SOME POSSIBILITIES OF HOW TO REDUCE LOSSES
IN SHEEP KEEPING

Lengyel, Lajos Nagy, Zoltán
Tóth, István Délborsod Co-operative
University of Agriculture Sciences for Fish and Sheep Farming
Faculty of Agricultural Gelej, Hungary
Engineering College
Meztúr, Hungary

ABSTRACT

The main aim of the examination was to establish the formation of yield-expense and income relationship at a 4000 ewe keeping farm (Agricultural Co-operatives, Gelej), where the crossbreeding of 70-75 percent milking species is under progress in relation to several constructions.
Profitability of sheep keeping is determined by the external and internal (industrial) production factors at the disposal of farming organizations. The presence and absence of all these affect the stock-number, the volume of production, utilizational trend, the standard of breeding and keeping technology.
Five year data (1992-1996) show gradual increase in milk production of cross-bred stocks despite the fact that it is at a slow pace. Average milk-yield per ewe in 1992 was 55 litres, in 1996 it was 78.5 litres. The greatest output (115 litres/ewe) was by Pleven F1 x East Friesian (selected) stock in 1995.
The formation of output depending on the current purchasing price significantly affects the greatness of income.
We can deduce the utilizational trend from the knowledge of per-product composition of the income. On this basis it can be concluded that in the examined years the income of meat was 52-57 percent, and milk was 28-33 percent. As the result of the increased forage and other expenses, milk and the purchasing price increase compared to 1992 could only take part of the compensation.
Total income per ewe increased year by year, in which the increase of yields and greater purchasing price played a major role owing to the effect of cross-breeding. (Milk price in 1995 was 58 Ft; in 1996: 65.0 Ft; in 1997: 101.9 Ft). The greatest income was reached by Pleven F1 x East Friesian selected stock.
Of course, so far as the purchasing price of sheep milk would meet the price in western countries (which in relation to cow-milk in the USA is 1:4, in Spain 1:3 and in Hungary 1:2), the branch could reach much greater success.
The profitability of the branch was unfavourably affected by the significant increase of input prices.
It can be concluded that the coverage expense increased in some constructions, moreover the coverage support and amounts by Pleven F1 x East Friesian selected stock were the greatest.
We can finally conclude that the security of the profitability of sheep keeping is a specialization based on the consistent breeding work and the cross-breeding type-formation. The formation of the purchasing price of sheep products is the determinant factor of branch income. Reduction of export aids, however, can conserve the earlier situations and can be an obstacle to prosperity.
Continuation of the cross-breeding of type-formations is a further possibility of yield-increase.
The specialization of the meat trend of Merino stock beside a smaller specific milk yield is a significant income source, but as a result of the cross-breeding of type-transformation we can count on further yield increase. In the economy the two utilizational trends complement each other exceedingly, as the risk of income acquisitions can be reduced.

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INTRODUCTION

The profitability of sheep keeping is determined by the external and internal production factors available to the farming organizations. The presence or absence of these affects the number of stock, production volume, utilizational trend and the standard of breeding and keeping technology.

This establishment is proved by the crisis that was typical of the past decades and the publications of the researchers (Illés B.Cs. 1995; Daróczi L. - Kukovics S. 1995; Jávor A. 1996; Lengyel L. - Tóth J. 1995) dealing with this theme.

International market demand of sheep products (mutton, cheese) is typical today. In the past few years we were only partly able to meet our export demand due to some known reasons. The quality measures taken in the past few years that increased the number of staff and export - though they were recently brought into existence - have given a little hope to the stopping of reduction of staff and, if they become stable, they may influence the prosperity of the branch.

MATERIAL AND METHODS

With the cooperation of farming exports at the cooperative in Gelej, Borsod county, we carried out examinations for many years on the basis of the profitability of milking sheep-stock. The grounds of the examination are reflected by the collected data in the economy, which have been worked out with traditional industrial statistical methods and shown in analysis tables. The periods of examination were 1993-96.

The basic objective of the examination was to show the profitability of the branch with more than 4 000 ewes, where the crossbreeding of milking directed type-formation was 75 percent in relation to different constructions.

RESULTS

Table 1 shows the composition of ewes per type-construction in the examined periods.

Table 1. Composition of the stock per type-construction

Type-construction	1993		1994		1995		1996
	how many	%	how many	%	how many	%	how many	%
Merino	1 174	26	1 565	34	843	24	688	20
(Merino x Pleven Blackhead) F1	2 726	58	2 384	50	1 225	34	-	-
PlF1 selected	389	8	399	8	494	14	1 345	39
PlF1 total	3 115	66	2 783	58	1 719	48	1 345	39
PlF1 x East Friesian	382	8	392	8	688	19	-	-
PlF1 x East Friesian selected	-	-	-	-	332	9	1 401	41
PlF1 x East Friesian selected total	382	8	392	8	1 020	28	1 401	41
Total	4 678	100	4 740	100	3 582	100	3 434	100

It can be concluded that in 1995 and 1996 the number of the milked stock was reduced owing to some economic reasons.

Table 2 shows the specific milk yield per ewe per year.

Table 2. The formation of the specific milk yield per type-construction (litres/ewe)

Five-year data show there is a gradual increase in the milk yield of the crossbred stocks, although it happens at a slow pace.

The formation of yield depending on the current purchasing price significantly influences the greatness of income.

Table 3. The structure of income

Name	Mutton		Milk		Wool		Rejected ewe		Expense support		Total
Examined years	HUF (000)	%	HUF (000)	%	HUF (000)	%	HUF (000)	%	HUF (000)	%	HUF (000)	%
1993	10 196	56.2	5 578	30.8	1 289	7.0	50	0.3	1036	5.7	18 158	100
1994	14 155	54.7	8 018	31.0	1 038	4.1	1269	4.9	1405	5.4	25 885	100
1995	15 389	51.7	9 710	32.6	835	3.1	2106	7.1	1657	5.6	29 756	100
1996	21 870	56.7	10 857	28.2	1 211	3.2	2354	6.1	2249	5.8	38 541	100

Conclusions can be drawn from per product composition of income towards the utilization trend. On this basis it can be established that within the income, mutton represents 52-75 percent, while milk is 31-33 percent. Because of known reasons the income ratios (3-7 percent) of wool is insignificant; it hardly covers the shearing costs. An increase of expense support might be one of the elements of a production incentive scheme.
With relation to the effected income of 1993, more than 50 percent milk and slightly less slaughtered-sheep purchasing price-growth could play a significant role because of greater fodder and other expenses (energy, medicine, etc.).

Table 4 shows the specific income, expense and profit of the branch.

Table 4. The formation of specific expenses, income and profit of the branch in 1993-1996

(HUF/ewe)

Specification	Income				Production cost				Profit
	1993	1994	1995	1996	1993	1994	1995	1996	1993	1994	1995	1996
Merino	3 022	5013	6 382	9 284	3 148	4 912	4 548	8 245	-126	602	734	1 039
(Merino x Pleven Blackhead)F1	3 910	5522	7 829	-	3 625	4 522	6 877	-	266	1 000	952	-
PlF1 selected	4 913	6153	9 807	9 920	4 211	5 030	8 439	8 860	702	1 123	1 369	1 060
Total PlF1	4 036	5612	397	9 920	3 698	4 595	7 326	8 860	338	1 017	1 072	1 060
PlF1 x East Friesian	5 324	6176	10 989	-	5 110	5 699	8 320	-	211	474	2 668	-
PlF1 East Friesian selected	-	-	9 145	13 092	-	-	7 563	11 162	-	-	1 581	1 930
Total PlF1 East-Friesian	5 324	6176	9 745	13 092	5 110	5 699	7 809	11 162	211	474	1 936	1 930
Total	3 882	5461	8 307	11 223	3 670	4 626	7 069	9 676	212	835	1 238	1 547

Total income per ewe is increasing year by year. In this yield in 1995-96 the purchasing price-increase played a significant role. The greatest income - 13 092 Ft/ewe - was reached by the Pleven F1 x East-Friesian stock. Despite the significant expenses that are typical of type-construction (as the effect of the yield and purchasing price) the profit was also the greatest.
Of course, in as much as the purchasing price of sheep-milk (which has in relation to cow-milk in the USA a 1:4 and in Spain a 1:3 ratio, has less than a 1:2 ratio in Hungary) would be similar to the sheep-milk producing western countries' purchasing price, the branch could reach much greater profit.
The income of the branch within four years increased by 2.9, while the production costs increased 2.6 times, which are reflected by the profit indices. Inasmuch as the expected alternative expenses after investments, or the underdeveloped income should be taken into account, the branch could be a lossmaker under these circumstances as well.
Conclusions can be drawn from the favourable tendency formation of indices leading to the favourable effect of type-formation breeding. In 1996 the stocks with less than 25 percent milked were not burdened by the relative great costs of unmilked stocks because of a small specific yield (Table 5).
Table 5. The funds contribution and amount per ewe

Specifi-cation	Funds contribution								Funds amount
	1993		1994		1995		1996		1993		1994		1995		1996
	HUF	%	HUF	%	HUF	%	HUF	%	HUF	%	HUF	%	HUF	%	HUF	%
MFM	1 007	67	2 482	89	2 878	68	5 144	82	-2.6	-	902	78	1 220	68	1 086	68
PlF1	1 425	94	2 748	98	3 810	89	-	-	504	124	1 310	113	1 508	84	-	-
PlF1 selected	2 666	176	3 629	130	5 161	121	5 529	88	946	232	1 526	132	2 014	112	1 111	69
Total PlF1	1 850	-	2 889	-	4 194	-	5 529	-	473	-	1 356	-	1 654	-	1 111	-
PlF1 x East-Friesian	2 568	170	2 921	104	6 507	153	7 501	120	438	107	882	76	3 307	183	-	-
PlF1 x East Friesian selected	-	-	-	-	5 031	118	-	-	-	-	-	-	2 164	120	2 330	145
Total PlF1 x East Friesian	2 568	-	2 921	-	5 508	-	7 501	-	438	-	882	-	2 536	-	2 330	-
* per ewe	1 515	100	2 799	100	4 259	100	6 257	100	408	100	1 158	100	1 803	100	1 603	100

On the basis of the above-displayed data it can be determined that there was a rise of funds amount in some construction.
Funds contribution and amount were greater at PlF1 x East-Friesian and PlF1 x East-Friesian selected stocks. The above indices support the fact that the growth of surplus expenditure plays a significant role in the formation of profit.

CONCLUSIONS

Our examinations supported the establishments in bibliography, which are as follows:

· The security of profit by sheep keeping is a ground for specialization towards consistent breeding work.
· The formation of the price of sheep products (mutton, milk) is the determining factor of profitability.
· Besides the relatively favourable formation of the purchasing price of slaughtered sheep, the price of milk is relatively low compared to the European countries' prices, and we might add that reduction of export aid could put a stop to the booming of the branches.
· Continuation of type-formation crossbreeding is a possibility of further yield increase.
· Keeping of Merino stock might bring greater income and profitability if there should be favourable meat purchasing prices, but the double utilization (mutton, milk) might reduce the richness of profit acquisition.
· The branches cannot give up investments, subsidy of reconstructions either, besides the support of breeding and purchasing price.
· Participation of integrated organizations is indispensable in the development of branches.
REFERENCES

Daróczi, L. & Kukovics, S. 1995. [Shortage of the wew-milk - troubles - possibilities]. In: Magyar Juhászat [Hungarian Sheep Breeding] 1995, 10:2-3.
Illés, B.Cs. 1995. [Examination of the factors influenced the profitability of the sheep-branch, possibilities of the increasing of the competition]. In: Dissertation.
Jávor, A. 1996. [What kind of support-system do we need?] In: Magyar Juhászat [Hungarian Sheep Breeding] 1996, 7:5-7.
Lengyel, L. & Tóth, I. 1995. The results of sheep milking-equipment with reference to labour organization. In: Bulletin of the University of Agricultural Sciences I. Gödöll, pp. 333-342.
Lengyel, L. 1995. The profitability situation of sheep-milk production in Hungary. In: Cercetaaria stientifica si tehnica in spriinul dezvoltarii si restructurarii agriculturii. Timisoara. pp. 11-18.