Optimization of Profit for Pasture-Based Beef Cattle and Sheep Farming Using Linear Programming: Young Beef Cattle Production in New Zealand

Abstract

In New Zealand, surplus dairy-origin calves not needed as replacement or for beef cattle farms requirements for finishing are commercially slaughtered within two weeks of age. This system has perceived ethical issues which can potentially negatively affect the dairy industry. Therefore, a young beef cattle production system to maximize the use of excess calves within the land size constraint is considered as an alternative to a traditional 18 to 33-months slaughtering system. The current study examined the effects of young beef cattle production with slaughter ages at 8 to 14 months on pasture utilization, farm profitability and selling policy on class 5, intensive finishing sheep and beef cattle farms in New Zealand. A linear programming model that had previously been developed for this farm class (optimized traditional beef cattle system) was modified to include a young beef cattle slaughter system and identified the carrying capacity for young and traditional beef cattle and the selling policy required to optimize pasture utilization and farm profitability. Systems with young beef cattle slaughtered at 8, 10, 12 or 14-months of age were simulated without (Scenario I) or with (Scenario II) decreasing the number of traditional beef cattle. Daily per head energy demand for maintenance and live weight change was estimated and converted to kg DM/head on a bimonthly basis. Carcasses from young beef cattle were processed as one class under manufacturing beef price (NZ$4.50). The modified young and traditional beef cattle slaughtering system maintained an extra 6% and 35% beef cattle in Scenario I and Scenario II respectively, and finished 90% and 84% of traditional beef cattle before the second winter. Pasture supplied 98% of the feed demand for the beef cattle activities and 79–83% of that was consumed. Mixed young and traditional beef cattle finishing scenarios returned 2% less gross farm revenue per hectare (GFR/ha). However, earnings before tax per hectare (ETB/ha) in Scenario I and Scenario II were 15–25% greater than that of the optimized traditional beef cattle system, respectively. Young beef cattle production increased pasture utilization and farm profitability and increased selling options for finished beef cattle. Therefore, the young beef cattle system is a viable option for farmers and will help to reduce the need to slaughter calves within two weeks of age.