Small businesses drive rural America, but for those in the cattle industry, governing statues and regulations have not evolved alongside the changing business models, said National Cattlemen's Beef Association member Ken Keesaman Thursday at a House Committee Small Business Subcommittee on Agriculture, Energy and Trade hearing.
"The evolution of today's livestock industry has shifted, and in order for family businesses to survive, we have expanded and diversified our operations," said Keesaman, owner of KK Farms in Missouri. "In terms of agriculture, today's small business has changed and it is appropriate for the size standards applied by the Small Business Administration to more accurately represent today's small operations."
For small family businesses like KK Farms, diversifying is essential to mitigating risk, NCBA says. KK farms started out in the cattle business in the 1870s and has since grown to incorporate 1500 acres where they raise 300 head of registered Angus Cattle, a few hogs and farm corn, soybeans, and hay.
The family has further diversified their operation by adding a vineyard and winery, a microbrewery, and has plans to add a restaurant and event center in an effort to spread risk.
"When you evaluate the success of America's cattle farmers and ranchers, we have developed a successful business model not only domestically but also globally," said Keesaman. "In terms of production, the United States has only 7% of the world's cattle supply but we are able to produce 20% of the world's beef. We have found ways to utilize more of our natural resources and the latest science to be more efficient than our international competition."
The agriculture industry is the only industry which a statue mandates size standard, NCBA says. While the face of the small business has changed, smaller operations still play a significant role in the beef cattle industry.
According to the USDA, the average domestic cow herd size is 40 head. With the smallest national beef herd since 1951, the industry has still managed to produce approximately 25 billion pounds of beef for the increasing global market.
"As industries adapt to the changing market place, it is important for the government to modify the governing statues and regulations to better reflect the changes in the business climate," Keesaman said.