Small-scale, Grass-based Ranching:

A Safe, Healthy and Sustainable Beef Alternative


(or, Why Shopping at Seis Flechas Farm is a Good Idea)


by Wylie Harris of Seis Flechas Farm

May 2004


Concentration and integration are widely recognized characteristics of the beef industry in the United States.  In addition to the economic concerns it raises, the currently prevalent mode of beef cattle production propagates a variety of environmental and health risks.  Grass-based beef production eliminates many of these negative aspects, creating a safer, more nutritious product whose value is more likely to be returned to local producers and their communities.  Unlike other meat sectors, the current structure of the beef industry is amenable to a rapid and widespread conversion to direct marketing of beef grown on small, family-operated farms.  Such a shift, already in progress, can further magnify the benefits of grass-based beef production.


Beef production is the largest single sector of the United States' agricultural economy, at 18 % of total farm sale 1.  Like other segments of agriculture, the beef industry is highly concentrated, meaning that most market share is concentrated in the hands of very few companies.  Just four firms control nearly 80 % of beef slaughter, up from 36 % in 1980 2-4.  Beef production is also increasingly vertically integrated, with the same companies that dominate slaughter also controlling large shares of other steps, such as feeding and packing, in the conversion of raw agricultural goods to finished products 2, 5


The combined processes of concentration and vertical integration in the beef industry have negative economic consequences for small producers, rural communities, and consumers.  There is general economic consensus that when four firms control more than 40 % of market share, the market is no longer competitive 2.  A federal jury recently supported this view in the landmark Pickett vs. IBP ruling, which found that the defendant had violated the 1920 Packers and Stockyards act by using its market dominance to lower prices paid to independent producers.  A substantial, though not unanimous, body of literature in rural sociology posits that the advent of industrial meat production is detrimental to the social and economic fabric of rural communities in a variety of ways 6.  For instance, where large, industrial hog production facilities dominate, per capita incomes are lower and more people use food stamps 7.  Finally, though not all analysts concur 4, 8, there is evidence to support the common-sense notion that increasing concentration in the beef industry leads to higher meat prices for consumers 9.


On top of these undesirable economic consequences, concentration and integration in the beef industry have also created a number of negative impacts on environmental quality 10.  Many of these stem from the increasing number, size, and geographic concentration of feedlots that have accompanied the economic concentration of beef production.  Large numbers of animals confined within relatively small feedlot facilities quickly generate large quantities of manure, posing a contamination hazard to surface and ground water.  Increased levels of odor and airborne dust are other environmental threats posed by confined animal feeding operations, or CAFOs, to local communities 11.  Recent evidence suggests that growth hormones in feedlot residues may also affect the sexual development of wild fish downstream 12.   Additionally, the feedlots' demand for grain to feed fattening cattle creates incentives for increased production of corn and other grains.  The industrial methods of production for those grains raise their own set of environmental concerns, including soil erosion and contamination of water by synthetic fertilizers and pesticides.


In addition to the health risks posed by CAFOs' environmental quality impacts, grain-fed beef itself carries other potential health hazards.  Some of these stem from the reliance on grain as the major feedstock.  Feeding grain to cattle, which are adapted to a diet of grass, increases the fat content of their meat, and reduces its content of health-promoting compounds such as essential fatty acids, conjugated linoleic acids (CLAs), and beta-carotene 3, 13.  A grain-based diet also increases the acidity of cattle's stomachs, selecting for acid-resistant strains of E. coli.  Since the human digestive system relies in part on high acidity to eliminate harmful microorganisms, meat containing acid-resistant strains can increase the likelihood of disease 14.


Other health risks stem from the sheer scale of feedlot operations.  Large numbers of animals confined tightly together are more prone to outbreaks of disease, leading feedlot managers to rely heavily on antibiotics.  In a process analogous to that of grain feeding and acid resistance, this practices favors the emergence of antibiotic-resistant bacteria, reducing the effectiveness of medical treatment used to treat human bacterial infections.  The pressure to maximize efficiency led to the practice, only recently banned, of using waste tissues from dead animals as a protein supplement in the feed for live ones – creating the means for cattle to contract bovine spongiform encephelopathy (BSE, or mad cow disease).  With the 14 largest slaughter and packing plants handling 63 % of U.S. beef (over one million animals each, per year), any episode of meat contamination is guaranteed to be a large one 3.  This explains the commonness of meat recalls in quantities of millions of pounds, and provides the context for a recent study that found antibiotic-resistant bacteria in half the meat for sale in Washington, D.C. area supermarkets 15.


Grass-fed beef avoids virtually all of these environmental, health, and economic drawbacks of the concentrated industrial system of feedlot beef production.  On pasture, cattle spread their own manure as a natural fertilizer, rather than concentrating it as a toxic waste.  Forage plants have denser roots and thicker aboveground cover, dramatically reducing soil erosion from the levels that occur in fields of grain grown for feedlot cattle.  Pastures also provide a much more suitable habitat for wildlife than row crops; in some cases, ranchers even use native plants, rather than introduced forages, to provide both grazing and hay 16-18.


Such a system is healthier not only for the cattle, but also for the people who eat their meat.  A diet dominated by grass rather than grain produces leaner beef, and what fat the meat does contain has a higher proportion of "good" fats, such as CLAs and essential fatty acid 3, 13.  Moreover, the free-range conditions of pasture-based production avoid the risk of antibiotic- and acid-resistant bacteria, as well as eliminating all known mechanisms of exposure to BSE.


In addition to creating health and environmental benefits, pasture finishing of beef holds substantial potential economic rewards for cattle producers.  Input costs are significantly lower in pasture-based system 18, 19.  Surveys show that consumers are willing to pay more for meat produced in sustainable, healthy ways 20.  They are also willing to pay more for food that they know comes from their local communities 21.  The second point concerning consumer preference is a key one.  It points directly to the potential of local, direct sales of pasture-raised beef to increase not only the health and safety of the product, but also the economic vitality of small cattle raisers as well as their struggling rural communities.


Much of that potential is inherent in the structure of the beef industry.  Though 87 % of grain-finished cattle are sold from feedlots holding more than 500 animals, 66 % of them start out in small herds of fewer than 100 head, many on pasture 22.  Shifting the majority of U.S. beef production to locally-based, pasture-finished cattle is thus a real possibility.  It requires only that more producers begin to custom process and direct market their cattle, rather than selling to a feedlots.  The infrastructure for such a transition already exists.  In the Southern Plains (Kansas, Oklahoma, and Texas), home to one quarter of U.S. beef cattle, more than half of producers have a small custom processing plant within 30 miles 23, 24.  Direct marketing of locally processed beef creates opportunities for both producers and processors to capture a larger share of the profits that currently go to large feedlots and packers. Even using high estimates for processor fees 25, the combination of direct sales to consumers and the added value of pasture-based beef can yield substantially higher profits for producers than the standard sale through contracts or auctions.


Since small farms already hold the majority of calves destined for beef markets, they are well positioned to multiply those economic benefits and pass them along to the surrounding communities.  One study reported that livestock operations in this category make 80 % of their business expenditures within 20 miles of the farm, as compared to 50 % for larger, industrial-scale ones 26.  And though pasture-based beef's premium prices are attractive for small producers, lower input costs sometimes translate into consumer prices close to those for conventional beef in supermarkets 13.  This can be an even better bargain in light of the commonly overlooked medical and environmental costs of large-scale feedlot beef production.  Finally, since small farms occupy three-quarters of the land area devoted to beef cattle production, a shift to pasture-based production focused on small operations maximizes the ecological returns as well as the economic ones 27, 28.


Recent growth in both overall and direct sales of locally produced, pasture-based beef suggests that neither producers nor consumers are unaware of its multiple benefits 10.  Between 1992 and 1997, direct sales of agricultural products in the U.S. grew by 36 %, with the number of farms participating in such sales increasing by 8 %, and the average income of those farms by 27 % 22.  Although natural meats represent a small portion of the overall market in organic foods, numerous surveys of consumer willingness to pay suggest that they are at least keeping pace with that market's 25 % annual growth in recent years 29.  As this momentum continues, both producers and consumers can reap multiple benefits from increasing small-farm production of pasture-based beef.



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2.             Heffernan, W., M. Hendrickson, and R. Gronski. Consolidation in the Food and Agriculture System. 1999. National Farmers' Union.

3.             MacDonald, J.M., et al. Consolidation in U.S. Meatpacking. 2000. Economic Research Service, U.S. Department of Agriculture: Washington, D.C. 47p.

4.             Mathews, K.H., et al. U.S. Beef Industry: Cattle Cycles, Price Spreads, and Packer Concentration. 1999. Economic Research Service, U.S. Department of Agriculture: Washington, D.C. 47p.

5.             Hendrickson, M., et al. Food Retailing and Dairy: Implications for Farmers and Consumers in a Global Food System. 2001. National Farmers' Union.

6.             Welsh, R. The industrial reorganization of U.S. agriculture: An overview & background report. 1996. Henry A. Wallace Institute for Alternative Agriculture. 36p.

7.             Durrenberger, E.P. The expansion of large-scale hog farming in Iowa: The applicability of Goldschmidt's findings fifty years later. Human Organization. 1996. 55(4): p. 409-415.

8.             Food Marketing Institute. Competition and Profits. 2003.

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11.           Consumers Union Southwest Regional Office. Animal Factories: Pollution and Health Threats to Rural Texas. 2000.

12.           Orlando, E.F., et al. Endocrine disrupting effects of cattle feedlot effluent on an aquatic sentinel species, the flathead minnow. Environmental Health Perspectives. 2003(December).

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14.           Diez-Gonzalez, F., et al. Grain feeding and the dissemination of acid-resistant Escherichia coli from cattle. Science. 1998. 281: p. 1666-1668.

15.           Schroeder, C.M., et al. Isolation of antimicrobial-resistant Eschericia coli from retail meats purchased in Greater Washington, DC, USA. International Journal of Food Microbiology. 2003. 85: p. 197-202.

16.           Boody, G.M. The Multiple Benefits of Agriculture. 2001. The Land Stewardship Project: White Bear Lake, MN.

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19.           Levins, D. Monitoring Sustainable Agriculture with Conventional Financial Data. 1996. The Land Stewardship Project: White Bear Lake, MN. 35p.

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22.           USDA National Agricultural Statistics Service. Census of Agriculture. 1997. USDA.

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25.           Johnson, A.S. U.S. Beef Packing Industry. 2003. Agricultural Marketing Resource Center, Iowa State University. 4p.

26.           Helmuth, J. Buyer concentration in livestock markets: trends, impacts, and implications. 1995. Dakota Rural Action: Brookings, S.D.

27.           Cash, A.J. Where's the Beef? Small Farms Produce Majority of Cattle. in Agricultural Outlook. 2002. p. 21-24.

28.           Rosset, P. The Multiple Functions and Benefits of Small Farm Agriculture in the Context of Global Trade Negotiations. 1999. The Institute for Food and Development Policy (Food First): Oakland, California. 22p.

29.           Rocha, L.P., A.L. Varsi, and M. Boland. The natural beef market in the United States. 2003. Instituto Nacional de Carnes: Montevideo, Uruguay. 30p.


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