Feed Cost Per Cow Per Day: Today’s Critical Metric
The 2021 climate of high feed costs and tepid milk prices are creating a tenuous financial scenario for most U.S. dairy farms.
Penn State Dairy Extension specialist Virginia Ishler said current conditions are mimicking those of 2012, when feed prices soared to unprecedented highs. “Using farm financial data from 2020 and projecting costs into 2021, most operations will be extremely vulnerable to maintaining a positive cash flow, especially if high feed prices continue,” she stated in a Penn State Dairy Extension bulletin.
Ishler and her team have developed a cash-flow analysis comparing a range of breakeven cost of production to cash flow from milk revenue. “Operations with cost of production exceeding $19.00/cwt. will have an uphill challenge in keeping feed costs below their projected maximum,” said Ishler.
Drilling down to the per-cow level can help keep a tighter handle on overall cost of production. Ishler said even using cost numbers for home-raised forages, most operations exceed $5.50/milk cow/day during periods of “normal” feed costs.
