Lamb cost of production: Breeding sheep

We present costing and performance insights for breeding ewes, using Farmbench data.

What does the 2022/23 season tell us?

Income levels:

Despite small total income rises seen from the 2022/23 season sales (lambing in 2023) for the middle 50%, we saw total income fall for the top and bottom 25% Farmbench performers.

Costs:

On the cost side, Farmbench users saw higher total feed and forage costs for the middle 50% − contributing to a rise in total variable costs both for breeding ewes and finishing lambs. Interestingly, the top 25% performers kept feed and forage costs for 2022/23 lower than the middle 50% − this was the key factor in net margin differential for breeding ewes and finishing lambs. Though these top 25% enterprises generally had more forage area allocated in 2022/23 to the enterprise and minimised bought in feed.
Overhead costs too saw a large rise on the year for the middle 50% of Farmbench users (includes depreciation), contributed to in a large part by total labour, machinery and equipment, as well as property and energy.

Overall:

In 2022/23, total cost of production saw significant rises on the year for the middle 50% performers for both breeding ewes and finishing lambs. Though the picture was more mixed for breeding ewes, for finishing lambs Farmbench users saw rises in total cost of production across the board – from the top 25% all the way to bottom 25% performers.
Altogether we saw full economic net margin lower for breeding ewes across the board for 2022/23, with the middle 50% pushed into negative numbers (per ewe put to the ram). For finishing lambs, the full economic net margin was pushed into negative numbers across the board (per kg liveweight).

Characteristics of top and bottom performing beef and sheep farms

Our study uses a statistical examination of the Farm Business Survey and a case study analysis to identify the key actions of top performers. The study also offers a list of considerations for ways in which beef and sheep farm businesses can improve.

Read our study about traits of top performing farms

Breeding ewe enterprises ranked by total economic margin

Two years of data about the costs of production and net margins are shown for the three Farmbench groups. The figures are per ewe put to the ram.

Breeding ewes – cost of production		2021/22 (Lambing 2022)			2022/23 (Lambing 2023)			Change YOY for middle 50%
Breeding ewes – cost of production		Top 25%	Middle 50%	Bottom 25%	Top 25%	Middle 50%	Bottom 25%	Change YOY for middle 50%
KPIs	Cost of production per lamb reared (£/kg)	1.89	2.42	3.97	1.91	2.99	5.29	24%
	Lambs reared per 100 ewes put to the ram (%)	154.46	138.67	137.57	142.59	133.29	132.79	-4%
	Daily liveweight gain for reared lambs (kg/day)	0.24	0.20	0.22	0.21	0.20	0.18	0%
Enterprise detail	Number of ewes put to ram	986	621	161	833	525	197	-15%
Enterprise detail	Total forage area allocated to enterprise (ha)	108	102	32	134	97	85	-5%
Technical performance	Ewe to ram ratio	44.22	47.26	34.15	52.70	40.35	30.43	-15%
	Scanning %	180	166	163	172	166	157	0%
	Empty ewes %	3.31	4.55	9.47	5.92	4.92	6.54	8%
	Age at sale (days)	152	171	184	169	165	188	-4%
	Weight produced per forage hectare (kg/ha lwt)	507	286	284	307	242	93	-15%
	Non-forage feed fed DM (kg/hd)	12.85	16.90	83.19	8.48	32.60	39.45	93%
	Harvested forage fed DM (kg/hd)	66.67	72.35	55.17	53.96	67.76	86.99	-6%
	Creep feed fed (kg/hd)	6.37	6.60	3.41	1.08	10.43	12.54	58%
Income (£/ewe put to the ram)	Total income	170	129	135	151	132	108	2%
Variable costs (£/ewe put to the ram)	Vet and medicine	9.42	9.93	16.77	7.29	8.72	11.63	-12%
	Bedding	2.12	0.77	1.86	1.29	1.32	1.29	71%
	Total variable costs excluding feed	37.61	41.34	54.37	32.33	39.40	55.83	-5%
	Purchased feed including minerals	7.33	10.99	40.69	5.67	17.80	21.82	62%
	Homegrown forage variable costs	6.40	5.58	11.64	3.51	7.05	5.01	26%
	Total feed and forage costs	18.20	19.07	53.36	14.17	27.40	37.51	44%
Overhead costs (£/ewe put to the ram)	Total labour	26.04	23.77	59.04	22.16	28.45	54.09	20%
	Total administration costs	3.74	5.72	15.25	3.84	5.33	13.35	-7%
	Total machinery and equipment	12.45	15.35	25.16	9.77	17.70	30.49	15%
	Total property and energy costs	4.49	4.27	9.05	3.80	5.19	10.71	22%
	Total overheads	61.24	66.37	135.00	58.92	82.18	145.07	24%
Full cost of production and net margin	Full economic cost of production (£/ewe put to the ram)	117.05	126.78	242.73	105.42	148.99	238.40	18%
Full cost of production and net margin	Full economic net margin (£/ewe put to the ram)	53.44	2.10	-107.49	45.32	-17.29	-130.31	£ -19.39 per ewe put to the ram

View table as PDF: Breeding ewes cost of production ranked by total economic margin

Understanding the data

Farmbench is an online benchmarking tool that allows you to compare your farm to similar businesses, facilitated by AHDB and our Farmbench managers. The latest production year insights above have been drawn from this tool.

Production year: By ‘production year’ we mean a 12-month period which covers all financial and physical activity relating to the production of the annual crop (plant or animal) from an enterprise. For example, the 2022/23 production year is associated to 2023 lambing, and calving for autumn 2022 and spring 2023.

Number of farms' data:

For 2022/23 insights, the tool gathered data from a total of 86 farms across England, similar to 81 in the 2021/22 season.
This 2022/23 total included 57 suckler herd, 41 finishing beef and 35 store beef enterprises, and 61 breeding flock and 34 finishing lamb enterprises. Lambs finished before tupping are included within the breeding flock; any retained and sold from tupping onwards are included within the finishing lamb enterprise.

Three benchmark groups: Each lamb enterprise is grouped by full economic net profit margin: the top 25%, middle 50% and bottom 25%.

Back to: Lamb: Cost of production and performance