MidWest Tour Day 7

Fort Morgan and Denver, Colorado...

Day #7 | Midwest Crop Tour | Five Rivers Feedlot, Fort Morgan, CO

Brent Vink, Rachel Whaley, Jenna Wight, Jared Yantzi

Today is Day #7 of the Midwest Crop Tour! We left Nebraska early this morning to travel into Colorado. In Nebraska, we were surrounded by dryland pastures and irrigated cropland. As we moved west, we watched as the landscape changed from a healthy shade of green into a noticeably drier brown. Irrigated cropland became increasingly sparse in comparison to dry rangeland, and the topography became flatter.

After three and a half hours, we arrived at our only tour stop for the day! The Five Rivers Feedlot - Gilcrest Facility is located outside of LaSalle, Colorado. We received a warm welcome from the Five Rivers staff and enjoyed a lunch prior to our tour. After enjoying the delicious Tex-Mex, we were introduced to Ed (Five Rivers Assistant Manager) and his crew: Tiago (Feed Manager), Caleb (a.k.a. Popcorn; Cattle Manager), and Mark (Mill Manager). The group was more than willing to answer our extensive list of questions about the world of corporate feedlots.

Tour of Five Rivers Feedlot

Five Rivers is a corporate feedlot owned by Pinnacle Arcadia Cattle Partners. The Five Rivers - Gilcrest facility has the capacity to feed 69,000 head of cattle, many of which are sourced from individual producers in Wyoming, South Dakota, Nebraska and Idaho. The facility was originally owned by the Montfort Family, who started the facility in the 1960s. Gilcrest is now one of 12 feedlots owned by Pinnacle Arcadia Cattle Partners, joining a collective of large operations in Kansas, Texas and Arizona.

During our tour, it was evident that the staff at Five Rivers strive to be the best that they can be. The success and safety of their workers, the health and comfort of the animals under their care, their role in environmental stewardship, and their social responsibility to their consumers - each of these roles are paramount at Five Rivers.

Corporate Structure

Five Rivers is a world-leader in the feedlot industry. As a corporate feedlot with multiple locations in the US, the visit undoubtedly had a different feel when compared to the smaller family farms we had visited.

During the first week of our trip, we learned about the advantages and disadvantages of family farms. Family farms may benefit from making their own management decisions without the approval of an employer. However, many family farms lack the financial assets available to corporate operations and find it difficult to purchase new equipment or survive an economic downturn. In our first week, we encountered family-run operations that had found ways around these issues, such as forming cooperatives to finance costly facilities or sharing the cost of new equipment with neighbours.

The Five Rivers Feedlot was the first corporate farm, and the largest facility we have visited to date. The size of the feedlot was an incredible sight to see, and we were amazed to see 69,000 head capacity at a single site (it’s a shame we couldn’t visit their Arizona site with 130,000 head capacity)!

Change of Ownership

In March 2018, the ownership of Five Rivers Feedlot was transferred from JBS (a major Brazilian livestock and meat company) to Pinnacle Arcadia Cattle Partners. This change has influenced the management and operations of the Five Rivers facility. Management decisions, such as the amount of cattle within the feedlot, were previously dictated by the JBS head office. In accordance with the market conditions, JBS would fluctuate the number of cattle within the feedlot to suit the demand of their processing facilities. Now, the Five Rivers staff have the independence to operate their feedlot to maximize profit, and therefore, see less variation in the number of cattle moving through their facility. Our group was surprised that JBS would operate feedlots at such low capacity, and enjoyed hearing how Five Rivers has changed their company strategy since moving away from JBS ownership.

Futures Market

The Chicago Board of Trade plays an important role in the operations of the Five Rivers Feedlot. A dedicated risk management team is located at their corporate head office, and much of their work involves hedging in the Chicago futures market. Price discovery at the Chicago Board of Trade heavily influences the prices that Five Rivers will buy or sell their cattle. As the cattle market is highly volatile, involvement in the futures market is a strategic way for Five Rivers to manage risk.

Many of the farms we have visited are involved in the futures and/or options trading market in Chicago. Hedging provides an opportunity to manage the risk of losing profit during the peaks and declines of the commodity market. The futures and/or options markets have been a major recurrent theme during our tour. The Chicago Board of Trade plays an important role in risk management for operations of all sizes, and those involved in Ontario agriculture should familiarize themselves with trading as an option to manage risk.

Employee Success

Throughout our tour, it has been evident that the agricultural industry struggles to find long-term workers. Five Rivers has experienced labour shortage, and has a high rate of employee turnover. However, employee turnover at their facility is largely due to their on-site trainee program. The Five Rivers staff prides themselves on training employees to take on management roles at other feedlots. This was an interesting twist to their corporate structure that we did not expect from a corporately-owned facility, but an excellent opportunity that they offer to exceptional employees!

New Technology

Five Rivers is seeking to mitigate their labour shortage by implementing exciting new technologies, such as drones, health-tracking microchips and driverless GPS- navigated feed trucks. These new technologies would ultimately replace employees, however, it would also increase productivity and efficiency.

During our visit to Wagonhammer Ranch, we heard of a significant issue within the beef industry. Seed stock breeders and processing facilities have a poor track-record for communication, and information regarding superior processing traits are rarely shared with the seed stock breeders. It would benefit the industry, as a whole, if this information was more readily available. That is an issue that Five Rivers is currently working on. They are able to access this information from the processing plant, and developing ways to track that information back into the hands of the feedstock producers and seed stock breeders. This is a step in the right direction, and we all felt that integration between the breeders and processors was an important step in the production of better quality meats.

closeup view shoulders and face of brown beef cow
Beef cattle housed in a JBS feedlot facility (Photo credit: Andy Cross, The Denver Post)

Feedlot Management

The majority of the 45,000 head population is comprised of heifers (95%; ~43,000), as heifers seem to perform better under the Five Rivers management protocols. Livestock are sourced from the cattle-producing states surrounding Colorado that share a similar climate, such as Wyoming, Idaho, North Dakota, South Dakota and Nebraska. This sourcing strategy is directly related to herd health and profitability, as cattle from similar climates have an easier time acclimating in Colorado.

Five departments comprise the Five Rivers Feedlot - Yard, Milling, Feeding, Cattle and Shipping/Receiving. Forty employees work within these departments, and oversee the 88,000 head of cattle that move through the facility each year. These departments need to work efficiently and collaboratively to ensure the operation runs smoothly.

Yard Department

The Gilcrest property has 265 cattle pens, each about an acre in size. Older yearling calves (700 to 900 lbs.) are housed at a density of 230 head per pen, while younger calves (450 to 550 lbs.) are housed at 160 head per pen. The stocking densities used at Five Rivers were not what we expected. As these cattle will spend 150 to 200 days within the feedlot facility, quality of life is an important consideration for animal health and profitability. At Five Rivers, each cow had room to move around and freely access water and feed. We had expected to see the animals shoulder-to-shoulder, and it was a nice surprise to see such a high quality of life within the feedlot.

Milling and Feed Departments

An external nutritionist is employed by Five Rivers to develop appropriate rations for the cattle under their care. Feeder calves entering the feedlot are placed on a starter diet, which allows for a gradual introduction to a standard high energy diet. This is unusual, as many feedlots push high energy diets without a starter ration. This sudden change in diet can lead to bloat and potentially death, and may associate with Five Rivers low mortality rate (0.27%).

The milling department is responsible for creating the rations developed by their nutritionist, and the feeding department distributes the rations to the correct pens. The Five Rivers facility does not have significant stores of ingredients, with two weeks of corn and hay and two days of syrup. Feed rations are mixed daily, as needed. This lack of storage has caused issues for Five Rivers in the past, especially if their milling system breaks down or requires maintenance. Fortunately, they have a sister feedlot nearby that can assist if problems arise. Other facilities that we have visited have stored at least one days worth of milled feed ingredients, in the event of their milling plants needing repairs.

Five Rivers does include feed additives, such as beta antagonists and Melengestrol Acetate (MGA), in their feed rations. Beta antagonists are used in the 30 days preceding slaughter to maximize muscle mass. However, there was increased heat stress noted in black cattle that were fed beta antagonists. Five Rivers decided to remove beta antagonists from the feed rations provided to their black hide cattle, which decreased this stress without a significant reduction in profitability. MGA is also included in the heifer feed rations. This hormone supplement halts estrus, allowing the heifers to continuously eat during their time within the feedlot.

During our previous farm visits, Enogen® corn was a significant topic of interest for cattle feed and ethanol production. Enogen® corn contains an enzyme called alpha-amylase, which breaks down starch for increased bioavailability. To the staff at Five Rivers, it did not appear to be the game-changing technology that we heard about in Iowa and Nebraska. Although, the staff admitted that those decisions are left up to their contract nutritionists.

cattle feeding from trough on feedlot
Cattle in a JBS feedlot enjoying a fresh batch of feed rations (Photo credit: Zach Brewer)

Cattle Department and Animal Health

The average daily gain at Five Rivers has significantly improved (from 2.5 lbs. per day to 3.47 lbs. per day), along with the efficiency of their daily operations and the quality of their cattle. Environmental stresses, such as heat or cold stress, are present within the feedlot and can create a range of health issues (varies by season; ex. more cases of pneumonia in the winter). However, it was not a major concern with proper health management practices. We also experience these environmental stresses in Ontario, which usually cause a loss in average daily gain. Many facilities have undergone renovations to include windscreens and sunshades, in an effort to mitigate these environmental stressors.

Cattle may also experience stress while entering the feedlot. Groups of cattle that are brought into the feedlot are immediately processed and sorted. This may separate herd mates, or mixed multiple herds together. This is a stressful process for the cattle, however, Five Rivers believes that cattle must be sorted by size to reduce stressors they may experience while in the feedlot.

Each pen is checked by the pen riders on a daily basis, and sick cattle are flagged and removed to hospital pens. Cattle that do not improve after three treatments are slaughtered for animal food before their condition worsens. This practice is also related to Five Rivers remarkably low mortality rate (0.27%), which is amazingly low for a feedlot of this size.

Environmental Stewardship

The two most concerning environmental issues that Five Rivers has encountered are odor and dust pollution. In 2006, they installed a sprinkler system that shoots water into the pens to wet the dust down. This limits the amount of dust that gets blown out of the feedlot, and works remarkably well (they have not had a dust complaint in 7 years). The sprinkler system also helps mitigate the odor from the high number of cattle on site.

Water-Use

The Gilcrest Feedlot uses groundwater sourced from four on-site wells (and 4 backup wells), to provide drinking water and supply their dust management system. The site sits on the Ogallala aquifer, with the average well reaching 29 feet. This way a major contrast from the irrigation wells we had visited yesterday, with many reaching in excess of 150 feet to the base of the aquifer. Their water is tested annually, and  they have not experienced water quality issues (such as nitrogen contamination). At present, water levels in the Ogallala aquifer have not decreased at their location due to overuse, and they are not concerned about losing their access to water.

Manure Management

Cattle pens are cleaned out 3-4 times per turn of cattle (150 to 200 days), and receive a deep cleaning after the pen has been shipped. The manure produced by the feedlot is given to local farmers, who utilize it as a source of nutrients for their crops. Five Rivers runs into manure issues during the summer months, as they have to store the manure until the Fall harvest. The site also contains two wastewater lagoons to catch and hold runoff water, which the facility spreads on their irrigated hay ground with a centre pivot irrigation system.

Social Responsibility

During our tour of the Five Rivers facility, questions regarding the social responsibility of corporate feedlots and the social pressures imposed upon them by the local community were asked. This was an interesting topic for us, as the Ontario livestock industry has experience backlash from numerous activist groups in recent years. The Ontario industry is also facing mounting pressure to conform to consumer demands - namely locally-produced, hormone-free, antibiotic-free meat products. To our surprise, the Five Rivers feedlot has not experienced such extreme pressures from their community.

Hormone and Antibiotic Use

Five Rivers feedlot has not experienced social pressure to limit the use of hormones or antibiotics in their animals. This was extremely surprising for us, as the social pressure we face in Ontario has increased in recent years (with major grocery and fast-food companies capitalizing on antibiotic-free and hormone-free products).

The major concern regarding antibiotic use in Ontario, is the potential for drug residue to remain in the meat products. The processing plant supplied by Five Rivers imposes a penalty for drug residue, with those animals removed from the food-grade supply chain. Feedlots that ship animals with drug residue can ultimately lose their right to slaughter (this has never happened during Ed’s time at Five Rivers). As a result, Five Rivers takes the use of antibiotics seriously, and has imposed numerous fail-safes to prevent a treated animal from entering the processing facility. When an animal is sent to a hospital pen at Five Rivers, it receives a unique hospital identifier ear tag. This ear tag allows the animal to be tracked once it has returned to its pen, and allows pen riders to identify animals that are not ready for shipment to the processing facility.

As in Ontario, Colorado feedlots are facing new regulations regarding the use of antibiotics. If these regulations limit the availability of antibiotics, Five Rivers plans to utilize a more intensive health management plan. New technology, such as drones and fitness-tracking microchips, will help identify sick animals before a pen rider could visually identify them. These preventative measures will hopefully reduce the amount of antibiotics required, and catch sick animals before they require antibiotics. Animals that still require antibiotics could be treated (if it was profitable), or may be sent into the pet-grade food supply.

Community Involvement

A major issue in the livestock industry is the lack of information provided to consumers. Many livestock operations are hesitant to allow the public into their facilities, as some activists use those opportunities to bend the truth. The staff at Five Rivers admits that greater transparency is required within the industry, and that is what we experienced today. Our perception of corporate feedlots was changed during our visit, and the quality of life within the facility was much higher than we had expected.

To help increase transparency, Five Rivers is organizing a community day. Local residents will have the opportunity to visit the facility on bus tours, and learn about the operation as we were able to today. This is an incredible step, and it would be interesting to see other livestock facilities open their doors to educate the general public. These opportunities may help to dispel the negative connotation associated with corporate agriculture, and would be beneficial across the entire agricultural industry.

Lasting Impression

We had a great visit at Five Rivers Feedlot! Many of us were surprised at the high quality of life provided to the animals within the feedlot. The pen density was much lower than we were expecting, and animal health was a major priority for the staff. This was exemplified by their low mortality rate (0.27%), which was surprising for a 69,000 head operation.

The staff at Five Rivers are truly amazing cattlemen, and have a compassionate relationship with the livestock that move through the facility. Ed shared a story with us that exemplified this relationship. In 2013, the area surrounding Five Rivers experienced a devastating flood. The flooding prevented much of the Five Rivers staff from reaching the feedlot for many days. The nine staff that were on duty maintained normal operations for 3 days until additional help could arrive. They did not cut corners. They did not complain about the long hours. They just made sure that the cattle were well taken care of until more help could arrive. Feedlots are often demonized and associated with death or animal cruelty. This was not the case at Five Rivers, and we were fortunate to see the facility for ourselves.

In Ontario, the livestock production industry has felt mounting pressure from social and environmental activists. Five Rivers Feedlot has faced less pressure than we are accustomed to in Ontario. They have not had a significant issue with the local community, although their processing facility has experience some pressure from local activist groups. This was encouraging news for us. Five Rivers has taken steps to bring the public onto the feedlot, in an effort to show the local community the day-to-day operations at the facility. Perhaps if the Ontario livestock industry was more open, we could take steps to mitigate the backlash experienced from those outside of the agricultural community.

Our stop at Five Rivers Feedlot was a highlight on our Midwest Crop Tour. For those of us that were unfamiliar with feedlot operations, it was an important tour to sway any negative connotation associated with the feedlot industry. To see the level of care and compassion shown to these animals was a wonderful experience.

A black angus cow destined for a new home (Photo Credit: Rachel Whaley)

 

References

[1] Syngenta. 2018. Enogen® corn for ethanol. Accessed: 2 September 2018. <http://www.syngenta-us.com/corn/enogen>