Profitability of growth agents ‘more complex’

Press, 2 November 1984, Page 24

Profitability of growth agents ‘more complex’

Measuring the profitability of growth-promoting agents (G.P.A.S) in beef cattle in grass-based, mixed livestock farming is somewhat more complex than the estimates based on carcase returns accompanying some trial results.

This view is given in a discussion paper, by Ms D. E. Fowler, released by the Agricultural Economics Research Unit at Lincoln College. Ms Fowler, an assistant research economist with A.E.R.U., examines the economic potential of growth-promoting agents in beef.

She points out that many trials evaluating performance of beef cattle treated with G.P.A.S have been in feedlots with high-energy concentrates as part of the dry matter consumed. In these trials carcase returns from treated and control animals have been compared. In a grazing system, availability and composition of feed are determined by the location and character of the land, climate and season, as well as by management decisions. Managing feed in a feedlot does not require the same judgments as on a Eastoral farm. Differences etween intensive management and the mixed-live-stock, pastoral management practised in New Zealand are such that economic evaluations in one system may have , only limited application in the other. Administering G.P.A.S to beef cattle has become a widespread practice in most beef-producing countries. New Zealand farmers have had relatively limited opportunity to use the. technique. As yet only one product, Ralgro, is fully licensed for use here, although two others may be licensed shortly. There has been a conservative approach to using G.P.A.S in New Zealand because of concern by some importing countries, particularly within the E.E.C. The concern is about possible harmful residues in meat from animals treated with anhbolic agents. / However, this concern has been.reduced by experience and few countries now ban imports of treated animals. . No' limitations on the production or export of beef treated with . registered G.P.A.S have been placedby

the United States, which buys most of New Zealand’s beef exports. But because more than half of the beef offals exported from New Zealand go to E.E.C. markets, its regulations on G.P.A.S are relevant to this country.

Generating profits from G.P.A.S needs positive management, especially of available feed.

Rapid liveweight gain, whether by feeding, implanting or both, generates better returns, even though opportunity costs are higher. Ample feed is needed to maximise the potential of G.P.A.S in implanted animals, but this could affect other livestock on the farm.

If implanted beef animals get priority for feed when feed is limited, liveweight gain of lambs may be less. The cost of lamb liveweight gain thus foregone could reduce the net benefit from implanting by nearly half at low rates of liveweight gain, but this effect is much less at higher rates of gain. Clearly there is an advantage in finishing beef animals to a target liveweight, rather than to a planned sale date, so G.P.A.S cbuld prove valuable in achieving this.

But using G.P.A.S to achieve higher final .liveweights at a planned sale date is still highly profitable. The return to the farmer from using G.P.A.S in beef cattle needs only to be more than the cost of using these to be worthwhile.

Even less-advantageous management and relatively modest liveweight gains from using G.P.A.S in steers can be profitable. If using G.P.A.S can modify behaviour sufficiently there is a potentially large gain to be made from fattening bulls rather than steers.

This is particularly so if target liveweights are achieved sooner, rather than achieving larger carcases at sale date.

Implanted bulls could yield net benefits three times higher than implanted steers with assumed improved feed conversion efficiency.

Partly this is the liveweight difference of about 10 per cent in yearling animals before implanting. Even if there were no differences in liveweight

gain between implanted bulls and implanted steers the initial liveweight difference of an extra 10kg carcase weight remains. There would seem to be considerable advantages for farmers 'whose farms are likely to dry off in summer. They would have larger animals at the start of the Spring flush and get rid of them before feed ran out, without having to run sexually active bulls. Ms Fowler says her approach is completely theoretical, because bf lack of field data on dry matter intake and feed conversion efficiency in implanted animals on pasture.