Developing a Methodology for Aggregated Assessment of the Economic Sustainability of Pig Farms

Abstract

The economic sustainability of agricultural production is a crucial concern for most farmers, especially for pig producers who face dynamic changes in the market. Approaches for economic sustainability assessment found in the literature are mainly focused on the short-term economic viability of the farm and rarely take a long-term perspective. In this paper, we propose and test a new, innovative assessment and aggregation method, which brings about a broader view on more long-term aspects of economic sustainability. This wider view on economic sustainability, in addition to classical concepts such as technical efficiency, labor productivity, and farm profitability, incorporates the assessment of the levels of entrepreneurship, risk management, and the resilience of the invested resources. All indicators were scaled and aggregated using scaling and weighting procedures proposed by experts into subthemes and themes. The methodology was tested on a sample of 131 pig farms located in 6 EU countries: Germany, Italy, the Netherlands, Poland, Finland, and Austria. We hypothesized that closed-cycle farms might be economically more sustainable than those farms that are specialized in pig breeding or finishing. The results showed that closed-cycle farms do indeed have advantages in terms of raising healthy animals and having slightly better overall resilience of resources, however specialized breeding and finishing farms appeared to be more sustainable in the areas of profitability, risk management, and reproductive efficiency. Our approach supports evidence-based economic sustainability assessments of pig farms and provides a tool that can be used for economic sustainability improvement strategies for farms.

Keywords

• aggregated assessment
• economic sustainability
• entrepreneurship
• pig production
• resilience
• risk management