This analysis of a Merino ewe enterprise supports the economic merit of fine wool bloodlines

An analysis was conducted to determine the bloodline traits which have most influence on the gross margin of a Merino ewe enterprise. Data from the co mbined bloodline analysis was used as bloodline production information. Woo l auction prices and lamb sale prices from 1993 to 1997 were used as market information. Fibre diameter had the largest influence on gross margin (cor relation = 0.83), and fibre diameter and clean fleece weight in combination influenced the majority of variation in gross margin (r = 0.98). When the economic ranking of bloodlines for the ewe enterprise was compared to the e conomic ranking of bloodlines for a wether enterprise, the correlation was very high (r = 0.98). However, the bloodline variation was lower for the ew e enterprise (range of 40%) than the wether enterprise (range of 60%). The broader bloodlines had higher income from progeny sales as they tended to h ave higher body weights and estimated reproductive rates. However the incom e and bloodline variation from sale of wool was substantially higher than t hat for progeny sales and therefore the influence of fibre diameter on ente rprise gross margin was substantial. In a narrow market period when wool pr ices were relatively low and weaner prices were relatively high, the influe nce of fibre diameter on enterprise gross margin was minimal. However, it w ould be a risk to use a narrow market period as an indicator of future mark et trends.