Economic Tidbits

Bullish on Cattle Feeding

The latest monthly cattle on feed report from the USDA National Agricultural Statistics Service (NASS) indicates Nebraska feedlots with capacities of 1,000 head or more contain 2.56 million cattle. This amounts to 22% of the total cattle on feed inventory in the country and ranks Nebraska second among states to Texas. Nebraska’s cattle feeding sector is diverse in terms of size and scale.

More cattle are fed in Nebraska today compared to 20 years ago, but the number and size of the feeding operations have changed. In 2002, Nebraska farms fed 2.45 million head. In 2022, the number had grown to 2.96 million, the most of the four censuses conducted since 2002. Figure 1 compares the structure of the feeding sector in 2002 and 2022. The chart on the left shows a breakdown of operation sizes between the two census years. The chart on the right shows a breakdown of the number of cattle fed in each size category. The data comes from the Census of Agriculture by NASS. In 2002, 69% of the farms feeding cattle had less than 200 head and fed 6% of the cattle. Farms feeding more than 2,500 head accounted for 6% of farms and fed 71% of the cattle. In 2022, cattle feeding was more concentrated in fewer, larger operations. Farms feeding less than 200 head had declined to 46% of all farms which fed just 2% of the cattle. Farms with more than 2,500 head grew to account for 16% of farms, feeding 84% of the cattle fed.


Percent of Feedlots by Size

Percent of Cattle Fed by Size

Source: USDA Agricultural Statistics Service

Structural changes in cattle feeding were also experienced at the county level. Figure 2 maps changes in the number of feedlots with more than 500 head between 2002 and 2022. NASS does not categorize data on operations larger than 500 head at the county level, so mapping changes in the number of operations larger than 500 head, for example a 2,500 head feedlot, is not possible. Darker-colored counties on the map had more 500+ head feedlots in 2022 compared to 2002. Lighter-colored counties had fewer feedlots of this size. And counties of medium color saw no change. Data was not available for counties shaded grey. As seen on the map, a greater number of counties experienced declines in the number of farms feeding 500+ head compared to those which experienced increases. Still, 23 counties saw increases in the number on larger feedlots with Platte County leading the way gaining 17 feedlots over the 20-year period. Merrick and Morrill Counties followed with increases of five and four feedlots respectively. On the other hand, Wayne and Dawson Counties experienced the greatest declines, losing 12 and 11 feedlots respectively.


Source: USDA Agricultural Statistics Service

Economies of scale and cost efficiencies are most likely driving the structural changes in Nebraska’s cattle feeding sector. Abundant natural resources, access to feed, lower transportation costs, and a sizable processing sector give Nebraska a “leg up” in cattle feeding over other states. These attributes, along with ongoing structural changes, mean Nebraska is well positioned to continue to be a national leader in cattle feeding.

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