Corn Belt states like Iowa and Nebraska lead the nation in corn, ethanol and cattle production. Each part of that business model benefits from the other even during these inflationary times in agriculture.
In the heart of cattle country producers are well aware of the synergism between cattle and corn production and that includes Mark Jagels who raises both cattle and corn as part of his operation near Davenport, Nebraska. “Nebraska sits in the Golden triangle of livestock, corn and ethanol and I think that is so true of what we can produce and how we produce it so cost efficiently and effectively.”
Over 75% of the state’s corn is irrigated and that consistent crop is the reason so many feedlots have set up shop in Nebraska. But Jagels says that corn also goes beyond the state’s borders. “Over 40-percent of the corn grown here in Nebraska is utilized though livestock across the United States. So livestock is a very vital part of the corn industry.”
Cattle producers say the role corn and DDGs play in the ration has helped differentiate their product in the marketplace. Steve Wellman, Director of the Nebraska Department of Agriculture says that product is demanded by consumers at home and abroad. “Nebraska beef is sold around the world. Last year in 2021 we had a record level of value of 1.81 billion dollars of Nebraska beef sold nationally.”
The Corn Fed Beef Program is part of the Nebraska Straight from the Good Life marketing campaign and core to their long export relationship in southeast Asia. Wellman says, “Japan had been our leading customer for export markets but South Korea has grown recently and actually South Korea is now the leading destination for beef from Nebraska.”
U.S. Meat Export Federation figures indicate U.S. red meat exports utilize 537 million bushels of corn and 3.4 million tons of DDGs annually. Jagels says, “So in the big scheme of things for a corn producer I mean that’s adding almost 3.5 billion dollars worth of income to a corn producer by the corn that he’s utilizing in livestock, along with the distillers.”
Cattlemen in the nation’s top corn and ethanol producing state of Iowa also rely on the corn but also the distillers grains that the industry provides. In fact, David Trowbridge says it has been game changer in cattle rations. “And they are extremely important to us as far as feeding cattle both in the pricewise, energywise.”
He runs Gregory Feedlots near Tabor, Iowa, and says their inclusion rates run from 25 to 45% depending on the price, but DDGs have cut their feed costs. “At times its been significant, probably 15%.”
Trowbridge says distillers grain also improves the palatability of the ration and improves consumption. “It made us all better bunk managers in the feeding industry no doubt about that.”
However, even with historically high priced corn he says they’re able to make it work on their balance sheet. “We’re just dealing with a lot more revenue expenses going into the cattle but more money coming out of the cattle also. So our net returns or margins really haven’t changed a whole lot due to the high price of corn.”
And he says the reason they have the cattle industry in Iowa is because of the ability to feed local grain. So it’s a close link that they value.
