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Beyond the Bale : September 2010
September 2010 BEYOND THE BALE WOOL PRODUCTION 15 Don't be fair-weather about whether to sell off wethers; have another think about it. This is the advice of Victorian BESTWOOL/BESTLAMB co-ordinator Peter Schroder, who believes far too many wethers have been sold off for meat without a second thought. "There are millions of wethers being sold every year for spurious reasons," Peter says. "In a Merino flock, wethers are the bale fillers and the number of bales is still a large profit driver. I personally think people who continue to sell off wethers and increase their ewe portion need to do their homework a little more thoroughly, especially if they need to buy ewes. The figures show the Merino wether is a huge profit generator when managed well." Pure self-replacing Merino businesses with wethers are still returning solid profits when run well, according to the veteran of over 38 years of agricultural consultancy and research in south west Victoria. At this year's F'ewe'ture Farming annual conference in Bendigo, Peter was compelled to remind the over 300 producers gathered that it was the management of enterprises that made the difference rather than the type of enterprise. Think twice about the wether FAST FACTS l Pure self-replacing Merino businesses are returning solid profits when run well. l Benchmarking is key to identifying potential areas for improvement in any enterprise. l Benchmarking is a regular feature of AWI state networks. "There is understandably a lot of enthusiasm for the prime lamb industry at the moment but I can tell you that the best operators in my two BESTWOOL/ BESTLAMB groups are serious wool producers, and they do what they do really well rather than chase rainbows", Peter says. "This has allowed them to still achieve a cash return on assets (land, plant and stock) of five to 10 per cent return on their farms. This is calculated using current high land prices." Benchmarking is a regular feature of many BESTWOOL/BESTLAMB groups and is key to identifying the potential areas for improvement in any enterprise, according to Peter. "The average woolgrower is more likely to improve profits by becoming a more efficient woolgrower. You don't go from average returns to great returns by switching enterprises; you do it by getting better at what you do." His "stick to your knitting" stance is backed up by Holmes Sackett analysis which involves over 170 benchmarked enterprises across NSW, Victoria and South Australia. Over the past seven years, the net profit per hectare per 100 millimetres of rainfall by the best wool producers has averaged between $29 and $39. These flocks ran up to 35 per cent wethers in the flock over this period of time, had above district average stocking rates and managed to keep their costs under control at the same time. Their consequent average cost of production was $6.60/kilogram clean. This compares favourably with the best lamb enterprises which averaged between $32 and $44, with both above the best beef producers who averaged between $26 and $30 per hectare per 100mm of rainfall. "The same story comes out in the Monitor Farm Project run by the Department of Primary Industry (DPI), it is a theme that continues no matter what the season, no matter what the enterprise: do what you do well rather than chasing the latest rainbow," Peter adds. BESTWOOL/BESTLAMB The BESTWOOL/BESTLAMB state network in Victoria, funded by AWI with DPI Victoria, has been running for 12 years and has over 730 group members and over 800 associate members. It provides farmers with a network through which they can access vital farming information, share best practices and develop social and business networks. Its success was officially recognised last year, with the program winning the inaugural Samuel Wadham Award for Practice Change at the DPI Victoria Science Awards. The Award recognises outstanding contributions leading to practice change improvements for Victorian farm businesses. The program's success was illustrated further this year by the high attendance and quality of speakers at the BESTWOOL/BESTLAMB F'ewe'ture Farming annual conference in Bendigo. More than 300 producers and industry service providers enjoyed a day full of insights and discussed the challenges and new developments in the sheep industry. More information: www.bestwoolbestlamb.com GROWER NETWORK GROUP COORDINATOR PHONE EMAIL BESTWOOL/BESTLAMB (Vic) Lyndon Kubiel (03) 5761 1649 firstname.lastname@example.org Sheep Connect NSW Jac Staines (02) 6391 3913 email@example.com The Sheep's Back (WA) Bob Hall (08) 9736 1055 firstname.lastname@example.org Bestprac (Pastoral) Carlyn Sherrif (08) 8842 1103 email@example.com Sheep Connect SA Ian McFarland (08) 8226 1875 firstname.lastname@example.org Leading Sheep (Qld) Tony Hamilton (07) 4688 1270 email@example.com Sheep Connect Tas Warre n Hunt (03) 6336 5464 firstname.lastname@example.org AWI STATE NETWORKS AWI state networks provide opportunities for woolgrowers and producers to make changes to their production and management practices. To learn more about how you can get involved, call the coordinator in your state/region: