productivity of hog operations chart

Editor’s note: The following was written by Carl Zulauf, Ohio State University Department of Agricultural, Environmental and Development Economics, for the University of Illinois Farmdoc Daily website May 24.

While not the most encompassing measure of crop productivity, yield — or production divided by land — is easy to compute. Research confirms its value as farms with consistently higher yields are found to be more profitable over time.

In addition, since land is a foundation input used in all crop production, percent change in yield provides insights across crops. In short, yield is a simple, useful metric.

In contrast, commonly used livestock productivity measures are specific to a species and usually to a particular part of the production process, such as pigs per litter.

This article discusses a livestock productivity measure that is easy to compute and can be used to compare productivity across species. It is analogous to yield in construction. Specifically, livestock output is divided by the breeding stock that produces the animals that produce the output. The latter will be referred to as the foundation herd.

By this measure, hogs clearly have the highest productivity gain over the last quarter century.

Productivity jumps

The productivity of hog operations stands out. It was 68% higher in 2014-18 than in 1993-97 (see Figure 1). Next highest were dairy and broilers at 44% and 43%, respectively. Productivity gains for beef and eggs are 17% and 13%, respectively.

In assessing the productivity of beef, it is important to keep in mind that calves from dairy cows that are not retained for the dairy herd are often fed out for beef and culled dairy cows are sold for beef. If the share of beef coming from dairy cows and calves has changed since 1993, it could affect the change in productivity of beef production.

Productivity increased only 2% for sheep. Non-commercial slaughter is much larger in sheep than other species due to demand from non-traditional markets. This slaughter is a moving target and difficult to assess. It is not captured in the productivity ratio, and thus could explain at least some of the small gain in sheep productivity.

At its simplest, productivity increases when more output is produced with the same foundation herd or when the same output is produced with a smaller foundation herd. Dairy illustrates the former as more production is coming from a foundation herd that has changed little.

Beef illustrates the latter as about the same production is coming from a smaller foundation herd. And, while production increased more for broilers than hogs (63% vs. 43%), productivity increased more for hogs as its foundation herd declined 15% vs. a 15% increase for broilers.

A key difference across beef, hog, and sheep is change in offspring per female animal. To illustrate, saved pigs per litter rose 30%, from 8.25 in the March 1993 Hogs and Pigs report to 10.70 in the March 2019 report.

Using numbers from cattle, ratio of the calf crop during the prior calendar year to cows and heifers that had calved as of Jan. 1 was 0.89 in 1993 vs. 0.90 in 2019, a 1% gain.

Sheep and goats reported lambs per 100 ewes in 1993 as 102 vs. 107 in 2019, a 5% gain.

Comparison to crop yields

Caution is needed in comparing changes in this livestock productivity measure with changes in crop yields, in part because livestock production is a flow process while crop production is more akin to a stop-action process involving a time-defined planting-to-harvest period.

However, the comparison does provide one perspective. Gains in hog productivity exceeded the increase in harvest yield of nine large acreage field crops over the same period. The gain in dairy and broiler productivity is on par with the increase in corn yields and is exceeded only by the increase in peanut yields.

By this measure, hogs had the largest increase in productivity over the last quarter century: 68% vs. the next highest increases of 44% and 43% for dairy and broilers.

Any ratio measure calls attention to its components, in this case, the important role foundation herd plays in livestock productivity. A smaller foundation herd is a key contributor to the large increase in hog productivity and in particular its advantage over broiler and dairy productivity gains.

This observation implies more attention should be paid to the role of the foundation herd in livestock productivity at all levels, from individual operations to the sector.