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Heritage and Lifestyle Motivated Beef Producer
Description
Heritage and Lifestyle Motivated Beef Producers currently operate a large
percentage of Missouri’s beef enterprises. This type of producer
typically depends upon non-cattle sources of income for the majority of
his or her family livelihood. While this type of producer may be deeply
committed to his or her farm and to the cattle business, they typically
adopt a low input management style. The primary operational motivation
on this type of farm may be to simplify the production system so that
it does not consume more time than is absolutely necessary. This type
of producer may also be extremely cost conscious in purchasing inputs,
in an effort to avoid having to subsidize their farming operation.
Strengths
• Financially and geographically stable.
• Low capital input.
• Cattle operation enhances wealth due to land appreciation and
enforced savings.
• Cattle provide liquid family asset in times of need.
Weaknesses
• Low profitability – low operating returns on family capital
and labor.
• Access to borrowed capital depends upon personal finances and
credit worthiness rather than profitability of the beef operation, which
limits growth potential.
Opportunities
• Where suppliers or vendors can package simple production enhancements,
these producers can adopt practices to enhance profitability.
• Long-term land appreciation may justify the investment in a beef
operation even with meager operating profits.
• These operations provide liquidity to cattle markets by producing
large numbers of calves in small batches.
• The large number of these types of producers provides profit potential
for supply and marketing companies with targeted service programs.
Threats
• Scarcity of time and capital may hinder the ability of producers
to evolve and adapt to changing industry conditions.
• Scarcity of time and capital may hinder the ability of producers
to improve quality, thus degrading the reputation of other Missouri cattle.
• Increasing speed of innovation threatens producers who lag behind.
• Maintaining access to markets as consolidation continues and supply
chains tighten.
• Emerging demand for source verification will usher in changes
in price and marketing for undifferentiated cattle.
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