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Improving grazing management has a huge effect of herd profit. Every additional 1t of grass DM/ha consumed can increase net profit by more than €100/ha.
The profitability of suckler beef production came under examination at this week’s BEEF 2016 event. Increasing volumes of beef from the expanding dairy herd provides direct competition for suckler-bred animals and may well put domestic beef prices under pressure this winter.
But the messages coming from the event is that there is still a future for suckler herds on well-run units with a high level of technical efficiency and output. Combined, both can return farms a net margin of €400/cow. At the heart of this will be maximising liveweight gain from a grass-based system.
As the cheapest feed available, getting as much high-quality grazed grass into cattle will not only drive liveweight gain, it will improve profitability.
For every additional 1t/ha of grazed grass consumed, net margin can be increased by approximately €105/ha farmed.
On a 40ha farm growing 10t DM/ha, increasing utilisation from 60% to 80% would add an extra €8,400 to net margin. Grass utilisation is increased through better grazing management, which basically means adopting a rotational paddock system.
Could this involve reseeding? Watch Teagasc researcher Philip Creighton discuss grassland reseeding methods at Beef 2016 in our video below:
Profit
Profit is not simply reliant on a high beef or mart price. There is no doubt that the beef trade requires a fair price to cover the costs of production.
But with so much variation in production efficiency inside the farm gate, a high beef price will not guarantee that all farms are profitable.
Profit comes down to a combination of market price, production level, herd efficiency and animal performance. Production and performance are every bit as important as price.
For instance, a high beef price is less beneficial if the farm is under-stocked and cattle sales are limited as a result, especially when operating on rented land.
The same applies if the farm is selling too many cattle below their potential sale weight or if the majority of an animal’s lifetime liveweight gain has come from intensive feeding of concentrates.
As market prices are outside of the farmer’s control, they can do little to influence it. However, they can take steps to insulate their farm business from the effects of market prices.
Influencing factors
At BEEF 2016, speakers outlined the three main areas that suckler farmers have control over. These include:
Grass utilisation.
Animal performance.
Stocking rate.
Irish farms have the potential to grow up to 15t DM/ha, yet the average farm is struggling to grow 50% of this yield.
The main reason for reduced grass growth is low soil fertility. Soil analysis from grassland farms shows that 90% of soils are below the optimum phosphorus (P) and potassium (K) levels. Around 70% of farms need lime applied.
Unless soil fertility is addressed, your farm will continue to struggle to grow enough grass across the year to feed animals, especially during the spring and autumn periods. This means a later turnout and earlier housing date.
Watch Teagasc researcher Pat Forrestal discuss nitrogen fertilisation at Beef 2016:
Ground conditions will still have an impact, but if there is insufficient grazing available, cattle will need supplementing with some form of conserved forage or meal.
Stocking rates will depend on ground type and how much grass can be grown. There is no point in increasing stocking rates if they cannot be carried at grass. Having to purchase feed every year will cancel out the benefit of having increased sale numbers.
Increasing output
Higher stocking rates will generate more cattle for sale and drive higher output. However, before increasing stocking rates, it is important that herd owners start by focusing on improving the herd management in their current system.
Before increasing stocking rate, a farmer must be able to cope with additional numbers – otherwise they will be working harder for no reward.
Increasing numbers will put the whole farm system under pressure if the management level is not up to the day-to-day tasks. Animal health is one area that can quickly suffer as a result of too many animals in the system.
Therefore, the message to farmers looking to increase cow numbers is to start by improving the output from the current herd, mainly herd fertility and weaning percentage.
Getting more live calves on the ground and weaned at a heavier weight will be a better starting block for expansion as well as increasing output.
Key points
Increasing grass utilisation through better grazing management will improve profit by €100/ha.
Only increase stocking levels from an efficient management base.
Focus on improving liveweight gain and increasing the number of live calves born annually to increase output.
Increasing calves born per cow per year by 5% increased profit by €54/ha.
Increasing lifetime DLWG by 0.1kg/day increased profit by €78/ha.
Comparing the profitability
of the different systems
The Teagasc team of beef specialists outlined how production efficiency and the level of herd output influenced farm profit.
Five different production systems were considered in relation to animal performance, herd fertility, grass utilisation, calving pattern and finishing system. There is no land charges associated with the five systems and all support payments are excluded.
Option one uses the national average baseline data for suckler-to-beef production. Stocking rate at 1.27LU/ha is low. Steers were finished at 30 months, with heifers finished at 26 months.
Average carcase weight was 374kg, with an average weaning weight of 250kg liveweight. Heifers calve at 36 months in this system. Net margin is -€3,512 from a 23-cow herd. There is plenty of scope to improve this system.
Option two shows the impact of increasing stocking levels, but without addressing the problems of inefficient management. Stocking rate has been increased to 2LU/ha, which has led to an extra 14 cows in the system and could put pressure on housing facilities, as well as labour.
This option assumes the management levels are similar between option one and option two. At 0.83 calves/cow mated, the extra 14 cows are only producing an extra 11 calves every year.
Simply increasing livestock numbers alone has only reduced the net margin loss by €500, despite increasing beef output by almost 9,000kg of liveweight.
The reason behind this is down to amount of purchased meal fed, which has doubled. Fertiliser use has also increased significantly, as more grazed grass and winter forage is required.
Option two shows that simply relying on increasing output without addressing herd efficiency will do little to increase farm profit. Farmers in option two will most likely find that they will end up cutting back in cow numbers, as they are no better off financially and a lot worse off in terms of workload.
Improved efficiency
Option three is a system with similar stocking levels to option one. But the big difference is the level of herd management in place is at a much higher standard in option three.
Mean calving date is one month earlier here. With more cows calving in March compared with April, there is a longer grazing season for cows to wean heavier calves off grass. Weaning weights increased to 293kg compared with 250kg in option one.
Steers are finished at 24 months and heifers are finished at 20 months of age, compared with 30 months and 24 months respectively. Despite the younger finishing age, the average carcase weight remains similar at 370kg, although meal has increased by 0.13t/LU.
Heifers are calving 12 months earlier at 24 months and 0.95 calves/cow/year are born each year. The higher levels of technical efficiency in option three have made a massive difference to the net profit of the herd.
Net margin is now positive at €8,439 from the 31-cow herd running on 40ha. Compared with option two, the stocking rate is lower in option three and beef output is 2,000kg lower. Yet, net margin is €11,000 higher from operating a smaller herd at a much higher level of production efficiency.
For any suckler farmer thinking about increasing the size of their suckler herd, this is the type of management system that will be able to cope with additional cattle numbers.
This option also reflects how improved herd fertility and management can influence output for farms operating on a restricted land base or on more marginal ground that is limited in stock-carrying capacity.
High efficiency and output
Options four and five show the potential increase in profit when high levels of herd management are in place, along with higher levels of output.
Option four has a stocking rate of 2.22LU/ha, which reflects better quality land. This amounts to 53 cows on a 40ha farm where cattle are taken through to finish steers at 24 months and heifers at 20 months.
Fertiliser use is obviously higher in option four compared with option three, with another 2,000kg of nitrogen used.
The higher stocking rate in option four has increased the amount of liveweight produced substantially.
More liveweight produced can help to dilute the costs of production. Net margin is over €21,000 in option four before accounting for land rent or any subsidies.
Option five is a young bull system and as there is less grazing animals compared with the steer beef system, cow numbers have been increased further to 61 animals.
However, with the additional meal purchased, net margin has only been increased by €1,500.
Carcase weight in the young bull system is crucial to keep output high, thereby reducing the production costs per kilogramme of liveweight produced.
For more advice from Beef 2016 on land drainage, watch Pat Tuohy's presentation in our video below:
The profitability of suckler beef production came under examination at this week’s BEEF 2016 event. Increasing volumes of beef from the expanding dairy herd provides direct competition for suckler-bred animals and may well put domestic beef prices under pressure this winter.
But the messages coming from the event is that there is still a future for suckler herds on well-run units with a high level of technical efficiency and output. Combined, both can return farms a net margin of €400/cow. At the heart of this will be maximising liveweight gain from a grass-based system.
As the cheapest feed available, getting as much high-quality grazed grass into cattle will not only drive liveweight gain, it will improve profitability.
For every additional 1t/ha of grazed grass consumed, net margin can be increased by approximately €105/ha farmed.
On a 40ha farm growing 10t DM/ha, increasing utilisation from 60% to 80% would add an extra €8,400 to net margin. Grass utilisation is increased through better grazing management, which basically means adopting a rotational paddock system.
Could this involve reseeding? Watch Teagasc researcher Philip Creighton discuss grassland reseeding methods at Beef 2016 in our video below:
Profit
Profit is not simply reliant on a high beef or mart price. There is no doubt that the beef trade requires a fair price to cover the costs of production.
But with so much variation in production efficiency inside the farm gate, a high beef price will not guarantee that all farms are profitable.
Profit comes down to a combination of market price, production level, herd efficiency and animal performance. Production and performance are every bit as important as price.
For instance, a high beef price is less beneficial if the farm is under-stocked and cattle sales are limited as a result, especially when operating on rented land.
The same applies if the farm is selling too many cattle below their potential sale weight or if the majority of an animal’s lifetime liveweight gain has come from intensive feeding of concentrates.
As market prices are outside of the farmer’s control, they can do little to influence it. However, they can take steps to insulate their farm business from the effects of market prices.
Influencing factors
At BEEF 2016, speakers outlined the three main areas that suckler farmers have control over. These include:
Grass utilisation.
Animal performance.
Stocking rate.
Irish farms have the potential to grow up to 15t DM/ha, yet the average farm is struggling to grow 50% of this yield.
The main reason for reduced grass growth is low soil fertility. Soil analysis from grassland farms shows that 90% of soils are below the optimum phosphorus (P) and potassium (K) levels. Around 70% of farms need lime applied.
Unless soil fertility is addressed, your farm will continue to struggle to grow enough grass across the year to feed animals, especially during the spring and autumn periods. This means a later turnout and earlier housing date.
Watch Teagasc researcher Pat Forrestal discuss nitrogen fertilisation at Beef 2016:
Ground conditions will still have an impact, but if there is insufficient grazing available, cattle will need supplementing with some form of conserved forage or meal.
Stocking rates will depend on ground type and how much grass can be grown. There is no point in increasing stocking rates if they cannot be carried at grass. Having to purchase feed every year will cancel out the benefit of having increased sale numbers.
Increasing output
Higher stocking rates will generate more cattle for sale and drive higher output. However, before increasing stocking rates, it is important that herd owners start by focusing on improving the herd management in their current system.
Before increasing stocking rate, a farmer must be able to cope with additional numbers – otherwise they will be working harder for no reward.
Increasing numbers will put the whole farm system under pressure if the management level is not up to the day-to-day tasks. Animal health is one area that can quickly suffer as a result of too many animals in the system.
Therefore, the message to farmers looking to increase cow numbers is to start by improving the output from the current herd, mainly herd fertility and weaning percentage.
Getting more live calves on the ground and weaned at a heavier weight will be a better starting block for expansion as well as increasing output.
Key points
Increasing grass utilisation through better grazing management will improve profit by €100/ha.
Only increase stocking levels from an efficient management base.
Focus on improving liveweight gain and increasing the number of live calves born annually to increase output.
Increasing calves born per cow per year by 5% increased profit by €54/ha.
Increasing lifetime DLWG by 0.1kg/day increased profit by €78/ha.
Comparing the profitability
of the different systems
The Teagasc team of beef specialists outlined how production efficiency and the level of herd output influenced farm profit.
Five different production systems were considered in relation to animal performance, herd fertility, grass utilisation, calving pattern and finishing system. There is no land charges associated with the five systems and all support payments are excluded.
Option one uses the national average baseline data for suckler-to-beef production. Stocking rate at 1.27LU/ha is low. Steers were finished at 30 months, with heifers finished at 26 months.
Average carcase weight was 374kg, with an average weaning weight of 250kg liveweight. Heifers calve at 36 months in this system. Net margin is -€3,512 from a 23-cow herd. There is plenty of scope to improve this system.
Option two shows the impact of increasing stocking levels, but without addressing the problems of inefficient management. Stocking rate has been increased to 2LU/ha, which has led to an extra 14 cows in the system and could put pressure on housing facilities, as well as labour.
This option assumes the management levels are similar between option one and option two. At 0.83 calves/cow mated, the extra 14 cows are only producing an extra 11 calves every year.
Simply increasing livestock numbers alone has only reduced the net margin loss by €500, despite increasing beef output by almost 9,000kg of liveweight.
The reason behind this is down to amount of purchased meal fed, which has doubled. Fertiliser use has also increased significantly, as more grazed grass and winter forage is required.
Option two shows that simply relying on increasing output without addressing herd efficiency will do little to increase farm profit. Farmers in option two will most likely find that they will end up cutting back in cow numbers, as they are no better off financially and a lot worse off in terms of workload.
Improved efficiency
Option three is a system with similar stocking levels to option one. But the big difference is the level of herd management in place is at a much higher standard in option three.
Mean calving date is one month earlier here. With more cows calving in March compared with April, there is a longer grazing season for cows to wean heavier calves off grass. Weaning weights increased to 293kg compared with 250kg in option one.
Steers are finished at 24 months and heifers are finished at 20 months of age, compared with 30 months and 24 months respectively. Despite the younger finishing age, the average carcase weight remains similar at 370kg, although meal has increased by 0.13t/LU.
Heifers are calving 12 months earlier at 24 months and 0.95 calves/cow/year are born each year. The higher levels of technical efficiency in option three have made a massive difference to the net profit of the herd.
Net margin is now positive at €8,439 from the 31-cow herd running on 40ha. Compared with option two, the stocking rate is lower in option three and beef output is 2,000kg lower. Yet, net margin is €11,000 higher from operating a smaller herd at a much higher level of production efficiency.
For any suckler farmer thinking about increasing the size of their suckler herd, this is the type of management system that will be able to cope with additional cattle numbers.
This option also reflects how improved herd fertility and management can influence output for farms operating on a restricted land base or on more marginal ground that is limited in stock-carrying capacity.
High efficiency and output
Options four and five show the potential increase in profit when high levels of herd management are in place, along with higher levels of output.
Option four has a stocking rate of 2.22LU/ha, which reflects better quality land. This amounts to 53 cows on a 40ha farm where cattle are taken through to finish steers at 24 months and heifers at 20 months.
Fertiliser use is obviously higher in option four compared with option three, with another 2,000kg of nitrogen used.
The higher stocking rate in option four has increased the amount of liveweight produced substantially.
More liveweight produced can help to dilute the costs of production. Net margin is over €21,000 in option four before accounting for land rent or any subsidies.
Option five is a young bull system and as there is less grazing animals compared with the steer beef system, cow numbers have been increased further to 61 animals.
However, with the additional meal purchased, net margin has only been increased by €1,500.
Carcase weight in the young bull system is crucial to keep output high, thereby reducing the production costs per kilogramme of liveweight produced.
For more advice from Beef 2016 on land drainage, watch Pat Tuohy's presentation in our video below:
Teagasc has published new factsheets on lime and urea fertiliser management in conjunction with the Teagasc Beef 2016 open day in Grange earlier this month.
Teagasc business and technology adviser for drystock Gary Fisher spoke about the importance of reseeding and the correct seed mixtures to use at BEEF 2016.
Shanon Kinahan has all the details you need for the upcoming Lisduff Aberdeen Angus sale.
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