Budget Analysis of Spring, Fall with Winter Clean-up, and High-Fertility Fall Lambing Systems in a Simulated Fixed Forage Resource
Andrew, Shelley Lewis Jr.
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A successful business needs to generate enough cash to cover expenses, current debt, and family living expenses, pay interest on owned and borrowed capital, maintain productivity, and earn a reasonable return for the operator. Income from sheep production is generally only part of a total farm and nonfarm income. Thus options, opportunity costs, and decisions regarding the sheep production enterprise are not isolated; they affect other agricultural enterprises. Sheep production consistently returns profits to producers, which makes it an enticing agricultural enterprise. There are advantages in raising sheep in Virginia, such as abundant, high-quality forage, moderate climate, pasture improvement, and good access to markets with high demand for lamb. The disadvantages to sheep production are unavailable and inexperienced labor and operators, predators, and inconsistent market demand and supply. Sheep producers have the opportunity to choose which lambing system fits their existing operations and lifestyle. The use of economic analysis enables operator to make sound business management decisions. To compare different lambing systems (spring, fall with winter clean-up, and high-fertility fall) in a systematic way, a simulation model was constructed with a fixed forage resource of 50 acres of pasture including typical Virginia mountain pasture plus various amounts of fescue for stockpiling. The simulation included a production calendar; nutritional requirements for ewes, lambs, and artificially reared triplets; growth rates for lambs; lambing distributions; forage growth; and enterprise budgets including income, costs, and returns. A economic analysis was performed for each lambing system with average prices or with plus or minus one standard deviation for prices of corn, SBOM, and market lambs, and price differentials for market lambs across lambing seasons. Comparisons of each lambing systems produced various results. In spring lambing, only 78 ewes could be maintained on the fixed forage resource, while the fall with winter clean-up and high-fertility fall lambing system each had 115 ewes. This result occurred because of limited forage in July and August and higher nutrient requirements for spring lambing in those months. The overall nutrient requirements were higher in the fall with winter clean-up and high-fertility fall lambing than in spring lambing as a result of the increased ewe and lamb numbers. Concentrate consumption by lambs was also greater for fall with winter clean-up and high-fertility fall lambing than for spring lambing because of the increased numbers of lambs. Because of the low number of ewes and lambs, spring system produced the most hay. Labor costs were highest in fall with winter clean-up lambing because of the two lambing seasons. In the economic analysis system, each lambing was compared. With 10-year average prices for market lambs, corn, and SBOM, high-fertility fall lambing had the greatest income ($17,467), followed by fall with winter clean-up lambing ($14,695), and spring lambing ($10,358). This result occurred because high-fertility fall and fall with winter clean-up lambing had more lambs sold at higher market lambs prices than spring lambing. With 10-year average prices for market lambs, corn, and SBOM, high-fertility fall lambing had the highest cost ($7,935), followed by fall with winter clean-up lambing ($7,360), and spring lambing ($6,084). This was the result of increased ewe and lamb numbers in high-fertility fall and fall with winter clean-up lambing than spring lambing. High-fertility fall lambing had the greatest returns ($6,210), followed by fall with winter clean-up lambing ($4,025), and spring lambing ($2,028). On a fixed forage resource, increasing fertility in fall lambing clearly results in increased returns. In this model, forage availability controlled the number of ewes that a lambing system can have because of limited summer growth and had a major impact on profits. Conclusions of Tolman (1993) differed from those found within this thesis. On a per ewe basis, she found that spring lambing to yielded the highest returns whereas this thesis found that high-fertility fall lambing yielded the highest returns. A key difference between this study and that of Tolman (1993) was after weaning this thesis feed fall lambs stockpiled fescue and she feed fall lambs feed in dry lot.
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