Profitability Returns to Three of Four Dairy Budgets [VIDEO]
Thanks to a jump in milk prices, three out of four of his August dairy budgets in the Western Cornbelt were in the black, says Robert Tigner, a University of Nebraska Extension dairy educator.
This is a turn-around from July, when only the highest producing freestall herds were showing a positive return. Milk prices in the Central Federal Milk Marketing Order were $16.65/cwt in August, up 85¢/cwt from July. The prices would have been up even more had it not been for a -82¢ Producer Price Differential in August.
Tigner calculates whole-herd budgets for both 20,000 and 24,000 lb. herd averages in tie stall and freestall operations. In August, only tie stall herds with production at 20,000 lb./cow were still seeing negative numbers over all costs. These herds were losing 51¢/cwt.
Freestall herds producing 24,000 lb./cow were seeing net returns of $2.27/cwt and those producing 20,000 lb./cow were seeing net returns of 83¢/cwt. Tie stall herds with 24,000 lb./cow milk production were netting $1.09/cwt.
The budgets were also helped by declining feed prices. “Gross feed cost declined by about $161/cow/year, most of that from the decline in hay prices,” he says.
Dairy Budgets in the Black