Abstract

The stock unit (SU) system has been widely used in conjunction with gross margin (GM) and analysis to make recommendations to farm managers on the comparative profitability of pastoral livestock systems. This information can be misleading, particularly where beef breeding cow policies are being compared with finishing cattle policies that involve high rates of liveweight gain (e.g. bull beef production). To illustrate the deficiencies of the SU system for standardising between different livestock enterprises, relative gross margins per stock unit (RGM/SU) were derived for two case study farms in contrasting environments. One property was located in the Manawatu region (Tuapaka), the other at Port Waikato (Limestone Downs) in South Auckland. Using the breeding cow as a base (=100), the RGM/SU at Limestone Downs for breeding ewes, bull beef, steer finishing and once bred heifers were 70, 158, 74 and 121, respectively. If these RGMIsu were expressed in terms of returns per kilogram of pasture consumed ($/kg) the rankings, relative to breeding cows (=100), were breeding ewes (51), bull beef (95), steer finishing (53) and once bred heifers (106). Corresponding values for breeding ewes and bull beef at Tuapaka were 59 and 65. Thus, the substitution rates between livestock enterprises varied substantially depending on the method used to account for differences in feed consumption. The implications of these findings for farm management decision making are discussed.

HK, Crawford, and KI Lowe

Proceedings of the New Zealand Society of Animal Production, Volume 54, , 319-322, 1994