3%
U.S. 3.73 mil. .5%
Introduction to the U.S.
Swine Industry
 Swine Industry
Highly Vertically Integrated

Greater Confinement Facilities

 Swine Industry

Percent of total farm revenue: 5.6% Swine

- 5.6% of all Agriculture

- 11.6% of Livestock 51.6 % 42.8 %

U.S. Produces 10% of the worlds

pork with only 4.5% of the hogs
 Production Segments
1) Farrow ~ Feeder pig production
Raise pigs and sell from 25-40 lbs

1) Finishing Operation (grow-finish)

Unit can turn up to 3 times per year
if pigs are 50 lbs and greater
 Production Segments
3) Genetic Provider
Not necessarily associated with a breed
Some independent producers (Purebred)
Sell gilts and some boars mainly Semen
1 boar collection can cover 20 sows

4) Seedstock Operation
- Private Producers ~ because of demand for
boar semen have a tougher time selling boars
- Very large PIC, Newsham, Babcock, Danbred
Confinement Operations
 Production Timeline

Breeding age 6 mo

Farrowing Litter size 6-13 (avg. 8)

Litter wt good determinant of production
Pig Wt 3 – 4 lbs avg.
Confinement Operations
Farrowing
 Production Timeline

Weaning: Days of age 21days 10-12 lbs

Nursery: 6-8 weeks leave at 45 – 60 lbs

Grower/Finishing combined:
- Barns developed to accommodate smaller pigs
- Fed in barns from 120 -150 days
- Birth to Slaughter ~ fast 150 vs. 220 days old
- Market weight ~ 260 lbs
Confinement Operations
Nursery
Confinement Operations
Grower
Confinement Operations
Finishing
 Market Prices

Market Price: 52.00 /cwt live

Replacement Gilt: $50 over market ~

$150 – 160

Cull Sow: 31.00/cwt

avg. sow weighs 550 lbs ~ $175
 Swine Industry
U.S. Rankings
1st SD NE MN IN

Sows IA 11 6 3 4

Market Hogs IA 6 3 5
Million hd 28 1.2 3.5 5.4 4.0
USDA - NASS
 Swine Industry Issues
1) Perception
- Smell affect on Environment
- Small farmer vs. Corporation
2) Marketing
- Fewer market outlets especially harder for smaller producers
- Market prices depressed losing money
3) Manure Management
- Need to manage Nitrogen & Phosphorus
- Need more acres
- Public perception to spreading (odor)
 Chapter 2: An Overview of The Livestock
Industry
• What influences animal and animal
product prices?
• Understand biological lag time.
• Describe the segments of the beef, sheep,
and swine industry.
• Know the top producing countries of beef,
sheep, and swine.
– where the U. S. is located in production
numbers?
• Know what the top producing states are
for the species discussed.