Production Costs, Equilibrium, and Target Prices of a Goat Farm in Hidalgo, Mexico

Abstract

In Mexico, 440 thousand families depend directly or indirectly on goat sector. The objective is to quantify revenue and cost of production, equilibrium and target prices of a goat URP. Field data was collected in July 2013, in Tzidejhe, in the Mexican State of Hidalgo. The technic of producer panels was applied, 8 producers participated. Variable (CV), Fixed costs (CF), economic costs (CEC), financial costs (CFIN), cash flow (CF), total revenues and net income were estimated. A rustic URP, 10 productive goats (does or nannies), was analyzed. A CEC of 10,991 pesos per year, per female, was estimated, a CFIN of 4,070 pesos and a CF of 8,823 pesos per year. In financial terms, the URP gets a positive net income of 28,004 pesos per year. In economic terms the URP losses 41,206 pesos a year. A cash deficit of 19,529 pesos a year is faced. Equilibrium prices are reached only in economic terms, under the more common and optimistic yield scenarios. The URP will stay in business in the short run, its viability in the medium and long run is uncertain.