Low Costs Drive Production To Large Dairy Farms
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Dairy farms are moving away from smaller operations towards larger farms, largely due to the costs involved in keeping a small dairy farm business.
Profits and losses cause dairy production to shift to larger farms, while small dairy farms are exiting the industry, and more are expected to leave in the next decade.
Due to lower profits and greater losses, U.S. dairy production is shifting to larger farms, while small dairy farms are exiting, and more are expected to leave in the next decade.
Average production costs per hundredweight of milk decrease dramatically with herd size, therefore larger dairy farms earn greater profits, while smaller farms often experience loss.
Data and statistics are provided on the size and number of dairy farms since 1992.
Citations:
James MacDonald, William McBride, Erik O’Donoghue, Economic Research Service, USDA, 2007 United States (National)
