Economic Information Bulletin No. (EIB-43) 46 pp

January 2009

The Transformation of U.S. Livestock Agriculture: Scale, Efficiency, and Risks

U.S. livestock production has shifted to much larger and more specialized farms, and the various stages of input provision, farm production, and processing are now much more tightly coordinated through formal contracts and shared ownership of assets. Important financial advantages have driven these structural changes, which in turn have boosted productivity growth in the livestock sector. But structural changes can also generate environmental and health risks for society, as industrialization concentrates animals and animal wastes in localized areas. This report relies on farm-level data to detail the nature, causes, and effects of structural changes in livestock production.

Keywords: Livestock, dairy, broilers, hogs, fed cattle, farm structure, scale economies, contract agriculture, CAFOs, growth-promoting antibiotics

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