rabbit farming

Rabbit farming An evaluation of the Crusader R&D program A report for the Rural Industries Research and Development Corporation by Jenny Gordon and David Garrett, Centre for International Economics (CIE)

February 2004 RIRDC Publication No 03/144 RIRDC Project No CIE-19A

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© 2003 Rural Industries Research and Development Corporation. All rights reserved. ISBN 0 642 58710 8 ISSN 1440-6845 Rabbit farming: an evaluation of the Crusader R&D program Publication No. 03/144 Project No. CIE-19A The views expressed and the conclusions reached in this publication are those of the author and not necessarily those of persons consulted. RIRDC shall not be responsible in any way whatsoever to any person who relies in whole or in part on the contents of this report. This publication is copyright. However, RIRDC encourages wide dissemination of its research, providing the Corporation is clearly acknowledged. For any other enquiries concerning reproduction, contact the Publications Manager on phone 02 6272 3186. Researcher Contact Details Jenny Gordon and David Garrett, Centre for International Economics (CIE) Cnr Marcus Clarke Street and Edinburgh Avenue Canberra, ACT, 2601 Phone: 02 6248 6699 Fax: 02 6247 7484 Email: [email protected] Website: www.thecie.com.au In submitting this report, the researcher has agreed to RIRDC publishing this material in its edited form. RIRDC Contact Details Rural Industries Research and Development Corporation Level 1, AMA House 42 Macquarie Street BARTON ACT 2600 PO Box 4776 KINGSTON ACT 2604 Phone: 02 6272 4539 Fax: 02 6272 5877 Email: [email protected] Website: http://www.rirdc.gov.au Published in February 2004 Printed on environmentally friendly paper by Canprint

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Foreword

This report evaluates the Crusader rabbit program, a project funded by RIRDC and CSIRO and undertaken by CSIRO.

The R&D project established a rabbit herd at CSIRO’s Pastoral Research Laboratory at Armidale. The main research undertaken aimed to: estimate genetic parameters for traits such as number of kittens weaned per litter, average daily

live-weight gain and disease resistance; use this information to design and validate a breeding program; with commercial breeders, systematically quantify production parameters and develop simple

software to manage data and formulate practical systems of performance recording and rabbit selection; and

disseminate results and technical updates through existing industry networks. The purpose of this study was to assess the impact of the research in the first phase of the program on the rabbit industry. To estimate adoption rates and effectiveness of practices when adopted CIE conducted a survey of rabbit farmers. The survey covered experience with the Crusader program (adoption and the results), grower knowledge of the size and characteristics of the rabbit farming industry, and expectations for the future of the industry. The returns have been mainly through improved animal husbandry practices rather than from the breeding component of the program. The rate of return was estimated as 15 per cent on the R&D investment. This study also utilised information provided by researchers to assess the potential impact of the current phase of the research program. The potential returns from improved breeding performance are similar to the current rate of return. The returns are relatively modest as the industry is well established with a number of large successful producers. While both large and small producers did benefit from the program the gains were greater for the smaller producers and newer entrants. This project was funded from RIRDC Core Funds which are provided by the Federal Government. This report is an addition to RIRDC’s diverse range of over 1000 research publications and forms part of our evaluation of the Crusader R&D program. Most of our publications are available for viewing, downloading or purchasing online through our website: downloads at www.rirdc.gov.au/fullreports/Index.htm

purchases at www.rirdc.gov.au/eshop

Simon Hearn Managing Director Rural Industries Research and Development Corporation

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Contents Foreword.........................................................................................................iii

Executive Summary ........................................................................................v

1 Introduction................................................................................................1 Method of assessment .................................................................................................................. 1

2 The rabbit industry.....................................................................................3 Estimating industry supply ......................................................................................................... 3 Estimating industry demand....................................................................................................... 9

3 Program performance ..............................................................................12 The cost of the research program.............................................................................................. 12 Summary of program outputs................................................................................................... 12 Estimating adoption and effectiveness .................................................................................... 14 Experimental impact scenario ................................................................................................... 17

4 Implications for the future.......................................................................19 Implications of an expansion in supply ................................................................................... 19 Concerns and challenges facing the industry ......................................................................... 19 Implications for the future ......................................................................................................... 21

Survey of Rabbit Farmers..............................................................................22

Bibliography...................................................................................................29

Charts Chart 2.1 Distribution of size of rabbit farms............................................................................ 4 Chart 2.2 Estimated size of Australia’s farmed rabbit industry ............................................. 5 Chart 2.3 Supply curve for the farmed rabbit industry ........................................................... 6 Chart 2.4 Relationship between farm gate and wholesale prices........................................... 7 Chart 2.4 Relationship between farm gate and wholesale prices (continued) ..................... 8 Chart 2.5 Example value chain — values in $ per rabbit......................................................... 9 Chart 2.6 Estimated demand curve .......................................................................................... 10 Chart 2.7 Expected future wholesale price and quantity combinations.............................. 11 Chart 3.1 Share of survey respondents who sought information ....................................... 15 Chart 3.2 Adoption of specific outputs and reported benefits from Crusader (numbers of farms)...................................................................................................... 16 Chart 4.1 Perceptions of threats to the industry ..................................................................... 20 Chart 4.2 Factors affecting demand for farmed rabbits ......................................................... 21

Tables Table 2.2 Estimates of farm numbers and farm size.................................................................... 6 Table 3.1 Annual research costs for the Crusader project RIRDC budget ......................... 12 Table 3.2 Effectiveness of outputs when adopted ................................................................. 16 Table 3.3 Benefits for the Crusader farmed rabbit project using the best case scenario of the researcher’s estimates ............................................................ 17 Table 3.4 Results of the benefit cost analysis for the Crusader farmed rabbit project based on the survey responses........................................... 18

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Executive Summary

This report evaluates the Crusader rabbit program, a project funded by RIRDC and CSIRO and undertaken by CSIRO. The R&D project established a rabbit herd at CSIRO’s Pastoral Research Laboratory at Armidale. The main research undertaken aimed to: estimate genetic parameters for traits such as number of kittens weaned per litter, average daily



disseminate results and technical updates through existing industry networks.

As part of the work, all aspects of animal husbandry had to be considered, and the technical advice generated by the project, included information on establishment and set-up costs. To the extent to which this also improved the guidelines for ‘benchmark’ practices the project went beyond the breeding objectives. As the evaluation demonstrates it is this aspect of the work that has proved most beneficial to the industry to date. However, the benefit is not uniform across all rabbit producers.

The benefits to date flowing from the project are largely from animal husbandry and management information and bring a return of 15 per cent on the R&D investment The approach taken to evaluation was to survey industry members on their awareness, adoption and effectiveness of various aspects of the project. The responses showed that the animal husbandry and other management advice had been the most valuable output of the project. This response was not uniform suggesting that ‘top’ producers were already achieving the benchmarks and the value was for newer entrants and farmers with less capacity to undertake their own research.

Based on estimates of industry size from the survey the respondents produce around 40 per cent of total farmed rabbit meat. Assuming that the rest of the industry adopt the results of the project at the same level as the survey respondents by 2006 and achieve similar results in practice, the net present value of the project is estimated to be $1.25 million, and internal rate of return of 15 per cent for a cost (in present value terms) of $0.34 million. This gives a return of $3.7 for every dollar invested in the R&D.

The breeding program results have not translated through to industry to date The results on breeding were very mixed with around half of the farmers who purchased breeding stock not reporting an improvement. Whether this is an accurate indication depends on the capacity of farmers to monitor performance. The researchers suggest that most producers would find it very difficult to assess the merit of one source of animals against another, as they do not keep performance records to allow progeny testing. In addition, the difference in genetic merit between the Crusader stock and industry population as this point in the breeding program is not expected to be large as the stock produced is only 2–3 generations into the breeding program. The benefits of industry breeding programs accrue over time at a steady but slow rate. To date the breeding advice, and possibly the software, seems to have been more useful.

If they can be achieved on farm they will be of similar value The breeding program has been shown to deliver a 5 per cent increase in the number of kittens weaned and a 10 per cent improvement in average daily growth rate. Running these productivity ‘shocks’

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through the Enterprise model and assuming adoption rises to 70 per cent the benefit is estimated as $1.55 million, a 16 per cent rate of return. This estimated benefit is lower than had been estimated by Prayaga and Eady (2000) which did not factor in adoption rates.

Long term benefits will depend on industry growth but only if in response to rising demand The approach taken in this study holds constant the total production of rabbit meat at the projected growth rate for the industry. This approach understates the benefits of the R&D to the extent to which the growth in the industry is a result of the R&D outputs of the project. The value of this expansion in the industry depends on the alternative uses of the resources. If these are very similar to the value added in the rabbit farming industry then the net benefits from the expansion of the industry are small. To the extent to which rabbit farming is a lifestyle choice the net impact on value added is uncertain. In addition, the impact of an expansion in supply on price, independent of growth in demand, is to push prices down. This price response lowers the net benefits of any R&D induced expansion in supply. Market analysis by Foster (1999) suggests that demand is relatively price sensitive and so the supply response will drive down prices, all else equal.

Producers are optimistic for the future of the industry, but expectations are that it will remain a ‘niche’ industry The survey also sought information on the expectations for the future of the industry. The information suggests that: consolidation will continue with growth in the average size of rabbit farms (currently 100 does

compared with 57 in 1999); with smaller players dropping out of the market; production levels will continue to grow steadily at around 14 per cent a year to 2005, slowing to

10 per cent to 2008, and 8 per cent to 2015 — much lower than the projected growth rate of 31 per cent made in 1999, but consistent with historical growth rate of 10 per cent from 1999 to 2003;

price expectations are for a steady rise in price, with wholesale prices rising from the current reported median price of $7.50/kg meat to $12.20/kg meat by 2010. The information provided by the survey and the project suggests that prices declined from 1999 to 2001 and have risen since 2001. This recent rise is consistent with expectations of future price increases;

the survey suggests that rabbit is not expected to become a ‘supermarket meat’, nor is it expected to be replacing wild rabbit, growth in demand must be driven by ‘niche’ market development. This is consistent with the project reports that when speaking to the processors they say the demand is coming from specialty meat wholesalers, butcher shops and restaurants. Their current assessment is that they are getting trade enquiry of approximately 3–4 times the level of rabbits that they can supply; and

key issues for the industry are: – feed prices; – disease, including calici virus and myxomatosis; – regulation; – slaughter and processing; – ensuring a clean industry profile; and – promotion and marketing of rabbit meat.

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1 Introduction Rabbit meat has been a source of nutrition for Australians since 1859, when twelve pairs of wild rabbits were released in Winchelsea, 109 kilometers east of Melbourne. However, myxomatosis, calici virus, droughts and rabbit trapping have made wild rabbit an increasingly unreliable source of meat; and the production of wild rabbit has decreased dramatically. Rabbit farmers are hoping to step in and capture this increasing gap in the market.

In 1999, CSIRO and RIRDC commenced a three-year R&D program, the Crusader program, to promote the viability of the rabbit farming industry. The goals were to: estimate genetic parameters for traits such as number of kittens weaned per litter, average daily




A second project funded in 2002 for 5 years is designed to increase the productivity of rabbit farming enterprises, reduce costs and manage disease. The focus of the project is on identifying and implementing methods to improve key profit drivers. Individual areas of work identified by industry as high priority are management of disease, improved survival of kittens and growers, optimum nutrition and benchmarking performance. The project aims to deliver information systems, feed formulations and improved genotypes to optimise productivity and profit. This report assesses the success of the first RIRDC Crusader program. It also assesses the potential value to the industry if the breeding result of the program can be achieved by farmers through purchase of superior breeding stock. The outcome of this report will provide a guide to RIRDC and CSIRO of the potential future direction for R&D into the rabbit farming industry.

Method of assessment

A benefit cost analysis (BCA) is undertaken to estimate the impact of the Crusader program up to and including 2002. It also assesses the potential future impact of the program if breeding results are realised on commercial farms. As the future of the industry is uncertain a range of scenarios for future industry development are utilised. The Crusader program was able to provide an assessment of the improvements achieved under program conditions. The impact of the R&D depends on the adoption of the program outputs and on the effectiveness of these outputs in practice. These are clearly related, with the anticipated effectiveness one of the key factors influencing adoption.

To estimate adoption rates and effectiveness of practices when adopted CIE conducted a survey of rabbit farmers. The survey covered experience with the Crusader program (adoption and the results), grower knowledge of the size and characteristics of the rabbit farming industry, and expectations for the future of the industry.

The survey

CSIRO provided CIE with contact list of 163 rabbit farmers and processors (this excluded feed companies, vets and international farmers on the CSIRO contact list). Rather than sending out an unsolicited survey to these farmers the approach taken was to contact them to see if they would be willing to respond to the survey before it was sent. This approach has two advantages. The first is that it is easier to assess response bias, due to people having left the industry not responding or non-response due to other influences. The second is that it helps create a sense of obligation to return the

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survey and understanding of the reasons behind the survey for a sector of the population who are often the target of surveys and may well suffer from survey fatigue. A previous report on Rabbit production (Wondu Holdings 2001) was based on a sample of only 8 survey responses, and it was imperative that a larger sample be acquired to conduct an effective evaluation of the R&D program.

Twenty-one per cent of farmers contacted had left the industry

Telephone numbers were obtained for 77 farmers, of which five were wrong numbers. We managed to get in contact with 43 of the remaining 72 farmers (60 per cent). Of these two expressed no interest in the survey. Nineteen of them were faxed the survey, 8 were emailed the survey and 5 had the survey posted. The remaining 9 (21 per cent) had ceased operations and did not want to participate in the survey. This included some of the farmers who had donated rabbits at the commencement of the program. An additional 26 surveys were posted out to farmers who we had not been able to contact but who were flagged as serious producers on the CSIRO list, bringing the total of posted survey to 31 and the total number of potential survey responses to 58. Overall 31 farmers responded, a response rate of 53 per cent. The responding farmers represent 24 per cent of the original sample (assuming that the dropout rate is the same across the 163 farmers). It is highly likely that there is a much greater proportion of the industry (see the analysis on industry size).

None of the people contacted listed as starters had entered the industry

In addition to people classified as ‘farmers’ in the CSIRO list was contact details of 61 starters. Of these 61 we managed to contact 29 (48 per cent), none of who had taken up production. The fact that none of the people contacted had started production is significant and reflects the fact that interested parties have not transformed this interest into an active investment. The reasons given for not having started production varied, however feed costs were a significant factor in lack of economic attractiveness.

This report

This report presents the evidence from the survey and from a review of the literature on the rabbit industry to provide an: assessment of the current industry size and characteristics and the expected future growth of the

industry; evaluation of the impact of the Crusader program to date and expected potential; and implications for the future of the industry, including an assessment of the key factors influencing

the future industry outcomes drawn from the survey.

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2 The rabbit industry

Prior to 1996, most of Australia’s rabbit industry was based around wild rabbits, although a small-farmed rabbit industry existed in Western Australia. In 1996, the value of the wild rabbit industry was estimated at $9 million per year, around $1.5 million of which was exported.

Until 1996, the farmed rabbit industry viability was restricted by the relatively low cost and high availability of wild rabbit for harvesting. In addition it was illegal to farm rabbits, for example, rabbit farming only became legal in Western Australia in the late 1980s. Apart from legality, some of the challenges facing rabbit farming were: lack of capitalisation: rabbit farms generally require special sheds capable of keeping rabbits

comfortable and secure, while appropriately dealing with ammonia from rabbit excreta; the labour intensiveness of rabbit farming; and difficulty in selecting the right (low cost) feeding formula.

As a result, farmed rabbit could only compete with wild rabbit in niche markets where it sold for around twice the price of wild rabbit.

Since the introduction of calici virus in 1996, the wild rabbit export and domestic industry has suffered from uncertainty of supply. In 1998–99, only $440,000 worth of wild rabbit was sold for human consumption. This has opened up opportunities for farmed rabbit. It is now legal to farm rabbits in all states except Queensland and Northern Territory, but in some states permits must be issued. This chapter draws on the survey results to estimate: the current size of the market and expected growth; the responsiveness of supply to price; and the responsiveness of demand to price.

Estimating industry supply

Size of rabbit farms

Survey results show a continuum in size with an average of almost 100 does

There are a total of 3006 does on the 31 farms responding to the survey, an average of 97 does per farm. This average hides a considerable diversity of farms. For the analysis farms were divided into large and small farms (small farms were classified as those with less than 40 does). On this basis, there are 22 large farms with 2849 does at an average of 130 per farm. There are 9 smaller farms with an average of 17 does per farm. Chart 2.1 summarises the distribution of farms by size.

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Chart 2.1 Distribution of size of rabbit farms

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0-19 20-39 40-59 60-79 80-99 100-200 200+

Freq

uenc

yNumber of Does

Data source: CIE estimates based on survey responses

Comparison with results from existing literature suggest a trend to larger farms

In 1998–99 over half of the farms surveyed had less than 50 breeding does, compared to the 2003 survey results where only 30 per cent of farms had less than 40 does. The average number of does per farm was found to be 57 in 1998–99, and 97 in 2003. This is evidence of the increasing economies of scale being employed by the industry.

Growth in farm size is expected to continue with an average size of 350 by 2008, with smaller producers dropping out

Most farmers responding to the question on growth expect their farms to grow in size between 2003 and 2008. Of the 81 per cent who responded to the question, 60 per cent expected to have more than 100 does by 2005. By 2008, there were 3 producers who expected to exceed 800 does, and only 11 others expecting to remain in the industry with a minimum size of 65 does.

These numbers indicate that the process of consolidation and generating economies of scale in the industry is already underway and is expected to accelerate in the future.

Industry size

Current size is estimated at around 157 tonnes per annum

A 1999 report for RIRDC by Foster estimated the size of rabbit meat production at 106 tonnes per annum (dressed weight). This was produced from 115 rabbit farms with an average of 57 breeding does. Assuming a 50 per cent conversion in live to slaughter weight and an average weight at slaughter of 2.4 kilograms (McInnes pers comm August 2003), this implies a market size of around 84 000 farmed rabbits. This implies a turn-off from does to animals for slaughter of around 14 rabbits per doe per year. This looks low considering the Crusader project estimates a turn-off of around 31.5 per doe per year. The survey reports a current market size of around 157 tonnes in 2003. The estimates provided range from 110 tonnes to 250 tonnes. On the basis of the conversion estimates (above) this suggests a market of around 131,000 rabbits (range of 100,000 to 208,000). On the basis of an average number of does of around 100 per farm and the Crusader estimates of production per doe this implies only 42 farms would be required to have supplied this market. On the basis of the 1999 figures there would be around 97 farms. The actual number is likely to be somewhere between these numbers so the survey respondents could represent anywhere from 80 per cent to 30 per cent of the total number of farms. We think it is around the third mark and the survey responses on production suggest that the

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survey respondents supply around 40 per cent of the total supply. This suggests that the actual average turn-off per doe is well below the Crusader 31.5 rabbits per doe. The survey results suggest an average turn-off of around 24 rabbits per doe.

Growth at around 10 per cent a year is projected

Our estimates for market size in 2003 suggest that growth has averaged approximately 10 per cent per annum over the period 1998–2003. Small and large farmers provided fairly consistent estimates in the survey of the current and potential future size of the market for farmed rabbit. All expect the market to expand in size.

Chart 2.2 shows two scenarios for growth in the rabbit industry, starting in 1999. The first reflects Foster’s projected industry growth at 31 per cent per annum, based on an assumption that the farmed rabbit industry would be an imperfect but reasonable substitute for the wild rabbit industry. A growth rate of 31 per cent per annum growth was required to achieve his most likely scenario of 692 tonnes of production in 2004–05. Based on this ‘most likely’ scenario the industry would be producing around 400 tonnes dressed weight in 2003.

By our estimates the current market is around 160 tonnes, with growth well below the projected growth rate. This is most likely the result of the high costs experienced by farmers particularly those associated with feed costs and the large financial investment required to set up an efficient large scale operation (see below). Currently the low rate of profit to rabbit farming may preclude an investment of such magnitude. The drought during 2002 and into 2003 has had a major impact on feed prices and led to many farmers leaving the industry. In Tamworth feed prices went from $350 to $550 and are not predicted to ease until this year’s cereal grains become available in late summer, that is, February 2004.

The market is anticipated to grow from this point, with survey average projections of 305 tonnes by 2008 and 594 tonnes by 2015. This reflects relatively modest growth rates of 14 per cent to 2008 followed by 8 per cent to 2015.

Chart 2.2 Estimated size of Australia’s farmed rabbit industry

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1999 2001 2003 2005 2007 2009 2011 2013 2015

Tonn

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Foster CIE

Data source: Foster (1999) estimates are based on their most likely scenario of 692 tonnes of production by 2004-05, with a growth rate of 31 per cent per annum to achieve this. CIE estimates are taken from the survey.

The source of expansion in the industry has been growth in farm size

Over 1999 to 2015 the estimated rise in market size is 460 per cent while increase in does per farm is estimated at 580 per cent. Expansion to date has taken place through the increases in average farm size

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with possible consolidation occurring, as opposed to more entrants entering the market. This trend is expected to continue to 2008 and then slow.

Table 2.2 summarises the estimates of farm size, number of farms and production levels that have been backed out of the survey data. The key unknown is the turn-off of rabbits per doe, which, as discussed above, could range from 14 to –31.5. At the low end of the turn-off estimates there will be little change in the number of farms, while at the high end there will be considerably fewer farms. The reality is probably a small number of large and growing high turn-out farms and a large, but declining, number of small relatively low turn-out farms.

Table 2.2 Estimates of farm numbers and farm size

Year Meat Rabbits Implied growth

Low turn-out scenario - 13.5

rabbits per doe

High turn-out scenario - 31.5 rabbits per do

Tonnes Slaughtered % p.a No. of does Farms a Farms b

1999 106 88333 57 115 1152003 157 130556 10 97 100 422008 305 254167 14 158 119 532015 594 494643 8 387 95 41

a Assumes a turn-off of 13.5 rabbits per doe; b assumes a turn-off of 31.5 rabbits per doe Source: CIE estimates based on survey responses

The aggregate supply curve suggests that supply is highly elastic at current price levels

The survey asked farmers at what farm gate price they would drop out of the rabbit farming industry, and what amount they would supply at different price levels. From this, we were able to extrapolate a supply curve for the rabbit farming industry. The supply curve is fixed at low wholesale prices with only a few suppliers supplying below $5/kg of meat (about $7 a rabbit based on a weight of 2.4 kg). At $7/kg (about $9.40 a rabbit) there is considerable expansion in supply and the supply is highly responsive to prices until around $9/kg when supply becomes less elastic. Note that it is the supply response of the large firms that dominate the industry as small farms have only a very small impact on industry supply, producing only one per cent of rabbit meat.

Chart 2.3 Supply curve for the farmed rabbit industry

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Survey


The supply curve is fairly elastic for both small and large farmers. Small farmers tend to drop out of the market at a higher price than large farmers do.

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Prices for rabbits and meat

The project reports that rabbit is currently retailing for between $11 and $15/kg, with prices up to $17/kg in centres where supply is tight, that is Brisbane, and where the market can bear it, that is, north-shore suburbs of Sydney. In Victoria rabbit retails at the lower end of this range. The project reports that in 2001 they were being paid $2.50/kg live (about $7 per rabbit) and in 2003 are being paid $3.30/kg live about ($9.24 per rabbit). Macleay Valley rabbits who are processing about 25 per cent of the New South Wales rabbits have increased prices from $5.00/kg dressed in 1999 (about $7.30 per rabbit) to $6.50/kg dressed in 2003 (about $9.50 per rabbit). Processors in Victoria report similar increases in prices paid. The survey respondents demonstrated that farmers achieve a range of prices depending partly on location. Their reported average prices were around $2.96/kg live, which is roughly consistent with the reported wholesale price of $7.40/kg.

Chart 2.4 shows the relationship between the different prices and how the weight per rabbit impacts on the prices quoted.

It should be noted that the benefit estimates are independent of price, so this uncertainty over the actual price does not affect the result of the evaluations. Price is important, however, in determining the profitability of rabbit farming, and hence the long-term future for the industry.

Chart 2.4 Relationship between farm gate and wholesale prices

3.40 $/kg 2.8 kg $9.52X =

Farmgate estimateper rabbit

50%

X

=

6.80 $/kg $2 / 1.4 kg$.33 / 1.4 kg

$8.46+ =

Wholesale$/kg

Enterprise model results

Live weight Weight

Conversion

Transport andslaughter costsCarcass weight

(Continued on next page)

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Chart 2.4 Relationship between farm gate and wholesale prices (continued)

3.28 $/kg 2.5 kg $8.21X =


50%

X

=

6.57 $/kg $2 / 1.25 kg$.33 / 1.25 kg

$8.43+ =

Wholesale$/kg

Foster (1999)Live weight Weight

Conversion


2.96 $/kg 2.5 kg $7.40X =


50%

X

=

5.92 $/kg $2 / 1.25 kg$.33 / 1.25 kg

$7.78+ =

Wholesale$/kg meat

Survey resultsLive weight Weight

Conversion


The value chain for rabbit production Rabbit farming is a relatively capital and labour intensive industry. The cost of establishment has been estimated at $240,000 to $300,000 for a 300 doe farm (Foster 1999). However, the Crusader project has found that this has not generally proved the case with farmers being able to establish facilities, even when built from scratch, at a much lower capital cost. For instance, the facility for rabbits at CSIRO which would accommodate 140 does as a commercial operation has required a capital investment of approximately $60,000. Many farmers are starting with existing sheds and do not have the major capital expense of building construction. Therefore, profit after accounting for fixed costs, is likely to be higher for more recent farmers entering the industry then the farmer on which Foster based his income estimate. The Enterprise model assumes a capital cost of around $26,000 for a 100 doe farm (based on an 8 per cent cost of capital).

Using the Enterprise model capital costs are around 16 per cent and feed costs, which are most of the variable cost excluding labour, make up 69 per cent of the total cost of farm production (excluding labour). Off farm costs make up around 20 per cent of the wholesale price. Chart 2.5 shows an example value chain for farmed rabbit. Based on a price of $3.40/kg live, which is around $7.60/kg

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wholesale the return to labour for a 100 doe farm supplying 2380 rabbits to market (a turn-off 24 per doe per year) would be under $2,000. If the Enterprise rate of 31.5 rabbits per doe is achieved the return to labour is a little over $8,000 a year. These figures suggest that a wholesale price higher than $8/kg required to make the industry attractive to new entrants.

Chart 2.5 Example value chain — values in $ per rabbit

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10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Slaughter cost 17%

Transport 3%

Feed cost 40%

Other variable 6%

Return to labour 25%

Wholesaleprice $11.85

Farm gate price $9.52

"Profit" $2.97

Fixed costs 9%

Enterprise model

($3.40/kg live)

($7.63/kg meat)

0%

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30%

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100%

Slaughter cost 17%

Transport 3%

Feed cost 57%

Other variable 8%

Return to labour 3% "Profit" $0.38Fixed costs 12%

Survey based model

Farm gate price $9.52

($3.40/kg live)

Wholesaleprice $11.85

($7.63/kg meat)


Estimating industry demand

The closest substitute to rabbit meat is usually considered to be chicken meat, which has a fairly elastic demand, that is, quantity demanded is strongly related to price (Foster 1999). However, a recent study on rabbit marketing in Sydney (by Kurt and Tim Johnson University of Western Sydney) that found that rabbit was more comparable to veal and lamb, but unlike these two other meats, regardless of level of supply the price for rabbits remained constant. The implication of this finding is that demand is highly price elastic. This does not fit the profile of rabbit as gourmet meat which implies that demand is less price sensitive. The reputation of wild rabbit was as a cheap meat, to the degree that farmed rabbit replaces wild rabbit at low prices, and becomes a gourmet meat at high prices this suggests demand is more price sensitive at lower rather than higher prices. This would give the demand curve a convex to the origin shape.

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A demand curve was constructed based on estimated price elasticities for farmed rabbit meat. Foster (1999) estimated that rabbit meat has an own price elasticity of –0.8 at the then current market levels. This implies a one per cent increase in price will result in a fall in demand of 0.8 per cent at current prices and volumes. Chart 2.6 shows the demand curve for several elasticities of demand. Note that wholesale prices are used in the diagram.

Chart 2.6 Estimated demand curve

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0 50 100 150 200 250 300 350 400 450 500 550 600 650 700Quantity (tonnes)

Pric

e $

per k

g

E=-.8 E=-1 E=-2

Data source: CIE survey, 2003

Wholesale prices in 2003 appear to be roughly the same as in 1998 (average reported by Foster for 1998) while the industry output has grown by roughly 50 per cent. This would be observed if demand for rabbit meat is perfectly elastic or close to it, or that demand has increased (a shift of the demand curve), so that the equilibrium price has remained at $7.50. This shift of the demand curve could have been driven by the substitution of farmed for wild rabbit.

Pricing outlook

Without exception the farmers surveyed who commented on anticipated price movements believed that prices for rabbit meat would increase. Average expected price-increases for 2003-05 were 10 per cent, 6 per cent for 2005-08 and 7 per cent for 2008-10. Wholesale prices are expected to rise from an average of $7.40 in 2003 to $9.00 in 2005, $10.70 in 2008 and $12.20 by 2010.

To achieve these increases in price, given the expected increase in supply, demand must be expected to increase over time. Chart 2.7 shows the expected rise in price and market size.

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Chart 2.7 Expected future wholesale price and quantity combinations

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Data source: CIE survey, 2003

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3 Program performance The overarching purpose of the R&D program was to maximise the profits of rabbit farmers. To achieve this purpose, the project established a rabbit herd at CSIRO’s Pastoral Research Laboratory at Armidale. The main research undertaken aimed to: estimate genetic parameters for intensive measurement traits such as number of kittens weaned per

litter, average daily liveweight gain and disease resistance; use this information to design and validate a breeding program; with commercial breeders, systematically quantify production parameters and develop simple



As part of the work, all aspects of animal husbandry had to be considered, and the technical advice generated by the project included information on establishment and set-up costs. To the extent to which this also improved the guidelines for practices the project went beyond the breeding objectives. As the evaluation below demonstrates it is this aspect of the work that has proved most beneficial to the industry to date.

The cost of the research program The estimated cost of the Crusader program to 2002-03 is $392,269 in nominal dollars (table 3.1). This probably understates the actual cost of the program to the extent to which in-kind contributions are not included. The main omission is the use of breeding software developed prior to the program, which has been further developed by the program.

Table 3.1 Annual research costs for the Crusader project RIRDC budget 1999-2000 2000-2001 2001-2002 2002-2003 2003-2004 TOTAL

$ $ $ $ $ $RIRDC Funding 76,606 80,293 62,298 20,766 239,963CSIRO Funding 47,004 38,641 39,561 0 125,206Industry & Other Funding 11,100 8000 8,00 0 27,100TOTAL 134,710 126,934 109,859 20,766 392,269Source: RIRDC database

Summary of program outputs

The breeding program

The rabbit breeding program focused on the three major farmed rabbit breeds in Australia, the New Zealand White, Californian and Flemish Giant.

The breed evaluation showed that, for reproduction traits such as litter size, purebred New Zealand does were just as good as crossbred does, indicating that the level of hybrid vigour being expressed is not large enough to warrant a structured cross-breeding program. It would be unwise to base a breeding program on purebred Californian rabbits, and possibly Flemish Giant, because their reproductive performance was poorer than New Zealand Whites. For growth traits, the New Zealand White and Flemish Giant purebreds performed the best, with similar results for the crosses of these two breeds. Purebred Californians grew the slowest and crosses with Californian were intermediate.

These results suggested two options for the breeding program:

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develop a superior line of purebred New Zealand White rabbits; and develop a synthetic or composite strain of rabbits by selecting the best individual rabbits

irrespective of breed.

The decision was made to do the latter, so that selection intensity could be maximised for the given population of animals (that is the very best rabbits, regardless of breed, could be used), and so that genetic variation in the foundation population was maximised. In July 2001, the Crusader breeding program commenced using the index defined below. Index ($/doe/year) = (Number Weaned EBV x $33.71) + (Average Daily Gain EBV x $10.61)

Response to selection has been positive, with the trend in both phenotypic measurement and estimated breeding values showing an improvement for the two traits in the breeding objective. There has been about a 10 per cent increase in average daily growth rate and a 5 per cent increase in number of kittens weaned. There also has been an accompanying improvement in individual liveweight of rabbits at 10 weeks of age and in number of kittens born alive per litter.

The trend in estimated breeding values indicates that improvements can be attributed in part to genetic gain but there has also been a corresponding improvement in rabbit management and husbandry. In addition, low producing animals that had to be retained as part of the breed comparison were culled, giving an immediate lift to current productivity levels (Eady 2002, Final Report to RIRDC).

There are two ways in which farmers can hope to achieve these gains – improving the genetics of their rabbits and by adopting husbandry and management improvements demonstrated by the project. The first way of improving the genetic merit of their rabbits is to purchase superior breeding stock from the program or an associated breeder. The second is by implementing their own breeding program based on concepts obtained through Crusader, this may or may not involve the use of the software developed by the program.

Sales of breeding stock

Sales of Crusader breeding stock commenced in 2001. By January 2003, sales exceeded 250 breeding rabbits. Crusader has hosted a number of field days and workshops across Australia, where the availability of Crusader breeding stock is made known to farmers. Breeding does have recently been sold for around $40, and bucks for $50. In a recent field day (July 2003) all available rabbits were quickly sold out (McInnes pers comm. August 2003).

The software

The Crusader program assisted Daniel Brown, of GROWTEC Rabbits, with producing a computer program called Rabbit Central Version 2. RC-2 is a rabbit management and performance-recording software designed to help rabbit farmers with farm management and performance recording. It is commercially available and sells at a starting price of $700-$800 for small producers and increases in price as the enterprise size increases.

Animal husbandry

One of the aims of the program was to improve the overall productivity of the industry by developing ‘best practice’ in management. These cover areas from establishment to operations.

To the extent to which industry members are already following best practice they tend not to gain from this type of information, and may, in a price sensitive industry, lose as a result of competitors improving their productivity. Thus there can be some tension with this type of R&D project. Under these circumstances the winners are the entrants to the industry who face greater certainty and benefit from being able to ‘get it right’ the first time, and existing industry participants who had not had the resources (time and/or skills) to experiment.

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To the extent that the R&D creates new standards for best practice that improve productivity there is a potential gain for all members of the industry. Existing members can also gain when entry is deterred due to better information on the costs, profitability and effort required. This helps the industry avoid a boom and bust cycle often seen in ‘new’ animal industries. Developing ‘best practices’ is especially important in the rabbit industry, as poor quality product would tarnish the entire industry’s image, thus affecting all producers.

Animal husbandry advice and information provided by the Crusader project has in many cases had substantial effects on production and is viewed as a vital component of the Crusader project.

Estimating adoption and effectiveness

Survey results

Part 2 of the survey questionnaire inquires about the farmer’s knowledge of the Crusader program, adoption rates and the effectiveness of the knowledge and/or breeding stock.

All farmers surveyed were aware of the existence of the Crusader project; however as contacts for the survey were taken from the Crusader database of farmers this was not surprising.

The results from the survey show that small rabbit farms were more likely to adopt the outputs of the Crusader program than large farms. They were also more likely to gain benefits from the use of the information.

Adoption of Crusader outputs

Of the 22 large farms surveyed, 17 sought information on the Crusader project. Seven out of eight small farmers sought some sort of information (one did not respond to this part of the survey).

Of the respondents on large farms, approximately half sought information on animal husbandry, breeding and disease control, 23 per cent sought information on establishment and startup costs. However, less than half of all farmers indicated that they adopted the outputs of the Crusader program by purchasing does, bucks, RC-2 or changing animal husbandry (see chart 3.1). Some may have changed breeding practices as a result of the information provided, but this was not captured directly in the survey.

Three quarters of small farmers were researching breeding and disease control, half sought information on animal husbandry and establishment costs, and around two-thirds sought startup advice. Seventy one per cent of small farmers who sought information adopted some aspect of the Crusader program.

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Chart 3.1 Share of survey respondents who sought information

0%

10%

20%

30%

40%

50%

60%

70%

80%

Animal husbandry Breeding Disease control Establishment andstartup cost

Valu

eLarge farms Small farms

Data source: CIE survey 2003

Effectiveness of program

The survey allowed the adoption of specific outputs of the program to be measured, but there are less tangible knowledge outputs the adoption of which is only revealed through the assessment made by the farmers on the impact of the program on their performance. This section traces through adoption of specific outputs and their impact, and the less tangible overall impact on the key performance indicators for farmers. The main finding is that it has been the animal husbandry and general management advice rather than the breeding products (breeding animal and software) that has impacted on farm performance.

Performance of Crusader does and bucks

Those farmers who purchased Crusader does did not report any benefit in terms of increased number of weaners, increased weight at slaughter or reduced health or feed costs. Of those who purchased bucks, none of the large farmers reported any benefits. One small farmer who purchased bucks found an increase in weaners of 20 per cent, and increase in weight at slaughter of 50 per cent.

Performance of Rabbit Central 2 software

Only large farms reported purchasing RC-2 software. The value of selective breeding is greater with a larger range of breeding stock. Also the investment is not insignificant in terms of the cost of the software and the time required to utilise it. Of the four farmers who had purchased the software, only one found that it provided any sort of benefit.

Changes to animal husbandry

Changes to animal husbandry was the most adopted aspect of the Crusader program. Seven large farms and five small farms changed animal husbandry due to the Crusader program, with two and three respectively benefiting from the change. The largest benefits were felt by small farmers, who achieved benefits of up to 50 per cent in reduced health costs and a 32 per cent increase in weight at slaughter age. Large farmers who implemented husbandry changes reported increases in the number of weaners per litter ranging from 0 to 20 per cent and increases in weight at slaughter from 0 to 10 per cent. Overall the animal husbandry component of Crusader has had the largest impact on production.

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Chart 3.2 Adoption of specific outputs and reported benefits from Crusader (numbers of farms)

01

23

45

67

89

10Fr

eque

ncy

Achieved benefits (small farms)Adoption (small farms)Achieved benefits (large farms)Adoption (large farms)

Purchased does Purchased bucks Purchased Rabbit Central 2 softw are

Changed animal husbandry


Table 3.2 summarises the effectiveness or direct outcomes of the R&D. Note that these are different from those gains achieved in the experimental farm. It is common for R&D outputs not to be replicable in practice and the effectiveness to be lower. This is due to a range of factors, including constraints on other inputs, which are usually less constrained under experimental conditions. What is interesting here is that very little of the benefit seems to arise from the breeding stock, with the greatest reported source of gains being in animal husbandry and for a few improving their own breeding program.

Table 3.2 Effectiveness of outputs when adopted

Area of productivity gain

Number farms reporting change

Impact reported

Impact for adopters

Overall impact

Implied adoption rate

Large Small Range %Weighted

average %Weighted

average % % production

Increased weaners 4 4 5–20 19 4 19

Weight at slaughter 2 3 10–50 17 1 6

Reduced health costs 1 1 550 24 1 3

Reduced feed costs 2 3 540 18 1 6Source: CIE survey 2003

The estimated impacts of Crusader are increasing weaners per litter (although it is not clear how much of this is due to decreasing mortality rates or larger litter sizes), increasing live-weight gain and in a few cases a reduction in feed and health costs. The gains for the large farmers were predominantly in increased weaners. The comments on the surveys suggest that some farmers did not find that the program provided them with new information, while for other farmers it did. Thus the results suggest that the gains are largely more in improving average practices by raising awareness and understanding of ‘better practices’ rather than introducing new technologies and methods.

Approach to estimation of the benefits

The benefits can all be transformed into a cost reduction per kilogram of rabbit produced, that is, the impact is estimated as a change in per unit cost of production. This takes into account changes in the total cost of production (which tended to rise slightly due to higher production levels) divided by the volume of production (which rose due to both more rabbits produced and higher average weight at

17

slaughter). This approach enables efficiency costs to be evaluated on an industry level as opposed to a farm or per doe level.

The approach taken for the estimates reported in this chapter was to use the industry projections of size and apply the cost savings to this estimate. To the extent that this does not attribute to the project the value added of the expansion in production the approach will underestimate the benefits. However, there are several reasons why this approach was taken to avoid overestimating the benefits. The survey found that many members of the industry are struggling to gain a return on their capital

investment due to the high cost of feed. As a result the additional value added is relatively low. If a per farm benefit based on a relatively profitable farm is simply ‘multiplied up’ this will significantly overstate the benefits.

The ‘per farm’ or ‘per doe’ approach assumes that the farmer can sell all increased production at the going price. For a price taker, this is a reasonable assumption. But when selling into a price sensitive market, the increase in production implied tends to result in an, often significant, fall in prices.

The overall magnitude of cost reductions is estimated using the projections of industry size from the survey. Using a cost savings approach to evaluating the benefits means that no assumptions have to be made regarding the future price of rabbit meat. Allowing the price of rabbit meat to vary will have a significant impact on profitability and hence on the likely supply response, but not on the estimates of returns to the R&D investment.

Experimental impact scenario The Crusader project estimated that the benefits flowing to farmers from adopting Crusader were: a ten per cent increase in the average daily growth rate; and a five per cent increase in the number of kittens weaned.

In estimating the impact of these shocks we assumed that the average farm is 100 does and use the Enterprise model for costs of production and output estimates (www.csiro.gov.au/crusader). The adoption profile used is the profile anticipated by the program researcher. Adoption in 2003 was assumed to be very low at 5 per cent of the industry, rising to 70 per cent by 2007.

Our evaluation of these estimated efficiency gains using a unit cost of production approach give a net present value of $1.55 million at the five per cent discount rate with an internal rate of return of 15.7 per cent. The net benefit investment ratio (NBIR) is reported as any costs of implementation are incorporated into the estimation of benefits. Thus this estimates the return on the research investment given that farmers make any investment required to implement the R&D outputs. Results of this evaluation are detailed in table 3.3.

Table 3.3 Benefits for the Crusader farmed rabbit project using the best case scenario of the researcher’s estimates

Discount rate Project costs NPV NBIR IRR $m $m %0 per cent 0.36 4.12 11.4 15.75 per cent 0.34 1.55 4.6 10 per cent 0.32 0.68 2.1 Note: NPVs are in 2003 dollars calculated as at the beginning of the project in 1999. Source: CIE calculations, project estimates of shocks (Eady 2002).

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The results are not very sensitive to the assumptions about industry size and growth rates. A low production scenario with production 10 per cent lower than the base case results in a NBIR of 4.1 and an internal rate of return of 14.9 per cent. If the industry is 20 per cent larger than the base case the NBIR is 5.5 and the internal rate of return is 17.3 per cent.

Impact of the Crusader program based on survey data

As discussed above, the shocks reported by the survey are different to those anticipated. The adoption rate is based on the survey adoption rate, and an assumption that the survey respondents reflect 40 per cent of production. It is assumed that other members of the industry adopt the program outputs at the same rate as the survey respondents and achieve the same changes in productivity, but with a lag of 2 years. The productivity benefits are assumed to be sustained until 2029. The other difference is that these changes are applied to an ‘average’ farm of 100 does. The cost structure for this farm is basically the same as the Enterprise model, except that the turn-off per doe estimate used is 24 rather than 31.5. This better reflects the survey results and in the model is input as a lower number of litters per year. The results are the same if litter size were reduced.

Evaluation of the impact of the Crusader project based on the survey data gives similar results to the ‘best case’ scenario, however the drivers of the gains are very different. A $1.25 million NPV is generated at the 5 per cent discount rate with an IRR of 14.5 per cent. As indicated by chart 3.2 most of the gains indicated in the analysis are being generated by animal husbandry advice and improved disease control as opposed to improvements in breeding stock. Details of the benefits flowing from the project as estimated by the survey responses are given in table 3.4.

Table 3.4 Results of the benefit cost analysis for the Crusader farmed rabbit project based on the survey responses

Discount rate Project costs NPV NBIR IRR $m $m %0 per cent 0.36 3.26 9.0 14.55 per cent 0.34 1.25 3.7 10 per cent 0.32 0.57 1.8 Note: NPVs based on 1999 as of 1999 (project start). Source: CIE calculations, Survey responses.

As with the ‘best case’ scenario the results are fairly robust to changes in the industry size. With the low growth scenario for industry size the NBIR is 3.3 and the internal rate of return is 13.6 per cent. With the high growth industry scenario the NBIR is 4.5 and the internal rate of return is 16.2 per cent.

Conclusion

The results of the survey suggest that the returns to the first Crusader project have been solid but not spectacular gains coming about through improving animal husbandry and general practices in rabbit farming. Little of the gain can be attributed to the breeding component of the program.

The breeding gains achieved in the program, if transferred to the industry, will provide additional returns on the investment. To the extent to which additional R&D is required to achieve these gains in practice is additional investment need to be taken into account. The results of this BCA should be interpreted more as an ex-ante evaluation that implies an additional investment of $340,000 that achieves a 10 per cent increase in average daily growth rate and a 5 per cent increase in number of kittens weaned with 70 per cent adoption will provide a return of around 16 per cent.

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4 Implications for the future Implications of an expansion in supply

Foster (1999) estimated that the farmed rabbit market would grow at a rate of 31 per cent per year from 1999 to 2005, but that prices will remain steady at around $7.50/kg. For this to occur, demand and supply must expand at roughly the same rate. The evidence on price is mixed (see chapter 2), but suggests that prices may have fallen to 2001 and recovered, at a minimum, to the 1998 levels.

Growth in the industry appears to be significantly slower than projected (around 10 per cent a year), and costs of production have risen in recent years due to feed prices, and for some farmers dealing with the impact of the calici virus. Clearly offsetting this has been some consolidation and growth in the average farm size, which brings scale economies. While input price rises would shift the supply curve upwards (reduce supply at any given price) the economies of scale shift the curve out (increase supply at any price). Given the market growth and relatively constant prices both demand and supply curves have clearly been shifting out over time.

Practically all the farmers surveyed expect prices for farmed rabbit meat to increase in the future, even though they also expect production to increase. For this to occur, demand would have to increase at a greater rate than supply. As discussed below there does not appear to be a clear understanding of what forces would drive this outcome.

Concerns and challenges facing the industry

Threats to the industry

The survey asked farmers to rate their perception of threats to the rabbit farming industry. Responses are shown in chart 4.1.

The highest perceived threat is feed price followed by regulation of the industry and the lack of processing and slaughtering facilities. Eighty six per cent per cent considered feed prices to be a high concern, 59 per cent considered regulation a high concern and 54 per cent considered processing to be a high concern.

Myxomatosis, calici virus, other diseases and animal rights were also viewed as concerns. However, 62 per cent of respondents consider foreign imports to be only a low concern, indicative of the low probability of this happening.

20

Chart 4.1 Perceptions of threats to the industry

0

5

10

15

20

25

Foreign

impo

rts

Feed p

rice

Myxom

atosis

+ ca

lici

Other d

iseas

e

Animal

rights

Slaugh

ter +

proce

ssing

Regula

tion

Freq

uenc

y of

obs

erva

tions

High Medium Low


These results confirm views expressed earlier (Foster, 1999), who determined that drought sensitivity, animal welfare, disease, pollution and associated regulation, and food safety and quality were the major issues facing the industry.

Factors affecting demand

Foster (1999) cites the factors affecting demand for rabbit meat as the price of competing meats, consumer tastes (of which perceived food safety is a determinant) and incomes. Our survey expanded on these demand side concerns by asking what farmers regarded as the critical factors driving present and future demand for rabbit meat.

Rabbit meat has had a reputation of being an inferior meat due to its position as a staple meat during the Depression era. However it has the potential to become a ‘respectable’ meat for health reasons. Rabbit is low in fat, high in protein and has a higher iron content than chicken.

The most important factor affecting demand for rabbit meat cited by survey respondents was the ability of the industry to maintain a clean image, with 93 per cent of respondents citing this as of ‘high’ importance. Other important factors seen to affect demand were promotion and marketing of rabbit meat, industry coordination and the decline in the availability of wild rabbits (see chart 4.2).

The relative unimportance of wild rabbits and supermarkets suggests that the survey respondents do not see farmed rabbits as a substitute for wild nor that rabbit will become a ‘standard’ meat on offer in supermarkets. This suggests that the view of the future market is in specialty meat shops and restaurants.

21

Chart 4.2 Factors affecting demand for farmed rabbits

0

5

10

15

20

25

30

Demand wilddecline

Promotion +marketing

Clean profile Coordinatingindustry

Supermarkets

Freq

uenc

y of

obs

erva

tions

High Medium Low


Implications for the future Key points: There are substantial potential gains to the profitability of the industry in bringing up the industry

average performance to the turn-off rate per doe as achieved in the Enterprise model (that is 31.5 rabbits per year).

The improvement in the industry performance will have a major impact on the ability of the industry to supply meat rabbits, and this will have downward pressures on price unless demand can be stimulated.

Demand growth must come in the ‘niche’ markets of restaurants and specialist shops while there is currently scope to stimulate demand in these areas, the volume at which market saturation is reached is not known.

To date there is little evidence that the breeding side of the project is yielding observable improvements in production on-farm. At this stage the gains are largely from improved animal husbandry.

Increasing economies of scale could reduce the need for external breeding as stocks are large enough to source own breeding stock. However scale may offer opportunities for more specialist provision of breeding stock.

22

Survey of Rabbit Farmers

June 2003

Thank you for participating in this survey. This survey, undertaken on behalf of the Rural Industries Research and Development Corporation (RIRDC) New Animals program, is an essential part of the evaluation of the CSIRO Crusader project for the rabbit meat farming industry. It is important for the Government to assess the performance of its programs to support research and development (R&D) through evaluations of this kind. The survey aims to assess the adoption of the R&D results, the impact that this has had on the industry and the likely future growth of the industry.

Although we ask for specific figures, in many cases these may not be known with a high degree of accuracy. Therefore, in most cases your best estimate is what we require. All information you provide shall be treated as commercial-in-confidence and the report will only provide estimates of the aggregate impact of the Crusader program.

The survey is expected to take approximately 30 minutes to complete.

Please return this survey by COB Friday, 25 July 2003, although earlier receipt would be appreciated.

To The CIE By email: [email protected] By fax: 02 6247 7484

If you have any questions about the survey please contact: Jenny Gordon or Dave Garrett on 02 6248 6699

If you are willing to discuss your answers please provide your name and contact details below.

Name:

Contact details:

23

Part 1 About your business enterprise

We need to understand a little bit about your business in general and its involvement with the Crusader program.

1.1 What is your involvement with the rabbit farming industry? Currently Producing

Exploring options for involvement

Specialised rabbit farm

Producing rabbits as part of a broader farm enterprise

Producing rabbits as a part time occupation (for profit)

Hobby farm (not for profit)

Research

1.2 If you are involved in multiple farming activities, what percentage of your farm income is generated from rabbit farming?

%

1.3 How many does do you currently/plan to have? Current

2005

2008

1.4 Are you aware of CSIRO’s Meat Rabbit Project (Crusader)

Yes Please complete Part 2

No Please go to Part 3

Please go to part 2

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Part 2 Impact of the CSIRO Crusader program We need to understand the adoption of the R&D findings and effectiveness of the R&D in the field.

Field-days

News letters

Internet

Sought out information

Other farmers

2.1 How did you hear about the CSIRO Crusader project? (please indicate all relevant answers)

Other (please specify)

Animal husbandry

Breeding advice

Establishment costs

Startup advice

Disease control

2.2 What information did you seek/ find out from the Crusader project?


Purchased Crusader does

Purchased Crusader bucks

Purchased and/or used the Rabbit Central 2 software package

Changed animal husbandry

2.3 Have you changed any practices as a result of the information and/or services provided by the Crusader project? (please indicate all relevant answers)

Other changes (please specify)

Increased weaners per doe %

Increased weight at slaughter age %

Reduced health costs per doe %

2.4 What effect have these changes made to the profitability of your rabbit farming enterprise?

Reduced feed costs per doe %


Please go to part 3

Part 3 Performance

The Crusader program has targeted three variables (number weaned, growth rate, disease resistance) which can be improved through genetic breeding and improved animal husbandry. Breeding and

25

growth productivity are key variables to the success of rabbit farming. The following questions aim to evaluate the productivity levels you have achieved and your anticipated improvements in these areas.

If actual data is not available, please give your best estimate. 3.1 Please give your best estimate of your average performance.

Source of improvements

Past Performance

2000

Present performance

2003

Anticipated improvements

2008 Breeding % Animal husbandry %

Litter size per doe (#)

% %

Litter size at weaning (mortality rate) (#)

% %

Time to weaning (weeks)

% %

Weight at weaning (kg)

% %

Age at slaughter (weeks)

% %

Slaughter weight (kg)

% %

Please go to part 4

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Part 4 Industry Prospects

In order to evaluate the benefits of R&D it is necessary to estimate the industry’s potential for growth, limiting factors, and possible threats. The following questions ask for your assessment of the future of Australia’s rabbit meat farming industry.

Estimate Average does per farm Total Production meat

1999 does tonnes

2003 does tonnes

2008 does tonnes

4.1 What do you think the average size of farm will be in the future and the total size of the market?

2015 does tonnes

Foreign imports of rabbit meat High Medium Low

Feed price sensitivity (drought) High Medium Low

Myxomatosis and Calici virus High Medium Low

Other diseases High Medium Low

Animal welfare rights High Medium Low

Access to slaughtering and processing facilities

High Medium Low

Over-regulation by councils High Medium Low

4.2 What threats to the future of Australia’s rabbit farming industry are you concerned about?


Demand driven by decline of the wild rabbit industry

High Medium Low

Promotion and marketing High Medium Low

Maintaining a clean profile of rabbit meat and the industry

High Medium Low

The development of a National Association capable of coordinating industry R&D and lobbying for decreased regulations

High Medium Low

The potential to distribute produce via supermarkets

High Medium Low

4.3 How important are the following factors for the development of markets for the Australia rabbit farming industry?


27

4.4 One objective of the program is to develop a National Breeding Program that could include breeders from all regions in Australia who will undertake a linked genetic evaluation and provided rabbits with objective measurements for the industry as a whole. To the best of your knowledge, what share of the industry would source their rabbits from breeders involved in such a program? Please give your best estimate.

Now 2005 2008

Small farmers(<50 does)? % % %

Medium sized farmers (50-200 does)? % % %

Large farmers (>200 does)? % % %

Please go to part 5

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Part 5 Price effects As in any industry price plays a critical role in determining the level of production and ultimately the size of the industry. The following questions are designed to gauge the level of price sensitivity for the demand and the supply of rabbit meat.

2003 2005 2008 2010 5.1 What price do you think you will get for rabbit meat in the following years ($/kg)? $/kg $/kg $/kg $/kg

5.2 At current production costs what price would you cease producing rabbits? $/kg

$7 per kg $8 per kg $9 per kg $10 per kg 5.3 How much would you increase production at each of the following prices? % % % %

Other comments Please use the space below to provide any other comments on the program or the industry in general.

Thank you for your participation. The results will be compiled and presented in the report to RIRDC on the returns to the R&D program.

All individual responses will remain confidential.

29

Bibliography

Bobbitt, J. 2003, Buffalo, Camel, Crocodile, Emu, Kangaroo, Ostrich and Rabbit Meat – New value added products, RIRDC Publication No. 03/036, RIRDC Project No. DAV-182A, RIRDC, Canberra.

CSIRO 2001, Farmed Rabbits for Growth in Australian Agriculture, RIRDC Research Project CSU-1A, Annual Report, 10 December 2001.

Davidson, B.R., Martin, B.R. and Mauldon, R.G. 1967, ‘The Application of Experimental Research to Farm Production’, reprinted from Journal of Farm Economics, Vol. 49, No. 4, November 1967.

Eady, S. J. and Prayaga, K. C. 2000, ‘Rabbit Farming for Meat Production in Australia: Preliminary Estimates of Economic Values for Production Traits’, Pastoral Research Laboratory, CSIRO Animal Production, Armidale, NSW, 23rd Conference of the Australian Society Animal Production, Sydney, July 2000.

Eady, S.J. 2002, Final Report to RIRDC.

Foster, M., 1999, Australian Farmed Rabbit - Prospects for Industry Development, RIRDC Publication No. 99/98, RIRDC Project No. ABA-7A, RIRDC, Canberra.

http://www.csiro.gov.au/crusader Crusader Meat Rabbit Project, accessed 22 July 2003.

http://www.growtec.com.au/ Growtec – Commercial Rabbit Farming in Australia, accessed 4 July 2003.

Mo’ane, C. and Carota, M. 2003, ‘The farmed rabbit industry in Australia – a commercial perspective’, discussion paper prepared by Australian Rabbit Farm Pty Ltd, July 2003.

Wondu Holdings 2001, Benchmarks for New Animal Products – Alpaca, Buffalo and Rabbit Production and Duck Processing, RIRDC Publication No. 01/113, RIRDC Project No. WHP-2A, RIRDC, Canberra.

rabbit farming

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