Increasing Suckler Beef Profitability

IRELAND - The profitability of suckler beef production in Ireland can be increased significantly by reducing production costs and increasing farm output.

16 June 2011

3 minute read

Europe

The adoption of key technologies in relation to grassland management and suckler cow type is key in achieving these objectives. At present within the Irish suckler herd only eight out of every 10 cows produce a calf per year. This in combination with poor grassland management is significantly reducing profitability at farm level.

The Derrypatrick herd, in Teagasc Grange was set up as a stand alone, high profit herd, demonstrating optimal breeding, grassland management and technical efficiency. An Open Day took place in Grange yesterday, Wednesday, 15 June outlining all the details of this herd’s performance over the last two years.

The Derrypatrick herd has shown that higher stocking rates, (2.9 livestock units per hectare) combined with good management can deliver higher gross margins per hectare - €850 per hectare gross margin projected for 2011. This in combination with a suckler cow with excellent fertility and high milk potential crossed with a terminal beef sire with high beef characteristics will be the key driver for achieving a gross margin in excess of €1,000 per hectare - the target set for the Derrypatrick herd.

This is well above the results from the National Farm Survey (2009) and the level in the eProfit Monitors completed by farmers which show a gross margin of €113 and €368 respectively. Higher stocking rate is the key in achieving higher output levels per hectare and is the foundation for significant increases in margin.

Speaking at the Open Day in Grange, Head of the Teagasc Animal Production and Grassland programme, Dr Pat Dillon said: “The Derrypatrick herd is on track to deliver on its targets. A number of important lessons have already been learnt in the first two years, in relation to cow type and bull fertility. A high stocking rate in combination with the correct genetics has the potential of achieving a carcass output of 650 kg/ha/year. This will be the real driver for improving financial performance on suckler farms and lifting gross margins. This higher stocking rate can only be sustained by growing and utilising more grass, which the team in Grange has achieved.”

In this calving season there was the equivalent of 91 live calves born per 100 cows. Mortality at 9 per cent was higher than anticipated due to difficulties that arose with purchased in-calf animals where the mortality rate was higher.

In calculating the gross margin a higher replacement rate was used to take account of the number of non-pregnant cows in 2010, the calf mortality rate of 9 per cent, and a 12 per cent rate of caesarean sections. The net impact of these factors is to reduce the expected gross margin in 2011 by 18 per cent to €856/ha, assuming a beef price of €3.25/kg carcass (current price €3.60/kg)

Teagasc Beef Enterprise Leader, Eddie O Riordan said:” The Limousin x Friesian cow is the best performing cow. The calves from these cows were heavier at weaning due to higher levels of milk production. Over a 230 day pre-weaning period, calves from the Limousin x Friesian cows were 48 kg heavier than calves from Charolais × Limousin cows and about 26 kg heavier than the calves from the other two cow types being evaluated.“

Teagasc beef specialist Aidan Murray provided the farmers attending the Open Day with an update on the Teagasc/Irish Farmers Journal BETTER Farm programme. He showed that the target stocking rate on the BETTER Beef Farms is set at 2.2 LU /ha. The stocking rate on these farms has increased from 1.85 LU/ha to 2.02LU/ha in 2010. This is reflected in the average gross margin increasing on the BETTER farms from €368 per hectare at the start of the programme in 2008, to €563 per hectare in 2010.