Simulation of mountain cattle farming system changes under diverse agricultural policies and off-farm labour scenarios

Livestock Science 137 (2011) 73–86

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Livestock Science j o u r n a l h o m e p a g e : w w w. e l s ev i e r. c o m / l o c a t e / l i v s c i

Simulation of mountain cattle farming system changes under diverse agricultural policies and off-farm labour scenarios A. García-Martínez a,1, A. Bernués a, A.M. Olaizola b,⁎ a b

Centro de Investigación y Tecnología Agroalimentaria de Aragón. Av. Montañana 930, 50059-Zaragoza, Spain Departamento de Agricultura y Economía Agraria, Universidad de Zaragoza. Miguel Servet 177, 50013-Zaragoza, Spain

a r t i c l e

i n f o

Article history: Received 3 December 2009 Received in revised form 5 October 2010 Accepted 6 October 2010 Keywords: Farm dynamics Off-farm work Land use CAP decoupling Mixed linear programming

a b s t r a c t European mountain farming systems have changed considerably in recent years. These changes are due to factors related to the following: internal characteristics of the farm and household; local and regional conditions; and economic and political environment that determine the general market situation and subsidies that the farmers receive. The decoupling of subsidies decided in 2003 CAP reform was an unprecedented change that raised many questions about the response of mountain livestock farming systems. The objective of this paper was to analyse the possible adaptation strategies of mountain cattle farms in various scenarios as a result of changes in policies and markets. The study is based on a previous evaluation of cattle farms diversity carried out in three valleys of the Spanish Pyrenees. Six types of farms characterised according to their past observed evolution trajectory (1990 to 2004) (García-Martínez et al., 2009) were the basis to define mixed linear programming (LP) models that represented the annual operation of the farms. Five socioeconomic and policy scenarios were simulated depending on CAP conditions (partial or total decoupling), orientation of production (weaned or fattened calves) and existence of an off-farm work market (tourism activity). Sensitivity analyses for the price of feedstuff cereals, meat and weaned calves were completed. Off-farm work was economically profitable in the majority of the cattle farms under the current situation of partial decoupling, which may lead to a further decrease in the livestock farming activity and changes in land use (less proportion of mowing semi-natural grassland). Calf fattening was a viable activity, but it was extremely sensitive to changes in the prices of inputs and outputs. Therefore, a raise in the price of cereals or a declining price of meat may lead to a drastic decrease in calf fattening. Ensuring the provision of environmental services by mountain agriculture will not only depend on the specific circumstances in which conditionality is applied but also on the amount and delivery conditions of agri-environmental subsidies. In areas where tourism is on the rise, it is likely that the presence of non-agricultural activities on the farms will continue to increase, and, consequently, so will the displacement of the livestock activity with subsequent changes in land use. Furthermore, this trend will be accentuated in times of total decoupling. © 2010 Elsevier B.V. All rights reserved.

1. Introduction

⁎ Corresponding author. Tel.: +34 976761597; fax: +34 976762488. E-mail addresses: [email protected] (A. García-Martínez), [email protected] (A. Bernués), [email protected] (A.M. Olaizola). 1 Permanent Address: Centro Universitario UAEM Temascaltepec, Universidad Autónoma del Estado de México. Instituto Literario 100, Colonia Centro, C.P. 50000, Toluca, Estado de México, México. 1871-1413/$ – see front matter © 2010 Elsevier B.V. All rights reserved. doi:10.1016/j.livsci.2010.10.002

Livestock farming systems in European mountain areas are important even in a post-productivist period as today (Matthews et al., 2006). Although the livestock farming systems are not as economically significant in certain rural areas as other sectors, such as tourism, they also produce nonmarketable goods and services (landscape conservation,

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biodiversity, etc.). Consequently, livestock farming in mountain areas is associated with multiple productive, environmental and social objectives given its positive contribution to economic and social cohesion because it maintains rural employment (Laurent et al., 2003; Gibon, 2005). European mountain cattle farming systems have changed considerably in recent years. In the Spanish Pyrenees, the main changes observed in cattle farming systems in the period of 1990 to 2004 were as follows: the increase of land area and herd size; a change in productivity in mixed-beef (weaned calves) dairy farms; an increase in on-farm fattening activities; and an increase in off-farm activities (GarcíaMartínez et al., 2009). These changes were mainly due to factors related to farm location, farm characteristics, general economic environment and political environment. These factors determine the general market situation, and, therefore, price levels and specific subsidies that the farmers receive. All of these factors have a large impact on the choices livestock farmers make (Liénard et al., 1998), and the Common Agricultural Policy (CAP) is one of the main factors that explains the development of European agricultural systems (Matthews et al., 2006). The CAP reform decided in Luxembourg in 2003 established a new support model for European agriculture. The CAP reform had two main elements as follows: decoupling (the disassociation of subsidies from production) and modulation. The third element was the conditionality of the subsidies, which is regarded in the new model as a requirement for the collection of the new payments. The decoupling of subsidies is an unprecedented change in agricultural policy (Breen et al., 2005; Henessy and Rehman, 2008), which will be emphasised in the future according to the CAP health check, raises many questions about the response of livestock farmers to these changes. The use of mathematical models allows simulation and analysis of potential impacts of agricultural policies before, during or after their implementation (Buysse et al., 2007). Consequently, bio-economic farm models have been developed, making it possible to integrate economic and agroecological information (Ruben et al., 1998). Bio-economic farm models are classified as positive or normative according to their approach. A positive model aims at simulating the current behaviour of the farmer, describing the management decisions and trying to understand these decisions. A normative model aims at obtaining optimal solutions to management alternatives and allocation of resources. Mathematical programming (i.e., optimization models), often based on linear programming (LP), usually follows a normative approach. Arriaza and Gómez-Limón (2003) compared the predictive capacity of a number of optimization models and concluded that the predictive ability of the traditional profit maximization model is low, however it depended on the context situation and, therefore, on the particular case study. Janssen and van Ittersum (2007) suggested that the predictive capacity of these models is limited, especially when trying to simulate the adoption of new technologies by farmers. Kerselaers et al. (2007) reported similar conclusions in a study of farm conversion from conventional to organic, and they suggested that the results need to be interpreted as potential changes rather than real changes. Despite the limitations, mathematical programming models have been widely used in the modelling of livestock farms

and are still in use because the objective in many cases is not to optimize but to describe a particular situation (Buysse et al., 2007). Some of the latest applications of LP in beef cattle farming systems refer to the impact of Agenda 2000 on representative beef farms in Spain (Júdez et al., 2001) and on farms in the Charolais area in France (Veysset et al., 2005a). Furthermore, the applications also refer to the effect of the decoupling of subsidies on production decisions on Irish cattle farms (Breen et al., 2005) and French farms (Ridier and Jacquet, 2002) or the effect of changes on food strategy prices and participation in agri-environmental schemes on Irish farms (Crosson et al., 2006). According to Buysse et al. (2007), the renewed interest in the use of mathematical programming models above all other models to analyse the effects of changes in agricultural policies may be due to a shift from policies based on sustaining prices to farm-oriented systems (quotas, stocking rates single payments, etc.). Moreover, the renewed interest may be due to an increased interest in the multifunctionality of agriculture. This methodology offers the possibility of introducing restrictions, such as the availability of land areas or the requirements of animals. Relations are established among the models to prevent impossible results from being obtained and to increase the credibility of optimization models. Within this framework and based on an established typology of “trajectories of evolution” in cattle farming systems in the Pyrenees (García-Martínez et al., 2009), the objective of this paper was to analyse possible adaptation strategies of these systems in various scenarios as a result of changes in the policies affecting them and in the markets for labour, inputs and outputs. 2. Materials and methods 2.1. Study area Three valleys of the Spanish Central Pyrenees (900 to 1450 m.a.s.l.) located in Huesca (Aragón Region) were examined in this study (Broto, Benasque and Baliera– Barrabés valleys). In general, the population working in agriculture decreased drastically between 1991 and 2001, with a corresponding increase in the population working in the service sector. Moreover, the number of beef holdings decreased, but the number of cattle remained stationary. Large differences were observed across the valleys (GarcíaMartínez et al., 2009). 2.2. Farm types A constant sample of 71 mountain cattle farms located in the three valleys mentioned above was considered in this study. The information was available for two years (1990 and 2004), and a typology of trajectories of the evolution (T) of farms between 1990 and 2004, i.e. groups of farms that followed homogenous development paths over time, was previously established by means of multivariate analysis (García-Martínez et al., 2009). Six trajectories of evolution were obtained. Trajectory T1 “large size with no changes of structure and management”. These farms showed no changes in land and herd size between 1991 and 2004 due to the

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Table 1 Main structural characteristics of cattle farms that followed specific trajectories of evolution (2004). Trajectory

T1

T2

T3

T4

T5

T6

No. of cattle farms

4

12

5

20

12

18

(%)

(5.6%)

(16.9%)

(7.0%)

(28.2%)

(16.9%)

(25.4%)

Land area (ha of UAA) Sown grassland (ha) Semi-natural grassland (ha) Grazed grassland (ha) Forest pastures (ha) No. of cows Calves sold cow−1 year−1 % fattened calves Work units (on-farm work) % off-farm activity (farmer)

290.5 5 40 149.0 130 134 0.80 43 2.22 0.0

99.3 0 34.1 25.3 0 55 0.60 100 1.40 16.7

74.6 0 33.6 25.2 72 73 0.75 0 1.20 60.0

36.3 1.7 21.5 7.8 70 68 0.77 70 1.44 30.0

39.0 0 22.8 12.3 15 44 0.73 10 1.24 41.7

38.2 0.6 19.4 7.3 10 33 0.71 0 1.36 11.1

T1 “large size with no changes in structure and management”; T2 “medium–large size with no structural changes and fattening orientation”; T3 “large growth, labour reduction and no fattening orientation”; T4 “large herd growth and fattening orientation”; T5 “moderate growth and large-scale extensification”; T6 “small growth and decrease in productivity”.

reduction of labour and the increased number of heads managed per work unit (WU).2 The pluriactivity of both the farmer and the household strongly decreased in the period of study. Trajectory T2 “medium-large size with no structural changes and fattening orientation”. These farms were large with stable land areas and had relatively small increases in herd size. T2 was defined by the strongest change in orientation towards fattening. Similar to the general sample, the pluriactivity of the farmer and family increased in T2. Trajectory T3 “large growth, labour reduction and no fattening orientation” was observed in medium-sized farms that experienced the largest increment of land and herds, which doubled in the period of the study. Furthermore, T3 was characterised by the largest increase of farmer and household off-farm activities. Trajectory T4 “large herd growth and fattening orientation”. T4 grouped small farms that experienced a moderate increase of land and a large increase in animal numbers. There was a strong specialisation towards fattening activities in T4. Trajectory T5 ““moderate growth and great extensification”. In T5, the farms that experienced moderate increases in land and herds also had a reduction of labour, doubling the number of animals managed by WU. T5 was characterised by an intense process of economic and grazing management extensification. Similar to T3, off-farm activities increased considerably in T5. Trajectory T6 “small growth and decrease productivity”. T6 grouped the smaller farms at the beginning and at the final year of study, and these farms experienced moderate increases in land and herds. Both animal and labour productivity decreased intensely to the lowest levels in T6, and off-farm jobs were uncommon for farmers. The 2004 average values for technical and economic indicators of the farms belonging to each trajectory provided parameters specific to the model (Table 1). For each trajectory, a mixed LP model representing the annual operation of the farm distributed into four seasons was developed with the Xpress-MP programme (Dash-Optimization, 2002). In the text, we referred to MT1 to MT6 as the

2

Work unit (WU): time spent on an activity by one person for 1 year.

optimization models corresponding to the particular type of farm trajectory (T1 to T6). 2.3. Scenarios The six models, representing the trajectories of evolution (MT1 to MT6), were run under five scenarios of different implementations of CAP measures and labour availability (pluriactivity of the farmer). On one hand, the rationale behind the scenarios was that CAP had a central role when explaining changes of European livestock farming systems. On the other hand, the rationale behind the scenarios was that total (abandonment) or partial substitution of agriculture for off-farm activities was one of the most important phenomena in European mountain agriculture. The base scenario (Sc0) corresponded to the average structure and management observed in the conditions at data collection in 2004 (but before 2003 CAP reform was established). This scenario enabled the models to be adjusted so that the differences between the results obtained and the established trajectories of the mountain cattle farming systems observed were minimal, which was the first approximate validation of the models (Veysset et al., 2005a). Scenario 1 (Sc1) corresponded to the partial decoupling and possibility of calf fattening. Sc1 was based on Sc0, but the on-farm fattening activities became a decision variable of the model (i.e., the percentage of animals fattened in the farm was not fixed). In Sc1, the CAP measures corresponded to the 2003 reform in Spain. Specifically, it established 100% decoupling of the special male bovine premium (€210/animal) and extensification premium (€100/suckler cow), and it also established partial decoupling (60%) of the slaughter premium for adult cattle (€48/animal), which was introduced in the single payment (SP). For the calculation of SP (decoupled subsidies), the conditions of the trajectories, when the information was collected in 2004, were considered. Scenario 2 (Sc2) corresponded to partial decoupling, possibility of calf fattening and off-farm farmer activity. Sc2 was based on Sc1, but the possibility of the farmer performing a non-agricultural activity was considered. Farm labour became a decision variable simulating the observed situation of part-time farming in the area of study and involved the use of one

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half of a WU remunerated according to the average salary in Aragon in 2004 (€16,682/year) (AEAT, 2006) resulting in €8341. Scenario 3 (Sc3) corresponded to total decoupling, possibility of calf fattening and off-farm farmer activity. Sc3 was based on Sc2 but considered the total decoupling of the suckler cow premium (€200/cow) and slaughter premium for adult cattle (€80). Sc3 maintained the slaughter premium for weaned calves (€50/head). Scenario 4 (Sc4) corresponded to no subsidies, possibility of calf fattening and off-farm farmer activity. Sc4 was based on Sc3 and included a hypothetical situation of bringing to an end livestock subsidies.

2.4. Models As mentioned above, the parameters used in the models were the 2004 average values for each trajectory. Therefore, the structural characteristics of farms that followed a specific trajectory of evolution stated the availability of land, herds and labour for each model. The general structure of the model is represented in Fig. 1. The technical management of livestock considered in the models corresponded to the management strategies more frequently observed in each trajectory. The following animal activities were considered: cows, calves (males and females) and heifers (one and two years old). The bulls were only included as a farm cost.

Utilised Agricultural Area (UAA) *

Supraforestal grazing areas

Allocation

Purchased feedstuffs* - Alfalfa - Concentrates

Forest pastures*

Food requirements

Food requirements On-farm feeds - Hay - Silage - Grazing

Land use* - Grazed grassland - Semi-natural grassland - Sown grassland

The traditional spring calving period (April to June) was considered in all the models, and the number of calves sold corresponded to the observed average values (Table 1). Calves can be sold after weaning (at the end of the summer grazing period at mountain supraforestal pastures) or after they were fattened in the autumn and winter (depending on the model types and scenarios). The feeds available to meet the requirements of animals were as follows: i) private on-farm resources or Utilised Agricultural Area (UAA), which varied among models depending on the land area available; ii) supraforestal communal grazing areas, which were considered nonlimiting; iii) communal or private forest pastures in the models that had access to this grazing resources and were limited in each model by the land available (normally located at intermediate altitude between supraforestal areas and the valley-bottom UAA); and iv) purchased feeds, which were non-limiting and the same for all the models. As far as labour was concerned, the availability was distributed for each trajectory and was expressed in WU for the four periods. The income for each model depended on the number and type of animals sold but also on the amount and type of subsidies received by the farms. Moreover, the income also depended on the performance of off-farm activities in some scenarios. Detailed technical and economic parameters of the models are included in Appendix A.

Food requirements

Products - Weaned calves/ Yearlings* - Cull cows

Herd - Cows* - Heifers Labour availability/ requirements

Labour availability/ requirements Labour availability/ requirements

Off-farm activities *

Total output - Calves - Culling cows

FARM

Labour

+

Subsidies --Livestock premiums - Agri-environmental subsidies

Gross Margin **

* Decision Variables ** + income from off-farm activities in some scenarios. Fig. 1. General structure of the model.

-

Costs --Feed --Sanitary --Forage production --Leasing --Purchased feedstuffs

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2.5. The objective function and decision variables The objective function maximized the farm Gross Margin (GM) as follows: Total Output + Subsidies − Variable Costs. The following general formula was used: J

I

I

K

I

F = ∑ ∑ Xji Pj + ∑ Xi Si + ∑ Hk Sk − ∑ Xi Gi j=1 i=1 K

i=1

L

i=1

k=1

K

T

P

T

− ∑ Hk Gk − ∑ ∑ ∑ Flkt Cl − ∑ ∑ Apt Pp k=1

l=1 k=1 t=1

p=1 t =1

Where Xji is the production obtained (j) by the livestock farming activity (i); Pj is the price of production (j); Xj is the number of livestock farming activity units (i); Si is the subsidies obtained from livestock farming activities (i); Hk is the hectares used for each land use type (k); Sk is the subsidies received per land use type hectare (k); Hi is the variable expenses (except food costs) arising from the livestock farming activity (i); Gk is the cost of leasing one land use type hectare (k); Flkt is the tons of forage of the type (l) produced by crop growing (k) and used for feeding livestock in the different periods (t); Cl is the production cost of a ton of forage of the type (l); Apt is the tons of concentrates or feedstuff purchased (p) for feeding livestock in the different periods (t); and Pp is the price of a ton of purchased concentrated feedstuff or forage. In scenarios where part-time farming was a decision variable, the objective function included the incomes derived from off-farm activities, but they were not included in the calculation of the GM derived from the agriculture presented in the tables. The main constraints of the models related to the following: 1) Land: number of ha in use was equal or less than the observed value for each trajectory. For grazed grassland, the number of hectares was limited to the value observed because the conversion of grazing areas to sown grassland or semi-natural (mowing) grassland was not feasible due to physical limitations and was not realistic in the area of study. The trend was actually the opposite with land use extensification and complete abandonment in some cases. 2) Frequency and crop rotation: sown grassland cannot be rotated with themselves although this not the case for semi-natural grassland. Therefore, the area of the sown grassland was always less or equal to the area of seminatural grassland. 3) Herd: size of the herd was equal or less than the observed value for each trajectory to reflect real farm conditions in terms of facilities and capital availability. 4) Herd dynamics: restrictions to maintain the herd structure, such as fertility, replacement and mortality, were introduced. 5) Herd nutritional requirements per season were fulfilled with on-farm resources, purchased feedstuffs and communal grazing areas. 6) Relationships among grassland surfaces, pasture resources and land use: related availability and utilization by animals per season and type of forage according to land use (only grazing, silage or hay).

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7) Labour and machinery: labour and machinery used was equal or less than the observed availability per season. The following decision variables of the models were used: herd size, land size, land use, type of calf production (weaned or fattened in all scenarios except in Sc0), purchased feedstuffs, forest pastures use and off-farm activities in some scenarios (binary variable) representing the possibility of farmers working part-time in other activities (e.g., tourism). These variables were used to analyse and compare changes in model outputs between trajectories and scenarios. In the LP models, it was also relevant to analyse the shadow price in some variables, such as the part-time activity of the farmers. The shadow price or opportunity cost was the change in the objective value of the optimal solution obtained by relaxing the constraint by one unit, i.e., the maximum price that one would be willing to pay for an extra unit of a given limited resource. 2.6. Sensitivity analysis For all the models and in the conditions of Sc2, the hypotheses referring to changes in the price of cereals and meat were assessed. Sc2 was considered for sensitivity analysis because it better reflected the current conditions of application of the PAC 2003 reform for the livestock farming systems under study. The following conditions were considered: 25% (SAC25%) and 50% (SAC50%) increase in the price of concentrates; 10% (SAM10%) and 20% (SAM20%) decrease in the price of yearling meat; 10% decrease in the price of weaned calves with a simultaneous 25% increase in price of concentrates (SAMC10%25%); and 20% decrease in the price of weaned calves with a simultaneous 50% increase in price of concentrates (SAMC20%50%). 3. Results Our modelling exercise followed a positive approach. The objective was to analyze and understand ways for mountain beef cattle farming systems to adapt to changes in the policy and social environment. The results are presented per scenario rather than analyzing optimal solutions for individual trajectories. 3.1. Scenarios 3.1.1. Base scenario (Sc0) In all the MTs, the herd size in the optimal solution was the maximal herd size permitted by the model. Therefore, MT1 “large size with no changes in structure and management” was the largest in size with 134 cows, and MT6 “small growth and decrease in productivity” was the smallest in size with 33 cows (Table 2). In general, there were no large differences between the trajectories and the optimal solution of the model, especially concerning physical size (Table 2). In terms of land use, however, sown grassland disappeared completely (in this and all scenarios below) and semi-natural grassland decreased, except in MT4. Labour was not a limiting factor for the MTs in general. Labour available was not fully used in the optimal solution of all MTs, therefore, resulting in larger deviations.

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Table 2 Predicted values of the base scenario (Sc0) and deviations on observed values (%) for each MT. MT1

Gross Margin (000€) No. of cows Land area (ha of UAA) Semi-natural grassland (ha) Grazed grassland (ha) Forest pastures (ha) Work Units (on-farm work)

MT2

MT3

MT4

MT5

MT6

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

92.7 134 176.3 27.3 149.0 0 1.5

−16.7 0.0 − 39.3 − 31.8 0.0 − 100.0 − 32.4

45.8 55 49.5 24.2 25.3 0 0.9

−14.6 0.0 − 50.2 − 29.0 0.0 – − 35.7

42.7 73 60.2 35.0 25.2 0 1.1

−31.2 0.0 − 19.3 4.2 0.0 − 100.0 − 8.3

52.7 68 36.3 28.5 7.8 63 1.0

− 23.0 0.0 0.0 32.6 0.0 − 10.0 − 30.6

27.2 44 34.6 22.3 12.3 0 0.7

− 22.5 0.0 − 11.3 − 2.2 0.0 − 100.0 − 43.5

19.3 33 24.8 17.5 7.3 0 0.5

− 6.8 0.0 − 35.1 − 9.8 0.0 − 100.0 − 63.2

increase in labour requirements. Labour availability was limited in MT3. Therefore, the land area increased due to the use of more grazed grassland. However, semi-natural grassland with higher labour requirements decreased, and more forest pastures were used in MT3 “large growth, labour reduction and no fattening orientation”. In the rest of the MTs, labour availability was not as limited and, therefore, no changes occurred in land use. The fattening of all the calves involved an increase in GM on all the farms, and the largest increase occurred in MT6 “small growth and decreased productivity” followed by MT3. Nevertheless, the trajectory that obtained the highest GM was still MT1 followed by MT3 and MT5, which were the MTs that had the largest herd size. The subsidies did not vary in the MT2 and MT4 models because they were already fattening the majority of the calves. The subsidies increased by 20% and 28% in MT3 and MT6, respectively, because fattening was not as important in the base scenario (Fig. 3).

Herd requirements, except for calf fattening, were covered with on-farm feeds and forages as follows: in the summer, animals grazed in supraforestal grazing areas; in the winter, animals were fed with hay and silage produced by the seminatural grassland; and in the spring and autumn, animals grazed the semi-natural grassland, grazed grassland or forest pastures. Therefore, in the optimal solution of all MTs, the land areas of the farms were adjusted so that they could meet the requirements of the herds by grazing in the periods when that was possible. In turn, the stored forage was fed to the herd in winter because the costs of the stored forages were less than the costs of the purchased feed. With regard to economic results, the GM obtained in the optimal solution was less than the average observed values, which was due to the fact that the last solution included all incomes and not just incomes from cattle farming. Furthermore, the GM may have been less because the subsidies received may have included other subsidies, such as regional agricultural and rural development programmes, which were not included in the models. The MT1, MT2 and MT4 trajectories obtained the highest GM and labour productivity (GM/WU).

3.1.3. Scenario 2 (Sc2) partial decoupling, possibility of calf fattening and off-farm farmer activity Under this scenario, the optimal model included the performance of non-agricultural activities in all the MTs, except MT1 and MT3 (Table 4). Labour was available in all these trajectories, which allowed other activities to be performed. However, the performance of other activities involved a decrease in herd size with respect to the maximal size in MT2 and MT4, especially in MT4, and a slight decrease in the percentage of fattened calves in MT2 and MT5. Similarly, Sc2 involved a decrease in the land area for seminatural grassland and an increase in grazed grassland in all the trajectories, except in MT6 (Fig. 4). The feeding regime of cows remained the same as in previous scenarios.

3.1.2. Scenario 1 (Sc1) partial decoupling and possibility of calf fattening In the optimal solution, all the MTs maintained the maximal herd size, and all the calves were fattened causing some changes in the solutions obtained with respect to Sc0, except in MT2 “medium-large size with no structural changes and fattening orientation” because they already fattened 100% of the calves (Table 3 and Fig. 2). As in Sc0, herd requirements, except for fattened calves, were covered with on-farm resources in Sc1. Besides the change in production orientation, in general, no variations occurred in land use. However, Sc1 logically involved an

Table 3 Predicted values of Sc1 (partial decoupling and possibility of calf fattening) and deviations on base scenario (%) for each MT. MT1

Gross margin (000€) No. of cows Land area (ha of UAA) Semi-natural grassland (ha) Grazed grassland (ha) Forest pastures (ha) Work Units (on-farm work)

MT2

MT3

MT4

MT5

MT6

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

Pre.

Dev.

102.1 134 176.3 27.3 149 0 1.62

10.1 0.0 0.0 0.0 0.0 – 8.0

45.9 55 49.5 4.2 25.3 0 0.88

0.2 0.0 0.0 0.0 0.0 – -2.2

58.1 73 69.3 1.6 57.7 72 0.98

6.1 0.0 15.1 − 66.9 129.0 – -10.9

55.1 68 36.3 0.5 7.8 63 1.05

4.6 0.0 0.0 0.0 0.0 0.0 5.0

31.8 44 34.6 22.3 12.3 0 0.71

16.9 0.0 0.0 0.0 0.0 – 1.4

27.0 33 24.8 17.5 7.3 0 0.53

39.9 0.0 0.0 0.0 0.0 – 6.0

A. García-Martínez et al. / Livestock Science 137 (2011) 73–86

100 90 80 70 60 % 50 40 30 20 10 0

79

% fattened calves

Sc0 Sc1 Sc0 Sc1 Sc0 Sc1 Sc0 Sc1 Sc0 Sc1 Sc0 Sc1 MT1

MT2

MT3

MT4

MT5

MT6

Sc0: Base scenario. Sc1: Scenario 1. Partial decoupling and possibility of calf fattening. Fig. 2. Optimized percentage of fattened calves for each MT under scenarios Sc0 and Sc1.

The GM from farming remained the same in all the trajectories. Nevertheless, the total income increased as a result of earnings from non-agricultural activities, except in MT1 and MT3, because MT1 and MT3 did not include off-farm activities. For these two trajectories, the shadow price of one half of a WU was €16,682 and €20,500, respectively.

3.1.4. Scenario 3 (SC3) total decoupling, possibility of calf fattening and off-farm farmer activity In this scenario, the optimal solution varied little from the solution obtained in Sc2, except for MT1 (Table 5). In MT1, the total decoupling of subsidies also led to non-agricultural activities, causing a 15% decrease in the herd size and a 7% decrease in the agricultural area due to a 45% decrease in the semi-natural grassland when compared with Sc0. For MT3, the shadow price for one half of a WU decreased to €13,382. The total decoupling scenario (Sc3) involved a decrease in the GM obtained for MT1, MT4 and MT5 while the GM remained the same in the rest of the MTs. The decoupled single

payment in this scenario represented between 88% and 97% of the total subsidies received under Sc0 (Fig. 5). 3.1.5. Scenario 4 (Sc4) no subsidies, possibility of calf fattening and off-farm farmer activity The optimal solution obtained in Sc4 involved an important decrease in GM for all the MTs from 39% to 60%. This decrease was not compensated by the income obtained from off-farm activities. Nevertheless, this solution barely showed any variations in comparison with the solution obtained in the previous scenario (Sc3). Therefore, the results for Sc4 are not presented. 3.1.6. Sensitivity analysis The results obtained in SAC25% (increase of 25% in the price of cereals) highlighted that the optimal solution for the majority of the MTs did not vary with regard to the solution obtained in Sc2, except for trajectory MT3 in which the importance of fattening and the land area used (grazed

110 100 90 80

ooo €

70 60 50 40

Off farm activities

30 Subsidies

10

Gross Margin without subsidies

0

Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3

20

MT1

MT2

MT3

MT4

MT5

MT6

Sc0: Base scenario. Sc1: Scenario 1. Partial decoupling and possibility of calf fattening. Sc2: Scenario 2. Partial decoupling, possibility of calf fattening and off-farm farmer activity. Sc3: Scenario 3. Total decoupling, possibility of calf fattening and off-farm farmer activity. Fig. 3. Comparison of optimized gross margin, subsidies and off-farm income for each MT under diverse scenarios.

80

A. García-Martínez et al. / Livestock Science 137 (2011) 73–86

Table 4 Predicted values of Sc2 (partial decoupling, possibility of calf fattening and off-farm farmer activity) and deviations on base scenario (%) for each MT. MT1

MT2

Pre. Gross margin (000€) No. of cows Land area (ha of UAA) Semi-natural grassland (ha) Grazed grassland (ha) Forest pastures (ha) % fattened calves Off-farm activity Work Units (on-farm work) Work Units (off-farm work) a

Dev.

102.1 134 176.3 27.3 149 0 100 No 1.62 0

0.1 0.0 0.0 0.0 0.0 – 132.6 – 8.0 –

MT3

MT4

Pre.

Dev.

Pre.

Dev.

45.1 a 54 49.8 22.9 26.9 0 99 Yes 0.85 0.5

− 1.5 − 1.8 0.6 − 5.4 6.3 – − 1.0 – − 5.6 –

58.1 73 69.3 11.6 57.7 72 100 No 0.98 0

36.1 0.0 15.1 − 66.9 129.0 – – – − 10.9 –

Pre. 47.3 a 56 27.6 19.8 7.8 70 100 Yes 0.83 0.5

MT5

MT6

Dev.

Pre.

Dev.

Pre.

10.2 − 17.6 − 24.0 − 30.5 0.0 11.1 40.8 – − 17.0 –

31 a 44 38.5 16.2 22.3 15 90.6 Yes 0.66 0.5

14.0 0.0 11.3 − 27.4 81.3 – 806.0 – − 5.7 –

27 a 33 24.8 17.5 7.3 0 100 Yes 0.53 0.5

Dev. 39.9 0.0 0.0 0.0 0.0 – – – 6.0 –

Income from off-farm activity not included.

When the price of weaned calves decreased by 10% with a simultaneous increase of 25% in the price of concentrates (SAMC10%25%), no important changes occurred in the resulting optimal solution in Sc2, except for a reduction in the obtained GM (Table A6 in Appendix A). Furthermore, no changes occurred in SAMC20%50%. However, if the price of cereals increased further (between 55% and 60% for different MTs), a drastic decrease in calf fattening was observed in all the MTs. 4. Discussion 4.1. Labour productivity and off-farm labour Labour productivity is considered to be an indicator of competitiveness, economic sustainability or economic viability, and it continues to be crucial for beef cattle farming systems (Veysset et al., 2005b). The MTs that obtained the most labour productivity (GM/WU) were MT1, MT2 and MT4. Therefore, high labour productivity was connected with herd size (Manrique et al., 1999) and calf fattening under the scenarios considered. The MT1, MT2 and MT4 systems were, therefore, the most viable from a strictly economical perspective.

100 90 80 70 60 50 40 30 20 10 0

Grazed grassland

Semi-natural grassland

Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3 Sc0 Sc1 Sc2 Sc3

% Utilised Agricultural Area

grassland) decreased. In general, there was a decrease in the GM obtained by all the trajectories (Table A6 in Appendix A). In contrast, the 50% increase in the price of cereals (SAC50%) led to significant changes in the MTs when compared to the solutions obtained in Sc2. Calf fattening generally decreased in the models by approximately 60% (Table 6), which logically led to a drop in the GM obtained in all the models varying from 9% in MT6 to 13% in MT1. The labour requirements for the livestock farming activity also decreased, so there were no changes with regard to the performance of off-farm activities. However, the maximal herd size was maintained in all the MTs, and there were also no changes in land distribution. The 10% decrease in the price of yearling meat (SAM10%) did not lead to significant changes in the optimal solution obtained in the Sc2 solution, except for the MT3 farms where the fattening percentage decreased to 40%. There was a drop in the GM obtained by all the MTs (Table A6 in Appendix A). However, the optimal solution obtained in SAM20% involved a decrease in calf fattening, decrease in the GM and decrease in the labour for agricultural activity in all the MTs. In MT3, the situation led to a drastic reduction in calf fattening (Table 6).

MT1

MT2

MT3

MT4

MT5

MT6

Sc0:Base scenario. Sc1: Scenario 1. Partial decoupling and possibility of calf fattening. Sc2: Scenario 2. Partial decoupling, possibility of calf fattening and off-farm farmer activity. Sc3: Scenario 3.Total decoupling, possibility of calf fattening and off-farm farmer activity. * Sown grassland did not appeared in the optimal solution Fig. 4. Comparison of optimized land use (in % of Utilised Agricultural Area) for each MT under diverse scenarios*.

A. García-Martínez et al. / Livestock Science 137 (2011) 73–86

81

Table 5 Predicted values of Sc3 (total decoupling, possibility of calf fattening and off-farm farmer activity) and deviations on base scenario (%) for each MT. MT1

MT2

Pre. Gross margin (000€) No. of cows Land area (ha of UAA) Semi-natural grassland (ha) Grazed grassland (ha) Forest pastures (ha) % fattened calves Off-farm activity Work units (on-farm work) Work Units (off-farm work)

− 0.5 − 14.9 − 7.0 − 45.1 0.0 – 132.6 – − 12.7 –

MT4

Pre.

Dev.

Pre.

Dev.

Pre.

45.1 a 54 49.8 22.9 26.9 0 99 Yes 0.85 0.5

− 1.5 − 1.8 0.6 − 5.4 6.3 – − 1.0 – − 5.6 –

58.1 73 69.3 11.6 57.7 72 100 No 0.98 0

0.4 0.0 0.2 − 0.7 1.3 – – – − 0.1 –

45.9 a 55 30.4 22.6 7.8 51 100 Yes 0.85 0.5

MT5 Dev. − 12.9 − 19.1 − 16.3 − 20.7 0.0 − 19.0 40.8 – − 15.0 –

Pre. 30.2 a 44 38.5 16.2 22.3 15 90.6 Yes 0.66 0.5

MT6 Dev.

Pre.

11.0 0.0 11.3 − 27.4 81.3 – 806.0 – − 5.7 –

27 a 33 24.8 17.5 7.3 0 100 Yes 0.53 0.5

Dev. 39.9 0.0 0.0 0.0 0.0 – – – 6.0 –

Income from off-farm activity not included.

supplements the income of the farms. However, this process may also lead to the agricultural activity being displaced, and it depends, to a large extent, on the demands of off-farm and on-farm work being compatible with each other (MacDonald et al., 2000), although Fiorelli et al. (2007) observed that work organisation in farms with multi-job holders was not fully subordinated to the off-farm activity rhythm. The presence of non-agricultural employment related to large-scale tourism development in rural areas may lead to a decrease in agricultural activity because it competes for the labour factor (Davis et al., 2009) and for land (Olaizola, 1991), thus, displacing agricultural activities (Lasanta-Martínez et al., 2007).

When the off-farm work option was added to the partial decoupling scenario, the MTs with available labour (MT2, MT4, MT5 and MT6) had optimal models that included nonagricultural activities. Several MTs released labour through a reduction of herd size to allow for the inclusion of nonagricultural activities. The reduction of herd size led to a decrease in on-farm work in these systems, thus, highlighting the development process these beef cattle farming systems have undergone in recent years (García-Martínez et al., 2009). In Ireland, partial decoupling of subsidies may also lead to an increase in the likelihood of farmers working offfarm, and, therefore, to an increase in the time spent on nonagricultural activities (Henessy and Rehman, 2008). In a total decoupling scenario, even farmers with large farms and higher levels of professionalism (MT1) may choose other activities with a considerable reduction in herd size and land area, especially semi-natural grassland. The decrease in cattle farming in the majority of the MTs confirmed what other authors have reported about the possible effects of the total decoupling of subsidies in beef cattle farming systems (Chatellier and Delattre, 2005; Breen et al., 2005; Veysset et al., 2005b). In recent years, there has been an increase in pluriactivity in these mountain cattle farming systems (García-Martínez et al., 2009), which

4.2. Land use Natural resource management and labour opportunity costs are closely related factors that explain changes in European agricultural land use (Strijker, 2005). In European mountain areas, these changes were characterised by the modification of traditional farming practices that led to the abandonment of large areas of farmland (Macdonald et al., 2000; Mottet et al., 2006). The current scenario of partial decoupling of subsidies together with the possibility of off-farm activity results in a

100 90 80 70

% single payment/ subsidies

60 50 40 30 20 10

MT1

MT3

MT4

MT5

Sc3

Sc2

Sc1

Sc3

Sc2

Sc3

Sc2

Sc1

Sc3

Sc2

Sc1

Sc2 MT2

Sc3

Sc1

Sc3

Sc1

Sc2

0 Sc1

a

Dev.

92.2 a 114 164 15 149 0 100 Yes 1.31 0.5

MT3

MT6

Sc1: Scenario 1. Partial decoupling and possibility of calf fattening. Sc2: Scenario 2. Partial decoupling, possibility of calf fattening and off-farm farmer activity. Sc3: Scenario 3. Total decoupling, possibility of calf fattening and off-farm farmer activity. Fig. 5. Importance of single payment in total premiums for each MT under scenarios Sc1, Sc2 and Sc3.

↑ = Increase b 20%, ↑↑ = Increase 20-50%, ↑↑↑= Increase N 50%; ↓ = decrease b20%, ↓↓ = decrease 20-50%, ↓↓↓= decrease N 50%. a SAC50%: 50% increase in the price of concentrates; SAM20%: 20% decrease in the price of yearling meat; SAMC20%50%: 20% decrease in the price of weaned calves and 50% increase in the price of concentrates.

= = Yes = = ↓↓↓ Yes ↓ = ↓↓↓ Yes ↓ = = Yes = = ↓↓↓ Yes ↓ = ↓↓↓ Yes ↓ = = Yes = = ↓↓↓ Yes ↓ ↓↓↓ ↓↓↓ No ↑ = ↓↓↓ No ↓ = ↓↓↓ No ↓

= = No =

= ↓↓↓ Yes ↓

= ↓↓↓ Yes ↓

= = Yes =

↓ ↓↓↓ No ↑

= = No =

= ↓↓↓ Yes ↓

= = = = = = = = ↓↓↓ = =

=

=

=

=

↓↓↓

=

=

↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = ↓ ↑↑↑ ↓ = ↓↓ ↑↑↑ ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = = ↓ = = =

Gross margin (000€) No. of cows Land area (ha of UAA) Semi-natural grassland (ha) Grazed grassland (ha) Forest pastures (ha) % fattened calves Off-farm activity Work Units (on-farm work)

MT5 MT4 MT3 MT2 MT1

Table 6 Sensitivity analysis (SAC50%, SAM20% and SAMC20%50%) in Sc2 (partial decoupling, possibility of calf fattening and off-farm farmer activity) a.

SAC50% SAM20% SAMC20% SAC50% SAM20% SAMC20% SAC50% SAM20% SAMC20% SAC50% SAM20% SAMC20% SAC50% SAM20% SAMC20% SAC50% SAM20% SAMC20% 50% 50% 50% 50% 50% 50%

A. García-Martínez et al. / Livestock Science 137 (2011) 73–86

MT6

82

more extensive use of land areas, but the reduction of the natural resource utilisation may constitute the first step towards abandonment (Strijker, 2005). In this study, a disappearance of sown grassland, decrease in semi-natural grassland which require higher labour was observed even though the farmers received agri-environmental subsidies for their contribution to landscape conservation and biodiversity. Changes in some CAP measures may cause farmers to stop being interested in other subsidies, such as agri-environmental subsidies. Consequently, mountain agriculture and conservation of the environment may no longer complement each other as much as intended (Veysset et al., 2007), which shows that general agricultural policies are usually insufficient to ensure suitable production of intangible goods, such as landscape maintenance (Havlík et al., 2005). In mountain areas, the total decoupling of premiums in cattle farming is a great concern. The farmers’ perception of subsidies consists of the society's compensation for the provision of public goods, environmental goods and nonmarketable goods that are a consequence of the multifunctionality of these systems. The establishment of a single payment system is not the most suitable scheme (Chatellier and Guyomard, 2008). Instead, other criteria should be used, such as criteria employed in the receipt of other subsidies (i.e., criteria that require a real use of these areas by animals). However, the decision to keep the suckler premiums in the CAP health check in some countries, such as France and Spain, is justified as a measure to maintain cow-calf systems in mountain areas (Sarzeaud et al., 2008a). 4.3. Orientation of production: calf fattening Under partial decoupling scenarios, calf fattening was maintained in all groups of farms with no implications in land use because the calves were fattened with commercial concentrates, which did not put pressure on farmland. For beef cattle farmers, deciding on the destination of weaned calves is a constant concern (Liénard et al., 1996). In our models, given that calf fattening maximised the GM of the farm, it was chosen because it generated more income. Nevertheless, for some authors (Ridier and Jacquet, 2002; Chatellier and Delattre, 2005; Sarzeaud et al., 2008b), partial decoupling of subsidies did not generate large-scale production re-orientation on cattle farms, which was the case in some of the observed farm groups in our study. Other factors, such as risk attitudes and non-economic objectives of the farmers, may help to explain the divergence of results. One factor that is currently causing a high level of uncertainty in livestock farming systems in general and cattle fattening in particular, is the price of inputs (price of cereals) and price of outputs (price of meat) because the prices have a direct effect on production costs. In this study, a moderate increase (25%) in the price of concentrates did not involve large changes under the conditions of Sc2, which coincided with the results obtained in Irish cattle farming systems by Crosson et al. (2006). However, a larger increase in the price of concentrates (50%) or decrease in the price of beef (20%) resulted in a marked fall in fattening in all the trajectories with a subsequent drop in the obtained GM. The drop in fattening showed that the economic interest of intensive calf fattening activity was sensitive to the economic situation of

A. García-Martínez et al. / Livestock Science 137 (2011) 73–86

the market. Therefore, future competition between food and feed for human nutrition and the expected higher demand of bio-fuels will strongly impact the intensive, cereal-based fattening systems. 4.4. Trajectories of evolution Beyond the changes described above, it is important to consider individual responses of farms to changing economic conditions and markets (Lambin et al., 2001) because they are the decision unit in agriculture. Unlike aggregated models, farm models have the advantage to allow the analysis of differences among farms depending on their characteristics (Kerselaers et al., 2007). The farm model in this study compared the results simulated with real-life changes that were observed in the farms according to their various development trajectories between 1990 and 2004 as described in detail by García-Martínez et al. (2009). Trajectory T1 “large size with no changes in structure and management” represented a small number of large-sized, professional and market-oriented farms. The simulated results showed a stable trend in the future with partial decoupling. However, the simulated results showed that total decoupling of subsidies may cause the livestock activity to be replaced, to a certain extent, if the rest of the factors (price of supply, price of products and labour opportunity cost) were kept relatively constant. A similar development has been shown by trajectory T2 “medium-large size with no structural changes and fattening orientation”. The models demonstrated that the presence of other activities may increase in the future, which may have an impact on herd size and land use with a continual decrease in semi-natural grassland and a more extensive use of grazing (especially in a hypothetical situation of total decoupling). On the other hand, given that T2 farms are specialised in calf fattening with acquired premium rights, total decoupling of subsidies may compromise this productive orientation. In trajectory T3 “large growth, labour reduction and no fattening orientation”, the available labour matched the requirements of the farm. Therefore, the models did not produce a further increase of off-farm activities even in the hypothetical situation of total decoupling. A similar result may have occurred in the T4 trajectory (large herd growth and fattening orientation). However, given that the availability of labour was somewhat higher in T4, the process of partial replacement of livestock farming by other activities was more likely, which may bring pronounced changes in land use (decrease in semi-natural grassland and increase in the use of forest pastures) given that there was less UAA available in relation to herd size. Future increments of herd size in a situation of partial or total decoupling of subsidies are not likely (Ridier and Jacquet, 2002). Farms with a higher dairy orientation in 1990 were the farms that included moderate growth and large-scale extensification in the T5 trajectory. The models showed a relatively stable situation, with a margin for further increase in non-agricultural activities, while maintaining the number of cows and extensifying the land use, with a greater use of grazing resources. Trajectory T6 “small growth and decrease in productivity” grouped farms with a small size and comparatively poorer

83

technical and economic results, especially with regard to labour productivity that showed little economic viability. Therefore, these farms (25% of total sample) showed a high risk of abandonment of the agricultural activity in the shortterm or medium-term with or without replacement by other activities. The comparison between the past evolution of farming systems described by García-Martínez et al. (2009) with simulated predictions in this study offers a good framework for understanding the dynamics and future development of farms while highlighting possible different changes. Therefore, the usefulness of the results obtained by the models was consolidated. Pooling all of the information from these studies furthered the possible applications of the models developed for the design and assessment of agricultural and agri-environmental policies or other sector policies that may affect cattle farming systems in the mountain areas studied. However, the LP models searched only for the optimal economics, and other relevant factors in decision making of farmers, such as risk attitudes, family objectives, farmer personality and lifestyle (Ruben et al., 1998; McCown, 2002; Wallace and Moss, 2002; Valbuena et al., 2008; Gibon et al., 2010. ), were not considered. The results derived from this study apply to the beef-cattle farming systems in the Central Pyrenees. The extrapolation to other European mountain areas is problematic because PAC measures may vary between countries (Deblitz, 2008) and local environmental conditions may be diverse although it allows the explanation of farming evolution (Lambin et al., 2001). Furthermore, there is a wide variety of livestock farming systems and households within regions. However, generic processes of abandonment, extensification of management, land use change and specialization towards beef production have been described in many European mountain areas (Bernués et al., in press). The analysis of internal changes that occurred in groups of farms with different evolution trajectories has offered insight into the mechanisms of these changes. 5. Conclusions Under the situation of partial decoupling of subsidies and existence of an off-farm work market, pluriactivity is of economic interest for the majority of cattle farm groups. In farms with less labour availability, pluriactivity results in a decrease in the livestock farming activity (lower herd size and/or less fattening) and readjustments in land use involving fewer sown grassland and semi-natural grassland. In areas where tourism is on the rise, it is likely that the presence of non-agricultural activities on the farms will continue to increase and, consequently, so will the displacement of the livestock activity with subsequent changes in land use. Total decoupling of livestock farming subsidies implies an increasing economic interest of part-time off-farm activities. As a result, the total decoupling of subsidies may lead to a greater decrease in livestock farming activity and an acceleration in land use changes in the areas studied. Changes in the price of supplies, such as cereals, or price of products may lead to a drastic decrease in the economic interest of calf fattening in mountain cattle farming systems.

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A. García-Martínez et al. / Livestock Science 137 (2011) 73–86

Ensuring that the livestock farming systems and physical environments complement each other will not only depend on the circumstances in which CAP conditionality is applied but also on the amount of environmental subsidies and specific conditions of application at the local or individual level because the economic interests for the farms need to be maintained. The models implemented have enabled us to analyse possible evolutionary pathways of mountain cattle farming systems depending on changes in their socioeconomic environment. The consideration of risk and other noneconomic objectives important on family farms would allow a more precise simulation of the decision making of farmers. Acknowledgement

Table A1 Hay and silage production (t DM /ha).

Sown grassland Semi-natural grassland

Hay

Silage

2.746 2.042

1.957 1.455

Table A2 Pasture production in land area and forest pastures (t DM/ha).

Sown grassland Semi-natural grassland Grazed grassland Forest pastures

Winter

Spring

Summer

Autumn

0 0 0.329 –

0.749 0.729 0.987 0.603

0 0 0 –

1.497 1.385 0.657 0.301

This study was funded by INIA (Spanish Ministry for Education and Science) and FEDER (ref. RTA03-029-C2 and TRT2006-00044-C02). The first author acknowledges the financial support of CONACYT-Mexico and Fundación Carolina. Appendix A Technical parameters of the models As mentioned above, the traditional spring calving period (April to June) was considered in all the models, and the number of calves sold corresponded to observed average values. Calves were sold after weaning or after they were fattened. Mortality rates of 2.9% before weaning and 2% during the fattening period were considered (Alberti, 1995; Alberti et al., 1995). The average replacement rate was 15%, which corresponded to the average values observed and previous reports (Casasús, 1998). Animal energy requirements in different physiological stages were calculated by net energy (MJ NE) (AFRC, 1993). Intake capacity was also considered (kg DM). To establish the requirements of the herd, different sources were used including Casasús (1998), Teruel (1998) and Villalba (2000). It was assumed that summer requirements were fully covered by supraforestal grazing areas, so this resource was computed only as a feeding cost. The feeds available to meet the requirements of the animals were as follows: i) private on-farm resources, which varied among models depending on the UAA available; ii) supraforestal communal grazing areas, which were considered non-limiting; iii) communal or private forest pastures in the models in which grazing in these pastures occurred, and which were limited in each model by land availability; and iv) purchased feeds, which were non-limiting for all the models. In all models, UAA on-farm resources may have been grazed grassland (used only for grazing), semi-natural grassland (mowing and grazing) or sown (cultivated) grassland used both for grazing and forage production. Forage may have been stored as hay or silage, and grazing occurred in autumn, end of winter and spring (forage was only used to feed the animals because selling forage was rare). Hay, silage and grazing productions along with their composition are shown in Appendix A (Table A1, Table A2 and Table A3). With regard to a grazing calendar, it was considered that the whole herd went to supraforestal grazing areas in the

summer. In all the models, except MT2, animals also used forest pastures in spring (April to May) before using the supraforestal areas and autumn after coming down from these areas (October to November). The production and composition of forest pastures are detailed in Table A2 and Table A3. The purchased feedstuffs for cows were alfalfa in pellets and concentrates, the most frequently used products in the area of study, and they were available for all the MTs. For intensive fattening, only concentrates and straw were considered as purchased resources, and their consumption was estimated and considered in calf production costs. Labour requirements for the herd were established on the basis of the activity type and animal type (cow, heifers and calves) with information mainly from Revilla (1987), Olaizola (1991) and Teruel (1998) and from Alberti et al. (1995) for calf fattening. Labour requirements were also established for each forage resource (sown grassland, semi-natural grassland or grazed grassland) and season according to local technical information. The availability of machinery was distributed into four periods, and its cost was included in the calculation of the production cost of the forage available in the different models. The products obtained on the farms were culling cows and calves (males and females), which were either sold as weaned (6 months to 7 months) or as yearlings (fattened).

Table A3 Feed composition.

Hay (sown grassland) Hay (semi-natural grassland) Silage (sown grassland) Silage (semi-natural grassland) Grazed grassland Forest pastures Alfalfa in pellets Concentrates

% DM

MJ NE/ tDM

87 87 30 30 20 20 92 89

4350 4270 6180 5190 4890 4630 4450 7690

A. García-Martínez et al. / Livestock Science 137 (2011) 73–86

al., 2001), and an average sale price for carcass was €3.336/kg for 2004 (MERCASA, 2006) (Table A4 in Appendix A). The following cattle premiums were considered: suckler cow premiums; extensification premiums (connected with suckler cows); male bovines (only for males older than eight months or males aged between one and eight months that reached 185 kg of live weight); slaughter premiums applied to weaned calves, yearlings (males and females) and culling cows. Agri-environmental subsidies were also considered, which were applied exclusively to semi-natural grassland plots that were only mown once a year. The costs allocated directly to each type of animal referred fundamentally to sanitary costs and the use of supraforestal grazing areas. In models with calf fattening, the cost during fattening included food, installation and health costs that came to a total of €380.30 per fattened calf. The costs generated by the land areas of the farms included the leasing costs for each type of crop, and the production costs including seeds, fertilisers and machinery were considered in the forage produced on the farm itself (Table A5 in Appendix A). For feed purchased as alfalfa pellets and concentrates, the average market price for the 2004 year was considered (MAPA, 2005).

Table A4 Income, subsidies and costs considered. €/head Incomes Male weaned calf ( 6–7 months) Female weaned calf ( 6–7 months) Yearling (fattened) Cull cow

600 487 1113 273

Subsidies Slaughter premium (calves) Slaughter premium (adult bovine animals) Suckler-cow premium Extensification Male bovine premium

50 80 200 100 210

Costs Sanitary costs/ cow Sanitary costs/ heifers Sanitary costs/ calf Cost of supraforestal grazing areas/ cow or heifers Total cost of yearlings

22.84 10.9 24.9 14.0 380.3

85

Table A5 Forage production costs and price of purchased feedstuffs. €/tons Hay (sown grassland) Hay (semi-natural grassland) Silage (sown grassland) Silage (semi-natural grassland) Alfalfa in pellets Concentrates

References

89.0 55.0 32.0 19.0 177.4 242.2

AEAT, 2006. Mercado de trabajo y pensiones en las fuentes tributarias. Retrieved June 20, 2007 from www.agenciatributaria.es. AFRC, 1993. Energy and protein requirements of ruminants. CAB International, Wallingford, UK. Alberti, P., 1995. Características del cebo de terneros en España. Bovis 63, 13–56. Alberti, P., Sañudo, C., Santolaria, P., 1995. El cebo de los terneros con heno de alfalfa suplementado con pienso. Bovis 63, 53–63. Arriaza, M., Gómez-Limón, J.A., 2003. Comparative performance of selected mathematical programming models. Agric. Syst. 77 (2), 155–171. Bernués, A., Casasús, I., Sanz, A., Manrique, E., Revilla, R., 2001. Evaluación económica de diferentes estrategias de alimentación de la vaca y el ternero durante las fases de lactación y cebo en ganado vacuno de carne en sistemas extensivos de montaña. ITEA 97A, 117–130.

Economic parameters of the models The prices of the weaned calves and culling cows were the prices observed in the area. For the sale of fattened calves, an average carcass weight of 304 kg was estimated (Bernués et

Table A6 Sensitivity analysis (SAC25%, SAM10% and SAMC10%25%) in Sc2 (partial decoupling, possibility of calf fattening and off-farm farmer activity) a. MT1

MT2

MT3

MT4

MT5

MT6

S A C SAM SAMC S A C SAM SAMC S A C SAM SAMC S A C SAM SAMC S A C SAM SAMC S A C SAM SAMC 25% 10% 10%25% 25% 10% 10%25% 25% 10% 10%25% 25% 10% 10%25% 25% 10% 10%25% 25% 10% 10%25% Gross Margin (000€) No. of cows Land area (ha of UAA) Semi-natural grassland (ha) Grazed grassland (ha) Forest pastures (ha) % Fattened calves Off-farm activity Work Units (on-farm work)

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

↓

= =

= =

= =

= =

= =

= =

= ↓↓

= ↓↓

= =

= =

= =

= =

= =

= =

= =

= =

= =

= =

=

=

=

=

=

=

↑↑↑

↑↑↑

=

=

=

=

=

=

=

=

=

=

=

=

=

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↑ = Increase b 20%, ↑↑ = Increase 20-50%, ↑↑↑= Increase N 50%; ↓ = decrease b 20%, ↓↓ = decrease 20-50%, ↓↓↓= decrease N 50%. a SAC25%: 25% increase in the price of concentrates; SAM10%: 10% decrease in the price of yearling meat; SAMC10%25%: 10% decrease in the price of weaned calves and 25% increase in the price of concentrates.

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