An economic case study of entire male grain-fed beef from a north-western Queensland production system

Abstract

Assessing the differences in gross margins for a north-western Queensland beef-production system was undertaken using herd-budgeting software. The analysis reviewed the viability of producing beef for the domestic market from either a steer or bull production system. A hypothetical herd of 1200 breeders was created for the case study evaluation. An integrated beef production system from breeding to feedlot finishing was found to be less profitable for bull beef production than for steers at the current market prices. Although bull production was more profitable than steer production during the feedlot phase, the production of bulls in this phase failed to compensate for the earlier economic losses in the weaning phase of –AU$24.04 per adult equivalent for bulls. During the feedlot phase, bull production systems had lower break-even sale prices than did steer production systems. In reviewing two pricing scenarios for bulls, it was found that marketing bulls at the same price as steers was the most profitable production system. We conclude that the production of bull beef from a north-western Queensland production system can be profitable only if bulls can be sold without discount relative to steers.