SCP offers profit lift for heifer finishers
SCP offers profit lift for heifer finishers
By Marianne Curtis
FOR suckler producers who can finish stock, being able to make up to 40% of total suckler cow premium (SCP) claims on heifers from July 1 offers a chance to boost income, says Signet beef consultant Geoff Fish.
But many misunderstand numbers of heifers they can claim on. "Most think 40% means 40 heifers for a herd of 100. But if you have 100 cows eligible for SCP, provided you have quota, you can make up to 66 heifer claims – 40% of a total claim on 166 animals."
The new system makes heifer finishing a more attractive option for suckler herds than it has been in recent years, says Mr Fish. "Heifer store prices are poor. It may make sense to finish these animals providing you have the facilities and can avoid exceeding extensification premium stocking rate limits."
For top tier extensification farms, with a stocking rate of less than 1.4 LU/ha, premium claims on heifers will equal £190 including SCP, extensification premium (EP) and national envelope, says Mr Fish.
"This is greater than for a steer on a full EP farm, where the premium claim will be in the order of £140, assuming only one beef special premium claim is made."
With this is mind, some producers have chosen to sell steers as stores and finish heifers this year, says Mr Fish. "Where housing or extensification rules limit a farms finishing capacity, some sold steers because they were making a good price, keeping heifers believing they can make more through finishing them.
"Other advantages are that heifers are worth less than steers in the beginning, require less feed and finish efficiently, if they are not allowed to become too fat."
As heifers must be at least eight months old when SCP claims are made and remain on the farm for at least six months afterwards, typical farms opting for finishing will be spring calving with Continental crosses destined for slaughter at two years old, says Mr Fish.
"The secret is to grow heifers steadily through their first winter at no more than 0.75kg a day on silage and 1kg of concentrates. This allows them to develop size and frame and stops them from becoming too fat too early."
One producer deciding to increase the number of claims on heifers is Farmer Focus contributor Peter Delbridge. Running 60 cows, he plans to cut cow numbers, maximising SCP claims on finishing heifers. "For years we have given heifers away at store markets. It makes no sense to sell heifers to finishers who cant claim SCP on them when I can."
Some in the industry are critical about 40% of SCP claims being allowed on animals which may never produce a calf, but Mr Delbridge has no such qualms. "I am worried the British beef industry will shrink, but it is like rugby – you play the rules the way the referee interprets them."
Increasing heifer SCP claims, but maintaining a productive herd of 120 cows, the same size as previously, will be Dorset-based suckler producer Nick Harding. "About 30% of SCP claims will be on heifers destined either as replacements or for finishing and I will lease quota to achieve this." Provided quota can be leased in at £70, the exercise will be worthwhile, he believes.
But buying quota is worth considering, particularly for those on the highest extensification tier, says Mr Fish. "If you can buy quota for £200 a unit, and claim £190 an animal this year and next, even if the scheme changes the year after it will have been worthwhile."
But Farmer Focus contributer Gordon Capstick who has 100 suckler cows in Cumbria is more sceptical. "We still havent received the balance of SCP for 2001. Whether leasing or buying, it is a long time for money to be laid out, particularly when borrowed, with uncertainty about when it will be repaid." *
• Heifer finishing opportunities.
• Consider leasing/buying quota.
• Care over finishing system.