Suckler-to-weanling farms in the Teagasc Better Beef Programme have struggled to break the €1,000/ha gross margin target set out at the beginning of the programme, according to Teagasc’s Alan Dillon.
The Teagasc Advisor was speaking at Tuesday’s Better Beef Farm Conference in Tullamore, where he said lower output from these systems was the main reason for missing the target.
“The suckler cow does limit the amount you can produce on the farm, she is a big animal and requires a lot of shed space and feed,” he said.
Dillon said the gross margins on suckler-to-weanling farms were the lowest of all farms in the programme.
“It is really down to output. If you take the average weanling weight going to the mart is in the region of 320-350kg.
“It is probably making around €800, that is around €1,600/ha output if you are stocked at 2LU/ha.
The problem is the suckler cow is costing so much to keep. The suckler cow is probably costing €600-700 in terms of variable costs. “Take that off the weanling value and you haven’t much left at the end of the day,” he said. Dillon also said that it was difficult to increase the stocking rate on suckler-to-weanling farms above 2LU/ha, as these farms are generally in the more marginal areas.
However, despite the suckler-to-weanling farms struggling to break the €1,000/ha gross margin target, Dillon said that the gross margins on these farms increased by 20% over the past three years.
“The suckler-to-weanling farms performed well overall and there were some great strides made in terms of increasing output.
“Massive improvements have been made on these farms. If they hadn’t made the improvements there would probably have been a massive drop in gross margin,” Dillon said.
But, he said that the suckler-to-finishing systems are still the most profitable farms in the programme, with a gross margin of €1,464/ha in 2015.
20% jump in gross margin