Australasian Agribusiness Review - Vol

Aset of simulations were used to estimate the impact of improvements in cattle breeding efficiency and other management factors on gross margins in extensive pastoral systems in Western Australia. The output from the simulations was integrated into a statistical model of gross margin as a function of breeding and management variables. The simulations showed that gross margin was an increasing function of breeding rates, but age at first breeding and age at sale of offspring had variable effects on the gross margin of the enterprise. The statistical model illustrated that for a one per cent increase in branding rates, an increase in gross income of $5274 or $2 per adult equivalent was possible. The optimal ages at first breeding and sale of offspring were 20.6 months and 10.8 months respectively. Information generated by the simulation and the statistical model allows management to identify the breakeven value, or limit, of expenditure on changes to the system. For example, if branding rates increased by one per cent and as a consequence gross income increased by $5274, then management can determine if a proposed investment in supplementary feeding will cost more or less than this increase in gross margin.