1. Chapter 2

2.  Role & impact of U.S. livestock industry  International trade influences on animal agriculture industry  Overviews of animal livestock industries

3.  Historically – most farms very diversified How so? How is it different today?  U.S. – 283 million consumers – plus demand in the international market = high output demand from U.S. livestock producers

5.  Cash receipts from livestock products comprise 51% of all agricultural sales  22 states have cash receipts >$2b

7.  Refer to table 2.3  Notice animal agriculture is positive – others are negative  Much is driven by cattle hides, beef, fat/tallow, dairy

8.  Volatility in the market has had significant impact on farm-gate profits Not only U.S. supply/demand dynamics…but international If you are to be profitable long-term – know the averages for your commodity, and understand how to ride the highs/lows

10.  Global Perspective Cattle domesticated in Asia & Europe Provide: food, fiber, fuel, power What is our main use of cattle?  How about a developing country? 30 yr trend increasing cattle numbers  Greater demand for beef  Increased export demand U.S. - largest producer India – most cattle Uruguay & Argentina – highest per capita consumption

11.  U.S. Comprised of producing, processing, consuming segments Currently takes ~30m less head of cattle to produce same amount of beef produced in the 70’s  Carcass wt increased  Increased cattle fed/feedlot  Market age decreased  Cross-breeding  Imported cattle to finish in the U.S.

12.  Cattle Production Three phases:  Cow/calf – birth to 6-10 mos.  Stocker-yearling – 600-850 lbs.  Feedlot – 850+ lbs. Average market range – 15-24 mos. Cow-Calf Production  33m head throughout country – most concentrated in high forage availability areas  60% of operations have <50 cows  70% of cattle inventory located on farms >100 cows  Commercial and seed-stock producers

13. Stocker-Yearling Production  Grown for feedlot finishing programs  Can take advantage of a variety of feeding situations that might be cheaper, or even not available all year Feedlot Production  Most fed harvested feeds (only 10-15% are finished on pasture)  Typically located near abundance of feed

15.  Global Perspective India leading country in total head (38m) U.S. highest total fluid milk production Butter, cheese, and dried milk are highest total exports  U.S. Average U.S. dairy ~ 100 cows, farm 2-300 acres, raise own forage, market through coops Average producer markets ~1.5 m lbs milk/yr, value ~$200,000 Average total capital investment $500,000

16.  70% of cows located on large operations (>100 cows)…2001 data  U.S. herd ~9m head – 1/3 of herd total 50 yrs ago  Average production 19,951 lbs/cow

19.  Global Perspective Domestication ~5,000 yrs ago Purposes? U.S. herd total ~5m (4 th in the world), world herd ~55m  U.S. Perspective Rapid decline in the U.S. population coincided with development of vehicles and power equipment 3.5% of consumer expenditures for recreation spent in the horse industry

20. Horse owners tend to be upper-middle class and well-educated Annual costs for maintaining a horse ranges from $1000 to $15000 per head  Average costs:  Boarding - $150-$250/mo  Training & riding lessons - $300-$600/mo and $20-$50/hr  Farrier service - $50-75 Herd numbers increased steadily in 60’s and 70’s, declined rapidly in the 80’s  Current herd population on the rise again

21.  Global Perspective China has largest herd, U.S. leads in total production, Netherlands leader in total per capita consumption Fastest growing source of meat for consumption  U.S. Perspective Income exceeds $21b/yr Modernized poultry production began in the 1950’s Integration became implemented heavily from 1955-75

22. Most poultry now raised on contract basis Broiler production increased from 3.7m lbs in 1960 to 36.5m lbs in 1996 Dramatic increases in egg production  1880 – 100 eggs/hen/yr  1950 – 175 eggs/hen/yr  1986 – 250 eggs/hen/yr  1997 – 255 eggs/hen/yr Majority of egg production from large, commercial units

23. Turkey production has evolved from a primarily seasonal industry to year-round industry Export market became lucrative in 80’s and 90’s

24.  Global Perspective Originated in Europe and Northern Asia Often graze different species of plants than cattle, and can produce on lesser quality feeds World population nearly 1.1b in 2002 – highest on record  U.S. Perspective Population declined from 56m in 1942 to 6.5m in 2006 Mortality rates can be high

25.  Global Perspective 50% of world population in China  Leader in numbers and production U.S. herd is more productive  U.S. Perspective 2005 cash receipts ~$12b Majority of production located near the corn belt  Why? Iowa ~25% of U.S. production Number of farms greatly declined in last 20 yrs

29. Increasing pressure from environmental and welfare concerns We’ll cover the various types of production operations in future units