Beef production technology over the past 50 years has paid huge dividends toward keeping beef competitive in today's consumer's food basket. Increases in production efficiency since 1955 have been a major factor in reducing consumer cost per pound of beef by 26%, after adjusting for inflation.
Through a combination of research, technology and innovation, the U.S. beef cattle industry has increased beef production per head of cattle by more than 80%. Two leading beef industry scientists, who recently wrote a “white paper” on 50 years of beef technology, say the total production of beef has doubled, from 13.2 to about 27 billion lbs., from a national cattle herd that's about the same size today as it was in 1955.
Tom Elam, president of Strategic Directions, Carmel, IN, and Rod Preston, Pagosa Springs, CO, professor emeritus at Texas Tech University, list pharmaceutical technology, genetics, nutrition, pasture management, stocker management and feedlot production as all playing important roles.
“Increases in grain (corn) yields and a reduction in the real prices of grains have been pivotal in the growth of the feedlot industry,” Preston says. “The cattle feeding systems have enhanced the efficiency of beef production and improved the consistency and quality of the end product.”
The overall impact of these technologies has been to keep beef cost-competitive in the consumer's market basket while simultaneously improving its quality, Elam adds. Pharmaceuticals, including growth-promoting implants, have greatly facilitated and enhanced the increased importance of grain feeding in the U.S. beef production system.
“A synergistic combination of a number of technologies has increased our ability to feed cattle high-grain diets, the most significant contributor to increased beef industry productivity, efficiency and product quality over the past 50 years,” Preston says.
In fact, all of the beef supply increase since 1955 has come from grain-fed cattle, he adds. The U.S. produced about 7.5 billion lbs. of beef in 1955, compared to an estimated 22.9 billion lbs. projected for 2005. The total beef produced from cattle not fed grain has actually declined from about 5.7 billion lbs. to an estimated 3.6 billion lbs. for the same period.
“The increased supply of feedlot beef has revolutionized the consumer beef-eating experience, both in terms of quality and consistency,” Elam says, “At the same time, we also have significantly improved overall production efficiency.”
U.S. against the world
Based on per-head beef production, the U.S. is the most efficient beef producer in the world. Canada, using a system essentially identical to the U.S., comes in second.
“Our feedlot technology is what differentiates U.S. beef production from that of the rest of the world,” Preston says.
“The other major international competitors — the European Union, Australia, New Zealand, Argentina and Brazil, in order — fall well behind the U.S. in beef productivity,” Elam explains. “We have reduced the number of animals needed for our beef supply to a level lower than implied by the productivity level of any other country in the world.”
The primary benefits of increased productivity have accrued to the cattle industry and to U.S. beef consumers in the form of lower prices and improved quality and consistency.
“In 2004, we have a more plentiful, less expensive and higher quality beef supply than we did in 1955,” Elam says. “We have managed to simultaneously increase efficiency, quality and production.”
A recent USDA study placed the beef price elasticity at -0.35, which means a 10% increase in beef prices causes a 3.5% decrease in the amount of beef demand. Therefore, an 80% increase in retail price (reflecting the absence of the roughly 80% increase in productivity) would cause a 28% decrease in the amount of beef demanded.
“With 1955 technology and costs, we can say that 2005 beef production would be about 17 billion lbs. of carcass weight vs. an estimated actual production of about 24 billion lbs.,” Elam explains.
The environmental payoff
The progress in production efficiency began to widen dramatically in the late 1970s, after the U.S. cattle inventory peaked at about 133 million head in 1975 (see chart on page 108).
With cattle being the largest users of land in the U.S. food production system, increases in productivity have paved the way for a reduction in impacts on land use and the environment.
“To produce 17 billion lbs. of beef using 1955 productivity would require a cattle herd of about 126 million head,” Elam adds. With no increases in stocking rates, the need to “accommodate” a herd of 126 million head would require about 165-million acres of land.
“That would place an incredible strain on our land inventory and the environment,” Preston says. “Total animal waste production would be almost 30% higher than is currently produced.”
Given the large increases in the fed-beef supply since the 1950s, most would assume that the amount of land needed to produce increased amounts of “feedlot feeds” has increased. That, in fact, is not the case.
“The overall impact of technology changes for crops and cattle has been to significantly reduce the land used to meet the feed requirements for feedlot beef production,” Preston says. “The bottom line is that, despite an almost 200% increase in fed beef production since 1955, the real cost of feedstuffs used decreased about 28%.”
Mixed bag of technologies
No single technological factor can account for this increase in overall beef productivity and efficiency, the duo says. The beef production system has improved and developed into its current form as a result of a number of technologies.
Elam and Preston list several of the major contributors:
Pharmaceutical and other health products and programs, including antibiotics, implants, ionophores, vaccines and parasiticides.
Genetic advancements in both beef and dairy.
Nutrition in breeding cattle, pasture supplementation, stocker operations, backgrounding and cattle feeding.
Grain yields and overall feeding costs.
“Underlying this list is that the cattle business is a market-oriented, profit-seeking and price/cost-driven industry that's incredibly competitive,” Elam says. “The result is that cost-reducing technology is sought out and adopted by the industry, especially the feedlot segment.”
“The U.S. cattle industry can be proud of its record on innovation and technology application,” says Richard Shuler, president and CEO of VetLife. VetLife is among a group of several pharmaceutical industry firms that funded and are promoting the white paper produced by Elam and Preston.
“This industry should continue to look for opportunities to contribute to the U.S. economy, and its own well-being, through continued innovation over the next 50 years,” Schuler adds.