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How to make money from feedlot business

The main beef breeds in Kenya include Boran, Sahiwal, Zebu, Aberdeen Angus, Hereford, Charolais, Simmental, Short horn and Fleckvieh

As drought continues to bite in many parts of the country especially arid and semi arid lands, it is a common sight to see emaciated cattle and even carcasses dotting bare ground. Such a big loss to the owners. But out of this mess, is a business opportunity. Feedlot business. To ease the burden on the livestock farmers and address problem of food security daring entrepreneurs can invest in feedlot business. 

A feedlot is a farming operation where animals such as beef cattle and sheep are put in an enclosure at a certain age and weight. They are then intensively fed on high quality balanced feed to attain a certain slaughter weight within a specified period of time.

The Smart Harvest visited Suruqa Feedlot Ltd in Kitengela, Kajiado County, where an investor is trying out his hand in feedlot business and shares insights on the journey so far. 

Having realised the demand for quality meat outstrips the supply, the farm owner ventured into the production of quality meat to satisfy the market.  

Surqa Farm feed lot Manager Milton Mbaya attending to the animals in Kajiado [Esther Jeruto,standard]

To start off, Milton Mbaya, the farm manager, explains that they bought some 120 beef cattle and 300 sheep that were emaciated, but healthy.

Work closely with vet

“With the help of a veterinarian, we bought healthy cows that were a little bit emaciated and had a big body frame which is an indication of potential to add weight when they are well fed,” says Mbaya.

Once the animals arrived in the farm, Mbaya says they first quarantined them. During this period, the animals were vaccinated against diseases such foot-and-mouth disease (FMD), lumpy skin disease (LSD) and contagious bovine pleuropneumonia (CBPP). The animals were also dewormed to keep worms and flukes at bay.

“Spraying helps to kill ticks, mites and fleas. Animals that suffered injuries during transport are also attended to during this period,” Mbaya says.

Working with a vet is extremely key while setting up a feedlot business.

Dr Andrew Mbithi a veterinary surgeon and animal nutritionist says in order to money from feedlot business, livestock producers should aim to produce good quality cattle that will in turn produce premium meat that is on demand in high-end and export markets. 

When the animals attain the weight of 200kg they can be taken to a feedlot for fattening.  

One of the ways to have quality breed Dr Mbithi advises, is to increase the breeding herd and improve the reproductive rate of breeding cows such that each produce a calf once every year. This, he says, is achieved by synchronising mating or insemination so that calving coincides with periods of better feed availability. 

Supplementing cattle dietary requirements during the last trimester of pregnancy using dry season feed and mineral supplementation, and during lactation phase using wet season mineral supplementation also helps to raise good quality beef animals. 

Feeding of calves

If you are interested in using the feedlot system to produce high-quality cattle, Dr Andrew Mbithi says you need to begin by feeding and caring for your calves in the right way.

“For calves, aim at getting minimum growth rate of 320g per day so as to attain 200kg at 20 months of age. This is achieved by weaning them at an average age of eight months and carrying out dry season supplementary feeding for 183 days, followed by wet season mineral supplementation for 182 days until they are a maximum of 20 months old. In seasons where pasture is available, wet season supplementation is not important as there is no significant change in weight gain,” the vet explains.

When the animals attain the weight of 200kg they can be taken to a feedlot for fatenning.  The feeder cattle at the feedlot should aim to attain an average daily weight gain of 1kg per day for 120 days so that they reach cumulative weight of more than 320kg by 20 months of age.

For success in the feedlot business, it is important to factor in where you will sell the beef cattle, before you rollout the project.

Mbaya says they sell their beef when ready to Kenya Meat Commission who buys at Sh185 per kilo live weight.

To ensure the animals achieve the desired weight within the desired period, feed them with a balanced mixed rations, including minerals and regularly weighing them.

The feed taken, according to Dr Mbithi, is calculated by an animal nutritionist using precise computer software and is comprised of specific portions of roughage, protein, carbohydrates, vitamins, mineral premixes and portable water which animals can take ad libitum.

Dr Mbithi warns that poorly formulated feeds can predispose the animals to metabolic diseases such as rumen acidosis and laminitis as well as reduced growth rates.

If you do the feeding right under the guidance of a vet, you are assured of a mature animal that will produce quality meat. 

So how does quality meat look like?

According to Dr Peter Gathura, senior lecturer at the University of Nairobi, high quality beef is firm, velvety, fine grained lean, bright red and is well marbled. The fat is smooth, creamy white and well distributed. 

Beef cattle feedlot

When you take your meat to the buyer, these are the qualities that will determine how it will be graded and the amount it will attract.

“During meat grading the categories include prime, choice, fair average quality, standard and commercial,” says Dr Gathura.

Stressful conditions like a dirty cow pen, inhuman handling of the animals contribute to stressed animal that produces poor quality meat. That is why conditions at the feedlot should be comfortable so that the animals do not encounter any distressful conditions. If the animals can have luxuries like sleeping in a cow mattresses, it is a plus.

For those interested in beef meat business, here are useful insights to ensure the business is profitable.

Choose the right cattle breed: This is a key factor for the success of your business. A good breed will have large body frame for putting on weight, is resistant to diseases and has potential to attain the required average daily gain of between one and one and a half kilos per day.

The main beef breeds in Kenya include Boran, Sahiwal, Zebu, Aberdeen Angus, Hereford, Charolais, Simmental, Short horn and Fleckvieh which was recently imported from South Africa.

Proper feed management system: This will ensure that you have a backup of roughage such as hay which will reduce the overheads on feed costs and hike your margins in the long run. Make hay while the sun shines.

Focus on animal health: Animals need to be kept healthy at all time so that they can perform well in the feedlot sprint. Healthy animals have strong immunity and can feed and perform well in a feedlot. Practices like quarantining new animals, treating the sick, deworming and spraying are critical. Have a reliable veterinarian on call to attend to emergencies such as bloat.

Keep facilities well maintained: These include the feed and water troughs, weigh bridge, loading zone, foot bath and fences to keep off unwanted guests and vehicles which could be carriers of diseases.

Aggressive marketing: Be on top of your game when it comes to marketing. Seek out the current trends, niche markets including export market and network with industry stakeholders. Do not forget social media. Platforms like Facebook, Twitter and Instagram have great potential for getting new markets.

Adopt a circular economy: Basically, a circular economy is an industrial system that is restorative or regenerative by intention and design. It factors in global realities like climate change. So it focuses on prudent use of resources. On that note, you can have some kienyeji chicken to scavenge on the grain particles falling around the feeding troughs. The manure coming from the feedlot cycles can be used to grow fodder and in biogas production.

What can make a feedlot business fail?

With these useful tips at hand, it is worth noting that a number of investors have ventured into feedlot business only to close shortly afterwards. To avoid going that path, here are some useful tips to avoid going that route.

Buying old and sick animals: These may be cheaper to buy in the market but will take forever to attain the required market weight. Additionally, veterinary fees in treatment will make your overheads shoot through the roof.

Copy pasting feed formula: Feeding feedlot cattle in intense. You require precision to know what to include in the total mixed ration. What works for your friend may not work for you. They may be using different raw materials. Get an animal nutritionist to help you here.

Incompetent staff: To improve business operations and management, hire competent staff. They are your eyes and hear when you are not in the farm. Optimise the operations in your farm by communicating clearly to the management team what the objectives are who in turn communicate to the workers what is required of them. This way, you’ll have the records working and reduce wastages.

Failure to have a financial plan – before you start a feedlot, understand that a feedlot is a high capital intensive venture. Take your time to mobilise finances to factor in land, housing and other facilities like stores, feeds, stock of animals, wages, veterinary fees and other miscellaneous costs.

[The writer is a Veterinary Surgeon and the Resident Vet at FarmKenya]


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