30 Pork News & Views Better Pork April 2021 Pork News & Views Ontario Ministry of Agriculture, Food and Rural Affairs Better Pork | February 2024 column, you will see the benchmarks from Table 2. The next two columns convert them into earnings per head with the revenue per head you enter. Depending on the purpose, you can use a historical average price or a projected price. In this example, the farm projects revenue of $225 per head, this is multiplied by the percent of farm revenue results for both the ‘All farms’ column and the ‘Top 25th percentile’ column. Livestock purchases were much less of a factor for F-to-F operations than they were for finishing operations. The small difference in the top finishing group from the other finishing operations in livestock purchases likely reflects the purchase price being based mainly on commodity markets with less room for a farm to manage the cost. Feed, on the other hand, saw significant differences with the top group for both swine enterprises. All livestock farms know that control of feed cost is key, but the top farms are clearly managing more successfully in this area. Knowing your feed expense ratio is a good place to start managing them. If the farm purchases all their feed, feed costs will all be in cost of goods sold. Farms that purchase a portion and grow their own will have feed costs spread across several of the cost categories. Use the detailed list of included costs in the feed expense ratio from the definitions in the OFFAS summaries to calculate a comparable ratio for your farm. The Ontario Farm Financial Analysis Summaries for swine and the other farm types can be found at the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) website at www.ontario.ca/page/ farm-finance-statistics. The summary reports outline the reporting format, calculation details and financial measures presented in the tables. John Molenhuis Business Analysis and Cost of Production Specialist, OMAFRA john.molenhuis@ontario.ca 613-920-2162 Transporting pigs in different weather conditions Weather conditions have a major impact on pig welfare and health during transportation and can lead to significant animal and financial losses in the form of non-ambulatory or dead-on-arrival (DOA) pigs. It is the responsibility of the person (or people) loading and transporting pigs to ensure that the animal is not likely to suffer, sustain injury or die from exposure to environmental conditions (CFIA Heath of Animals Regulations Part X11: Transport of Animals). Pigs of all sizes are sensitive to weather extremes. They don’t have a thick coat, nor are they able to sweat, making them vulnerable to both cold and heat stress. According to the National Pork Board Transport Quality Assurance program (TQA Handbook), DOAs are more likely to occur in the hot summer months and non-ambulatory pigs are more likely to occur in the cooler winter months. Transporters can take several measures to help protect pigs of all sizes during transport. These include the use of bedding, altering stocking density and ensuring the right number of boards are used on the trailer for the given weather conditions. Transporters must be aware of changing weather conditions during the transport process and adapt accordingly. Table 1 provides recommended bedding and boarF-to-F All farms F-to-F Top 25th F-to-F - All $ per head F-to-F - Top $ per head Your Farm Revenue $225.00 $225.00 Cost of Goods Sold 56% 47% $126.00 $105.75 Direct Operating 19% 15% $42.75 $33.75 Operating Overhead 3% 2% $6.75 $4.50 Annual Cost of Capital 11% 11% $24.75 $24.75 Interest 3% 2% $6.75 $4.50 EBT (Profit Margin) 11% 22% $24.75 $49.50 Table 3: Cost of production planning example Ratio F-to-F F-to-F Top 25th* Finishing Finishing Top 25th* Operating expense 86.6% 73.9% 94.5% 79.8% Livestock purchases 1.3% 0.5% 29.2% 27.6% Feed expense 54.8% 44.7% 45.1% 33.2% Health expense 3.0% 2.3% 0.7% 0.6% Labour expense 4.7% 3.4% 1.1% 1.1% Machinery operating expenses 8.1% 6.9% 7.2% 4.9% Table 4: Selected financial ratios for F-to-F and Finishing (five-year average: 2017 to 2021)
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