1. www.iowabeefcenter.org Adjusting to an Ethanol World

2. www.iowabeefcenter.org

4. 8/30/06

5. www.iowabeefcenter.org Iowa corn processing & ethanol plants, current & planned, 10/26/06 63 Capacity: 129% of 2006 crop

6. www.iowabeefcenter.org 5.5 Bil. Bu. For Ethanol

7. www.iowabeefcenter.org

8. Livestock Marketing Information Center

9. www.iowabeefcenter.org Livestock Marketing Information Center

10. www.iowabeefcenter.org Livestock Marketing Information Center

11. www.iowabeefcenter.org DDGS Production and Usage Potential productionMil Ton 5.5 Billion Bu. Corn46.8 Potential use COF @ 20%7.10 Dairy @ 20%6.13 Hogs @ 15%6.72 Total19.95 Excess for export or use26-27

12. www.iowabeefcenter.org Situation More ethanol and more DGS Higher corn prices and more corn acres Higher land prices Lower calf and yearling prices Lighter carcasses and fewer Choice

13. www.iowabeefcenter.org Strengths:Weaknesses: Opportunities: Threats: External Factors Internal Factors

14. www.iowabeefcenter.org Strengths: Using MIG Close to coproduct Own land Produce corn High equity position Weaknesses: Nearing retirement Sell feeder cattle No facilities or equipment to background or feed coproduct Opportunities: Increasing land prices DGS nearby More corn stalks available Limited herd expansion or contraction Threats: Higher corn prices Lower calf prices Fewer cows will lead to less infrastructure External Factors Internal Factors Case 1

15. www.iowabeefcenter.org Strengths: Young, long horizon Good nutrition and management skills Facilities and equipment to background and/or feed Packers nearby Weaknesses: High debt level Rent most of pasture Limited labor available Opportunities: DGS nearby More corn stalks available Limited herd expansion or contraction Threats: Higher rental rates Losing pasture to crop production Lower calf prices Fewer cows will lead to less infrastructure External Factors Internal Factors Case 2

16. www.iowabeefcenter.org Strategies Adopt management intensive grazing Utilize DGS and/or CDS on pasture or in winter feed Convert hay to pasture and use aftermath with DGS/CDS for winter feed Early wean and/or creep feed to run more cows on same acres. Improve grading