The inclusion of Leucaena diversifolia in a Colombian beef cattle production system: An economic perspective

Enciso, Karen; Sotelo, Mauricio; Peters, Michael & Burkart, Stefan (2019). The inclusion of Leucaena diversifolia in a Colombian beef cattle production system: An economic perspective. Tropical Grasslands - Forrajes Tropicales, 7(4): 359-369

Despite the great potential of legumes in cattle production, their adoption and use throughout the tropical world remain limited. While this is largely attributed to factors such as limited knowledge or access to credit, lack of information on the viability and profitability of the technology can influence the adoption decision. The objective of this study is to evaluate the profitability of including Leucaena diversifolia, accession ILRI 15551 in a Colombian beef cattle production system. For this purpose, we use data from a grazing experiment comparing a grass-legume association (Brachiaria hybrid cv. Cayman and L. diversifolia) with a grass monoculture (cv. Cayman) in the Valle del Cauca department, both with the purpose of beef production. We use a discounted cash flow model, developed with the simulation software @Risk, which considers inherent risk and uncertainty factors in these types of rural investment projects, under three different pasture degradation scenarios. The results indicate that the inclusion of L. diversifolia is financially profitable and substantially improves the associated risk and performance indicators. Profitability indicators increased in a range of 15‒110%, and the probability of suffering economic losses decreased from 72% to 0%. The results were directly related to the increases in animal productivity (49%) and efficiency resulting from including the legume. This work shows that L. diversifolia has significant potential to increase both animal production and profitability, which is conducive to the sustainable intensification of beef production in grazing systems.