Masters Theses

Date of Award

8-1965

Degree Type

Thesis

Degree Name

Master of Science

Major

Agricultural Economics

Major Professor

W.P. Ramney

Committee Members

William Goble, Robert M. Ray

Abstract

Much concern has been given to the economic development of the livestock industry in various regions of Tennessee. The livestock industry in a particular area is composed of many firms or farm units throughout the area. The goal of these individual units is generally that of increasing net returns, which at the farm level, would not only contribute to the competitive position of the farmers in the agricultural industry but would quite likely contribute to the overall development of the particular area.

The Elk River Watershed, the area in which this study was made, is one in which the livestock industry is a major agricultural industry. The Watershed includes Coffee, Franklin, Giles, Grundy, Lawrence, Lincoln, and Moore Counties of Middle Tennessee. Livestock and livestock products have provided a substantial source of agricultural income to farmers in the above counties for many years. In 1939, income from livestock and livestock products composed 56 per cent of the total value of all agricultural products sold in the seven counties. By 1959, this percentage had increased to 6h per cent (Figure 1). It is worthwhile to note that the percentage of total value of all agricultural products sold in this area has been greater for livestock and livestock products than for crops for the 1939-1959 period, whereas the opposite is true for the state of Tennessee (Figure 2).

Farm production expenses for all farms in the Elk River Watershed increased 96 per cent for the period 1950-1959 (Table I). During the same period gross income increased only 53 per cent. The increase in cost of production, accompanied by unstable prices, which have contributed to fluctuating farm incomes, has resulted in the farmer having been caught in a price cost squeeze. It has become more important than ever for the agricultural producer to use better management and new technology as tools for increasing profits.

"Farm management is concerned with the decisions that affect the profitability of the farm business." This comprehensive study of livestock practices and their effect on farm income should provide useful information for livestock farmers in the Elk River Watershed as they attempt to increase net returns through better management of livestock enterprises.

It is hoped that this study will also serve as a basis for further analyses of livestock enterprises in this area of the state. Additional analyses could include development of planning models based on various analytical tools, such as marginal analyses, partial budgets and linear programming, for arriving at net income. These analyses will necessitate the gathering of considerable input data.

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