Economic Analysis of Dairy Breeds


Which breed is the best?

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Jersey Canada engaged a team of researchers at the University of Guelph to perform an Economic Analysis of Dairy Breeds in Canada. This analysis focused on measuring Revenue, Operating Income and Return in Investments. A typical herd of each of the seven breeds in Canada, Jersey, Holstein, Brown Swiss, Guernsey, Milking Shorthorn, Canadienne and Ayrshire was established based on 90 kilograms of Quota. An investment of $2,250,000 in Ontario at the time of writing. . .

After factoring in operating expenses of feed, milking labour, reproduction costs and veterinary charges, (only avaiable for Holstein and Jerseys) and milk cheque deductions, Jerseys were the top Income Generator at $161,451 versus Holsteins at $141,388 in second place and Canadienne in third with a likely income of $133,000 should they face similar Veterinary costs as the Jerseys.

The final measure of economic performance was Return on Investments. Due to the above findings the Jersey breed was the top performer with an ROI of 5.86% versus 4.98 for Holsteins and Canadienne estimated at 5.00%. An interest expense proxy was factored in at 6% on the investments calculated by breed for further comparison. The findings placed Jerseys as the only breed that came close to a profit after interest of $(3,917).

In summary, the Jersey breed is the most economical and financially viable dairy breed. The smaller size is a benefit due to efficient conversion of feed, lower labour costs, higher components, lower health and reproduction costs and lower investment in fixed assets.

"Should a potential producer wish to consider what breed to use in their operation, the Jersey Breed should be the preferred breed for lower investment, higher profit and higher return." Exerpt from Executive Summary

E. Currie, J. James, J. Whytock, L. Carty, S. Wick, Economic Analysis of Dairy Breeds: Which Breed is the Best, 2014, University of Guelph.

Click here to view the brochure: What does the most profitable dairy breed look like? 

Click here to view the full report: Economic Analysis of Dairy Breeds

Click here to view report tables: Tables - Economic Analysis of Dairy Breeds

 

 

 

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