Top flocks are bucking trend to lower incomes
By Richard Allison
SHEEP flock incomes have fallen sharply over the past year, but top performing flocks are achieving margins up to 48% higher than average by managing for higher lamb output.
Specialist sheep units in less favoured areas have seen a 79% fall in farm income during 2001/2002 compared with the previous year, according to figures recently published by DEFRA. Over the same period, direct livestock subsidy payments declined by 20% for sheep producers.
This cut in farm income is not surprising with sheep annual premiums being halved to £5.48 for 2001, says MLC senior economist Jane Connor. "Returns from lamb sales were also down, due to a lack of exports and lower prices during the foot-and-mouth outbreak.
"But there is scope for improving financial performance by changing flock management, so helping to reduce the impact of lower sheep premium payments."
MLC Flockplan figures show top performing flocks achieving up to 48% higher gross margins than average. She believes this was mainly due to better lamb survival rates and higher carcass weights. "Virtually all the difference in margins for Welsh hill flocks was accounted by superior lamb rearing rates."
One way to improve lamb output with an existing breed is to use better quality sires for growth rates and conformation, says head of ADAS Redesdale, Northumberland, Ray Keatinge. "Pure hill breeds are not suited to producing quality lamb carcasses.
"Breeding from superior Scottish Blackface ewes and rams within the nucleus flock at Redesdale has resulted in a 1.5kg increase in weaning weight and improved carcass conformation."
But Alastair Davy of the Hill Farming Initiative, who farms in Swaledale, North Yorks, is concerned with the growing move for breed substitution in the hills. "All it takes is a bad winter like 10 years ago and these breeds will suffer severe lamb losses, as they have less wool."
Another problem is lack of hefting ability. Developing a breed with improved carcass conformation which is hardy and hefted would take many years and cash the industry has not got, says Mr Davy.
But Ann Walker of Kisdon Research, North Yorks, questions whether hefting would be a problem. There are other breeds, such as North Country Cheviots, with better conformation, being successfully managed on large areas overseas. She questions whether these breeds have a poorer hefting instinct.
With lamb survival, management tends to be more limiting than breed, says Mr Keatinge. "At Redesdale, lamb output in 2001 was 179% for Mule ewes and 129% for the hill flock, placing us in the top third of flocks."
This is achieved by managing ewe body condition and good nutrition of ewes. He believes many hill and upland flocks can benefit from using more technology, such as pregnancy scanning, to fine-tune breeding."
Recent MLC figures also show most producers reduced variable costs last year, despite problems caused by F&M, says Mrs Connor. This was mainly due to a fall in purchased feed costs by better use of grass and forage.
Mr Keatinge agrees that better grass management is a key area for improving flock performance. "Boosting grass production improves lamb performance and allows more stock to be carried. Delaying lambing to May can also maximise grass use on some farms."
Labour is another key cost. Changes which reduce labour inputs can improve margins, as upland and hill units generally have a high labour input a ewe, says Mr Keatinge.
"Another option to explore is reducing stocking rates and taking advantage of agri-environment schemes. This would cut variable costs, such as feed and fertiliser and some overheads." *
Average Top third
Lowland* 22.79 33.58
Upland* 33.57 45.10
Hill (Wales only) 25.10 30.00
*Spring lambing flocks.