Tri-County Steer Carcass Futurity Program – Impact of Custom Feeding on SW Iowa Economy

Darrell Busby, ISU Extension Livestock Specialist, SW Area Office, Lewis , IA

Problem

Custom feeders indicate one of the greatest problems they have is finding new customers. Cow-calf producers indicate one of the reasons they do not retain ownership in a custom lot is a lack of trust they have for feedlot operators. The TCSCF cooperative program is governed by a group of beef producers and agribusiness people from SW Iowa . Out of state cow-calf producers trust their local Extension worker and are willing to participate in a retained ownership program that the Extension Service is involved in.

Response

The TCSCF program has developed Extension and producer contacts in Georgia, South Carolina, Indiana, Alabama, Virginia, Florida, Tennessee, Wisconsin, Mississippi and Missouri that assist with recruiting producers and cattle to be fed in SW Iowa. This year 203consignors evaluated 4,310 head of steers and heifers. Ten custom feedlots were utilized in the TCSCF program. Additional SW Iowa feedlots are custom feeding cattle for former TCSCF consignors. They are not only pleased with performance of cattle fed in SW Iowa but more importantly the cost of gain is lower than other regions of the US .

Impact

Businesses directly impacted in SW Iowa by the TCSCF cooperative’s program include, feedlots, truckers, feed dealers, corn processors, veterinarians, bankers, beef harvesters, pharmaceutical suppliers, beef processors, fence suppliers, concrete suppliers and travel agents. Total feed usage for the 4,310 head was 7,773 tons of dry matter feed. Total feed costs $732,678. Trucking to Iowa feedlots totaled $81,880 and trucking to the harvest facility totaled $36,336. Yardage income to feedlots totaled $184,692. Vaccines, health treatments, implants and tags totaled $72,882. Insurance, interest and miscellaneous expenses totaled $40,322. Data collection fees equaled $46,871. Total dollars spent in SW Iowa was $1,182,877.

Depending on which multiplier you choose to use, the economic impact of the TCSCF program to SW Iowa may total from 2.5 times the total dollars or $3.0 million or 6 times the total dollars or $7.1 million.

In October of 2004, 105 consignors completed and returned a survey on the TCSCF program. 49% of the respondents currently had cattle on feed with TCSCF. The number of times the respondents had fed cattle with TCSCF ranged from 1 to more than 6 times and number of times was evenly distributed. Of the respondents who fed cattle 4 or more times, 30 out of 45 (67%) currently had cattle on feed, whereas, only 21 out of 60 (35%) of the respondents who fed cattle 1 to 3 times had cattle on feed.

In response to the question “Would you recommend the TCSCF program to your neighbors?” 99 out of 101 (98%) responded yes. The reasons given were quality data, genetic evaluation, marketing/sorting, profitability, Extension oversight, feedlots, communications/trust, and size neutral.

ISU Extension is involved in the data collection, genetic evaluation materials, and marketing and sorting of the cattle, as well as providing oversight of the program as directed by the TCSCF board of directors.

The following benefits in consigning cattle to TCSCF were rated as very or extremely important.

Benefit

% of Total

% of Reponses

Genetic Evaluation

93.4%

94.2%

Retained Ownership

80.0%

81.6%

Pen Size/Size Neutral

80.0%

81.6%

Sorting & Marketing

79.0%

81.4%

Assistance with herd management decisions

50.5%

52.5%

Feed and Yardage Financing

50.5%

52.5%

Availability of Risk Management Tools

39.0%

47.0%

Cattle Advances

39.0%

41.8%

In response to the following question, “Iowa State University Extension is actively involved in the TCSCF program. For each activity listed below, please circle a number on the scale to indicate how important ISU’s involvement is to you.” The scale used was not important, somewhat important, important, very important, or extremely important. The following activities were rated as very or extremely important.

Activity

% of Total

% of Reponses

Developing summary reports

95.2%

97.1%

Overseeing carcass data collection

92.4%

95.0%

Developing & monitoring feedlot protocol

88.6%

91.2%

Sorting & Marketing

78.1%

81.2%

Accounting & financial services

72.4%

75.3%

Responding to questions regarding cattle

74.3%

77.2%

Assisting with weighing cattle

61.9%

64.4%

The 105 respondents own or manage 14,322 cows, or an average, 149 cows. 29% of the producers own 51 to 100 cows. The respondents were younger than the general farm population with 41% between 40 and 55 years of age and 34% were between 56 and 65 years of age.

The table below represents their response to the question, “Percent of farm income from your cowherd.”

 

Number of Responses

% of Total

% of Reponses

No Answer

11

10.5%

 

Less than 25%

19

18.1%

20.2%

25% to 49%

17

16.2%

18.1%

50% to 74%

9

8.6%

9.6%

75% to 99%

30

28.6%

31.9%

100%

19

18.1%

20.2%

66% of the respondents found out about the program through either Extension or their State Cattleman’s Association.

One response may have summarized the TCSCF program the best when the producer wrote “When we are so far away trust remains the primary focus, everyone must do what they say they will no excuses.”

September 7, 2005
107 -- Iowa Beef Center

Page last updated: July 8, 2006
Page maintained by Linda Schultz, lschultz@iastate.edu