Large Dairy Farms Have Huge Labor Efficiency Advantage
Large dairy farms, those milking 2,000 cow or more, are two and half to five times more efficient in their use of labor than herds with fewer than 500 cows.
That’s the finding of an analysis by USDA’s Economic Research Service that examined the changing structure of the U.S. dairy industry. For example, large herds produce at least 1,000 lb. of milk for every one hour of labor while herds with fewer than 100 cows produce 200 lb. of milk. Herds with 500 cows produce about 500 lb. of milk per hour of labor.
“Farms with at least 500 cows are much more likely to milk three times a day while smaller farms typically milk twice a day,” says the report. Even though more labor is required to milk 3X, milk production increases more than offset the added labor. Other labor efficiencies come into play as well, such as animal care, feed mixing and delivery and feed production.
USDA also found large herds are able to pay higher wages than smaller farms. Herds with 2,000 or more cows were paying about 20% more per hour than herds with less than 100 cows, and 4% more than herds with less 500 cows.