Runoff
I Continued from Pan 44|
area is characterized by
farmer-feeders—operators
with a one-time capacity of
less than 1,000 head—who
usually have other faming
enterprises such as feed
grains and other field crops.
The western way. In
contrast, output in the
western beef feeding States
(Southern Plains, Colorado,
California, and Arizona) is
dominated by commercial
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feeders with large, highly
specialized feeding
operations. Unlike farmer
feeders who produce most of
their fed beef during the
noncropping season, com
mercial beef feeders usually
operate the year-round.
Close to 49,000 fed beef
operations in the 18 States
have surface water runoff
problems. Some 95 percent
are located in the eastern
States where small lots
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predominate. And about 600
of the 1,800 lots with more
than 1,000-head capacities
were estimated to have
problems controlling runoff.
Highs and lows. If the EPA
guidelines were binding upon
all cattle feeders, the highest
per head investments would
be borne by small fed beef
operations with open lot
systems located in the humid
eastern beef feeding States.
At the other end of the
spectrum are large com
mercial feedlots. located in
the arid western States.
In the eastern States,
investments in runoff control
facilities to meet EPA
guidelines would average
$145 per head for operations
with less than 100-head
capacities. As lot capacity
increases, investment per
head tapers off. For a 100-199
head capacity, investments
per head would drop sharply
to an average of $2l. And the
average investment
required for a 1,000-plus
capacity lot is $3.
Nonetheless, there would
be considerable variation
among individual States in
the eastern region. For
example, a farmer-feeder
with 100-199 head housed on
an open lot would have to
invest $47 per head in Ohio
versus $l9 in Nebraska.
In the western beef feeding
States, investments for
feedlots with Jess than 1,000-
head capacity would vary
from around $l2 per head in
Colorado to $3O per head in
California. Investments in
facilities for controlling
runoff from the region’s
largest feedlots—capacities
of 16,000 head and over—
would range from less than
$1 to $4 per head.
All things considered.
Though compliance with
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proposed EPA guidelines
would require the entire fed
beef industry to invest some
$133 million, this is not a
large sum when compared
with existing investments in
production facilities and
annual gross receipts of
more than $lO billion.
Since larger operations
would incur lower in
vestments per head for
runoff control facilities,
most big capacity feedlots
with surface water problems
would be expected to adopt
control measures.
Nonetheless, many small
eastern producers could be
forced to call it quits. Almost
70 percent of the total in
vestment would fall upon
small farmer-feeders m the
eastern States whose lot
capacities are less than 100
head.
Annual costs on these low
volume operations would be
upped by about $2l per head.
This translates into a rise in
production costs of about $4
per 100 pounds of gain.
Minimal impact. Even
though a number of small
producers could be forced
out of business, experts see
little effect on beef prices or
total beef supplies. Feeder
animals previously headed
for these low-capacity lots
would go to bigger
operations where capacity
already exists or could be
added wtih nominal effects
on production costs.
As in the dairy industry,
however, compliance with
EPA guidelines would
probably hasten the regional
and structural trends
already present in the fed
beef industry. We could
expect to see larger-capacity
beef feedlots growing in
relative importance as a
source of beef supplies.
HOGS
Nearly 1 of every 5 hog
fanners in our leading pork
producing States is
estimated to require surface
water control facilities to
meet EPA guidelines.
The top hog States number
15, are situated in the North
Central and Southeast
regions of the U.S., and
Southeast regions of the U.
5., and produce about 90
percent of the country’s
pork. The farms with runoff
problems number about
112.000.
Meeting EPA guidelines
for controlling surface water
runoff could require initial
investments of up to $254
million and increase annual
costs as much as $36 million
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for the hog industry.
In analyzing the impact of
pollution abatement
measures on the Nation’s
hog industry, economists
noted that most hogs, unlike
fed beef cattle and poultry,
are produced primarily on
small enterprises on crop
livestock farms.
According to the 1969
Census of Agriculture,
roughly three-fourths of all
hog producers in the 15
States marketed fewer than
200 hogs, though they ac
counted for a third of all hogs
sold. Another third of all hog
marketings came from
farms selling 200-499 head
per year.
Few large producers.
Only 1 percent of producers
sold 1,000 head or more but
accounted for 12 percent of
output. Nevertheless,
average annual sales from
all farms amounted to only
155 head.
Only a fifth of the
producers in the two
smallest categories (1-99
head and 100-199 head) were
estimated to 'have un
controlled runoff. Even so,
these producers numbered
66,000 and accounted for 60
percent of the farms with
problems.
Producers with annual
sales of 200-499 head were
singled out for special at
tention. They numbered
95,000 and a third were
estimated to have un
controlled runoff from their
production sites. These
farmers produce more than
a third of all hogs.
Total investment.
Economists found that
meeting EPA guidelines
would require an estimated
investment of $254 million.
About $197 million, or 80
percent of the total in
vestment, would be in the
Corn Belt and Lake States.
The Southeast States
would have to spend $3l
million, and the Plains
States, $25 million. Even
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though the Plains States
market more hogs, higher
costs would fall on the
Southeast because of its
humid climate.
As for individual
producers, investments
would fall heaviest on low
volume operators. In
vestments would range from
$6l per hog on the smallest
operations—those selling
fewer than 100 head an
nually—to $4 per hog for
farmers selling more than
1,000 hogs per year.
Annual costs per 100
pounds of pork sold would
run $4.24 for the smallest
producers—vs. 26 cents for
the large-volume operators.
While these costs vary
somewhat among regions,
the differences fail to give
any region an economic
edge.
Hastening trends. Current
trends in the hog industry
are toward larger operations
in confined feeding quarters.
When properly managed,
these systems appear to be
the most efficient and the
easiest in which to control
runoff. Adoption of pollution
control guidelines would
doubtless hasten current
trends.
Roughly three-fifths of the
farms with runoff problems
in the 15 States are small
volume producers with high
unit costs. The added in
vestments for pollution
abatement measures could
force many of these small
operators out of the hog
business. More than four
fifths of the total added in
vestment would be borne by
producers selling fewer than
500 head per year.
In the short run, consumer
prices for pork would rise,
since pork supplies would
tighten if large numbers of
small farmers decide to call
it quits.
Pork prices would con
tinue high until the
remaining producers could
up their output.
S