Beef Cow-Calf Analysis Highlights for 2005

The 2005 Beef Cow Summary from the Ontario Farm Management Analysis Program (OFMAP) summarizes income and expenses as well as some production data for 49 cow-calf farms in Ontario. The results show wide variation amongst beef cow farms in scale of enterprise, net income per farm and net revenue per cow (Table 1). While the overall average for Net Farm Income (NFI) was negative (a loss of $305), the top 1/3 group of farms had an average NFI of $35,131, while the bottom 1/3 had an average NFI of -$33,219.

Why the large difference between these groups? An overview of the numbers highlights a few of the probable reasons. As shown in Table 2, the high NFI group had more cows (119) compared to the average (81) and the low NFI group (60 cows). With about twice the number of cows, the high NFI group sold about twice the value of market and feeder animals as the low NFI group. The high NFI group also sold a greater value of breeding livestock, other livestock and other sales. All of these factors contributed to the advantage in NFI associated with the larger scale operations. Interestingly, the number of calves weaned per cow was almost identical for the three groups, indicating that reproductive efficiency and calf survival rate were likely not important factors influencing the differences in NFI among the groups.

The high NFI group generated $106 more per cow in cattle revenues than the average, and $293 more than the low NFI group. In addition to having higher income per cow, the high NFI group also had lower expenses. They had $50 less per cow in variable expenses than the average NFI group, and $158 less than the low NFI group. Feed costs were the biggest single reason for these differences. As well, the fixed expenses for the high NFI group were $8 and $50 per cow lower than the average and low NFI groups respectively.

On the crops side of the operations (Table 3), there was very little difference among groups in expenses per tillable acre. However, the high NFI group produced $27 more per acre than the average group and $47 per acre more than the low group. Most of the crops were fed to the livestock on the farm for all 3 groups.

Table 1: OFMAP Summary for Ontario Beef Cow Farms, Beef Cow Enterprise Basis, 2005*

Net Farm Income Category

 
Low 16 Farms
Avg 49 Farms
High 16 Farms
Average Number of Cows
60.1
81.2
118.9
Calves Weaned
52.8
70.5
102.2
Cows per Person (whole farm)
60.1
81.2
99.1
$ per Cow
 
Low 16 Farms
Avg 49 Farms
High 16 Farms
Cattle Sales Less Purchases
595
624
648
Change in Inventory & Receivables
-98
60
141
Feed Costs Including Home Grown
713
641
595
Other Variable Expenses
327
291
288
Total Fixed Costs
165
133
126
Beef Enterprise Net Revenue
-708
-382
-219


Table 2: OFMAP Summary for Ontario Beef Cow Farms, Whole Farm Basis, 2005*

Net Farm Income Category

Revenue
Low 16 Farms
Average 49 Farms
High 16 Farms
Market Livestock
3,300
11,690
12,322
Feeder Livestock
26,770
39,282
63,850
Breeding Livestock
4,050
4,998
11,142
Cull Livestock
2,928
1,686
1,107
Other Livestock
9,518
17,887
37,619
Crop Sales
4,143
5,623
6,578
Other Sales
7,156
13,613
27,898
Total Cash
57,762
94,779
160,516
Change in Inventory & Receivables
-5,995
6,755
19,059
Total Farm Revenue
51,767
101,534
179,575

Expenses
Low 16 Farms
Average 49 Farms
High 16 Farms
Purchased Livestock
5,776
9,682
14,126
Purchased Feed
6,613
7,227
10,957
Animal Health & Breeding
2,386
2,697
3,913
Other Livestock Expenses
1,033
4,019
10,968
Seed
2,790
2,239
1,716
Fertilizer & Lime
6,190
5,743
5,675
Other Crop Expenses
1,584
2,316
1,943
Marketing & Transportation
3,454
4,779
8,009
Custom Work & Equipment Rental
2,913
4,187
7,975
Hired Labour
874
1,958
2,870
Machinery & Equipment - Fuel
6,554
7,688
10,654
Machinery & Equipment - Repairs
6,924
6,894
7,974
Motor Vehicle Expenses
1,586
1,801
1,818
Building, Fence Repairs
1,505
2,967
5,310
Electricity & Telephone
2,958
3,126
4,282
Accounting, Office Expenses
2,074
1,650
1,866
Property Taxes, Fire & Liability
Insurance
3,688
4,196
6,254
Lease & Rent Payments
2,027
2,835
4,712
Interest
4,973
5,657
8,417
Other Cash Operating Expenses
1,989
3,610
7,177
Depreciation
16,825
16,528
17,828
Total Farm Expenses
84,986
101,839
144,444
Net Farm Income
-$ 33,219
-$ 305
$35,131
* Data from the Ontario Farm Management Analysis Project

Table 3: OFMAP Sumary for Ontario Beef Cow Farms, Crop Enterprise Basis, 2005*

Net Farm Income Category

 
Low 16 Farms
Average 49 Farms
High 16 Farms
Tillable Acres
397
435
487
$ per Tillable Acre
 
Low 16 Farms
Average 49 Farms
High 16 Farms
Crops Fed to Livestock
99
110
135
Crop Sales & Inventory Change
8
16
19
Crop Variable Expenses
58
59
62
Crop Fixed Expenses
41
39
40
Crop Enterprise Net Income
9
29
52
* Data from the Ontario Farm Management Analysis Project

It's always interesting to look at trends over time. Figure 1 shows a graphical summary of average revenue, expenses and net farm income for OFMAP data collected for 1998 to 2005. Figures 2 and 3 compare the High NFI group with the Ontario average for NFI income and feed costs per cow, respectively for the years 2001 to 2005.

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