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III. Economic evaluation of different types of buildings on the outcome of finishing beef cattle
Dan LoyProfessor of Animal ScienceDirector, Iowa Beef Center
Iowa State University
Five Systems Analyzed• Earthen lot with no shelter…windbreak only
• Earthen lot with a shed for shelter
• Concrete lot with a shed
• Total confinement with solid concrete floor
• Total confinement with slatted floor
Costs/assumptions
• 1 USD $ = 2.32 R$
• 1 R$ = $.43
• Interest rates 10%
Assumptions Common to All• Fencing costs are the same for all. Cost = R$76/m.
• Site preparation = R$ 4.64 per head
• Concrete cost costs = R$ 606/m3
• Concrete depth = 10.2 cm
• Earth volumes for settling basin and detention basin construction = volume of liquid to handle
Assumptions Common to All• 150 head per pen
• .3 m of bunk space per head
• 1 gate per pe
• 1 waterer per pen
• 100% of rainfall runs off
• Environmental control facilities designed per DNR regs (for once a year pumping)
6
Earthen Lot with Shed
Open lot (150) head
Open lot (150) head
Fenceline bunk
Windbreak fence
Windbreak fence
Drive alley
Detention basin
Settling basin
Earthen Lot Assumptions
• 3.66 m concrete apron along length of bunk
• 13.9 sq m concrete pad around waterer
• 2.72 MT/yr-hd solid manure each year
• Lot with windbreak – 23.2 sq m per head lot space– 2.79 sq m per head mound space– Windbreak = R$ 34.80/ head
Earthen Lot Assumptions
• Lot with shed– 20.9 sq m/head outside, 2.3 inside– No concrete inside building– Building cost = R$388/sq m
9
Concrete Lot with Shed
D e t e n t i o n b a s i n
P a v e d l o t
S e t t l i n g a p r o n
D e t e n t i o n b a s i n
P a v e d l o t
S e t t l i n g a p r o n
Concrete Lot Assumptions• 1.85 sq m/head inside, 2.79 outside
• No feed alley
• No roof water gets on lot
• 4.1 MT/yr/hd solid manure
• Weekly scraping or oftener
11
Complete Confinement Building with Solid Floor
Complete Confinement Building• Total roof means no liquid manure to haul
• Total solid concrete floor
• 5.5 MT/yr/hd solid manure
• Solid hauling cost = R$8.88/MT
13
Complete Confinement Buildingwith Slatted Floor
Complete Confinement Buildingwith Slatted Floor
• No solid manure to haul
• Liquid manure = 24.6 l/day/hd
• Hauling cost = R$0.06/l
Change In Feed Intake Open Lot vs. Confinement
ISU 70-75 ISU 78-83 MN 70-76 MN 77-78 NB 74-75 MO 74-82 SOI 88-970
2
4
6
8
10
12
14
Change In Feed/Gain Confinement vs. Open Lot
ISU 70-75
ISU 78-83
MN 70-76
MN 77-78
NB 74-75 MO 74-82
SOI 88-97
-4
-2
0
2
4
6
8
Change In Feed/GainNo Shelter vs Shelter
ISU 70-75 ISU 78-83 MN 70-76 MN 77-78 H&G SOI 88-970
1
2
3
4
5
6
7
8
9
10
ADG Assumptions
Open OL/S, PC Conf
Yearlings 1.40909090909091 1.48636363636364 1.37272727272727
Calves 1.27272727272727 1.34090909090909 1.23636363636364
0.100.300.500.700.901.101.301.50
F/G Assumptions
Open OL/S, PC Conf
Yearlings 7.4 7 7.2
Calves 7 6.7 6.85
6.3
6.5
6.7
6.9
7.1
7.3
Rations
• Flexible feed storage– Modified distillers grains– Ground hay– Dry corn
– Supplement
Economic Analysis
• Initial investment
• Annualized costs
• Cost per head
• Yardage
• Environmental structures costs
Other costs• Feed costs ($R per MT)
• Bedding cost
• Labor, land, etc.
Other non-feed costs• Bedding-- $R 127/MT• Land Rent-- $R 1030/hectare• Wage rate $R32/hr
Other Non-feed Costs, per Head ($R/head) YEARLINGS CALVESVeterinary and health 18.50 22.30 Machinery and equipment 16.25 25.50
Marketing and miscellaneous 37.10 32.50 Total 71.85 80.30
Feed Costs
• Corn--$R 387/MT
• Hay--$R 199/MT
• Modified Distillers Grains (50% DM)-- $R 217/MT
• Supplement-- $R 1020/MT
Earthen Lot w/Windbreak
Earthen Lot w/ Shed Concrete Lot w/ Shed
Confinement Solid Floor
Confinement Slatted Floor
$-
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
Initial Investment Per Head by System and Size R$
750 head
1,500 head
5,000 head
Earthen Lot w/Windbreak
Earthen Lot w/ Shed Concrete Lot w/ Shed
Confinement Solid Floor
Confinement Slatted Floor
$-
$50
$100
$150
$200
$250
$300
$350
Ownership and Operating Costs (nonfeed) per Head(Two Turns of Yearling Steers), R$
750 head1,500 head5,000 head
Cost of gain with 2 turns of yearlings (days on feed = 152 to 164) R$
Earthen Lot w/Windbreak
Earthen Lot w/ Shed Concrete Lot w/ Shed Confinement Solid Floor
Confinement Slatted Floor
$1.84
$1.86
$1.88
$1.90
$1.92
$1.94
$1.96
$1.98
$2.00
$2.02
$2.04
750 head
1,500 head
5,000 head
Cost of gain with one turn of calves (days on feed = 194 to 207), R$
Earthen Lot w/Windbreak
Earthen Lot w/ Shed Concrete Lot w/ Shed Confinement Solid Floor Confinement Slatted Floor
$1.72
$1.74
$1.76
$1.78
$1.80
$1.82
$1.84
$1.86
$1.88
$1.90
$1.92
750 head
1,500 head
5,000 head
Breakeven Yardage Charge at 85% Capacity, R$
Earthen Lot w/Windbreak
Earthen Lot w/ Shed Concrete Lot w/ Shed Confinement Solid Floor
Confinement Slatted Floor
$-
$0.50
$1.00
$1.50
$2.00
$2.50
750 head
1,500 head
5,000 head
Breakeven Yardage Charge minus Manure Value (85% Capacity), R$
Earthen Lot w/Windbreak
Earthen Lot w/ Shed Concrete Lot w/ Shed Confinement Solid Floor
Confinement Slatted Floor
$-
$0.20
$0.40
$0.60
$0.80
$1.00
$1.20
$1.40
750 head
1,500 head
5,000 head
Initial Investment
• Earthen lot with windbreak has lowest initial investment
• Adding a shed doubles the costs
• Concrete with shed comparable to earthen lot with shed when environmental structures included
• Confinement highest investment
Overhead and Operation• Earthen lot advantage for small lot
• Earthen lots without shed or concrete lot were lowest cost for large lot
• Confinement had higher costs
• Yardage ranges from R$1.23-2.06 /head/day
Cost of Gain
• Incorporates animal performance
• Yearlings and calves similar
• Confinement has higher cost of gain
Environmental Structures
• Not needed on confinement
• Lowest for concrete lot with shed– 1/5 to 1/10 the cost of earthen lot structures
• Relative cost of structures– $50 was largest initial investment– 15% of pens lose more than $50/head– Maximum annual cost less than $5/head
Size of Feedlot• Subject to assumptions
– Many costs were linear
• 750 head lot– Already capturing most economies of scale
– Environmental savings may be short lived
• 5000 head lot– Economies of scale– Environmental and overhead
ISU Beef Feedlot Systems Manual
(PM-1867)
SummaryConstruction and Operational Factors
• Confinement systems have the highest initial investment
• Economies of size exist for runoff containment
• Operational costs are highest with the deep bedded housing mostly due to bedding costs
• The cost of shelter is justified in all systems
• To capture the value of initial investments in confinement producers must also capture and utilize increased manure nutrient values.
Key to Competitiveness with Confinement
Questions?Questions?
Dan LoyExtension Beef Specialist Director, Iowa Beef [email protected]
www.iowabeefcenter.org
