The Sierra Club has something to say about CAFOs:
America's drinking water, rivers and lakes are at risk from giant, corporate-owned factory farms. Animal feeding operations, many of which confine thousands of animals in facilities, produce staggering amounts of animal waste -- 500 million tons per year. Too often, this waste leaks into our rivers and streams, fouling our air, contaminating our drinking water and spreading disease. According to the Environmental Protection Agency, hog, chicken and cattle waste has polluted 35,000 miles of rivers in 22 states and contaminated groundwater in 17 states.California, home of the "happy cow," has been the Nation's #1 dairy state (ahead of Wisconsin) since 1993. Of course, California's 1.5 million dairy cows produce a lot of shit. When I asked the local environmental regulator about "effluent plumes" in Tulare (#1 county with an average of 1,200 cows per herd, each using 75 gallons/water/day [PDF].), she fell silent (or was it Kern? Fresno? No matter -- south Valley). It seems that "economic impact" is more important that water quality.
Bottom Line: Cheap meat (and dairy) comes at a cost to YOUR environment. Plan accordingly.