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Integration of forage, beef, and hog production systems in Western Canada: An economic assessment

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  • Brewin, Derek G.
  • Undi, Michael
  • Kulshreshtha, Suren
  • Wittenberg, Karin
  • Tenuta, Mario
  • Ominski, Kimberly H.
Abstract
This study was conducted to evaluate the economic sustainability of single enterprise farming operations when compared to integrated operations. The single operations consisted of either a hog only production system, a forage-based production system or beef cattle on pasture and the integrated operations were either a hog–forage or hog–beef production system. The hypothesized benefit of integration was the relatively inexpensive supply of nutrients from the hog facilities which may be applied to forage land used in both hay and beef cattle production, resulting in improved forage yield and cattle stocking rates. Net income from a 500-sow farrow-to-finish operation was analysed along with net income from a 349-ha forage production system and a 349-ha cattle production system. The 349-ha land area was an estimate of the forage area needed to spread the manure from the hog operation at nutrient removal rates governed by provincial (Manitoba, Canada) legislation. At ten year average prices, the single-enterprise beef and forage operations were not profitable, losing $2838/year and $34,169/year, respectively. Integration of single-enterprise operations with the hog operation made integrated operations viable, with additional profits of $50,935/year (beef) and $9894/year (forage), over and above the profit of the hog portion of the operation, as a consequence of the additional nutrients provided in the form of manure. Annual net income of the integrated hog–forage operation was 2% greater than the hog only operation that treats manure as a waste. Further, the integrated hog–beef operation realized a 10% increase in net income as a consequence of integration.

Suggested Citation

  • Brewin, Derek G. & Undi, Michael & Kulshreshtha, Suren & Wittenberg, Karin & Tenuta, Mario & Ominski, Kimberly H., 2014. "Integration of forage, beef, and hog production systems in Western Canada: An economic assessment," Agricultural Systems, Elsevier, vol. 127(C), pages 1-8.
    • Handle: RePEc:eee:agisys:v:127:y:2014:i:c:p:1-8
    DOI: 10.1016/j.agsy.2013.12.005
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    References listed on IDEAS

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    1. Grossman, Sanford J & Hart, Oliver D, 1986. "The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 691-719, August.
    2. Williamson, Oliver E, 1971. "The Vertical Integration of Production: Market Failure Considerations," American Economic Review, American Economic Association, vol. 61(2), pages 112-123, May.
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    1. Mosnier, Claire & Boukhriss, Sanae & Minviel, Jean-Joseph, 2023. "Does pig production improves cattle farm sustainability in the French massif central? A hierarchical constrained directional benefit-of-the-doubt approach," Agricultural Systems, Elsevier, vol. 210(C).

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