Buffaloes in Haryana

Cattle in Kerala

Intensive cattle development project

Replacement heifer rearing is critical for the future of the dairy operation, especially to improve genetic merit and maintain herd size. A replacement heifer from the day she is born to the day she calves herself is generally a 2-year investment without potential income. A myriad of options exists on how to manage, fed, and ultimately raise replacement heifers. This study quantifies the costs associated with replacement heifer management decisions from birth to calving related to housing, labor, feed and health. The heifer rearing period can be broken into pre and post weaning sections to allow for more understanding the variation of these different biological time periods. Variation can influence the investment per day and breakdown of resources required from a dairy producer. Total heifer raising cost varied broadly across all management scenarios in our study, with feed and labor consistently representing over 60% of the total cost. After determining the true cost on an individual farm, or providing developed assumed cost for a change in management, producers can better manage current expenses and be more prepared for future investment.

This thesis explores the details and profitability of two distinct operational strategies utilized by dairy operations as alternatives to expanding milk production. It features farms that have either transitioned to organic production or installed a farm-scale anaerobic digester, motivated in part by the opportunity for market specialization or income diversification to increase the viability of their dairy farm businesses. The first analysis examines the demographics and production characteristics impacting the profitability of organic dairy farmers in Vermont and Maine. This provides policymakers, educators, lenders, and suppliers with a profile of this sector that accounts for 23% of dairy farms in Vermont and 20% of dairy farms in Maine, annually shipping, on average, 787,600 lbs. milk per farm. The study was conducted through a longitudinal survey of 83 organic farmers in Vermont and Maine from 2004 to 2012. A multiple linear regression analysis of the sample demonstrated six significant variables that affect farm profitability measured by return on assets (ROA). Having at least 80% Holstein herd composition, increasing the daily pounds of grain fed to cows during the winter months, a primary farm operator having grown-up on dairy farm, and the use of feed mixing machinery all positively impacted ROA. Farm profitability was negatively affected on farms with a high rate of annual cow morbidity and also tended to decrease over the course of the survey as organic prices leveled. While the model developed here has some explanatory power (R2 = 0.387), variability in farm profitability is affected by complex economic pressures. The second analysis reports the predicted and actual annual maintenance figures collected from anaerobic digester systems in Vermont. Within Vermont, 16 farms operate methane-generating ADS. All of these farms have received some form of public funds and/or a voluntary consumer premium. The analysis compares costs by creating a ratio of actual maintenance, repair, oil, and labor costs over these same predicted costs. This ratio is used to assess whether the suggested industry operating cost estimator tends to over or under predict annual maintenance costs. The ratio was evaluated with a one-way Student's t-test (p = 0.046) finding that maintenance costs tend to be under-predicted compared to the actual costs. One-way ANOVA was used to determine a statistically significant effect of herd size (F = 6.453, p = 0.052), showing that the maintenance ratio varies significantly between groups, This analysis indicates that predicting annual maintenance, repairs, and labor costs as a function of 3.5% of total kWh production is an acceptable method for digesters on farms with more than 500 cows, but under predicts maintenance costs for smaller farms. For smaller farms, the actual costs were on average 2.5 times higher.

Master of Agribusiness / Department of Agricultural Economics / Christine Wilson / Methane digesters are a potential investment for a dairy farm. A digester can lower greenhouse gas emissions, manage manure waste, generate energy, provide fertilizer and recycle bedding. The AgSTAR project of the Environment Protection Agency describes anaerobic digesters as a solution to a problem dairy farmers have always had to solve but that has become more acute with the innovation of larger scale, confined animal feeding operations developed in response to the growing food demands of the world’s larger and more prosperous middle class population – what to do with cow manure. Digesters take cow manure and convert it into energy while also eliminating manure odor. Energy is the primary economic benefit of a digester. A dairy farmer can use the electricity or gas generated from the digester to fuel the energy needs of the farm. Selling gas or electricity on the market is a revenue source that largely determines the level of profit from investing in a digester. This thesis will explore the four economic factors required to make anaerobic digesters a viable economic investment for a 1,500 head cow herd in the United States. It is imperative that farmers are able to obtain a return on the investment as soon as possible as many do not have the capital to invest in a nearly $1 million project. Congress may need to provide additional incentives for farmers and utility companies to take waste and process to energy. The future for methane digesters looks profitable when energy and carbon markets are available and allowed to trade competitively. The federal government may consider focusing on incentives for the utility companies’ infrastructure to make purchases of renewable energy from a digester more economically attractive and efficient. Today, an obstacle for increasing the number of digesters in the United States is the cost associated with moving the energy from the digester and into the national natural gas to grid. Natural gas companies may need to be compensated for that expense plus the potential difficulties of dealing with multiple suppliers or digester owners. Electricity companies have a grid in place to power rural and urban communities. They have spent billions of dollars and decades to establish efficient routing of power to residents and businesses. Manure digesters are mostly located in rural areas that would also require an investment in infrastructure to move the energy from the digester to the power grid. Mandating net-metering would require energy companies to purchase renewable energy, but consumers may see an increase in their cost. Therefore, the answer to increasing the number of manure digesters in the United States may be to direct the incentives to utility companies to invest in expanding infrastructure rather than increasing digester owner subsidies. Although, the REAP grants are helpful for assisting farmers with startup installation costs, there may not be a need to increase that subsidy in the next farm bill if an energy bill includes incentives for energy companies to purchase renewable energy from digesters.