AUSTRALIA

Australian beef producers hoping to expand operations

Beef

The Beef Producers Intentions Survey (BPIS), which was conducted in November 2023, is aimed at informing industry and particularly producers about information such as sentiment, herd profile and intentions, sales timing, drivers of on-farm decisions, cull rates, bull purchases, calving rates, sales channels and type of operation.

Posted on Apr 15 ,00:15

Australian beef producers hoping to expand operations

The BPIS revealed that Queensland has the lowest heifer rebreed rate at 76%, compared to NSW and Victoria at 79% and 80%, respectively. This indicates the differences in production systems and the importance of maintaining adequate nutrition during the dry season to sustain those rebreed rates.

The key differences between southern and northern production systems are reflected in the heifer/cow join and calving rate. Southern Australia has a heifer and cow join rate of 73% and 88% and heifer/cow calving rate of 82% and 91%, respectively, which is consistently above the national average. This suggests an intensive production system allows for greater oversight of the business and better production metrics.

Northern Australia's heifer/cow join rate and calving rate are consistently below the national average, driven by the less intensive production systems. Queensland has a joining rate of 63%, 5 points below the national average, with a cow calving rate of 81% which is 7 points below the national average.

Queensland represents 42% of all cows on hand, which is notably the impact of harsher and drier conditions. This particularly impacts cows that need to maintain adequate nutrition to ensure fertility into the following years, and the provision of supplementary feed during the dry season to maintain their fertility for future years.

The survey found 38% of producers stated they were more likely to improve beef cattle next year, and out of those 44% are looking to expand operations. Looking to expand operations can indicate a business is profitable but farm size is inversely correlated with productivity, where smaller farms are located on more productive land and vice versa.

For example, properties in Queensland’s south-eastern regions are characterised as more productive, and farm sizes are typically smaller. Smaller operations have the agility to change processes and very easily improve productivity outcomes.

However, those genuinely looking into expansion are competing with neighbours, domestic and foreign corporate investment groups to buy farmland. Producers are relying on equity to purchase other aggregations leading to economies of scale and potentially higher productivity. The land is becoming more valuable to a buyer who has existing assets based within close proximity.

Managing these factors within a business can improve profitability and productivity in the long term, allowing producers to take risks on their property and expand their operations.

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