ISU Dairy Specialist Responds to Dairy Profit Concerns

Name and Position/Title:
Larry Tranel, Extension Dairy Field Specialist

Fiscal Year Submitted:

POW Title and Number:
110 Dairy

ISU Dairy Specialist Responds to Dairy Profit Concerns

Problem Statement:
2009 was a difficult year for the dairy industry. Low milk prices and high feed prices combined to give losses on many farms between $500 - $1,000 per cow for the year causing both negative cash flows and losses of equity position.  Because of the serious profit issues, dairy producers needed to fine-tune not just their financial management but their herd management, facility management and their personnel management as well.

Programmatic Response: 
The ISU Extension Dairy Team conducted meetings around the state on the Dairy Financial Crisis and at their Dairy Days event.  As a follow-up to these meetings, this dairy field specialist highly encouraged  farm visit to continue assistance with education that helps producers survive the current financial crisis.  A survey was sent to 55 producers in May, 2010; 36 responded. Below are the numbers of producers who were assisted with each topic area:

Dairy Herd Management:                 Dairy Financial Management:                      Dairy Facility Management:         
_6__Milk Quality/SCC                        _18_Calculating Milk Production Costs          _19_Milking Parlors/Equipment
_10_Nutrition/Feed Quality                _17_Financial Benchmarking                         _16_Dairy Housing/Cow Comfort
_9_Herd Health/Reproduction           _8_Dairy/Heifer Budgeting                            _17_Labor Efficiency/Ergonomics
_5_Heifer Management                     _19_Managing Dairy Farm Finances             _2_Manure/Environment/Energy
_13_ Rotational Grazing                    _25_Dairy TRANS Financial Analysis              _7_Ventilation/Cow Comfort

Personnel Management: _9_Farm Family Relationships  _8_Employee Training     _4_Hispanic Labor
Other Areas not listed:  _Share Milking_____________________________________________________

Outcome Statement:  
The respondents rated the teaching and consulting effectiveness of this dairy field specialist, his value in assisting dairy farm management decisions, and his impact on the profitability of the dairy farm.  The total economic impact of the assistance provided by Extension was measured at $1,182,191.  The data below shows details of the responses.

  1. How would you rate the teaching or consulting effectiveness of Dr. Tranel? 

28  Excellent (78%)     8  Good (22%)             0  Fair              0  Poor

  1. Did you find Dr. Tranel valuable in assisting you in dairy farm management decisions?

34  YES (100%)            _0_  NO                                              

  1. Did Dr. Tranel have an impact in the profitability or understanding of the profitability of your dairy farm?

            _35__YES (100%)        _0_ NO                                               

  1. Please list any estimated gross dollar or production improvement Dr. Tranel and ISU Extension has had:
    1. $_217_ per cow ($112,840)    $ 45  per acre ($22,050)   or   $_90,000_ per farm ($360,000)

__104_ cows in herd               _245__acres operated            n=5, n=2, n=4 above respectively

    1. Milk production increased __9.0__ pounds per cow/day  ($358,722)   n=7

Milk production increased _250,000_ pounds per FTE/yr  ($75,000)  n=2
Milk production increased _2,167_ pounds per cow/yr ($101,415)  n=3

    1. Somatic Cell Counts decreased by 145,862.5  per cow  (~50%)

n=6 x 104 cows x 200/cwts./cow x $.40/cwt = $49,920
n=6 x 104 cows x 375 lbs increase/cow/yr x $.15/lb. = $35,100

    1. Feed costs decreased by $_0.70__ per cow/day    ($53,144)  n=2

    or        by $_.50__ per cwt. of milk produced   ($14,000)  n=1


110 Dairy

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