Pastured dairies really shine with higher oil prices

by Allan Nation

MOUNT VERNON, Missouri: Higher fuel prices are having a much lower impact on pasture-based dairies than on their confinement competitors giving them an even greater competitive edge, according to a Missouri research station.

“Confinement dairies rely much more heavily upon machinery to plant and harvest forages and crops,” Superintendent Richard Crawford of the University of Missouri’s Southwest Dairy Center said in his June 2005 report.

“Fertilizer costs tend to follow fuel costs, and by having the cows return 95% of the nutrients back to the pastures, grazing dairies tend to have reduced fertilizer costs compared to conventional dairies.

The Southwest Center in the Missouri Ozarks is the only seasonal, grass-based dairy research center in the United States.

In 2004, grazed dairy cows at the Southwest Center returned a net operating margin of $1695 a cow or $1342 an acre.

This operating margin was nearly double that of 2003's $881 per cow return.

Operating margin is the amount of money available for debt service, heifer replacement, income taxes and family living.

The higher margin in 2004 was the result of a combination of high milk and cattle prices in 2004. Milk prices averaged $17.94 cwt for the entire 2004 production season.

A cool summer also helped by keeping pastures digestible. This resulted in milk production increasing by 1000 lbs per cow over 2003 to 13,807 lbs.

Milk fat averaged 4.19% and protein 3.32%. Total expenditures were $8.71 per cwt. Of this purchased grain was the largest cost at 35% of total expenditures or $428 per cow and $3.10 cwt.

Pasture costs were only 88 cents a cwt and supplemental hay was $1.00 cwt.

“Grazing dairies we work with in the region reported similar results,” Crawford said.

“As gasoline prices continue to climb, this difference will be even greater giving pasture based dairies an even bigger advantage.”

© by The Stockman Grass Farmer

If You Would Like To Read More Articles Like This One, CALL 1-800-748-9808 And Request A Free Sample Of THE STOCKMAN GRASS FARMER TODAY!
Or Order A Free Sample Of THE STOCKMAN GRASS FARMER online. CLICK HERE.