Being a dairy producer is more than a job or even a career — it’s your life. With faith, drive and mindful decision-making, you can help your dairy succeed by identifying opportunities for increased profit potential.
You are in the business of making and selling milk, so to the extent that you can make more milk on a pounds per cow per day basis, the more profitable you are going to be. In fact, a study by Zoetis and Compeer Financial found that herds with high milk production increased their profitability by $192 per cow per year.1,*
The study analyzed 11 years of herd data from 489 year-end financial and production-record summaries to identify key areas driving profitability on dairies. When adjusted and sorted, the difference in individual cow production between the top third and bottom third of herds in this study was 20 pounds of milk per cow per day — that’s a difference of $209,000 per year in net farm income.1
Produce more milk to outpace production costs
Here’s how. You have low variable costs, such as the small incremental cost of additional feed needed to make more milk. As milk production goes up, maintenance costs, on a per-hundredweight (cwt) basis, go down. The revenue increases from producing and selling more milk will outpace any additional costs associated with making that milk. Subsequently, dairies that generate an additional 20 pounds of milk per cow per day are generating more net farm income.
The bottom line is making more milk makes you more profitable.
Milk production and profit drivers: It’s all relative
The study also found that increased milk production correlated with other dairy financial drivers and positive management benefits. Herds producing more milk also had an improved 21-day pregnancy rate, lower feed cost per cwt of milk, fewer days open and lower death losses, as well as reduced somatic cell counts.
Prioritizing reproduction helps increase productivity, profits
Milk production positively correlated with increased 21-day pregnancy rates in the study.1 Cows get pregnant on a faster basis and we see fewer days open, benefiting dairies because the cows are not in late lactation for extended periods of time. Average milk production per day goes up, as does herd profitability and net farm income.
Additionally, it is my opinion that producers managing high-producing herds have increased confidence in their ability to get cows pregnant. Therefore, they invest more in their breeding program — purchasing semen from top sires and increasing the rate of genetic progress in their herds at a faster rate than herds with more moderate levels of milk production. Over time, these progressive dairies enhance their herd genetics, health
Older cows are more productive, profitable
Keeping cows healthy, so they can produce milk in the prime of their careers, helps drive profitability. Managing death losses and somatic cell counts are important profitability drivers and pushing these rates lower can help reduce herd turnover and increase milk production.
Herds in our study with higher average levels of milk production per cow had lower death rates. I believe this is credited to excellent animal husbandry within those high-producing herds. Excellent animal husbandry improves animal wellness and performance, partly by reducing overall health risks, therefore reducing death losses and elevated cow turnover rates, so we can keep older, higher-producing cows in the herd longer.
Finally, increased milk production had a strong negative correlation to somatic cell counts. Not surprisingly, when cows are exposed to intramammary challenges, such as mastitis, they produce less milk. However, we also saw herds with higher energy-corrected milk were milking more older cows, ultimately producing more milk per cow on a per-day-of-productive-life basis.
Three tips to make more milk
Now that we understand the connection between making more milk and improving net farm income, let’s discuss how to make more milk on your dairy.
Help your dairy improve profitability by continuously looking for your next marginal milk opportunity. Learn more about strategies to increase milk production by contacting your Zoetis representative for more information about the Dairy Financial Drivers and how each may be applied
* Results based on 11 years of herd data from 489 year-end financial and production-record summaries with an average herd size of 1,087 from Zoetis/Compeer Financial study.
1Lormore M. What Drives Financial Success on a Dairy? Parsippany, NJ: Zoetis; 2018.
2Kirkpatrick MA, Olson JD. Somatic cell counts at first test: More than a number, in Proceedings. NMC Annu Meet 2015;53-56.