Production Efficiency more Important than chasing the Top Market Price

3rd Aug 2011

Gavin Hill

Too many beef producers are continuing to chase an illusionary “crock of gold” by taking cattle to higher sale weights to achieve a high gross price rather than concentrating on overall efficiency, SAC beef specialist, Gavin Hill, told a seminar at Scotland’s Beef Event.

“Breeders are losing out by taking stores on to 18-20 months of age before selling them and piling on feed costs,” said Mr Hill. “Finishers then have to take them on to 28-30 months before they are ready for slaughter. The cattle may make £1200 or £1300 a head but it is an inefficient system and many producers are failing to count the cost of getting them to those higher weights.”

A recent report from QMS highlighted that one-in-five cattle are failing to meet factory specifications because they are overweight or overfat which is costly for processors and results in penalties for farmers.

The increase in prime beef cattle prices in recent months was welcome, said Mr Hill, but costs were escalating just as quickly. Prices had risen by 63% over the past seven years but variable costs were up 44% and fixed costs 14% higher.

“Beef production has to become more efficient,” he said. “Breeders should be aiming to sell stores at a year old and finishers selling prime cattle for slaughter at 18-20 months. There is too much emphasis on trying to top the market.”

Breeders had to ask themselves if it was more profitable to sell 80 calves for every 100 cows put to the bull at £950 a head or 92 calves at £100 a head less. Reducing the amount of barley fed to cattle may not be the most efficient way of reducing costs even with barley at £160/tonne compared with £100 previously.

The emphasis had to be on the type of suckler cow with good maternal traits and the ability to consume bulk forage rather than big, high maintenance cows. Put to the right terminal sire, these cows would still produce a highly marketable calf.

The decline in the Scottish suckler herd seems to have reversed and Mr Hill suggested that smaller herds were now more manageable and efficient.

“The loss of the suckler cow premium and the high price of cull cows compared with the over thirty month slaughter scheme has encouraged producers to get rid of older and less productive cows in recent years,” said Mr Hill.

“These cows are being replaced by genetically improved heifers which is leading to improvements in efficiency.”

It was vital that some form of encouragement to production was maintained in the next round of reforms of the Common Agricultural Policy.

“Many beef breeders are only surviving because of the Single Farm Payment and are wondering why they are continuing to keep cows when they don’t make a profit,” said Mr Hill. “They are only holding on to their cows in the hope that direct support will be available to encourage production under the next CAP regime.”

Meat processor, Alan McNaughton, site director at McIntosh Donald’s Portlethen plant, also highlighted fatness, weight and age as the “key wastes” in beef production.

Over the past five years, 17% of steers slaughtered at the company’s plant classified 4H or worse for fat and 32% for heifers.

“This overfatness is a waste to both the processor and the farmer, especially at the current price of cereals and straw,” he said. “It also shows how important it is to treat heifers differently from steers.”

Average carcase weight was 350kg but carcases over 400kg resulted in problems in marketing higher value cuts.

“The most interesting fact is that some cattle of the same breed are reaching those higher weights at about 20 months but many are no heavier after almost 30 months,” said Mr McNaughton. “This points to huge inefficiencies in the store period with too many cattle not being pushed hard enough.

“Some would advocate that creep feeding of calves is money well spent and fully recovered. We can see the true potential of most breeds and crosses from breeder-finishers who are achieving good liveweight gains at a young age and marketing at 18 – 22 months of age.”

Too many cattle were being moved too often, resulting in extra costs and higher slaughter weights, which was detrimental to eating quality.

“Tenderness is the one attribute that our customers want above all else and it would certainly help if more cattle were marketed at a younger age, preferably under 24 months,” he said.

Harbro technical director, Willie Thomson, said feed conversion efficiency was the key to profitable beef production. Producers should aim for young, fast growing cattle, high quality diets, good health and the best genetics.

“It takes 50% more energy to produce 1kg of weight gain at 600kg compared with 300kg,” he pointed out. “Fast growing animals gaining at 1.5kg/day also need a third less dry matter for kg/deadweight than those gaining at only 0.75kg/day.”

Feed costs, even at current higher cereal prices, could also be reduced by achieving higher output with the cost of each kg of gain working out at £2.50 for animals gaining at 1.5kg/day and achieving a feed conversion ratio of 6:1 compared with £3.50 for animals gaining at only 0.75kg/day and a FCR of 9.3:1.

Bio-Best managing director, Paul Burr, said Scotland still had a long way to go to eliminate major diseases having an adverse effect on production and profitability.

The best option to avoid bring disease on to the farm was to adopt a closed herd policy but if this was not possible, farmers should ensure that they only buy breeding stock from known sources or accredited herds. Bought-in animals should be isolated and tested before joining the herd.

“Buying in poses the biggest threat and having a closed herd is the best way of controlling infectious diseases,” said Mr Burr. “Paying for prevention is always better and cheaper than paying for a cure.”

published with permission from: Farm North East

latest news

Royal Ulster Show
Taking top honours in the British Blue championship at Balmoral was Andrew Craig with his heifer Woodview Frarlein, a Barbier daughter out of Woodview Britney. [results]

Carlisle Annual Spring Show & Sale 2012
280 British Blues on Friday 19th & Saturday 19th May 2012. [catalogue]

Dispersal of the College Valley herd at Carlisle on Friday 25th May. [catalogue]

Strong demand for quality at Chelford
“Quality” was the name of the game when the British Blue bulls went through the ring on Saturday 3rd March. [report]

Get your free copy of Acrobat Reader to view PDF documents on this site.