Sixteen dollar milk prices and $1/cwt Milk Income Loss Contract (MILC) payments are providing enough revenue to cover feed and other costs, but are not sufficient to cover returns to labor and management.
That’s according to dairy budgets prepared for Midwest dairy operations by Robert Tigner, a University of Nebraska Extension Educator.
“Dairy farmers are increasing milk production to earn more money, lower unit costs and to try to earn the unpaid labor and management,” says Tigner. “If you look at the 24,000 pound freestall budget there is a small return to labor.”
Total costs, excluding labor and management, are running about $17.63/cwt for tie stall herds and right at $16 for midsized freestall operations. But returns for labor and management add anywhere from another $5/cwt for 20,000 lb/cow tie stall herds to another $1.55 for 24,000 lb./cow freestall herds, says Tigner.
The budgets are based on $6.31/bu corn, $400/ton soybean meal, $208/ton alfalfa and $72/cwt cull cow prices.
