Bovine respiratory disease (BRD) is the most common disease among feedlot cattle in the United States. It accounts for approximately 75 percent of feedlot morbidity and 50 percent to 70 percent of all feedlot deaths (Edwards, 1996; Galyean, Perino, and Duff, 1999; Loneragan et al., 2001). The majority of deaths due to BRD occur shortly after arrival to the feedlot or within the first 45 days (Edwards, 1996; Loneragan et al., 2001). In fact, Buhman et al. (2000) reported that about 91 percent of calves diagnosed with BRD were diagnosed within the first 27 days after arrival. BRD causes an estimated $800 million to $900 million annually in economic losses from death, reduced feed efficiency, and treatment costs (Chirase and Greene, 2001).
Medical costs attributable to the treatment of BRD are substantial, and the economic impacts of BRD on carcass merit and meat quality further increase the economic costs. Medicine costs accounted for 21 percent of the decrease, while 79 percent was attributable to lower carcass weight (8.4 percent less) and lower quality grade (24.7 percent more USDA Standard quality grade carcasses). BRD can also cause economic losses due to decreased gain and carcass values (Duff and Galyean, 2007). A Texas Ranch-to-Rail study found BRD morbidity accounted for 8 percent higher production costs, not including losses related to decreased performance (Griffin, Perino, and Wittum, 1995). They found cattle with BRD had a 3 percent decrease in gain compared with healthy cattle and cost the program $111.38 per sick animal. Snowder et al. (2006) estimated economic losses in a 1,000-head feedlot from BRD infection due to lower gains and treatment costs to be approximately $13.90 per animal.
Demand for higher quality products and increased value-based marketing have heightened beef producers’ awareness of health management practices with potential to increase profitability and beef product quality. Feedlot producers able to purchase calves more likely to remain healthy during the feeding period could potentially increase profits through reduced costs and higher revenues. Previous studies document the economic impact from BRD in either backgrounding or finishing programs. The majority of those studies are from animal scientists and veterinarians. Current research relating to animal disease in agricultural economics journals deals with major outbreaks of infectious diseases (e.g. bovine spongiform encephalopathy or bovine brucellosis), tracking systems, and eradication programs (Amosson et al., 1981; Elbakidze, 2007; Hennessy, Rossen, and Jensen, 2005; Kuchler and Hamm, 2000). Limited research on BRD in feedlot cattle is reported in agricultural economic journals. Nyamusika et al. (1994) however, using a stochastic simulation model of BRD, found significant returns to vaccination of cattle. The simulation found vaccination programs, combined with treatment of BRD, increase net revenues by $44. Further analysis on the economic effects of BRD in the backgrounding phase is warranted along with the effects in the finishing phase and the phases combined.