Predictors of economic performance of sheep meat farms

The sheep sector is suffering an important decline in recent years and it is necessary to ensure its economic viability in order to guarantee its continuity. The main objective of this work was to determine the structural, technical and economic variables that best predicted the economic performance of a sample of sheep farms. Assuming that there were different types of farms, a typification was also carried out to find out whether the predictor variables differed between the groups. Eleven structural, technical and economic variables were studied in a sample of 126 Aragonese farms (Spain) over the period 1993-2016, and several statistical analyses were carried out: Factor Analysis, Cluster Analysis and Multiple Linear Regression. From the result of the typification, three groups of farms were obtained that can define three production systems differentiated mainly by the productive structure, and the degree of intensification of production. It was observed that different farm management could lead to the same economic results. Labour intensification followed by the number of lambs sold per ewe per year were the indicators with the highest positive predictive power on economic results, while feed cost per ewe was the variable with the highest negative predictive power, in all cases with no differences between groups.