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Economics lesson: Why would livestock producers raise natural or organic beef?

Economics lesson: Why would livestock producers raise natural or organic beef?
Students in advanced class approach topic of natural and organic beef from dollars-and-cents, livestock rearing point of view.

Sometimes perhaps we get too close to a subject to view it objectively. The natural beef vs. organic beef vs. regular beef fed low doses of antibiotics and growth-stimulating agents may be one of those situations.

Related: We Should Add Grass-fed Beef Category To The Grading System

Advanced students doing college level work recently tackled a project to put together their own farm on paper. They were asked to go the whole nine yards: What enterprise would they select, what building would they need, what would they feed, how would they handle manure, and how would the bottom line come out on cost vs. expenses?

Translated, would they make a profit with their farming operations?

Feed for faster gain: Students unbiased by social pressures chose to shoot for top gain to garner maximum profit in the college-level class planning project.

The project also asked them to summarize what they learned. One student answered succinctly: "I wouldn't farm and raise livestock because I can't see how I could make a profit long-term."

Long-term may be the key. Currently, most livestock operations are turning at least some profit, with beef cattle likely leading the way as livestock prices remain in the stratosphere of some of the highest prices ever paid for cattle on live cattle markets.

One of the questions the students had to address was whether they would grow natural or organic products, or opt to use technology that tends to produce faster rate of gain.

All of the students, except a couple wanting to sell local freezer meat, took one look at the numbers and came up with a similar answer.

Expected gain from using products available to stimulate growth was economically better – they found it to be a no-brainer. These students saw no advantage for going all-natural, which is a loose definition by anyone's understanding of the term. And they certainly didn't see the value in committing to growing corn without commercial fertilizer for three years to be fed to livestock that couldn't be treated with any hormones or drugs of low-level antibiotics, all of which tend to increase rate of gain, whether those promoting natural-produced and organic meats like it or not.

Related: Consumers Demand Beef, Despite Uncertainty About Tech Used in Production Process

The bottom line for the students was that if they were producing for the live cattle market, they could profit most if animals gained faster and on less feed per pound of gain. There wasn't a taker in the room for natural or organic production.

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