A bioeconomic approach to derive economic values for pasture-based sheep genetic improvement programs

Economic values for a range of different maternal and carcass sheep performance traits were derived for hill sheep in the United Kingdom. A bioeconomic model that includes estimates of available energy supply and herbage intake for sheep from hill and mountain pastures, together with that from improved grassland, has provided a base from which to define the economic limitations to genetic improvement in harsh environments. The degree to which different farm systems can accommodate changes in animal performance as a result of genetic improvement was explored. Results showed that genetic improvement in harsh environments is likely to be of greater benefit to farms with fewer constraints to improvements in production, such as better quality pasture or a higher ratio of improved grassland to hill pasture. For farm types in the harshest locations, the economic value of improving litter size was only positive within defined production limits. Increasing litter size beyond these limits resulted in diminishing marginal returns because the costs of additional inputs outweighed the benefits of extra returns. Results also showed that relative improvements in maternal characteristics are at least as economically important as improvements in lamb carcass quality. The effects of variation in market prices on economic values for the major costs and returns of the sheep enterprises showed that, in general, economic values are robust. The methodology described could be adapted and applied to other extensive sheep systems worldwide.