Profit Usually Increases The Closer Beef Gets To The Plate, Economist Says

US - As markets and the weather change, beef producers may be wondering how to maintain a thriving operation.
calendar icon 26 April 2007
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Beef producers can consider a variety of marketing options, but should first look at the work and cost involved with each option

“There’s a lot of different things you can do with beef cattle,” Bennett said, speaking at a recent beef and forage field day in Bowie County. “It just depends on your own operation.”

Bennett said it is important for producers to know what they are capable of before making marketing decisions. He added that three main sectors of the beef industry - demand, marketing systems, and production - must also be considered when making marketing and planning decisions for a cattle operation.

According to Bennett, examining the three sectors of the industry is only the beginning.

“You break the industry into three sectors, but it’s really complex from there,” he said.

There are several aspects of the industry that make the cattle business complex, he added. Bennett said the industry is based on the cow-calf producer, but that additional opportunities in the stocker, feedlot, slaughter, wholesale, retail, institutional, and export markets open many venues for producers.

“About half the value of beef is added after it leaves the farm,” he said. So, he said, if producers want a larger cut of the profit, “It’s really important to to try to get closer to that consumer.”

He said profits for cow-calf producers tend to be low and by expanding their business into another areas, cattle producers may turn a bigger buck.

Source: Sulphur Springs Country World News
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