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THE ECONOMICS OF ORGANIC, GRAZING, AND CONFINEMENT DAIRY FARMS

Thomas Kriegl

Summary

Ten Land Grant Universities plus Ontario standardized accounting rules and data collection procedures to gather, pool, summarize and analyze actual farm financial performance from many sustainable, small farming systems which currently lack credible financial data that producers need for decision-making, in a project initially sponsored by USDA IFAFS grant project #00-52501-9708.

This effort compares Wisconsin organic dairy farm data to grazing and confinement data since very little organic dairy data was collected from outside of Wisconsin. However, the Wisconsin data is compared to the limited amount of organic data collected in other parts of North America.

This project has over 80 farm years of Wisconsin organic dairy farm data spanning ten years to help understand the level of economic competitiveness of organic dairy farming.

Insights include:
1. Actual farm financial data from organic dairy farms is still scarce.
2. The financial performance of organic dairy farms looks dramatically different from one part of the country to the other.
3. Organic dairy farms in the data were financially competitive with other dairy systems in Wisconsin in the last ten years.
4. The price premium was very important to the financial competitiveness of organic dairy farms.
5. Management intensive rotational grazing (MIRG) appears to enhance profitability of dairy farms more than organic practices do.
6. Organic dairy farms that effectively raise most of their feed tend to be more financially competitive.

The up-to-date conclusions of this project can be accessed at http://cdp.wisc.edu.

Details

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