Hail. Fire. Straw. VI. Quantity and price of material per acre-Continued. Binder.. Hay loader.. Road wagon. Low-truck wagon. Barges and racks. Corn planter Lister.. Disk sled.. 1-row cultivator. 2-row cultivator.. 1-horse cultivator Harrow. Roller.. Tractor Truck.. Small engine.. Electrical generator. Elevator. Fanning mill. Miscellaneous tools. Total. Per acre... 1 NOTE.-Balance-share for labor and other operating expenses divided into total net expense gives cost per bushel. Dr. SPILLMAN. That completes the statement on wheat, unless there are some other questions. I have some figures here on the cost of producing beef cattle. I will say that these figures on beef cattle extend over a longer time. We have been making a very detailed and careful study of that subject for five years past, and the figures we have are, we believe, worthy of confidence. First, I want to show you the curve for the cost of producing a pound of gain. People who are not familiar with the beef-feeding industry, of course, are likely to be misled when I say the cost of producing a pound of gain on beef cattle is 18.6 cents a pound for five years past, while the farmers have been selling their beef cattle at very much less than that. That does not necessarily mean that the farmers have been losing money. If a farmer buys a steer weighing 800 pounds at 12 cents a pound and sells it at 14 cents a pound later, he gets a profit of 2 cents a pound on that first 800 pounds. That is what makes the beef-cattle business possible; it would not be possible if it were not for what is called the feeding margin, which applies to the original carcass of the animal. It is supposed to balance up the loss which the farmer practically always makes on the cost of putting on gain, but it does not always do so, by any means. The CHAIRMAN. However, he has to put on the gain in order to sell the other? Dr. SPILLMAN. Yes; that is the point. He has to put on the gain in order to get that extra 2 cents on his first cost. That is the whole feeding game-to buy a carcass at a cheap price and convert it into something worth more per pound and make something on the original carcass. You lose money on the meat you put on; you usually lose a great deal, just about enough to balance up the account. Here [exhibiting a chart] is the average cost of putting on gain on beef cattle-18.6 cents a pound. The height of this curve at each point represents the number of farmers who produced it at that price. There are 227 farmers in all represented here. You will notice that if you go 10 per cent above the cost, to a price of 201 cents a pound, you let the average of these farmers make 10 per cent profit, though about 30 per cent of them would still be losing money. But if you come out here [indicating on the chart] and cut off only these fellows that are producing beef at entirely too great a cost and who ought to be out of the business, you have to go about 35 per cent above the average cost of production in order to maintain your production at an adequate level in competition with anything else that happens to be profitable. Senator WADSWORTH. What breed of cattle do you standardize those costs on? Dr. SPILLMAN. Those records are based on Shorthorns, AberdeenAngus, and Herefords. Senator WADSWORTH. Averaging them together? Dr. SPILLMAN. Yes. Senator WADSWORTH. The cost would be more if you included Holsteins, would it not? Dr. SPILLMAN. Yes; it would be. Senator WADSWORTH. And Jerseys? Dr. SPILLMAN. Yes. The main difficulty with Holsteins and Jerseys is that even when you put on the extra weight you do not get the extra money for them. Senator WADSWORTH. There is a reason. Dr. SPILLMAN. Yes; that is the reason. It is because the fat is not put in the right place. When a real beef animal gets fat you will find little strips of fat between the strips of lean meat. That is what gives the lean meat its flavor. When an animal of a strictly dairy breed, like the Holstein or Jersey, get fat the fat is largely on the entrails, around the kidneys, around the liver, and around the heart; it is not distributed in the lean meat to any considerable extent. For that reason the lean meat will not sell for as much as the lean meat from a regular beef animal. The CHAIRMAN. It is too lean? Dr. SPILLMAN. It is too lean; that is the trouble. Here are some figures. We have so many figures on beef cattle that I have not had time to marshal them in anything like adequate shape. The CHAIRMAN. I would be very glad if you would insert those figures before the last edition of your statement is published. Dr. SPILLMAN. I will insert them when you send me the records to correct. The figures in the following table have already been published by the department in report 111, office of the Secretary. They relate to the cost of beef calves in the years 1914 and 1915. Cost of producing calves 6 to 8 months old in Illinois, Indiana, Minnesota, Iowa, Missouri, South Dakota, Nebraska, and Kansas. We find a great variety of costs, depending on the manner of handling the cows and their calves. In one group, where the cows were not milked at all-just handled as a beef-raising propositionthe cost in 1914 of a beef calf 8 months old was $38.42. That is the average for a large number in Illinois, Minnesota, Iowa, Missouri, South Dakota, Nebraska, and Kansas. The next year it was $37.01. The cost was a little less in 1915 than it was in 1914. There was another group which were handled somewhat different. The calf was fed heavily as soon as it was weaned and run right on and sold as baby beef. Of course, his cost at weaning time did not differ materially from those I have just given you, and the figures for 1914 were $37.74, which is 70 cents less than the figures above, and $36.21 for 1915, which is 80 cents less than the group above. There was a group, called the mixed group, in which some of the cows were milked and their milk was sold to a creamery. That milk was credited, so that the cost of the calf was a little less, and instead of $38 or $37 it is $34.06 for 1914. In 1915 the price of milk raised very materially, and the cost of the calf dropped to $27.64 in that group; that is simply crediting to the calf the profit on milk sold. There was another group-partial milking-in which the farmer let the calves suck about half the milk and then he would take the other half. We called that the partial-milking group. The cost of the calf there, after crediting milk that was sold, was $28.25 the first year and $23.76 the second year. There was another group-double-nursing group-in which the farmer would milk his best cows and transfer their calves to other. cows, so that he would let one cow nurse two calves and milk his other cow and sell the milk. In this group the cost in 1914 was $29.11, and the next year, when the price of milk raised, it was $13.58. That is all that calf cost at weaning time. These calves weighed at weaning time from 300 to 450 pounds each. Mr. LASATER. In making that statement, Dr. Spillman, are you not crediting to beef production all the products the farmer gets out of dairy production? Dr. SPILLMAN. Absolutely. Mr. LASATER. Then you could not feed this country on beef by those methods? Dr. SPILLMAN. I was just coming to that. I was going to make that same statement that Mr. Lasater has made. He is absolutely right about it. There is one group known as the dual-purpose group. They are beef cows, but the calves are weaned and the cows are milked and their milk sold. In these figures here that milk is credited to the calf. In that group the first year the cost was $31 and the second year $16. These methods here transfer all the profit on the milk and credit it to the calf, and that is what makes those calves appear to be cheaper. I merely want to state that they are not cheaper, but there is some difficulty in dividing whatever profit there is in the operation-in fact, it is a profit in one case and a loss in the other-in dividing that between these two items. How much of the profit may be placed to the milk, and how much to the calf? The calf is given all of it here, and it is not fair, because, as Mr. Lasater says, the people of this country are not fed on beef produced in that way at this time. So far as the prices here are concerned, the price of milk raised in 1915, but the price of cattle and of feed had not risen so much at that time, very little in fact. They did rise in 1916-17, however. Mr. LASATER. May I not ask if labor conditions do not make your dual-purpose group practically impossible under present conditions? Dr. SPILLMAN. Almost. A great many dairy farmers are going out of business because they can not get labor and a great many others are putting in milking machines. Mr. LASATER. The point I was trying to make is that there is such a small profit in that kind of dairying under present conditions that it is practically eliminated? Dr. SPILLMAN. Oh, yes. And, so far as that is concerned, that style of dairying does not supply the country with dairy products at all. The CHAIRMAN. A number of dairies have been closed in the vicinity of Muskogee this summer for some reason. Dr. SPILLMAN. And it is so all over the country, because of labor difficulties, feed difficulties, and price difficulties. Here are some figures from 188 farms in Nebraska, Iowa, and Missouri for the fattening of beef animals during the years 1916 and 1917. Fattening beef animals on corn-belt farms, 1916–17. [Survey method; 188 farms; 9,541 2-year olds, 1,530 yearlings, 1,135 baby beeves; Nebraska, Iowa, and Missouri.] This column is for animals included in an earlier study. The figure $36.84 in this case represents cost of raising the calves; the corresponding figures in the other columns represent purchase price on the market. 2 Months. |