Managing The Big 3 Dairy Farm Expenses

While the Dairy Revenue Protection is still on the way, I thought this article might help producers who are struggling with low milk prices. These tips from Dairy Herd Management by Peter Erickson of the University Of New Hampshire Cooperative Extension might be what you need to get by until the new insurance program kicks in. Below are ways to manage the Big 3 expenses that dairy producers face.

FEED

Erickson says that this is the single largest cost on the farm and goes on to share that it accounts for more than half of the milk check. You can make better quality forage to address feed costs. Producers supplement the feed to make up for nutrients not found in the forages. Therefore, if you were harvesting better quality forage, you would be spending less.

LABOR

According to Erickson, many dairies have too many employees. Based on Northeast benchmarks, milk production is at 1.2 million pounds of milk per full-time equivalent (FTE) annually or one employee per 50 cows (not heifers or calves).  As you consider the FTE, think about all your employees, including those who work parttime.

HEIFERS

In the Northeast, it costs $2,300 to raise a heifer. Erickson says that most dairy farms have too many of them. Based on goals, they should calve at 22 months and also produce 80% of the milk mature cows produce during their first lactation. Consider your herd size, the cull rate percentage, age of calving in months, and the mortality rate percentage. Click here to view the full article for the formula.

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Rick Pascual, CPC/ PRC • Dairy Recruiter

Rick Pascual recruits in dairy nutrition for feed companies and their suppliers across the United States. Rick joined Continental Search in January 2015 and has successfully filled a number of searches for nutritionists, sales, and sales management for leading companies.

After completing coursework and a grueling exam, Rick became a Certified Personnel Consultant (CPC) in November 2015, as well as a Professional Recruiting Consultant (PRC) by AIRS in April 2016. Visit his LinkedIn profile for more information and to stay updated with news about recent dairy trends.

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