agri benchmark beef conference 2007
DESCRIPTION
Agri Benchmark Beef conference 2007. By Pieter Taljaard and André Jooste. Outline. Introduction and background Co-workers and countries Agri-benchmark Methodology RSA representative data Results Conclusions. Introduction & Background. International farm comparison analysis - PowerPoint PPT PresentationTRANSCRIPT
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
ByPieter Taljaard and André Jooste
Agri Benchmark Beef conference Agri Benchmark Beef conference 20072007
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
OutlineOutline
• Introduction and background• Co-workers and countries• Agri-benchmark Methodology• RSA representative data• Results• Conclusions
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Introduction & Introduction & BackgroundBackground• International farm comparison analysis
– Beef finishing (feedlots)– Cow-calf production system
• Collaboration in RSAUP - NAMC –UFS
• NAMC (Membership sponsor)• UFS (Beef)• UP (Cash crops)
– Dairy (MPO)
• Overall objectives – competitiveness and potentials of regions
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Introduction & Introduction & BackgroundBackground
• 2007 Beef conference and pre-conference training– Braunschweig, Germany– New countries: RSA, Australia and India– Beef finishing - 16 countries, 38 farms
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Participating countriesParticipating countries• Western Europe
– Austria– France– Germany– Italy– Ireland– Spain– Sweden– UK
• Eastern Europe– Hungary– Poland
• North America– Canada– USA
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Participating countriesParticipating countries• South America
– Argentina– Brazil
• Asia & Oceania– Australia– China– India
• Africa– South Africa
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Co-workersCo-workers
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Agri-Benchmark (AB) Agri-Benchmark (AB) methodologymethodology
• AB SOP– Select regions and locations– ID prevailing production system– Determine farm size of typical farm(s)– Data collection (2007) and updating
(2008)• Standard questionnaire (pannel of farmers)
– Farm data - Typical or representative figures
• Prices for inputs and outputs
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
RSA representative dataRSA representative data
• 1 Beef finishing (feedlot)– One time standing capacity 25 000
head (i.e. +/- 75 000 head annual through-put)
• 3 Cow-calve farms– Vryburg (250 cows)– Heibron (300 cows)– Howick (200 cows)
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Beef finishingResults - Beef finishing
Share of market returnShare of market return
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
AT-2
5FAT
-35
AT-1
20AT
-150
T
DE-2
30DE
-260
DE-2
80DE
-800
DE-5
25T
FR-4
5FR
-70
FR-9
0AFR
-90B
ES-6
30ES
-940
ES-6
790
IT-91
0IT-
2880
T
IE-18
5
UK-3
5UK
-90
UK-9
8
SE-1
40SE
-230
T
PL-1
2PL
-30
CA-9
600
US-7
200
AR-8
00AR
-220
0
BR-1
40BR
-240
BR-3
40BR
-600
CN-3
00CN
-940
AU-2
7K
ZA-7
5K
Other farm enterprises
Dairy
Cow calf
Cash crops
Beef finishing
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Beef finishingResults - Beef finishingMarket returns and coupled government payments Market returns and coupled government payments
2006 2006 (US$ per 100 kg carcass weight)(US$ per 100 kg carcass weight)
0
50
100
150
200
250
300
350
400
450
500
AT-2
5FAT
-35
AT-1
20AT
-150
T
DE-2
30DE
-260
DE-2
80DE
-800
DE-5
25T
FR-4
5FR
-70
FR-9
0AFR
-90B
ES-6
30ES
-940
ES-6
790
IT-9
10IT
-288
0T
IE-1
85
UK-3
5UK
-90
UK-9
8
SE-1
40SE
-230
T
PL-1
2PL
-30
CA-9
600
US-7
200
AR-8
00AR
-220
0
BR-1
40BR
-240
BR-3
40BR
-600
CN-3
00CN
-940
AU-2
7K
ZA-7
5K
Whole farm payments Organic and environmental payments Livestock payments Crop paymentsBeef price
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Beef finishingResults - Beef finishingPurchase prices (US$ per 100 kg live weight)Purchase prices (US$ per 100 kg live weight)
0
100
200
300
400
500
600
700
800
900
AT-2
5FAT
-35
AT-1
20AT
-150
T
DE-2
30DE
-260
DE-2
80DE
-800
DE-5
25T
FR-4
5FR
-70
FR-9
0AFR
-90B
ES-6
30ES
-940
ES-6
790
IT-9
10IT
-288
0T
IE-1
85
UK-3
5UK
-90
UK-9
8
SE-1
40SE
-230
T
PL-1
2PL
-30
CA-9
600
US-7
200
AR-8
00AR
-220
0
BR-1
40BR
-240
BR-3
40BR
-600
CN-3
00CN
-940
AU-2
7K
ZA-7
5K
Calf price Weaner price Backgrounder price
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Beef finishingResults - Beef finishingTotal cost by cost items (US$ per 100 kg carcass Total cost by cost items (US$ per 100 kg carcass
weight)weight)
0
200
400
600
800
1000
1200
AT-2
5FAT
-35
AT-1
20AT
-150
T
DE-2
30DE
-260
DE-2
80DE
-800
DE-5
25T
FR-4
5FR
-70
FR-9
0AFR
-90B
ES-6
30ES
-940
ES-6
790
IT-9
10IT
-288
0T
IE-1
85
UK-3
5UK
-90
UK-9
8
SE-1
40SE
-230
T
PL-1
2PL
-30
CA-9
600
US-7
200
AR-8
00AR
-220
0
BR-1
40BR
-240
BR-3
40BR
-600
CN-3
00CN
-940
AU-2
7K
ZA-7
5K
Total capital cost Total land cost Total labour cost Non-factor costs incl. depreciation
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Beef finishingResults - Beef finishingNon-factor costs by animal purchases and other cost Non-factor costs by animal purchases and other cost
(US$ per 100 kg carcass weight)(US$ per 100 kg carcass weight)
0
100
200
300
400
500
600
700
AT-2
5FAT
-35
AT-1
20AT
-150
T
DE-2
30DE
-260
DE-2
80DE
-800
DE-5
25T
FR-4
5FR
-70
FR-9
0AFR
-90B
ES-6
30ES
-940
ES-6
790
IT-9
10IT
-288
0T
IE-1
85
UK-3
5UK
-90
UK-9
8
SE-1
40SE
-230
T
PL-1
2PL
-30
CA-9
600
US-7
200
AR-8
00AR
-220
0
BR-1
40BR
-240
BR-3
40BR
-600
CN-3
00CN
-940
AU-2
7K
ZA-7
5K
Animal purchases Other
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Beef finishingResults - Beef finishingNon-factor costs excluding animal purchases (US$ per Non-factor costs excluding animal purchases (US$ per
100 kg carcass weight)100 kg carcass weight)
0
50
100
150
200
250
300
350
400
AT-2
5FAT
-35
AT-1
20AT
-150
T
DE-2
30DE
-260
DE-2
80DE
-800
DE-5
25T
FR-4
5FR
-70
FR-9
0AFR
-90B
ES-6
30ES
-940
ES-6
790
IT-91
0IT-
2880
T
IE-18
5
UK-3
5UK
-90
UK-9
8
SE-1
40SE
-230
T
PL-1
2PL
-30
CA-9
600
US-7
200
AR-8
00AR
-220
0
BR-1
40BR
-240
BR-3
40BR
-600
CN-3
00CN
-940
AU-2
7K
ZA-7
5K
Other inputs
Other inputs beef enterprise
Insurance, taxes
Vet & medicine
Buildings (maintenance, depreciation)
Fuel, energy, lubricants, water
Machinery (maintenance, depreciation, contractor)
Feed (purchase feed, fertiliser, seed, pesticides)
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Beef finishingResults - Beef finishingShort and medium term profitability (US$ per 100 kg Short and medium term profitability (US$ per 100 kg
carcass weight)carcass weight)
-400
-300
-200
-100
0
100
200
AT-2
5FAT
-35
AT-1
20AT
-150
T
DE-2
30DE
-260
DE-2
80DE
-800
DE-5
25T
FR-4
5FR
-70
FR-9
0AFR
-90B
ES-6
30ES
-940
ES-6
790
IT-91
0IT-
2880
T
IE-18
5
UK-3
5UK
-90
UK-9
8
SE-1
40SE
-230
T
PL-1
2PL
-30
CA-9
600
US-7
200
AR-8
00AR
-220
0
BR-1
40BR
-240
BR-3
40BR
-600
CN-3
00CN
-940
AU-2
7K
ZA-7
5K
Short-term: Total returns less cash cost
Medium-term: Total returns less cash cost+depreciation
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results – Cow-calf farmsResults – Cow-calf farms
Share of market returnShare of market return
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Cow calf Beef finishing Cash crops Other farm enterprises (forestry, manure, etc.)
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Weight at weaning per head (kg live weight per head)Weight at weaning per head (kg live weight per head)
0
50
100
150
200
250
300
350
400
450
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Male Female Av. male & female
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Weaner prices per head (US$ per head)Weaner prices per head (US$ per head)
0
200
400
600
800
1000
1200
1400
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Male Female Av. male & female
R2800/head
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Weaner prices per 100kg live weight (US$ per 100kg Weaner prices per 100kg live weight (US$ per 100kg
live weight)live weight)
0
50
100
150
200
250
300
350
400
450
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Male Female Av. male & female
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Total returns (US$ per 100 kg live weight sold)Total returns (US$ per 100 kg live weight sold)
0
100
200
300
400
500
600
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Government payments
Weaner and transfer to beef receipts
Breeding livestock receipts Cull animals and slaughter receipts
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Total cost by factor and non-factors costs (US$ per 100 Total cost by factor and non-factors costs (US$ per 100
kg live weight sold)kg live weight sold)
0
100
200
300
400
500
600
700
800
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Total capital cost
Total land cost
Total labour cost
Non-factor costs incl. depreciation
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Labour intensity (hours per suckler-cow and year)Labour intensity (hours per suckler-cow and year)
0
10
20
30
40
50
60
70
80
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40AU
-190
0
ZA-2
00ZA
-250
ZA-3
00
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Total returns and costs by cash and non-cash costs Total returns and costs by cash and non-cash costs
(US$ per 100 kg live weight sold)(US$ per 100 kg live weight sold)
0
100
200
300
400
500
600
700
800
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Opportunity cost Depreciation Cash cost Weaner + transfer + cull + breeding + government payments Weaner + transfer to beef + cull animals + breeding Weaner and transfer to beef receipts
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Short and medium term profitability (US$ per 100 kg Short and medium term profitability (US$ per 100 kg
live weight sold)live weight sold)
-100
-50
0
50
100
150
200
250
300
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Short-term: Total returns less cash cost
Medium-term: Total returns less cash cost+depreciation
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Results - Cow-calf farms Results - Cow-calf farms Whole farm profitability (‘000 US$ per farm)Whole farm profitability (‘000 US$ per farm)
-200,000
-150,000
-100,000
-50,000
0
50,000
100,000
150,000
200,000
250,000
300,000
AT-2
5CAT
-30
DE-1
100
DE-1
400
FR-6
5FR
-80
FR-8
5
ES-9
0ES
-160
IE-2
5
UK-4
0UK
-60
SE-1
50
HU-1
50T
HU-8
80T
CA-1
70
US-2
40US
-500
AR-7
30AR
-130
0
BR-4
00BR
-107
0
CN-2
AU-5
40 AU-
ZA-2
00ZA
-250
ZA-3
00
Net cash farm income (NCFI)
Farm income (profit)
+ 1,125,604+ 1,102,136
+ 727,126+ 384,322
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
20082008
• Annual update – expand• Local network (regional)• Emissions benchmarking• Quarterly price info• Trade profiles• Beef conference (Brazil)
– Bio-energy and beef production– SA farm story (case farm)
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
ConclusionConclusion
• Larger representation in SA• Useful info• Further analysis
– Comparative advantage analysis
• Involvement of industry
AGRICULTURAL ECONOMICSAGRICULTURAL ECONOMICS
Thank you!Thank you!