CRC Perspectives on constraints, opportunities and priorities Colin Kay Pork Producer, Director NZPIB November 2005

Key issues Sustainability Profitability

Sustainability Manure disposal – treat as a resource Odour reduction Country health status Animal welfare – group housing Marketing/promotion Pork quality – boar taint Pork industry image Unfair trading - dumping Obtain, train, retain good staff

Profitability Operating profit (EBIT) EBIT = Gross income – variable costs – fixed costs Cost of production All research should result in increase in profit or reduction in COP

COP relationships Price of feed vs. FCR -Use low value by-product – lower feed costs but higher FCR -Lower costs but reduce kg sold COP Feed = cost/kg feed x FCR

COP relationships Skilled Staff Mating area - ↑ total pigs born & ↑ No. litters Farrowing area -↓still born & pre-weaning mortality Will increase no pigs weaned/sow/yr Daily feeder adjustment - ↑ intake, ↑ growth rate & ↓wastage - Aim to ↓ FCR

COP relationships Breeding stock Improved carcass traits - killing out %, backfat and lean yield Increase total pigs born/litter ADFI + ADG + FCR

Effect of scale of production Compare two herd sizes –250 sow herd –500 sow herd Marketing pigs/sow/year Carcass deadweight 67kg average

COP Double sow herd to 500 Double variable costs 84% → 92% Fixed costs same 16% → 8% COP $2.77 → $2.48 Increase pigs sold/sow/yr → 24 Increase carcass wgt 67kg → 72kg COP$2.48 → $2.40

Profit ($/kg – ((cost/kg feed x FRC) + variable costs/kg+ fixed costs/kg))) x volume kg

Constraints Scale Environmental Cost of cereal grains Labour

Opportunities ↑ Utilisation of feed - ↑ intake ↓ wastage ↑ Digestibility of feed ingredients By product feeds ↓ Reproductive wastage Group housing management Outdoor production ↑ Carcass weights Staff training and recruitment

Priorities ↓ Feed costs/kg carcass (COP Feed = cost/kg feed x FCR) ↑ Digestibility + utilisation of feed ↑ Reproductive productivity Meat quality-boar taint-tenderness Technology transfer Staff training and recruitment Outdoor production systems