16 August 2002

What Beefplan top third did right…

PURCHASING winter finishing stores at the right price and maximising subsidy entitlement are key factors differentiating top performers from the average in MLCs latest Beefplan results.

Top third performers selling winter finished stores this spring made gross margins averaging £1587/head compared with £81/head for average Beefplan finishers in this category. Top third producers also managed to claim £29 more subsidy, according to MLC beef economist Duncan Sinclair (see table).

"Top third producers were likely to be more shrewd at acquiring cattle at a more favourable price than the average. They were also making a higher proportion of second Beef Special Premium claims and were possibly eligible for the highest rate of Extensification Premium."

Difference in subsidy claims between top third and average producers for winter finished suckled calves was similar to winter finished stores at £28/head, compared with a difference of only £10/head between top third and average bull finishers.

Gross margins for top third producers finishing young bulls was £267/head, £73/head better than average producers. "Top third producers saved £15/head on calf rearing and £10/head on straw. They also had higher daily gains and a shorter feeding period," says Mr Sinclair.

Compared with last years Beefplan results, average variable costs were £40/head higher for young bulls, says Mr Sinclair. "Bedding costs make a significant contribution to this. They worked out at £43/head this year compared with £28/head last year. Milk replacer and concentrate costs had also increased."

Overall, Mr Sinclair believes producers achieved a creditable performance, given the problems facing them. "With auction markets closed for many months, producers faced marketing delays, had less flexibility over timing of marketing and many acquired cattle later than usual."

Looking ahead, he believes margins will remain around current levels due to lower cereal and straw prices and increased subsidy payments. &#42

"Store cattle prices were strong earlier this year, but this will be balanced by lower cereal prices. Straw prices are also likely to be more favourable for beef producers. There will also be an increase in BSP and Slaughter Premium rates."

BEEF FINISHING RETURNS

Large variation.

Subsidy claims important.

Similar next year?

MLC Beefplan Costing Results 2001/2002

System finishing winter finishing winter finishing young bulls suckled calves stores

average top third average top third average top third

Gross margin (£/hd) 194 267 156 206 81 158

Output (£/hd) 534 567 325 357 204 283

(less calf cost)

Subsidy (£/hd) 158 168 143 171 100 129

Variable costs (£/hd) 340 300 169 151 123 125

Daily gain (kg/hd) 1.17 1.25 1.23 1.25 0.8 0.86

Feeding period (days) 431 421 185 183 170 191

MLCBeefplan costing results 2001/2002

System Finishing Winter finishing Winter finishing

young bulls suckled calves stores

average top average top average top

third third third

Gross margin (£/hd) 194 267 156 206 81 158

Output (£/hd) 534 567 325 357 204 283

(less calf cost)

Subsidy (£/hd) 158 168 143 171 100 129

Variable costs (£/hd) 340 300 169 151 123 125

Daily gain (kg/hd) 1.17 1.25 1.23 1.25 0.8 0.86

Feeding period (days) 431 421 185 183 170 191

TBUPDATE

Since our report last week, a bovine TB test at William Baileys Wilts dairy unit has revealed six more reactors and one inconclusive cow, which will all have to be culled.

"Two of these were animals brought in to replace some of those already lost to TB this year," he says. The herd, which started the year with 150 cows, has now lost 66 animals this year through TB.

"We will now be closed down until at least Christmas, which will make it a whole year." Mr Bailey is still trying to find out whether badgers tested on the farm as part of the Krebs trial have TB.