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Economics of Feeding in South Dakota
It is no secret in the cattle feeding world that, in the last five years, the cost advantage in feeding cattle has been shifting north with the availability of distillers grains. The rising costs of transportation for both feed and cattle have raised expenses to finish cattle in southern states. In a recent report from SDSU comparing closeouts from SDSU’s Opportunities Farm and information from Kansas State University on closeouts from Kansas feed yards, the cost of gain 
was consistently significantly lower at the feedlot in South Dakota. According to the report, this can be attributed to a $.60 per bushel advantage in South Dakota for corn and a lower death loss in South Dakota. To view the report click here.
The most significant factor in profitability in cattle feeding is the cost of gain. This is relative to the cost of feedstuffs and the efficiency of cattle. South Dakota ranchers and cattlemen are known for consistently producing top quality and high performing calves. The price of feedstuffs in South Dakota is among the lowest in the nation. South Dakota also has the advantage of being able to grow almost any type of crop/feedstuff, giving the livestock feeder the option to source exactly what they are looking for. South Dakota is also currently home to 13 operating ethanol plants, 4 plants in construction, and 3 in exploration. Currently, South Dakota also has a major soybean processor in production and two in the works. This provides access to high quality co-products that can be very useful in a feeding ration.
South Dakota offers livestock feeders several financial assistance programs as well. USDA/NRCS’s EQIP program is a cost share program with assistance up to 80% on the cost of construction of manure containment. Program rules change annually, but over the years these programs have proven to be a good option for those in the livestock feeding industry. The South Dakota Department of Agriculture also has some financial assistance programs in the form of 
bonds that can be used to gain lower interest rates. Various watersheds across the state also have funds available that can be used for manure containment and feedlot improvement projects.
Consider the advantages mentioned above and South Dakota appears poised to be a major player in livestock feeding for years to come. For more information about economics and assistance programs offered in South Dakota, contact a Livestock Development Specialist with the South Dakota Department of Agriculture at 605-773-5436.
Here are some publications regarding feeding in SD:
- Beef Cattle Handbook
- Cattle Feeding Breakeven
- Cost of Gain Comparison
- Feeding Corn Distiller's Co-Products to Beef Cattle
- How to Capture High Calf Prices
- Livestock Risk Protection
- Pricing Feeder Cattle
- South Dakota Stocker Cattle Prices
- Value Based Marketing Systems
- Estimate Feedlot Breakeven Purchase Price
- Strategic Advantage Factors for SD
- SDSU Weekly Cattle Market Review
Here are excel spreadsheets that can be used as calculators for breakeven points and rations:
& Range Sciences
Beef Quality Assurance
SD Animal Industry Board
NRCS Nutrient
Management
DENR Permits
Producer Groups
County Zoning
Livestock Markets
State Ag Statistics
Financial Assistance
SD Livestock Laws