Policy Analysis of Beef Production System in Peninsular Malaysia

In order not to be dependent on foreign countries for beef, Malaysia needs to increase her beef production to attain self-sufficiency level in the near future. In doing so, she needs to analyze the effect of different alternative production and decision-making policies in beef production and achievement of self-sufficiency level in beef. Thus, the objectives of the study were to develop a system modeling for beef production decision making, to evaluate the impact of production and trade policies on beef production, to determine the cost and return to government investment for importation of breeding stock and to suggest policy measures for beef production in Peninsular Malaysia. Simulation matrix (SIMM) model was developed based on system approach methodology to analyze the objectives of the study. The SIMM model was used to simulate the female breeding stock, male breeding stock, male calves and female calves and slaughter and production components of the beef production system. The ex-post SIMM model for beef production system from 1960-1996 was used as a base to simulate the ex-ante component by varying the rate of policy variables such as different calving, slaughter, mortality rates and the level of importation of female breeding stock. Thus, five SCENARIOS of different rates in decision-making variables were developed to analyze the impact of such variables on beef production in Peninsular Malaysia. SCENARIO 3 was found to be the most promising decision making strategy to attain self-sufficiency level at reasonable time frame and cost of investment. Under SCENARIO 3, at 76-80% calving rate, 5-7% slaughter rate, 1-2% mortality rate with 10000 heads/year, 5000 heads/year, 500 heads/year importation of beef cattle, dairy cattle and buffalo female breeding stock respectively, the results of BCR (1.96) and positive NPW show that beef production can be increased economically and 100% self sufficiency can be achieved in the period 2011/2012 at lower government investment cost for importation. Whereas SCENARIOS 1,2,4 and 5 show the negative NPW and less than 1 BCR and 14%, 24%, 13% and 11% self-sufficiency rate respectively due to lower calving rate and importation of female breeding stock, higher slaughter and mortality rate indicating that are not economically acceptable. Simulated results indicate that in order to maintain the higher level of self-sufficiency in beef, mortality rate and slaughter rate will have to be reduced. On the other hand, the rates of calving and importation of female breeding stock will have to be increased. The management of breeding stock is an important component in beef production system in order to achieve the level of self-sufficiency in beef.

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