Economist suggests Congress examine two separate dairy policies in Farm Bill


A University farm economist says it might be time to evaluate farm bill dairy policies based on the size of the farm.  Ohio State Ag Economist Carl Zulauf tells Brownfield that USDA’s Economic Research Service figures show the total cost of producing a hundredweight of milk varies about 55% between large and small herds.  “For farms of less than 50 dairy cows in their herd, the total cost of production is about $47-dollars per hundredweight.  If you look at the largest dairy herds that are provided by the work by ERS, it’s about $21-dollars per hundredweight.”

Zulauf says government leaders building the next farm bill should examine the differences between large and small producers.  “One of the questions is, that I think dairy policy needs to address is, do we need two different dairy policies?  One for small farms that address more of their chronic income problem (and) one for larger farms that address the risk management needs of those farms.”

The 2012 Census of Agriculture shows 44% of dairy cows are on farms with more than 1,000 cows, while 54% of dairy cows are on farms with less than 50 cows.

Zulauf tells Brownfield the ARS statistics show losses in all measured herd sizes, but because of the economy of size, herds with more than 1-thousand cows might break even or profit.

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