Though herds are smaller, the profit-margin potential is greater for those venturing into the grass-fed beef business, according to experts. A recent grass-fed conference at Texas A&M University in College Station, sponsored by the Texas AgriLife Extension Service, featured experts and producers discussing several aspects of an emerging industry sector.
"We had far more registrants than we had initially predicted," reports Dr. Rick Machen, AgriLife Extension beef cattle specialist. "This aspect of beef production obviously is gaining more attention, and there is a hunger for information on how to get started—or become more profitable. I think we identified several areas that gave producers some take-home ideas and an overall broad view of what is going on in the beef industry right now."
Attendees had the opportunity to learn about several topical areas, including fundamentals of growing forages, nutrient needs of cattle, beef processing, economic sustainability, and production and marketing.
"Whether you call it grass-fed or organic, it's one of the most interesting aspects of the cattle business right now," says Dr. David Anderson, an AgriLife Extension livestock economist.
Anderson had discussed the various aspects of getting into the grass-fed beef business, starting with a basic business plan. He told attendees to the conference that that producers must evaluate the consumer they are catering to, and if their business is profitable.
"You need to identify what your goal is and what you want to do with your business," he noted. "Are you making enough profit to keep doing it as long as you want, or do you want to perhaps someday pass it down to heirs? These are some things to consider going along."
Anderson always emphasizes the need to keep good records, while tracking income and expenses on females. The expense breakdown on a female cow is $571.13 when factoring in depreciation, veterinary health expenses, feed, and other items. Those considering a smaller herd with grass-fed animals need to keep in mind that with fewer cows and an operation tied to forage availability, producers will need to make sure each carcass sold brings a premium.
Bob Meeks, a South Texas grass-fed beef producer, said there is opportunity, noting consumers will pay 30% more for natural meats and 15% to 200% more for organic meats. He said there is a $350 million market for natural and organic.