An Economic Analysis of Waste Management for Texas Cattle Feedlots: An Analysis of System Alternative and Policy Implications

Over 20 percent of the nation's fed cattle are finished each year in the Texas High Plains. each animal that is fed produces approximately one dry ton of collectible manure. This equals about two dry tons of collectible manure per year per head of feedlot capacity. Given the amount of cropland in crop production on the High Plains, there is a potential demand for all manure produced.

The general objective of this thesis was to determine efficient waste management strategies which would be environmentally benign while benefiting agricultural producers. Specific objective were sought with respect to the physical aspects, cost of manure management, derivation of manure demand curves, and possible policy implications.

Mathematical optimization models for two study areas in the Texas Panhandle were developed with the objective of maximization of net returns. The primary differences between the Northern Farm Area and the Transition Farm Area were the addition of cotton production it the Transition Farm Area as well as decreased farm size. Crop supply and input demand functions were determined using duality theory.

Land application of manure was determined to be an optimal approach to waste management in the Texas High Plains. It was found that manure would be demanded at a lower price in the Transition Farm Area, as opposed to the Northern Farm Area. The resulting lower price was due to smaller average farm size a well as the incorporation of cotton production in the model, this leading to lower nitrogen requirements that that of corn production. The demand for manure and commercial fertilizer increased when the government program participation was excluded and the final output price was allowed to vary.

Water availability served as a supply and demand shifter in the model. As water availability increased, corn production increased, this increasing the demand for manure and commercial fertilizer. However, the supply of sorghum and wheat were found to have a negative relationship with water availability.