The Impacts of Farm Size on Production Cost and Economic Performance in Beef Cattle Farming: A Case of Samsun Province, Turkey

Abstract

The economic sustainability of the farms depends on estimating the level of cost and economic indicators. The aim of the study was to reveal the impact of farm size on beef production cost and economic performance. The data of the study were collected from 155 beef cattle sample farms via face-to-face surveys in Samsun province. A partial budgeting analysis method was used to estimate the cost and economic performance indicators such as gross production value (GDP), gross profit, net profit, relative profit, financial and economic rentability, and rentability factor. The research results show that, on average, the cattle farms produced 13,250.49 kg beef meat with a cost per kg of pound 21.89. The average costs of beef meat production per kg were pound 23.90 in small farms, pound 21.91 in medium farms, and pound 21.67 in large farms. The variable costs constituted 90.59% of the total production cost and breeding material (%56.52) and feed cost (%29.74) were the biggest cost items, respectively. The average gross profit and net profit for beef cattle farming were pound 97888.29 and pound 69784.0, while gross and net profit per kg were pound 7.38 and pound 5.26 respectively. Average financial, economic, and factor rentabilities were 9.62, 8.67, and 17.16 respectively. Farm size had a positive impact on the net profit, gross profit, and rentability of the cattle farms. In order to increase the economic performance of the cattle farms, the farmers should manage their inputs efficiently and the government should support the farms for increasing their farms' sizes.