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Beyond the Bale : March 2018
WOOL FOCUSED ENTERPRISES Wool enterprises have boomed in 2017 with sheep industry analysis showing gross margins for Merino fine wool enterprises have risen by 55% since 2016 to generate $554 per hectare. NSW Department of Primary Industries sheep development officer, Geoff Casburn, said the story was positive for sheep across the board, with a wether enterprise proving a real winner. “We saw a huge 61% leap for 18 micron wether enterprises, generating $51.73 per DSE or $517 per hectare,” Mr Casburn said. “Self-replacing Merino flocks with 18 micron wool had the highest gross margin at $55.43 DSE, and the two top enterprises benefitted from high prices for finer wool.” Merino-based breeding enterprises (20 micron wool) achieved gains ranging from 29% for ewes solely joined to Merino rams to 11% for ewes solely joined to terminal rams. The difference between the two is primarily due to the increased value of surplus ewe hoggets in the breeding enterprise and the cost of replacement ewes joined to terminal sires. The 20 micron wethers achieved a 25% *Gross margin calculations based on average wool and sheep prices from 1 March 2016 to 30 September 2016 and 1 April 2017 to 1 September 2017. Buoyant Merino wool prices are rewarding sheep producers that have stuck with Merinos, according to analysis by NSW Department of Primary Industries of the gross margins of ten types of wool and sheep meat enterprises. BOOMED DURING 2017 increase with a gross margin of $35.98/ DSE, reflecting a lower price rise in medium compared with fine micron wools. The meat sheep enterprises of 1st Cross ewes joined to terminal rams and the self-replacing Dorper enterprise only maintained their gross margins, achieving around $36/DSE. For those producers who have achieved strong genetic gain in their wool enterprises by using sound ram buying strategies and careful ewe selection, increasing their wool cut while maintaining or reducing micron, their gross margin gains could be even greater. “Compared with average results, producers who took advantage of genetic advances to lift both the adult wool value and wool cut by 15% could expect to see returns of $81.29 per DSE for 18 micron wethers or a total of $812 per hectare. “When we applied the same market sensitivity to 18 micron ewes, a 15% increase on average returns saw the enterprise delivering $65.02 per DSE or $650 per hectare.” Mr Casburn said cost structure helps explain performance differences between enterprises. “The highest costs per DSE were found in 20 micron ewes joined with terminal rams, due to the higher replacement ewe and fodder costs,” he said. “Whereas self-replacing 18 micron ewe enterprises had the second lowest costs, which combined with high returns delivered the highest average gross margin. The aim of the farm enterprise budgets prepared by NSW DPI is to provide producers with an additional planning tool to help evaluate their own budgets and options. The budgets also include sensitivity tables that allow producers to assess the impact that changing prices and production levels will have on the gross margin. Producers are advised to develop their own gross margins using actual costs and income. MORE INFORMATION To access the full gross margin outputs, visit www.dpi.nsw.gov.au/agriculture/ budgets/livestock Geoff Casburn, NSW DPI Wagga Wagga, (02) 6938 1630, firstname.lastname@example.org $/DSE $5 $10 $15 $20 $25 $30 $35 $40 $45 $0 2016 2017 $52 MERINO WETHERS (18 micron) $36 MERINO WETHERS (20 micron) $41 MERINO EWES (18 micron) – Merino rams $55 MERINO EWES (20 micron) – Merino rams $45 MERINO EWES (20 micron) – Merino rams, wether lambs sold as trade lambs $46 MERINO EWES (20 micron) – 75% to Merino rams, 25% to terminal meat rams $44 MERINO EWES (20 micron) – terminal meat rams $46 MERINO EWES (20 micron) – maternal meat rams $36 1ST CROSS EWES – terminal meat rams $36 DORPER EWES – Dorper rams $50 $55 $60 NSW sheep enterprise gross margins for 2016 and 2017* NEW SOUTH WALES Alexandra Cesnik Gumly Gumly Jayde Cluff Deniliquin Roy Elliott Eumungerie Jock Fisher Gulargambone Ross Fletcher Walcha Ally Jaffrey Crookwell Henry Ridge Sydney Mark Scott Sydney QUEENSLAND Benn Wilson Dirranbandi SOUTH AUSTRALIA Angus Ashby Gulnare Chelsea Dahlenburg Naracoorte Angus Halliday Bordertown Royce Pitchford Clare William Sandow Watervale TASMANIA John Chester Campbell Town VICTORIA Sam Crawford Dunkeld Oliver Vidor Derrinallum WESTERN AUSTRALIA Stephen Chappell Lake Grace Daniel Dempster Goomalling Kyle Gumprich Narrogin Justin Haydock Narrogin Alex House Claremont Carl Storer Cunderdin ON FARM 49
In the Shops - March 2018