By Larry Tranel
Managing a dairy farm’s finances and ensuring it is profitable is no easy task. The Iowa State University Extension and Outreach dairy team has developed a series of budgets to help dairy producers understand their current financial situation and determine the profitability of their operation.
The budgets can be found online through the ISU Extension and Outreach dairy team website.
Dairy businesses are often made up of many components that can either complement or compete with each other. The enterprise analysis allows producers to take stock of the entirety of their operation and determine its profitability.
“These are the most comprehensive budgets that we’ve seen specifically made for the dairy industry,” said Larry Tranel, dairy specialist with ISU Extension and Outreach. “We have included budgets for grazing, organic and conventional operations. As we look at the cost of production versus milk prices, it is imperative that producers understand their cost of production, especially those who are just getting into the industry or making changes.”
Three different types of budgets have been prepared, providing farmers who operate a conventional, organic or pasture based system an opportunity to set up a personalized budget plan that works for their operation’s herd size and production level.
"While the budgets are fantastic tools to begin the process of examining a farm’s profitability, visiting with an ISU Extension and Outreach dairy specialist is still a good idea," Tranel said. "Contact your dairy specialist for further information and assistance."
The budgets available online will be updated semi-annually, allowing for a current look at costs and projected income throughout the dairy industry. While the budgets are currently only available in PDF format, an editable Microsoft Excel spreadsheet version is coming soon.
Source:.iastate.edu