Economic significance of wool in meat production systems

Abstract

The contribution of wool to ewe output declines in relative terms as the number and value of lambs reared per ewe increases. This is illustrated by the spectrum of sheep production systems in Great Britain, from extensive hill production where wool accounts for 18% of ewe output, to intensive production out of the main lambing season, where wool only accounts for 6% of ewe output. The ratio of wool production to sheep meat production and their respective prices vary greatly between countries. In Great Britain, as technical efficiency increases, the relative, but not necessarily the absolute, contribution of wool to output declines. Changes in production systems and management, aimed at improving slaughter lamb output per hectare, will also bring about a consequential increase in wool production per hectare. Because wool represents an appreciably lower part of the output in meat producing systems than lamb sales, increases in wool prices have a relatively small effect on gross margins. In lowland flocks a 20% increase in wool prices only increases the gross margin per ewe by 3·1%. Although wool output is considerably less important than lamb sales in Britain it is, nevertheless, worthwhile for the producer to pay close attention to the fleeces produced in order to ensure that he receives the highest returns possible. This is illustrated by reference to the variation in wool returns per ewe between flocks. Fleece weights and quality have a high heritability and are rapidly improved by selection. However, the relative economic value of the annual genetic improvement in increasing the number of lambs reared per ewe is worth five times as much as the annual genetic improvement in fleece weight in lowland flocks; in hill flocks this falls to only twice the value.