Corn (Zea mays L.) silage in the northeastern USA yields more in narrow (0.38 m) than conventional (0.76 m) rows. Dairy producers, however, have considered converting from conventional to twin rows (0.19 m on 0.76 m centers) because twin rows are more compatible than narrow rows for herbicide application on glyphosate‐resistant corn. Two hybrids were planted in field‐scale studies in New York in 2003 and 2004 to evaluate growth, yield, quality, and economics of corn silage under conventional, narrow, and twin row production systems. Narrow rows had greater dry matter yield (17.6 Mg ha−1) than twin (17.2 Mg ha−1) and conventional rows (16.6 Mg ha−1). Row spacing did not affect in vitro true digestibility. Narrow and twin rows had greater fixed and variable costs associated with equipment requirements. Partial budget analyses indicated greater expected increases in annual profit with the conversion from conventional to narrow rows for 262 ($18 201) and 525 ha ($38 317) or to twin rows for 262 ($8246) and 525 ha ($17 584) of corn silage. The use of glyphosate‐resistant corn in twin rows may provide an advantage by delaying herbicide application until mid‐June, thereby increasing the probability of a timely first harvest of perennial forages. Dry matter content at harvest averaged 326 g kg−1 in narrow versus 314 g kg−1 in twin rows, increasing the probability of corn silage harvest before a fall frost. Dairy producers should consider economics and timely harvests when considering corn silage row‐spacing systems.
Purpose The purpose of this paper is to evaluate dairy farm financial performance over time utilizing farm financial ratios from three university business analysis programs. The evaluation includes measures of profitability, solvency, and liquidity by herd size. Design/methodology/approach Financial ratios to reflect profitability (rate of return on assets), solvency (debt to asset ratio), and liquidity (current ratio) were collected from Cornell University, Michigan State University, and the University of Wisconsin for dairy farms from 2000 to 2012. The distribution of farm financial performance using these ratios was examined over time and by herd size. Variance component methods are used to examine the percent of variation due to individual firm and industry aspects. A simple credit risk score is calculated to examine relative farm risk. Findings Dairy farm profitability performance is similar across herd sizes in poor years but larger herds realized significantly more profitability in good years. Findings were similar with respect to liquidity. Large herds consistently carried relatively more debt. Large herds’ financial performance was more uniform than across smaller herds. Larger herds had more financial risk as measured by credit risk scoring but recovered quickly to industry averages in profitable years. Originality/value The variation of dairy farm financial performance in an era of volatile milk and feed price is assessed. The results have important implications for farm financial management and benchmarking farm financial performance. In addition to helping to evaluate the efficacy of various price and income risk management tools, these results have important implications for understanding the benefits of the new federal Margin Protection Program for Dairy that is available to all US dairy farmers.
The profitability of rotational grazing versus mechanical harvesting of forages was estimated using data from 237 nongrazing and 57 grazing farms participating in the New York farm business summary program in the year 2000. The objective was to perform an empirical comparison of the profitability of grazing versus mechanical forage harvesting systems. A regression analysis technique that controls for treatment selection bias is used to determine the impact of grazing on the rate of return on assets. This is accomplished by joint maximum likelihood estimation of a probit adoption function and a profit function. The results indicate that treatment selection does not have an important impact on the estimate of the profitability of grazing. There were wide ranges and overlap of profitability among herds using the two systems. However, other things equal, farmers utilizing grazing systems were at least if not more profitable than farmers not using grazing systems. After controlling for the factors influencing the decision to graze, we found that herd size, rate of milk production per cow, and prices received for milk have a strong positive impact on profitability. Farmers who perceive potential lifestyle benefits that might be obtained by implementing a grazing system likely do not have to pay an income penalty for adopting a grazing system.
Data from 259 farms that participated in the Cornell University Dairy Farm Business Summary Project were used to measure the impact of bovine somatotropin (bST) on milk production and profitability per cow. Linear regression was used to estimate the response to bST when other variables were held constant. Bovine somatotropin was a dummy variable for bST use or nonuse in the equations. For farms that used bST on 25% or more of the cow days in 1994, milk production increased by 510 kg per cow. Returns above purchased feed costs increased $153 per cow for farms that used bST. Milk receipts over operating costs increased $120 per cow for farms that used bST. The use of bST was estimated to increase net farm income by $27 per cow, but this estimated coefficient was not statistically different from 0. Differences in costs for labor or veterinary services per cow were not significantly different between farms that used bST and farms that did not use bST.
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