Doctoral Dissertations

Date of Award

8-1975

Degree Type

Dissertation

Degree Name

Doctor of Philosophy

Major

Agricultural Economics

Major Professor

Luther Keller

Committee Members

Billy J. Trevena, Larry Bauer, Keith Phillips

Abstract

The purpose of this study was to determine the competitiveness of various beef and associated feed systems in the optimum use of farm resources and to determine the combination of livestock, forage, and row crop enterprises and resource utilization which will maximize net returns under various resource and pricing conditions. Analysis was conducted on a 450 acre representative farm in the Brown Soil and Delta area of west Tennessee. Alternative situations included in the basic analysis were: four farm labor situations; four investment and operating capital situations; three livestock price situations; inclusion and deletion of the 1972 Farm Program; four levels of calf crop efficiency; and four levels of weaning weights for feeder steers. Additional analysis was obtained with: variation of the risk level associated with the beef enterprises; elimination of specific feeds for forage and concentrate consumption for beef enterprises; and successive reduction of the various livestock alternatives considered. Standard budgetary techniques were utilized in developing costs and returns, and investment and operating capital requirements for 12 beef-feeding systems, four beef stocker systems, two cow-calf systems, three hog systems, and various row crop and forage crops suitable for the area. Feed requirements for each livestock enterprise were developed in terms of the TDN, DP, and DM required per month for maintenance and expected growth rate. Amounts of grain and forage produced per month were also expressed In TDN, BP, and DM terms. Adjustments were made for feed wastage and nutrient losses due to delayed grazing. Linear programming techniques were utilized to determine the optimum resource allocation and enterprise combinations that would maximize net returns to land, operator labor, and management for each resource and pricing modification when beef enterprises competed against the swine and row crop enterprises and when beef and associated feed enterprises were the only alternatives included in the model. Generally, the light weight stocker steer enterprise produced on permanent and bermuda pasture was the major beef enterprise in the optimal enterprise mix when all enterprises were considered. The production of both feeder pigs and slaughter hogs, utilizing farm produced corn, and cotton production were the other major income generating enterprises in most situations. The number of beef brood cows included in the optimal solution was about 30 head when an average weaning weight of 525 pounds and a 95 percent calf crop was assumed. Other modifications resulted in 20 or less brood cows in the solution. The number of beef animals to be fed was generally low in the various solutions when hog enterprises were also considered. The deletion of the 1972 Farm Program provisions resulted in a considerable increase in beef feeding numbers. The relationship between the number of cattle fed and the quantity of hogs included in the optimal solution was very sensitive to the beef-hog price ratio. When all enterprises were considered, the only beef feeding system included in the various optimal solutions utilized corn silage as the primary ration component. The corn silage was supplemented with protein and a limited amount of corn grain. Considerable net returns were foregone (55 percent) when alter natives were limited to only beef and associated feed enterprises as compared to the situation, when row crop and hog enterprises were also included in the model. When the model was limited to beef alternatives, beef feeding and light stocker steers grazing pasture in the spring and summer months were the major beef enterprises in every optimal solution. In most situations, corn silage was the major ration component for the beef feeding enterprises. However, with a relatively limited labor supply, the beef feeding systems which included a period of grazing in the spring and early summer became more profitable. Generally, steers were more profitable to feed than heifers. When row crop and hogs were deleted as alternatives, land utilizaiton increased but total labor required declined. When feed requirements were specified only in nutrient terms, beef feeding became a much more profitable alternative. When the cow-calf enterprises were the only income generating alternative allowed, net returns were negative, i.e., net returns were not large enough to cover all of the estimated farm overhead expenses.

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