Productivity and product quality

James Rowe

Graham Centre Sheep Forum June 2013

The map

• What is a CRC?

• Importance of productivity & quality

• Genomics for fast, well-balanced gain

• Meat quality

• Wool quality measurement for next-to-skin

• Sheep and their management

• Extension application

Sheep CRC 2007 to 2014

21 Participants – big ticket industry opportunity

$ 35.5 million from Commonwealth

$ 10 m MLA, $10 m AWI, $0.7 m AMPC

$ 70 m NSW DPI, UNE, … in-kind

Extension application 2014 to 2019

35 Participants – building on achievements

$ 15 million from Commonwealth

$ 10.5 m MLA , AMPC & WoolProducers Australia

$ 35 m NSW DPI, UNE, … in-kind

From: Fisher 2013.

Terms of trade for farmers have declined by

39% 1981 - 2011

Sheng, Mullen and Zhao (2012) From Fisher 2013

Contribution of productivity to GVP

From: Nossal and Sheng 2013.

Labour price index (‘100’ in 1961)

From: Nossal and Sheng 2013.

Labour productivity in agriculture4.6% less labour/year

Average age of farm managers/owners

Data source: ABARES (2013) From Fisher 2013

Sheep-4.4/year

Cattle1.4/year

Cropping5.1/year

50

100

150

200

250

300

1990 1995 2000 2005 2010

Sheep 'e

quiv

ale

nts

' (m

illio

n)

Changing land use based on

– ‘Sheep equivalents’ (from ABARE 2010)

Wool and sheep meat – gross value (ABARE 2010)

Wooly = -138 x

Lamby = 71 x

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

1990 1995 2000 2005 2010

Real g

ross v

alu

e o

f p

rod

ucti

on

(2

009-1

0 A

$m

)

Wool and sheepmeat

in world markets

Quality and Price

Pork, 41.5

Chicken, 31.1

Beef , 24.2

Sheep, 3.2

Sheepmeat as % of meat production(FAO Database – 2009 figures)

Wool, 1.6

Cotton, 33.0

Man made, 65.3

Wool as % of world Fibre Production(Oerlikon Report 2010)

Wool -4 c/kg clean

Wheat + $1/t

Beef + 1 c/kg carcase

0

200

400

600

800

1000

1200

1400

1990 1995 2000 2005 2010

Real p

rices o

f ag

ricu

ltu

ral p

rod

ucts

(a

dju

ste

d t

o 2

00

9-1

0 )

Real price of Wool, Beef and Wheat(ABARE 2010)

Lamb + 12 c/kg carcase

Wool -4 c/kg clean

Mutton + 12 c/kg carcase 0

200

400

600

800

1000

1200

1400

1990 1995 2000 2005 2010

Real p

rices o

f ag

ricu

ltu

ral

pro

du

cts

(a

dju

ste

d t

o 2

009

-10 )

Real price of Wool, Lamb & Mutton(ABARE 2010)

Mutton -5.2 c/kg/year

Lamb -9.5 c/kg/year

+12.6 c/kg

+12.3 c/kg

0

100

200

300

400

500

600

700

1950 1960 1970 1980 1990 2000

Pri

ce

ad

jus

ted

to

20

05

(c

/kg

)

Turnaround for lamb and mutton(ABARE – special data extract 2005, Rowe, 2005)

Eating quality R&D (Pethick et al. 2008)

0

20

40

60

80

100

120

140

160

Count

0 2 4 6 8 10 12

Shear Force (kg)

0

10

20

30

40

50

60

70

80

Count

0 2 4 6 8 10 12

Shear Force (kg)

1997/98 retail audit (n=907)

MSA best practise 2007 (n=806)

Before

After

Index of real commodity prices(ABARE Australian Lamb survey 2010)

Lamb production & carcase weight

Source: ABS, MLA forecasts

90 92 94 96 98 00 02 04 06 08f 10f 12f

0

100

200

300

400

500'000 tonnes cwt

15

17

19

21

23

25kg/head

production carcase weight

f = forecast

Increase in carcase weight 1991 - 2010

17 kg to 21 kg in 20 years

200 g per year - every year!! (1.1% p.a.)

At $4/kg = $0.80 per lamb sold per year

$16/lamb over 20 years

0.0

1.0

2.0

3.0

4.0

5.0

6.0

1860 1880 1900 1920 1940 1960 1980 2000

Avera

ge f

leece

weig

ht

(kg/h

ead )

Average fleece weights (1860 to 2010)

1.3% p.a.

0.15% p.a.

0

500

1000

1500

2000

2500

3000

16 18 20 22 24 26 28 30

Price

(c/k

g)

Fibre diameter

Jun-09

Jun-10

Jun-11

Jun-12

May-13

Wool – variable premium for micron

20

40

60

80

100

120

140

1996 1998 2000 2002 2004 2006 2008 2010

Gre

asy w

ool pro

duction

(m k

g)

21 um

22 um

<18.5 um

Changing production by micron (1997 – 2009) (Wool forecasting Committee April 2010)

Productivity gains essential• particularly labour efficiency

Quality matters • wool and sheepmeat niche markets

Priorities for the sheep industry

Comparison of Selected and Unselected

Broilers at 42 Days of Age

Unselected 1957 control

Selected 2012 pedigree broiler

Source: Aviagen

Value of cumulative gain – 7 yearsV

alu

e o

f ge

ne

tic g

ain

$/e

we

Time (year)

$2.00/ewe per year$0.70/ewe per year

$4.90

$14.00

Rate of genetic gain

=(Accuracy x Intensity x Variation)

Generation interval

Accuracy of predicting genetic merit

Pedigree

Performance

Genomic

Genetic Merit

DNA: building blocks of life

DNA code shows subtle differences between individuals:

The full ‘chain’ 3 billion letters

Less than 0.5% different (about 5 million SNPs)

The basis of genetic variation

The technology – identifying SNPs

50,000 SNPs on a chip – 50 k SNP chip

Reads each SNPs as 0 or 1

New ways to estimate breeding values

18 Organisation

5 Abattoirs

9 laboratories

75 researchers

>150 traits measured

> 5 Million data entries

>10,000 DNA profiles

End user delivery

for 70% of Terminal rams

for 35% of Merino rams

End user involved

in design specification

Sheep Genetics

Stud Ram Breeders Measurement Protocols

Select 100 rams/year

For 5 years

8 farms in 4 States

5 Organisations

4,500 ewes/year

5 years

18,000 lambs

AI ProgramLambing records

+ growth

On farm fat/muscle scan

and blood/ DNA samplesShearing

Reproduction of

female progeny

Parasitology

Behaviour

Base

data

joining

records

DNA

Extractio

n

Genotyping

DNA analysis

Meat ProcessorsWool

Laboratory

Fleec

e

data

Carcase

data

Meat analysis

Meat Science

Laboratories

Consumer

testing

Wool data

Reproduction

data

Meat quality

Sheep CRC Information Nucleus Data Base

Genomics DNA predictions

of breeding value

Improved accuracy of

genetic parametersNew traits

Sheep CRC Research Teams

Genetics, Meat, Wool, Reproduction and Parasitology

LAMBPLAN MERINOSELECT• Research Papers

• Technical Reports

• Training programs

Delivery of genetic information to stud ram breeders and

producers to select and use better rams

Impact through increased productivity gain, improved

product quality and easier management

DNA analysis (genomic data) contributes to more accurate estimate of breeding value

Pedigree

Performance

Genotype

Estimated Breeding Values

(ASBV)

Benefits of DNA analysis - genomics

– Selection of younger animals for breeding

• Reduce generation interval

– Predict breeding values for hard to measure traits

• Balance Lean meat yield and Eating quality

• Balance adult wool traits with growth and meat quality

• Horn - Poll

Faster and better balanced genetic gain

Sire variation – consumer tenderness(Pannier et al. unpublished)

40

42

44

46

48

50

52

54

56

58

60

60 65 70 75 80 85

Loin tenderness

Top

sid

e te

nd

ern

ess

97 sires, 745 lambs, 2 cuts per lamb

MSA Lamb mark II

Grade cuts into:

2* - Unsatisfactory

3* - Good every day

4* - Better than every day

5* - Premium

n Ungrade 3* 4* 5*

Mean 1,858 49% 100% 147% 200%

Willingness to pay data(Price relative to 3*, n = number consumers)

Australian consumers - lamb

Sire variation – consumer tenderness

40

42

44

46

48

50

52

54

56

58

60

60 65 70 75 80 85

Loin tenderness

Top

sid

e te

nd

ern

ess

3* 5*4*

Sire variation – consumer tenderness

40

42

44

46

48

50

52

54

56

58

60

60 65 70 75 80 85

Loin tenderness

Top

sid

e te

nd

ern

ess

3*

2*

Wool Next-to-skin Success

Superfine wool which could be worn next to skin

represented a breakthrough for the industry

Challenged myth of ‘itchy, bulky wool’

Created a new generation of consumers willing to pay

premium for natural wool attributes

Gained wool new market share (active wear, kids

wear)

Wool still has challenges in the

next-to-skin category

Perceived garment prickle or

inconsistent hand feel

Consumer mixed feelings about

wearing the fibre directly against

their body

Challenges to new positioning

Inconsistent Quality – a risk for the supply chain

No objective measurement tools to produce next-to-

skin wool products to standardised levels of

comfort and hand feel.

Traditional measurements of quality fail to account

for the effects of processing and finishing

Comfort and handle are based on little more than

human estimation.

Five years of comprehensive

consumer wearer trials

A Total Quality System

A means of objectively

specifying and promoting a

garment on the basis of superior

comfort and consistent handle

CRC Breakthrough: Objective measurement

A new generation of wool next to skin

We can now help retailers /

manufacturers perfect wool

next-to-skin

Securing market share gains

which return real value to

Australian wool growers

Driving demand for Australian

wool and its natural attributes

Supply Chain Demand

Differentiate their products

Develop a new range that out

performs on comfort and superior

handle

Transparently source and supply

product efficiently against clear,

objective specifications for quality and

handle

Consistently provide elite quality

next-to-skin products, not only

between batches, but across

seasons.

Embracing this Total Quality System retailers and manufacturers can:

Measuring comfort - Wearer Trials

0.00

1.00

2.00

3.00

4.00

5.00

6.00

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Prickle

sensation

Trial Periods

Fabric 1 Fabric 34 Fabric 28 Fabric 3

1 2 3 4

21o C 21o C40o C 40o C

The Wool ComfortMeter

Operation of Skin Comfort Meter

Wire

Instrument & Wearer Trials

1

2

3

4

6

7

89

1920

21

2223

24

25

26

27

28

29

31

32

33

34

35

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

0 200 400 600 800 1000

We

are

r s

co

re

Instrument measurement

Assessing Handle Attributes

Smooth – Rough

Soft – Hard

Clean – Hairy

Cool – Warm

Heavy – Light

Tight – Loose

Dry - Greasy

Wool HandleMeter

Force rod

Fabric

Nozzle

Beginning of deformation

Near the end of the extraction

Testing principle

0

0.05

0.1

0.15

0.2

0.25

1 8 15 22 29 36 43 50 57 64 71 78 85 92 99 106

Displacement

Fo

rc

e

a

φ

pDpDp

PPH

h

w

Φ

Curve Parameters

Wool – Comfort and Handle

Fabric description

Prickle sensation

Wearers% LIKE

ComfortMeter

HandleMeter

16.3µm SJW 1.61 81 263 5.5

18.1µm SJW 1.90 80 347 4.8

20.3µm SJW 2.61 47 529 4.5

100% Cotton 1.05 70 175 3.3

Pre-commercial Pilot Trial with AWTA: Building momentum to launch

Real market feedback from

Retailers & Brands

Australian retail feedback

Chinese knitters & spinners

Sheep and their management

1. Well adapted sheep – easy management

- Bred well fed well, Ram breeding guide

- Sheep – The simple guide ..

1. Improved reproductive efficiency- Lifetime Ewe Management

- Managing scanned ewes workshops

2. Better parasite management- ParaBoss – (FlyBoss, WormBoss & LiceBoss)

- Targeted treatment

CRC – Extension 2014-19

Consolidating the transformation

1. Enhanced wellbeing and productivity

- Better decisions less labour

2. Quality based meat value chain

- Cuts-based MSA eating quality

- Larger carcases & yearling Merino

3. Faster and affordable genetic gain

– better accuracy and effective use