Most dairy farmers watch milk checks to track milk price. But do you know what your profit per cow is or how much it costs you to produce a hundred pounds of milk? Dairy farming is complex, and determining your profit and costs of production is sometimes difficult. Yet, it is important to understand them.
I encourage dairy farmers to calculate income and expenses on a per cow basis and cwt basis. This will give you good perspective on your profit, enabling you to analyze your efficiency. Each year, the University of Maryland Extension conducts the Maryland Dairy Farm Business Summary. Through this summary, we work individually with dairy farmers to calculate their income and expenses per cow and per cwt. Data from all farms participating are then summarized to determine industry-wide average income, expense, and profit per cow or per cwt. This gives farmers benchmarks with which they can compare their farm.
“...calculate income and expenses on a per cow and per cwt basis. This will give you a good perspective on your profit, enabling you to analyze efficiency.”