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2011 Profitability Study Shows Improvements Across Board

22 November 2012

SCOTLAND - For 2011 the general trend across Beef enterprises saw farms experience an increase in margins, according to a survey completed on over 150 holdings by Quality Meat Scotland (QMS).

The survey, Cattle and Sheep Enterprise Profitability in Scotland, covered 116 suckler herds and 50 cattle finishers and concluded that margins for 2011 improved across all enterprise sectors surveyed.

Also revealed by the survey was the struggling businesses within these sectors. Of the suckler herds surveyed, 30 per cent reported a positive net margin from which to reinvest and pay family labour. This is a marked improvement on teh 2010 figure of 14 per cent. The results, according to QMS, show the difficulties still experienced in farming and that there are huge variations within sectors.

High physical or technical performance, low costs and the ability to maximise market returns were highlighted by QMS as attributes that all top producers had. Variable costs in particular were stressed as being hugely variable across farms. In all cases the most profitable businesses acheived higher output in 2011 had lower fixed costs.

QMS acknowledge the wide variation in Scottish farm landscapes and systems mean only the main types of livestock enterprises can be monitored.

Cereal based cattle finishers surveyed reported an average gross margin of £128 per beast and a net margin of £56 while forage based finishers made an average gross margin of £190 per beast and reported a net margin of £14.

The highest acheivers tended to buy the smallest cattle finishing them over the longest periods. QMS say the benefits of this included being able to sell int o rising markets. This was not the case in 2010 when a flat market benefitted those who could turn around animals the quickest.

To read the report 'Cattle and Sheep Enterprise Profitability in Scotland' click here

TheCattleSite News Desk

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