The economic effects of grazing in small-scale lamb fattening production systems in central México through a scenario analysis.

The objective was to assess grazing as an element of profitability and competitiveness of a small-scale lamb fattening production system in central México and compare its economic performance by means of an analysis of scenarios. Two scenarios were analysed to assess the contribution of grazing on profitability and competitiveness. The first analysis was when grazing was the feed base, and secondly, costs of opportunity and economic impacts were studied under the assumption that sheep do not graze, and total feed has to be bought from external suppliers. The economic effect of grazing on the profitability was analysed by means of the Policy Analysis Matrix. Differences were found between strata; farmers with more than 70 sheep have the best profitability indices and the least vulnerability under the non-grazing scenario. Grazing had a positive effect reducing the cost of production and increasing competitiveness in the four strata assessed. However, farmers with higher technical level, specialised breeds and larger flocks (strata 3 and 4) have higher economic profits. The conclusion was that the profitability in fattening sheep is linked to taking advantage of grazing. However, to keep and improve the current financial performance, there is a need for the adoption of strategies for an integral improvement of the system and the adoption of better grazing management to further reduce production costs.