Benchmarking update 2013

30 October 2013Paul McHenry

CAFRE Benchmarking

• Approximately 450 businesses benchmarked/year.

• Average farm size 61 hectares.

• Average suckler herd - 44 cows.

• Average ewe flock - 264 ewes.

• 64% of the businesses farming full-time.

Process of benchmarking at CAFRE

It’s all down to price!!!

Number of cows

Higher stocking rate

Kg liveweight/ha

Gro

ss m

argi

n/H

ecta

re

 Per CowTop   25% The difference

Bottom 25%

Output 1043 172 871

Variable costs 341 130 471

Gross margin 692 326 366

Net margin* 334 600 -266

Net Profit per Cow** 237 584 -347

Cost of production (£/kg carcase) 2.42 1.77 4.19

Range in performance for suckler to beef farms in 2011/12

*Ranked by net margin/cow

**No allowance for family labour cost

Why the difference?

• Lower total common fixed costs of £274/cow.

• Each cow produced 61kg more beef worth £172/cow.

• Lower variable costs of £130/cow.

Control of fixed costs

Trends over last four years on the top 25% of suckler to beef farms

Trends over last four years on average suckler to beef farms

£/K

g

Suckler to beef farms ranked per hectare

 £ per hectareTop   25% The difference

Bottom 25%

Output 1015 212 803

Variable costs 335 143 478

Gross margin 680 355 325

Net margin* 356 608 -252

Net Profit per hectare** 265 608 -343

* Farm ranked by net margin/ha ** No allowance for family labour

Trends in benchmarking• On average the farms producing the highest amount

of beef or lamb per hectare are making the highest gross margin per hectare.

• As a guide variable costs are approximately 35% of output on top 25% farms and 60% of output on bottom farms.

• The difference in performance is equivalent to £608 per hectare.

Kg live weight produced/ha

Gro

ss m

argi

n/H

aHow are benchmarked suckler herds

comparing against NISBP target?

How do the enterprises perform?

Gross marginPer Hectare (£)

Gross margin £/cow/animal

sold/ewe

Beef finishing (Store to beef) 1056 404

Upland/lowland sheep 917 102

Beef finishing (Calf to beef) 703 354

Suckler to beef 670 692

Suckler to store 620 580

Suckler to weanling 515 465

Hill sheep N/A 58