Managing Dairy Heifer Growth Investment
Accelerated prepubertal growth rates can lower heifer raising costs but may put heifers at risk for impaired mammary development and have been found to be detrimental decreased to milk production in the first lactation. The tradeoff between heifer raising costs and milk production loss is examined in a capital budgeting model. Monthly annuity net present value of a heifer investment through the first lactation is assessed for heifers calving at 20, 22, 24, 26 and 28 months of age. A 24 mo AFC base case strategy with 9009.5 kg subsequent first lactation milk yields $7.34 in returns per month. Accelerated growth resulted in higher returns ($12.77/mo for 20 mo AFC; $9.86/mo for 22 mo AFC) when milk production is not affected as total raising costs decline relative to the base case. Slower growth resulted in lower returns ($5.12/mo for 26 mo AFC; $3.15/mo for 28 mo AFC). When milk production declines, revenues decline as do feed and marketing costs which are a function of milk produced. Adjusting for factors, breakeven milk production losses were 10.6 % for 20 mo AFC and 5.3 % for 22 mo AFC relative to the 24 mo AFC base. These results were not sensitive to the assumed discount rate, heifer feed costs or discount rate. Other operation-specific heifer management factors including calving season, reproduction, herd size/expansion considerations and, in the longer-term, heifer facilities investments may be more significant economically than the differences found in this analysis.
|Date of creation:||2006|
|Contact details of provider:|| Postal: Justin S. Morrill Hall of Agriculture, 446 West Circle Dr., Rm 202, East Lansing, MI 48824-1039|
Phone: (517) 355-4563
Fax: (517) 432-1800
Web page: http://www.aec.msu.edu/agecon/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Harsh, Stephen B. & Wolf, Christopher A. & Wittenberg, Eric, 2001. "Profitability And Production Efficiency Of The Crop And Livestock Enterprises Of Michigan Dairy Operations: 1998 Summary And Analysis," Staff Papers 11616, Michigan State University, Department of Agricultural, Food, and Resource Economics.
When requesting a correction, please mention this item's handle: RePEc:ags:midasp:7429. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.