Efficiency Analysis of Sheep Farms in Cyprus

Sokratis Sokratous (), Athanasios Ragkos, Georgios Arsenos and Alexandros Theodoridis
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Sokratis Sokratous: Laboratory of Livestock Production Economics, School of Veterinary Medicine, Aristotle University of Thessaloniki, 54124 Thessaloniki, Greece
Athanasios Ragkos: Directorate General of Agricultural Research, Hellenic Agricultural Organization-DIMITRA, 11145 Athens, Greece
Georgios Arsenos: Laboratory of Animal Husbandry, School of Veterinary Medicine, Aristotle University of Thessaloniki, 54124 Thessaloniki, Greece
Alexandros Theodoridis: Laboratory of Livestock Production Economics, School of Veterinary Medicine, Aristotle University of Thessaloniki, 54124 Thessaloniki, Greece

Agriculture, 2025, vol. 15, issue 14, 1-14

Abstract: In this study, an empirical analysis was applied to measure the efficiency level of dairy farms in Cyprus and estimate the capacity of sheep farmers to support the increasing demand for halloumi cheese. Data Envelopment Analysis was used on data from 50 dairy sheep farms in Cyprus, which operate under extensive, semi-intensive, and intensive systems. The main features of the most efficient farms are presented, and a comparative financial analysis is implemented between the efficient and less efficient farms. The results indicate room for improvement in extensive and semi-intensive dairy sheep farming and verify that the transition that takes place in sheep farming towards more intensive systems constitutes the optimal approach. The most efficient farms operate under semi-intensive and intensive dairy sheep farming and achieve higher milk yields than the farms operating under extensive systems. Feeding constitutes the main cost driver, exceeding 60% in both efficient and inefficient farms, while labor wages and fixed capital cost varies between 25% and 30% of the total production cost for both efficiency groups. The findings indicate that the farms should utilize economies of scale to reduce production costs and utilize fixed capital endowments at full capacity.

Keywords: dairy sheep farming; technical efficiency; Cypriot sheep farms; haloumi cheese; economic performance; data envelopment analysis (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2025
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