Financial impact of average parity of culled females in a breed-to-wean swine operation using replacement gilt net present value analysis

Abstract

A net present value (NPV) analysis was used to determine the number of parities a sow must remain in the breeding herd of a breed-to-wean operation before the initial investment in her is profitable, and to evaluate the sensitivity of NPV to production, price received, and gilt replacement price. On the basis of 1996-2000 average production levels, segregated early weaning (SEW) pig price, production costs, and equity information, a replacement gilt must remain in the breeding herd for three parities before reaching a positive NPV. Sows having a longer productive herd life, when SEW price is at profitable levels, produce a higher NPV, and thus are more profitable investments than females which remain in the herd for shorter periods of time. Producers should identify genetic and environmental factors that improve the productive life, and thereby the NPV, of their replacement gilts. Additionally, increasing SEW pig prices and productivity improve the parity in which a replacement gilt reaches a positive NPV. This type of analysis could be used to assist producers, practitioners, extension specialists, consultants, and others to evaluate a host of management tools designed to improve the parity structure of commercial swine breeding herds experiencing the challenges of excessive culling.