Summary

•  Partial budget analysis suggests that increased milking frequency, that is, 4X for days 1 through 21 of the lactation, 2X thereafter, is attractive over a wide range of milk prices and marginal purchased feed and crop costs per additional pound of milk when compared to 2X for a dairy farm described as averaging 90 cows for the year.
• Results are sensitive to expected milk price, marginal purchased feed and crop cost, and milk yield response.
• Due to the sensitivity of results to changes in key variables, a farm manager's decision making regarding frequent milking during early lactation will benefit from analyses that reflect conditions, and expectations specific to the farm.

Economic Analysis

One measure that producers use to evaluate possible changes in practices is the expected change in profit. Profit equals the total value of production minus the costs of inputs used in production. Expected change in profit equals the expected change in total value of production minus the expected change in costs. Analysts construct a partial budget to estimate the expected change in profit associated with a proposed change in the farm business, for example, frequent milking during early lactation.

Selected Assumptions

• Average number of cows for the year: 90 (Source: Cornell University Cooperative Extension's Dairy Farm Business Summary (DFBS) Program, 2011, Group average for NYS, less than 200 cows, 2X milking, May 2, 2012)
• Proposed change: 4X milking in early lactation, that is days 1 through 21, 2X for the remainder
• Current: 2X milking
• Additional pounds of milk per cow per day, days 1 through 21: 17.27
• Additional pounds of milk per cow per day, days 22 through 270: 6.801
• Additional labor hours per cow per day attributed to 2 additional milkings: 0.2
• Number of animals milked 4X daily: 5
• Annual pounds of milk sold per cow per year - current: 18,800
• Milk receipts in $ per cwt. and marginal purchased feed and crop costs ($/additional pound of milk) are varied

Results

Twenty two of 25 expected milk price, expected marginal purchased feed and crop cost combinations yielded expected changes in profit greater than zero (Table 1).

Table 1. Expected Change in Profit by Gross Milk Sales per Cwt. by Purchased Feed and Crop Expense per Additional Pound of Milk -- 4X Days 1 through 21, 2X thereafter vs. 2X; Average Number of Cows is 90; Initial Expected Milk Response.

Given DFBS net farm income results for 2009, 2010 and 2011, the results from table 2 suggest that 4X milking during early lactation at the reduced expected yield response can be expected to increase profit by about 9 percent on average when compared to 2X.

To learn more about this work, please contact John Hanchar.



Table 1 (pdf; 30KB)