Joy Thesis Powerpoint
-
Upload
joy-enyinnaya -
Category
Documents
-
view
94 -
download
0
Transcript of Joy Thesis Powerpoint
A case study of the economics of
Raramuri Criollo (RC) cattle production in
the deserts of Southern New Mexico
Agricultural Economics and Agricultural Business
Joy C. Enyinnaya, B.Sc.Thesis Defense
July 15, 2016
Prof. Allen Torell, advisor
Introduction
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Demand for grass-fed, naturally raised, locally produced meats is
increasing
Finding breeds of cattle in the United states that can efficiently
finish well on grass had been problematic
Raramuri Criollo cattle possess a unique foraging behavior and are
willing to travel long distances from water
RC unique features
Agricultural Economics and Agricultural Business
Why is Criollo Cattle, a potentially viable economic
alternative?
• Improved grazing distribution increases harvested
AUMS
- Decrease grazing pressure on over-used areas
• High fertility and longevity
• Hardy, self-reliant and suited to arid environments
• Quality carcass from forage diet
• Mild temperament
• Good mothers and small calves
‒Reduced calving problems
‒Potential for cross-breeding
• Healthy with minimal vaccination,
parasite and fly control.
The Gap• Lack of information on the economic potential of Criollo
cattle because production only started about 12 years ago
• Limited information on the cost and returns of producing
livestock on the desert ranches of the Southwest
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Objectives Compare cost and return estimates for
producing Raramuri Criollo (RC) cattle
with Angus-Hereford (A x H) cross cattle
typically found on Chihuahuan desert
ranches.
Key production and economic differences
include
Foraging behavior
Production and live weight
Market and sale price
Production costs
Agricultural Economics and Agricultural Business
Agricultural Economics and Agricultural Business
Objectives Explore the economics of alternative
marketing options for RC cattle with
sales at farmer’s markets, based on
the direct marketing experiences of
Dennis and Deborah Moroney of the
47 Ranch near Bisbee, AZ.
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Methods (JER)Terms and definitions
• Animal Unit (AU) – measure of animal equivalency
based on forage demand relative to 1000 pound
cow
• Animal unit month (AUM)- amount of forage required
by an AU per month
• Animal Unit Yearlong (AUY)- amount of forage
required by an AU per year
Agricultural Economics and Agricultural Business
Methods (JER) The USDA-ARS Jornada Experimental Range (JER) introduced RC
cattle from Mexico in 2005
An enterprise budget was developed for 225 AUY RC herd based on
production and marketing experiences of the JER (Primary data)
An enterprise budget was developed for a 150 AUY A x H cow/calf ranch
based on previously published budgets (Secondary data)
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Methods
Based on RC improved grazing distribution characteristic, a
50% increase in carrying capacity was considered; - A x H cattle – 150 AUY capacity
- Criollo cattle – 225 AUY capacity
Two different beef price scenarios were considered:– Scenario 1: Average real 2011-2015 beef prices
– Scenario 2: Record 2015 high beef prices
On-the-hoof sale prices for RC cattle were discounted by about 20% based on JER marketing
experience.
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Methods (47 Ranch)
Agricultural Economics and Agricultural Business
Farmers market partial budget
Animal purchase
cost
Feeding cost
Slaughter/ Processing
cost
Refrigeration cost
Marketing cost
A farmers market partial budget was developed based on marketing
experiences of Dennis and Deb Moroney of the 47 Ranch (Primary data)
Two different beef price scenarios were also considered (5 year average
prices and 2015 high beef prices)
Cost variables considered in the farmers market partial budget include
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Results/FindingsProduction differences
Agricultural Economics and Agricultural Business
Description A x H RC
Mean cow culling age1 10 18
Mean bull culling age 7 12
Calving month April June
Calf crop at weaning 85% 91%
Cow-to-bull ratio 16:1 30:1
Mean calf birth weight 34 12
Steer sale weight 215 @ 7 months 431 @ 30 months
Heifer sale weight 204 @ 7 months 318 @ 24 months
Average cow weight 454 363
Average bull weight 612 499
Cow, bull and heifer death loss (%) 1% 1%
Sale animals death loss (%) 2% 1%1 age in years; weight in kg
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Forage demand differences
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
1.00
0.71
1.25
0.57
1.36
0.85
0.50
1.07
0.470.66
0.88
2.00
0.00
0.50
1.00
1.50
2.00
2.50
Mature cows Replacementheifers (13-24
months)
Bulls Weaned calves (6-12 months)
Growers (13-24months)
Finishing (25-30months)
Total AUY permature cow
AU
Y
Animal Class
AxH RC
Beef price scenarios for AxH
Agricultural Economics and Agricultural Business
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
$/k
g
Year
Heifers -wt400-500
Steers -wt400-500
Source: Livestock Marketing Information Center, 2016
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Farmer’s Market Partial Budget
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
47 Ranch Marketing effortLoads cows to trailer, drives to UA meat lab
for slaughter/processing,
200 miles
4 weeks later: picks up processed meat,
delivers to commercial customers
Drives 36 miles to Nathen (Walk-in freezer) to store rest of the meat
Thursdays: farmers market, Sierra
vista, spends about 8 hours in direct marketing, 100
miles
Saturdays: farmers market,
Bisbee, 120 miles
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Prices/kg of meat cuts sold at farmers market
Agricultural Economics and Agricultural Business
$24.86
$15.43
$13.23
$22.05
$18.37
$15.16
$7.75
$5.20$6.12
$8.57
$5.82$5.11
$0.00
$5.00
$10.00
$15.00
$20.00
$25.00
$30.00
chuck steaks cowboy rib steak Round steak sirloin steak roast ground beef andstew meat
$/k
g
Meat cut
Farmers market Grocery store
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Agricultural Economics and Agricultural Business
$3,133/head
$944/head
$100/head $80/head
$22.15/head
$1,319/head
$2,465/head
$668/head
$1,108/head
$2,254/head
$879/head
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
Revenue Slaughter andprocessing cost
Marketing cost Feeding cost Refrigerationcost
Animal purchasecost
Total cost Net returns
2015 High prices
5-year average prices
Farmers market partial budget analysis
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Summary and Implications• Favoring RC production
– Criollo cattle is a profitable option for a large, expansive, and poorly watered
pasture
– RC heifers make great breeders
– With 50% increase in carrying capacity, there is breakeven for RC
enterprise
– Reduced production costs
– Improved rangeland health and restoration of overgrazed areas
• Challenges for RC production
– Lack of structured market
– AxH can raise 3 sets of steer calves in the duration of raising one RC steer
calf
– Lack of infrastructure for slaughter and processing
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies
Future studies• Explore the economics of combining production
and marketing estimates in one budget
• Explore the economics of different marketing
strategies
– Cross breeding Criollo cattle
– Phone and internet sales
– Subscription based buying clubs
Agricultural Economics and Agricultural Business
Introduction MethodsResults/
Findings
Summary/
Implications
Future Studies