Evaluation of economic indicators for Czech dairy farms

Abstract

Milk production is one of the most important areas of the Czech agrarian sector, as evidenced by its 50% share (at 2017 prices) in revenues from livestock production. As for any business, a certain level of profitability is a prerequisite for long-term and sustainable development of dairy farms. This study's aim was to evaluate the economic efficiency of milk production from both Czech Fleckvieh (C) and Holstein (H) cows based on data collected each year from 48 to 70 Czech dairy farms in the period from 2012 to 2017. Total costs per feeding day and litre of milk, level of profitability, and income over feed costs were calculated. The influences of herd size and milk yield on profitability and break-even points were examined while sensitivity analysis and model calculations were utilised to predict profitability. The farms with higher average milk yields (>7 500 and >9 500 L per lactation for C and H, respectively) had higher costs per feeding day, lower costs per litre of milk, and improved profitability (p < 0.05). Average break-even points were estimated for milk price (0.31 and 0.32 EUR) and milk yield (7 257 and 9 209 L) in C and H herds, respectively.

Keywords

• break-even point
• costs
• milk
• sensitivity analysis