A group of cattle feeders from Canada and the US have come together to develop a brand-new 150,000 head beef feedlot and Anaerobic Digestor (AD) facility in the state of Nebraska.
The project broke ground in May 2023 and the development will take place in four phases.
The scale of the development is phenomenal and shows the level of confidence these cattle producers have in the future of the US beef sector.
To find out more about the project, Agriland caught up with one of the three founding partners of ‘Blackshirt Feeders’ – the group behind the project – Eric J. Behlke.
Eric explained to Agriland that Blackshirt Feeders is a group of “very progressive agricultural entrepreneurs”.
He said: “The partnership name ‘Blackshirt’ is a colloquialism in Nebraska for determination, hard work, perseverance, dedication, and tenacity. When deciding on a name, we wanted to choose a name that the locals could relate to and also a name that had a positive connotation.
“It became part of the local vernacular through the University of Nebraska football team’s defense being referred to as the ‘Blackshirts’ over the past several decades.
“The feedlot has no affiliation with the football team, we just chose the name because of the positive spirit it invokes with the local people of Nebraska.”
“The group itself is made up of eight entities, some of those are individuals and some are groups of people and families that have come together. Collectively, we have over 300 years of experience of owning and operating feedlots, farms and ranches,” he added.
The partners in Blackshirt Feeders are:
- Dr. Kee Jim;
- Dr. Calvin Booker;
- Dr. Eric Behlke;
- Doug Price and family;
- Adams Ranch;
- Thompson Livestock;
- Fredin Brothers;
Three of the partners work as veterinarians with TELUS Agriculture and Consumer Goods and Eric also has a PhD in ruminant nutrition.
Eric said: “Specifically, within Tellus agriculture, we are in the animal agriculture business unit and we provide consultation services for cattle operations around the globe.”
He explained how the partnership decided to develop this mega-scale cattle feed operation and why they chose the specific location.
“As agricultural entrepreneurs, we’re always interested in opportunities and this opportunity arose to build a feedlot.
“We were interested in finding what would be the best place to feed cattle. This location in Nebraska, it’s pretty interesting. As consultants, we’re always evaluating locations where we feed cattle so we did our due diligence on this location and there’s probably about three primary site criteria that we took into consideration,” he added.
The three criteria in selecting the location for the feedlot were:
- Feed costs;
- Weather;
- Harvest facilities.
Eric explained: “Feed is your number one input for a finished animal. This part of Nebraska is a very interesting place because there is an abundance of corn and basic supply and demand would indicate when there’s a lot of corn around then the price is going to be cheaper.
“This part of the word has historically been a net exporter of corn and that corn goes to the major cattle feed centres which would be down in southwest Kansas and the panhandle of Texas.”
Weather in Nebraska
Eric says there is a micro climate in southwest Nebraska – where the feedlot is located.
“The amount of precipitation and average temperatures is very similar to the panhandle of Texas,” he said.
“One of the driving factors of so many cattle on feed in the panhandle of Texas is because of the lesser amount of precipitation – relative to some other areas of the country.
“Less precipitation is a good thing because mud would be one of the greatest inhibitors of performance in feed cattle,” he added.
He explained that mud takes more energy for cattle to move around and decreases insulation capacity of animals’ hair.
“All around, mud is one of the biggest challenges for cattle feeders,” he said.
“There is a reasonable amount of precipitation in southwest Nebraska but we’re on top of the Ogallala Aquifer so there’s access to irrigation which allows us to grow corn so the corn price is favourable.”
Harvest facilities
The third primary site criteria is distance to cattle harvest facilities. Eric said: “There’s about four major companies that harvest cattle and several regional harvest facilities and to the four majors, we are equidistant.
“We have an abundance of harvest facilities all within a reasonable drive so being in the middle of them puts us in a good position as we want to market that commodity.
“So we looked at those three things: Precipitation, corn price and distance to harvest facilities and we truly think this is a fantastic location to feed cattle based on the collective years of experience of the group. We decided we would pursue the path to build a large feedlot in the region,” he added.
Once the location was identified, the partners had to source land to develop the facility on.
Initially, 1,000ac were purchased which will form the site on which the feedlot will be built.
“We have built this entire facility on concrete so that is relatively unique. Right now, if we look at total cattle on feed, there are less than 5% of cattle [in the US] fed on concrete,” he said.
Eric says that the concrete floor on the feedlot has two benefits. Firstly he said: “it takes the mud out of the equation”. The cattle have a cushion of bedding and manure to lie on which will be harvested and fed into the farm’s AD plant where renewable gas will be harvested.
He noted that a traditional feedlot would not be able to use manure in an AD plant as there would be clay in the feedlot manure also.
An additional 1,500ac of irrigated farmland was also bought. This land will be ‘retired’ and the water from those irrigated acres will instead be used to provide water for the cattle in the feedlot.
Eric said: “It won’t take all of those acres but we wanted to buy plenty extra. In Nebraska you essentially have to buy water allocation so the allocation that has been used on this farmland is going to be used to water the animals at Blackshirt Feeders.
We bought 1,000ac to build the feedlot on but the feedlot itself is only going to cover about 650ac though. We will have some extra acres around and the acres for the AD.
“The farm ground we are using the water allocation off, we returned to native pasture,” he said.
Where is the project now?
Eric explained how progress has been going on the four-phase development of this impressive scale feedlot.
He said: “We broke ground in May 2023 and we are going to build this feedlot in four phases.
“In Phase 1, we built the mill and some of the essential infrastructure. So we had to bring water lines to the site, we had to build a road to the site, install gas lines and all the essential infrastructure – that happened in 2023.
“Phase 2 started in spring 2024 and by the end of 2024, we had capacity for 50,000 head (of cattle). As we talk right now today, we have a little over 40,000 cattle on site – about 42,000 head,” he added.
Construction is due to start again this month (March) and Phase 3 will begin then to be completed by the end of 2025. This will bring the capacity of the facility to 100,000 head of cattle.
Phase 4 will commence in 2026 and Eric said: “After the final build out, we will be at 150,000 head capacity.”
At full capacity, the manure from 150,000 head of cattle will be going through the AD plant to produce renewable gas. The plan is to break ground on the construction of the AD plant this year.
The system
Cattle spend anywhere from 150-400 days on the farm – depending on their arrival weight.
He said: “On average, we won’t have cattle spend less than 120-150 days at the feedlot. Those would be some of the bigger cattle that come in and then some of the small cattle that come in, could be there for up to a year.”
Cattle are sourced from both the dairy and beef-bred dams and Eric explained that the facility has been built “to accommodate the dairy on beef population of cattle”.
“We plan to have a significant population of dairy on beef cattle however we aren’t opposed to feeding beef cattle and as I look now, we are probably at about 80% that would be straight beef cattle from cow-calf herds.”
These cattle are sourced from cow-calf herds (suckler herds) as yearlings and go to Blackshirt Feeders for finishing.
The finishing diet for the cattle on the farm is a corn-based diet. Eric said: “We steam flake corn so we process it through a steam chamber and rollers so it’s almost a flat piece of corn. It makes up the majority of the diet.
“We also feed silage from various sources – predominantly corn or wheat silage as our forage source and we also feed the associated vitamin and mineral package,” he added.
Attention to the level of forage in the diet and good feed bunk management are key components in preventing acidosis on the farm.
Breeds
The farm handles “just about all major breeds you can think of,” according to Eric who also said: “We are working with a group that has a composite that is multiple breeds together. I wouldn’t say there is any one breed we are set on.
“There is a group that we currently work with and these would be genetics that come out of the Leachman Line – again that would be a composite of several different breeds. So it’s multiple breeds that go into one bull.
“We are happy to take all types of cattle, we just realise that the different types of cattle have different performance expectations and when we buy the cattle we just have to make sure the price reflects the performance we expect of them,” Eric added.
Cattle are bought at auction yards, and from ranchers directly. The feedlot plans to move to buying more dairy-beef cross cattle and part of the ownership also owns calf ranches.
These calf ranches take “day-old calves direct from the dairy and they go into the calf ranch until they are approx 300 pounds (136kg) then they come into Blackshirt Feeders.”
“We will work with various calf ranches but there are members of the ownership group that do have a calf ranch and that will be a primary source but not the exclusive source. We will be flexible,” Eric added.
Target ADG, finishing weight and price
Eric said that the target Average Daily Live weight Gain (ADG) of the cattle “depends on a lot of things” such as the cattle breed and the cattle gender.
He said: “It’s not out of the question for them to gain three pounds a day (1.36kg/day) but there’s lots of variation around breeds and genders.”
Eric said: “We utilise different growth-promoting technologies but everything has to be on label for that population.”
The farm will be purchasing approximately 15 million bushels of corn/year.
“If there’s any specific programme, they may or may not allow those technologies. We do utilise them [growth promoters] when they are indicated for that particular population and market but we can also remove them if not indicated.”
He said that the slaughter weight will also depend on breed and gender of the cattle but “approximately 1,400-1,500 pounds” (635-680kg) would be a guide target slaughter weight.
Assuming cattle remain on the farm for 365 days of the year, at full capacity, the farm would be turning over 150,000 head of cattle/year.
When asked if this will be one of the largest feedlots in the US on completion, Eric said: “That is not a metric we have chased or looked at. We are going to be on the upper-end of the spectrum in terms of size, but we are most focused on operational efficiency.”
On beef cattle prices, Eric said: “Looking at the April live cattle board, we’re at $193/100 weight or $1.93/pound (€3.90/kg) is what the cattle futures market is today.
“That’s what we get paid for the live cattle. We have relatively high live cattle prices [currently] but we also have historically high feeder cattle prices so both of those need to be taken into consideration as we look at the overall profit.
“These are relatively strong prices. They have come off their highs over the last three-four weeks but in general, we have relatively strong prices,” he added.
Beef industry confidence
The Nebraska-based Blackshirt Feeders evidently have a high level of confidence in the US beef industry going forward. Eric said: “We are optimistic.
“It does look like there is going to be relatively strong demand for beef not just domestically but globally over the short to medium term so that’s something were pretty excited about.
“On the flipside, if we look at the cattle herd in the US, we have gone through a fair bit of contraction lately. We have had relatively low numbers of cows if we look at the North American cow herd and as that herd rebuilds, there should be a greater supply of feeder cattle.
“With the beef on dairy model, that’s not a new supply but it is a unique supply that will be used to help fuel what we see will be a very strong demand for beef going forward,” Eric added.
Agriland asked Eric if the potential of cheaper South American beef imports was perceived as a threat to the US beef industry.
Eric said: “There’s always going to be threats out there, that’s not one that comes to mind.
“Keep in mind – we are producing a very high-end grain-fed beef product that we think is very competitive for the consumers that enjoy that high-end product.
“There might be other beef producers out there but we’re pretty optimistic about the production of this high-end grain fed beef product. It tastes good!” he added.
