Profitability of Tasmanian beef enterprises: Calving dates and - PowerPoint PPT Presentation

Profitability of Tasmanian beef enterprises: Calving dates and stocking rates for weaner and yearling production systems Libby Salmon, David Counsell and Tim Rhodes Grassland Society of Southern Australia Inc

How can I make more from beef? “Profitable grazing businesses generate more income for roughly the same costs as less profitable farms” Holmes, Sackett and Associates, 2004 Grassland Society of Southern Australia Inc

More income, same costs Meat production Beef price (kg/ha) (c/kg) Stocking rate Type of enterprise, Genetics Time of calving Supplementary feed • Pasture production Animal health • Fertilizer management (Labour/DSE) Grassland Society of Southern Australia Inc

Key questions for beef production systems in midlands TAS What are the most profitable and sustainable: 1. stocking rates? 2. enterprises? 3. calving dates? 4. levels of supplementary feeding? Specific for farm, over a range of seasons Grassland Society of Southern Australia Inc

Farm resources weather livestock pastures soil management Grassland Society of Southern Australia Inc

Putting the farm’s resources together Management $ Profit • Depth • Water availability Risk • Bulk density • Fertility Sustainability Grassland Society of Southern Australia IncGrassland Society of Southern Australia Inc

Southern midlands -climate and pasture growth Elevation: 270 m Annual rainfall: 550 mm (1979-2004) 42 o S Apsley Grassland Society of Southern Australia Inc

Daily temperatures Average monthly temperatures Max + short days o C in winter Min Grassland Society of Southern Australia Inc

Rainfall variability Percentiles for monthly rainfall Best 10% Max Min mm 50% Worst 10% Grassland Society of Southern Australia Inc

Production risk Climate variability 400 400 350 300 Gross Average = $248/ha 250 200 200 margin 150 100 ($/ha) 50 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 -50 1.5 1.5 Feed hay 1.25 1.0 1 (t/ha) 0.75 0.5 0.5 0.25 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 300 300 Meat Average = 190 kg LW/ha 200 200 production 100 100 (kg LW/ha) 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 Cocksfoot, annual grass, sub clover 8 Green 6 pasture 4 (t DM/ha) 2 0 800 800 Average = 550 mm 700 Annual 600 600 500 400 rainfall 400 300 200 200 (mm) 100 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 1980 1985 1990 1995 2000

Pasture supply – S. Midlands Cocksfoot - annual grass - sub clover 8000 8000 8 7000 7000 6000 6 6000 Green 5000 5000 pasture 4 4000 4000 (tonnes 3000 3000 Dry Matter 2 2000 2000 /ha) 1000 1000 0 0 0 Jan Jan Mar Mar May May Jul Jul Sep Sep Nov Nov Stocking rate = 5 DSE/ha Grassland Society of Southern Australia Inc

Variability in pasture supply 8000 8 7000 Best 10% of seasons 6000 6 Green 5000 pasture 4 4000 (tonnes 3000 Dry Matter 2 2000 /ha) 1000 0 0 Jan Mar May Jul Sep Nov Worst 10% of seasons Grassland Society of Southern Australia Inc

Reliability of pasture supply - S. Midlands vs SW Victoria 8000 8 7000 Hamilton, VIC 6000 6 Best 10% Green 5000 pasture Worst 10% 4 4000 3000 (tonnes Dry Matter 2000 2 /ha) 1000 0 0 Jan Mar May Jul Sep Nov Stocking rate = 5 DSE/ha Grassland Society of Southern Australia Inc

Beef systems tested • Self-replacing herd: 550kg Angus cows – Weaner & Yearling production – 5 stocking rates at 3 winter-spring calving dates • Common weaning date (end Mar) Grassland Society of Southern Australia Inc

Assumptions for weaner system • Weaners sold on 1st April (7-9 months) Weaners prices (c/kg LW): < 285 kg < 300 kg > 300 kg Steers 270 250 230 Heifers 215 200 185 • CFA cows 130 c/kg LW Grassland Society of Southern Australia Inc

Assumptions for yearling system • Yearling steers sold on 15th Dec (15-17 months) • Cull heifers sold on 1 Mar (18-20 months) • Prices: - Steers 220c/kg LW - Heifers 175c/kg LW - CFA cows 130c/kg LW Grassland Society of Southern Australia Inc

Profit driver: Stocking rate Test 5 stocking rates: 0.3, 0.6, 0.9, 1.2, 1.5 cows/ha Over 25 years (1979-2004) Grassland Society of Southern Australia Inc

Grazing pressure: cows/ha vs DSEs Weaner System Cows/ha 0.9 (includes repl. heifers) Followers/ha 0 DSEs/ha on 1 Jul 8.5 Grassland Society of Southern Australia Inc

Grazing pressure: cows/ha vs DSEs Weaner System Yearling System Cows/ha 0.9 0.9 (includes repl. heifers) Followers/ha 0 0.6 yearlings DSEs/ha on 1 Jul 8.5 12.7 Grassland Society of Southern Australia Inc

Grazing pressure: cows/ha vs DSEs Weaner System Yearling System Cows/ha 0.9 0.9 (includes repl. heifers) Followers/ha 0 0.6 yearlings DSEs/ha on 1 Jul 8.5 12.7 +50% Grassland Society of Southern Australia Inc

Cost: Supplementary feeding Feed to maintain condition above: • score 2.0 -cows • score 2.5 -weaners Hay purchased at $150/t (not cut from surplus) Gross margins calculated after cost of feeding Grassland Society of Southern Australia Inc

Significant feeding needed at calving Percentiles for hay fed to mature cows worst 4 years in 10 half the years best 4 years in 10 kg/head/day Calving 1.2 cows/ha Grassland Society of Southern Australia Inc

Supplementary feeding depends on stocking rate Yearling systems Calving Annual 200 date feed cost Jul averaged over Aug 1979-2004 100 Sep ($/ha/year) Weaner systems 0 0 0.3 0.6 0.9 1.2 1.5 1.8 cows/ha

Key messages - feeding • Significant feeding– at stocking rates over 0.6 cows/ha • Yearling systems - more feeding than weaners • Weaner systems carry less animals through winter • In most years, yearlings also fed over winter to maintain weight • Earlier calving = more feeding Grassland Society of Southern Australia Inc

Profit driver: Time of calving Grassland Society of Southern Australia Inc

3 calving dates tested 8000 8 15 Aug 7000 6 6000 Green 5000 15 Jul 15 Sep pasture 4 4000 (tonnes 3000 Dry Matter 2 2000 /ha) 1000 0 0 Jan Mar May Jul Sep Nov Grassland Society of Southern Australia Inc

Time of calving: yearling vs weaner requirements 8000 8 Calving 7000 date? 6 6000 Pasture Pasture Green 5000 pasture quantity quality 4 4000 (tonnes 3000 Dry Matter 2 2000 /ha) 0.75 t DM/ha 1000 0 0 Jan Mar May Jul Sep Nov Grassland Society of Southern Australia Inc

Weaners: heavier sale weights from earlier calving and low stocking rates Weight of weaner steers at sale 350 300 Average Calving LW date 250 (kg) Jul Aug 200 Sep 150 0 0.3 0.6 0.9 1.2 1.5 1.8 cows/ha

Yearlings: reaching target (400kg) more likely at low stocking rate 100% 90% cows/ha 80% Probability 0.3 60% Probability 58% 0.9 40% 27% 20% 1.5 0% 200 300 400 500 600 Live weight at sale (kg) July calving

Calving date: little effect on reaching yearling target weight Calving 100% date 80% Jul Probability 60% Probability Aug 40% Sep 20% 0% 200 300 400 500 600 Live weight at sale (kg) 0.9 cows/ha

Stocking rate vs Profit (weaners) 400 300 Calving Average $100/ha date gross Jul 200 margin ($/ha) 100 0 0 0.3 0.6 0.9 1.2 1.5 1.8 cows/ha

Calving date vs Profit (weaners) 400 300 $50/ha Calving Average date gross 200 Jul margin Aug ($/ha) 100 Sep 0 0 0.3 0.6 0.9 1.2 1.5 1.8 cows/ha

More beef from higher stocking rates and from yearling systems 400 300 Meat weaner kg LW/ha production yearling 200 (kg LW/ha) 100 0 0.3 0.6 0.9 1.2 1.5 cows/ha July calving

Enterprise vs Profit Yearling systems 400 300 Calving Average date gross 200 Jul margin Aug ($/ha) Sep 100 Weaner systems 0 0 0.3 0.6 0.9 1.2 1.5 1.8 cows/ha

Enterprise (same stocking rate and calving date) Yearling systems 400 $100/ha 300 Calving Average date gross 200 Jul margin Aug ($/ha) Sep 100 Weaner systems 0 0 0.3 0.6 0.9 1.2 1.5 1.8 cows/ha

Enterprise (stocking rate and calving optimised) Yearling systems 400 $45/ha 300 Calving Average date gross 200 Jul margin Aug ($/ha) Sep 100 Weaner systems 0 0 0.3 0.6 0.9 1.2 1.5 1.8 cows/ha

Key messages Calving dates & Profit Weaner system (April sales): – later calving less profitable Yearling system: – calving dates had little effect on profit – (total amount of supplement high for all dates) Grassland Society of Southern Australia Inc

What has the greatest effect on Profit? Boost to gross margin: 1. Stocking rate 120-180% 2. Enterprise 15-30% 3. Calving date 0-15% Grassland Society of Southern Australia Inc

Stocking rate, profit & risk – What are the downside risks for each system? – What are the opportunities? Grassland Society of Southern Australia Inc