If Beef is easy and free to raise, why isn’t it CHEAP?

I was scrolling through Facebook land last week when someone posted the comment about why was beef so expensive… I mean it’s just plain highway robbery, right?! All we have to do is feed the cows grass… which is free! And maybe give the cows some vaccines, which is really just a choice if you want to?

Clearly the comments were golden.

Oh, the world we live in. Where we’re so removed from the farm and ranch that that’s what people ACTUALLY think.

Now, I know there are PLENTY of people that aren’t THAT dense. They know there’s more to it than that. But what really goes into it? I thought I’d clear up some misconceptions…

Let’s go all Sound of Music and “Start at the very beginning – a very good place to startttttt” (Gotta love a little classic musical theater reference.)

So yeah. Grass ain’t free.

It’s not even close to free. Not even a little.

In our “neck of the woods” good agricultural land may be $5,000 an acre, and it takes roughly 2 acres of land to raise one cow-calf pair in Southwest Virginia. But in all honesty, in some areas it might cost more and it might take more. So lets do the math with the numbers we’ve got: to raise a calf… You’ve got to have $10,000 to buy land to raise just 1 calf a year that might bring $900 at market.

Now, I was an Animal & Poultry Sciences major in college – but my courses in Agricultural Economics tell me that’s a terrible business plan.

Which is why there aren’t a lot of 1-cow operations out there. Most farmers and ranchers have a lot more cows – which means they have a lot more land, which means they have a lot more money tied up in the land/grass it takes to feed those cows. And they’re playing a longer game, planning that eventually they’ll pay off that mortgage and won’t have the land costs.

But some people don’t own the land. They lease it from the landowner. Maybe they pay $60/acre/year – that’s $6,000 on just 100 acres PER YEAR. Again – grass ain’t free. And they can’t even claim it’s an investment, right? Because they still don’t own it.

Wait, you mean not every farmer already owns the land? That’s right. There are plenty of us paying mortgages and leases just like YOU. The bills come callin’.

Now lets discuss the the winter months. Grass doesn’t grow real well. So then we feed hay that we harvested off the land during the summer. It may be “free” but the equipment we used to harvest it sure as heck isn’t.

And just to be clear – I’m using the term “free” VERY sarcastically. Nothing is ever free. We may not have exchanged money to pull the hay off of our own land… but it cost us a lot of money to produce it. It’s necessary. Our cows have to eat in winter. So here’s how we paid for it without ever exchanging a piece of money:

It’s called equipment. And it cost us dearly – and we’re still paying for some of it. To produce hay means we have to purchase equipment.

Tractor $72,000; Wet/Dry Baler $34,000; Mower Conditioner $27,000; Rake $2,000; Second tractor $20,000; . And I’m not even counting in the net wrap. We usually spend a $1000 in that or so every year…

Total Equipment Value: $155,000

But producing beef and charging for it is highway robbery…right?

Let me say it a little louder for those in the back: Grass ain’t free.

Look, I’m not mad, not even close – I love talking about how we raise beef. I just want people to understand what goes into it. Most people are so far removed from the farm it’s hard for it to be their fault for not knowing! But it’s our job as producers to help them learn.

I digress…

Obviously there’s value in our animals. There’s value in our genetics, value in the labor that goes into producing the animals. I think everybody can agree on that… So let’s say each of our cows is valued at $2,000, we paid over $7,000 for our last herd bull…. Look we have to spend money to produce beef.

And yes, we spend money on vaccines, which really shouldn’t be a choice in my mind but still is for some. We don’t cut costs or corners on items that keep cattle healthy and help deliver a superior product to the dinner table. Period. We’re producing what we want to eat on OUR table for YOUR table.

Our investment in cow health each year (per cow) is roughly $30, and each calf is $30. But lets say one cow gets sick and needs an antibiotic – which absolutely may happen. Because even when you do everything right… cows can get sick just like people can. One dose of an antibiotic could be $30/dose. (There’s no insurance or co-pay for Bessie!) But lets say 50 of our cows get sick, because it’s a larger operation, or 25% of the herd gets pinkeye (because we’ve alllllll been there…) Those numbers I quoted above, well they just went out the window. We try like heck to keep everybody healthy because we’re good stewards of our animals AND when we have to start treating with antibiotics – it gets expensive… quick. But sometimes it just has to be done for the health of the animal. That’s reality. And the health of the animal ALWAYS takes priority. (Also, just to be clear – there are plenty of years we get by with very little issue and almost no antibiotic use – that’s ALWAYS the goal.)

Ok, so now we’ve factored in medicines. So you combine the medicine costs of the cow and the calf (because we only have one marketable product between the two – the calf – and automatically deduct that from our sale price each year.

Ya with me so far?

Moo-ving to my next point – in EVERY. OTHER. AVENUE. OF. BUSINESS. The seller decides the price. But not us. We take our product to the buyers and the buyer decides what he/she will pay us. And we have to take it. Seriously. We’re dang sure not loading up 100 calves and putting them through the stress of hauling them back home to do it over again and potentially get a LOWER price.

Now, some producers like us have gotten savvy and started contracting out and playing the game a bit. But it’s truly a game. You settle on a price in advance – sometimes the market is higher when your cattle are ready and you’re screwed. And sometimes it’s lower and you’re doing a dang happy dance. But it’s like playing Blackjack in Vegas. Some people count cards better than others… Some years you win, some years you lose, but the goal is to beat the average and come out on the good.

So then there’s the packer side to this.

Who’s the packer? The packer is the guy who takes our beef cattle and processes it and puts it in the grocery store – of which there are really only FOUR major packers in the whole country. Suddenly it goes from $1.50/lb (what we get for our live cattle) to $5.00-20.00/lb (what the packers gets for beef after processing) – it really doesn’t seem fair. (There’s a federal investigation to understand how this is happening.)

There’s been a drastic increase in grocery store prices, but there HASN’T been an increase in beef cattle prices. Ya see the problem? If one goes up, so should the other. But it hasn’t. Why is this?

Well, I can’t answer that. I wish like heck I could. Every dang cattle producer in the country wishes we could answer that. We understand the meat price will be higher than the live cattle price, but as their price goes up… so should ours.

I’m not writing this to be dismal. I’m not writing this to tell you not to support the grocery store. Quite the opposite. BUY BEEF. If you stop buying beef in the grocery store, producers like us go belly up. I’m writing this to help you understand a little more about how we produce it. The beef in your grocery store and at restaurants started out on farms like ours. I wish I could say we captured a little more of the profits. But I’m still proud to be producing it.

My point in all of this is I wish like heck it were as simple as free grass, right? It’s not. Lordy, it’s not. There’s equipment costs, and medicines, labor that’s hard to find, and packers that capture too much of the profits and leave out the people actually producing the beef.

All I know is, I can’t fix the industry – but I can help consumers understand it a little better. And when we all understand it a little better – maybe then we can fix it together. I’m proud to produce beef. I’m proud to know many producers who got tired of seeing their profits go out the window and decided to market their’s locally. With full time jobs off the farm, we just don’t have time to raise ours out and market them – but check out our friends who do! If you think it’s a little pricey – I guarantee they’re not greedy. Often they’re cheaper than the store when you put pencil to paper! Or support them on special occasions if you can! They’ll appreciate you. WE appreciate YOU!

But as always – just eat beef. However you can:) And when you see those nincompoops on social media who think it’s as simple as free grass – think about people like us bustin’ our butts!

And shout out to our dairy brothers and sisters, and all those growing the food that graces your plate – it’s never as simple as it seems, folks.

Love,

S

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