Journal of Animal Science, Vol 77, Issue 6 1353-1363, Copyright © 1999 by American Society of Animal Science

JOURNAL ARTICLE

Biologically based coefficients for partitioning lamb and wool production costs

H. D. Blackburn and W. Pittroff
USDA, ARS, U.S. Sheep Experiment Station, Dubois, ID 83423, USA.

Global competition for selling lamb and wool requires sheep producers to effectively prioritize wool and lamb production. Both products are produced simultaneously, and this makes it difficult to differentially assess costs and net returns. This study addressed this issue by developing coefficients for use in financial analysis of lamb and wool profitability across and within five regions of the United States (Eastern, Midwestern, Intermountain West, Great Basin, and Texas). A procedure was developed using a sheep simulation model to partition the amount of nutrients used for lamb and wool production and then using the partitioning information to determine the proportion of costs to be assessed to lamb and wool production. Blackface breed types, when managed without nutritional limitations, had lamb and wool coefficients of .90 and .10, respectively. Wool breeds with unlimited and limited nutrition had lamb coefficients between .80 and .20 and .60 and .40, respectively. In-depth analysis of the Great Basin system indicated that wool and its improvement may contribute as much, if not more, under certain pricing conditions, as increased prolificacy to enterprise profitability. With low lamb prices ($1.32/kg) and moderate wool prices, the partial net returns for a Merino x Rambouillet were higher than the tested prolific breed type ($13.85 vs $11.27/ewe, respectively). This ranking was reversed under high ($2.31/kg) lamb prices ($47.90 vs $55.22, respectively). The derived method provides a basis for analyzing, comparing, and making management and breeding objective decisions.