20 September 1996

Costs must be cut for profits

CARCASS prices of £1.80/kg for steers, and average costs of £1.82/ carcass kg means Irish beef producers are desperate to cut costs and ensure at least some profit.

Latest suckler farm report from Irish advisory service Tegasc concludes that fixed costs, silage quality, concentrate cost and tighter calving spread are areas where considerable improvement can be made, said Teagasc cattle specialist Tony Pettit.

"Machinery often accounts for 40%, IR£94/ha, of fixed costs, and that should be critically assessed in the current financial climate."

Winter feeding accounts for a third to three-quarters of total feed costs, and gains could be made by better grass and silage management, he said.

"A 50g/kg increase in silage D-value will cut costs by £35 an animal sold, while reducing the cost of making silage by £1/t is worth £9 an animal sold."

Extending the grazing season and reducing concentrate cost by £20/t would add a further £17 a head and £12 a head, respectively, according to Mr Pettit. &#42


&#8226 Winter feed costs could be reduced by £12 a head using extended grazing which reduces silage needs by 1t.

&#8226 Improving silage quality (D-value) by 5% will cut costs by £35 a head.

&#8226 Machinery costs, at 40% of fixed costs, are too high.

&#8226 Grass potential is 970kg carcass/ha, compared with only 553kg currently.

&#8226 Feed cost/kg liveweight gain is £1.04/kg indoors, falling to only 21p/kg at grass.