What is Going on in Some of the
Traditional Dairy States?
By Bob Cropp
Dairy Marketing an Policy Specialist
University of Wisconsin-Madison
A brief look at:
• Existing dairy farm structure
• Changes in:
Dairy farms
Milk cows
Milk per cow
Milk production
• Potential in traditional states
Largest Per Capita Increases
1990 to 2000
Change in milk production
New Mexico
Idaho
California
Arizona
Kansas
Colorado
Vermont
Pennsylvania
Washington
Maine
0
20
40
60
80
100
120
% Change
140
160
180
Largest Per Capita Decreases 1990-2000
Tennessee
Wyoming
Arkansas
Alabama
North Dakota
North Carolina
Mississippi
Missouri
Alaska
Illinois
-60
-50
-40
-30
% Change
-20
-10
0
-37
+5
-14
+9
-16
+91
-44
+3
-32
+11
+13
+2
+2
-12
-14
-13
+5
-13
-12
-13
+35
-5
+186
-36
-28
-16
-31
+3
-17
-45
-44
-29
-21
-10
-3
-32
-34
-38
Percentage Changes
Decreasing (34)
Increasing (14)
-19
+9
-9
-5
-32
+31
-8
-21
-21
-11
Dairy Farm Structure, Selected States, 2001
Top number % of herds, bottom number % of milk
State
CA
ID
WA
AZ
NM
MO
NC
TX
Continued.
1 –29
cows
12.0
0.1
23.0
0.2
30.0
0.1
48.0
0.1
67.0
0.1
43.2
3.0
48.9
0.4
45.2
0.3
30-49
cows
2.8
0.1
8.0
0.6
4.0
0.4
0.0
0.0
0.0
0.0
18.9
15.0
4.4
1.6
4.8
0.7
50-99
cows
3.2
0.2
21.0
3.1
11.0
2.5
4.0
0.2
1.0
0.1
23.0
30.0
18.9
17.0
11.9
4.0
100 - 199
cows
10.0
2.0
15.0
4.6
19.0
10.0
4.0
0.5
1.0
0.4
16.2
38.8
17.8
33.0
15.2
14.0
200+
cows
72.0
97.0
33.0
91.5
36.0
87.0
44.0
99.2
31.0
99.4
1.4
14.0
10.0
48.0
22.9
81.0
Dairy Farm Structure continued:
State
NY
PA
VT
MI
OH
MN
WI
IA
IN
U.S.
1 –29
cows
18.1
1.5
17.5
3.0
8.1
0.5
31.8
3.0
46.2
5.8
14.1
3.0
16.5
2.7
23.4
4.0
51.7
7.0
28.9
1.6
30 – 49
cows
16.7
6.5
35.9
22.0
16.9
5.5
16.7
5.5
16.3
12.0
34.6
18.0
27.7
13.3
25.4
11.0
16.2
10.0
20.4
6.7
50 – 99
cows
38.9
25.0
35.0
37.0
48.8
28.0
24.2
15.5
24.0
30.0
38.5
37.0
40.8
36.0
34.3
35.0
19.7
24.0
29.9
18.2
100 –
199 cows
18.1
28.0
8.7
21.0
16.9
23.0
18.8
27.0
10.8
30.0
8.9
17.0
10.5
19.0
13.7
29.0
9.7
25.0
12.6
16.5
200 +
cows
8.3
39.0
2.9
17.0
9.4
43.0
8.5
49.0
2.7
23.0
3.8
25.0
4.6
29.0
3.1
21.0
2.8
34.0
8.2
57.0
Changes in number of dairy farms, cows, milk
per cow, and total milk production, 1993 -2001
State
CA
% Ch Ave. Size % Ch
farms Herd
cows
-40.5
636
34.5
Ave.
% Ch.
% Ch
milk/cow Per cow total milk
20,913
7.6
45
ID
-41.1
366
93.6
21,194
24.6
140
WA
-66.7
247
-3.9
22,324
15.2
11
AZ
-50.0
560
37.3
20,679
12.4
54
NM
-54.5
536
97.0
20,750
7.7
112
TX
-58.0
155
-15.6
15,689
2.2
-14
MO
-50.7
39
-34.7
13,441
5.5
-31
NC
-25.0
74
-28.7
17,373
10.0
-22
KS
-29.4
78
14.8
17,312
26.3
49.1
NE
-62.1
65
-21.7
16,056
31.3
3
Changes in number of dairy farms, cows, milk per cow,
and total milk production, 1993-2001, continued .
State
NY
% Ch
farms
-38.5
Ave. Size
Herd
93
% Ch
cows
-10.2
Ave.
% Ch
% Ch
milk/cow per cow total milk
17,527
14.8
3
PA
-20.8
58
-7.8
18,112
13.1
16
VT
-36.0
96
-5.6
17,431
13.1
7
OH
-35.0
50
-14.8
16,612
9.5
-7
MI
-34.0
92
-10.6
19,323
20.5
8
MN
-42.2
65
-21.3
17,278
15.4
-9
WI
-36.3
68
-17.0
17,182
16.3
-4
IA
-37.5
60
-28.8
18,024
31.2
-7
IN
-32.6
126
6.3
16,732
7.3
14
U.S.
-39.9
93
-6.1
18,139
16.7
10
So What ?
• Milk production will continue to grow in the
West, but at a slower rate and mainly by adding
cows.
• Milk production declines may slow in some
traditional dairy states and in fact, begin to
increase within 5 years as a result of slowing the
decrease in cow numbers, an increase in milk per
cow and an increase in herd size
• Milk production will increase in other states like
NE and KS, with newer large herds.
Reasons for some optimism for
traditional dairy states:
• Cost of production data demonstrates that modern style
large dairies located in WI, MN, IA, NY, PA and others can
compete with those in the West, and more of these will
locate here—how many depends upon whether the states
want them.
• Smaller herds—50 to 99 cows—can make changes at
affordable cost to grow to the 100 to 200 size and at a very
competitive cost of production.
It depends upon whether the 50 to 99 cow herds are
willing to abandon traditional “barn-based” dairy
systems in favor of “parlor-based” systems.
• Until recently, moving to a parlor-based system
was costly---$250,000 + for 500 + cows.
• Recently, thinking outside the box has resulted in
parlor-based systems at much lower costs--$50,000 to $100,000---for herd size of about 125
cows.
Low cost parlor-base systems:
• Remodel existing barn and place parlor in them
• These parlors are nearly as efficient as brand new parlor
set-ups
• Primary pay-off is labor savings---double eight parlor
system allows one person to milk 100 cows in about 2
hours versus almost 5 hours with a stall barn system.
• Works well for about 125 cows, about twice the average
herd size now in MN, WI and IA
There are several of these low cost parlors
now in operation in Wisconsin.
• The word of mouth is growing of successes.
• Both MN and WI have state funds available for
business plans
• Wisconsin has a new milk volume loan program—
low cost loans up to $1 million, if add cows.
Rates of Return on Parlor Investment of
$50,000 or $100,000
Cows in
herd
50
Investment of $50,000 Investment of $100,000
With Useful Life of:
With Useful Life of:
5-years
10-years 5-years
10-years
5.49%
14.98% - 8.49%
2.97%
75
17.50%
25.13%
- 1.16 %
9.33%
100
28.42%
34.44%
5.49%
14.98%
125
38.65%
43.31%
11.67%
20.20%
150
48.42%
51.92%
17.50%
25.13%
175
57.86%
60.39%
23.06%
29.85%
200
67.06%
68.77%
28.42%
34.44%
It is very possible that within 5 to 10 years,
the increase in cow numbers and milk
production of herds of 100 plus cows in WI
and IA and maybe MN will
Offset the decline in cow numbers and milk
production from continued exiting of herds
of less than 100 cows.
This may apply to some other traditional
dairy states—NY and PA, for example.
Wisconsin Dairy Industry Production Factors
1993-2001
Herds less than 50 cows
Number of cows
Total milk (Bil. Lbs)
Milk per cow
1993
2001
526,163
7.35
13,372
34.1%
30.8%
228,684
3.552
15,531
17.7%
16.0%
678,920
10.05
14,804
44.0%
44.0%
490,960
7.99
16,278
38.0%
36.0%
337,917
5.76
17,036
21.9%
25.2%
572,356
10.67
18,617
44.3%
48.0%
1,543,000
22.84
14,804
100.0%
100.0%
1,292,056
22.20
17,305
100.0%
100.0%
Herds 50 – 99 cows
Number of cows
Total milk (Bil. Lbs)
Milk per cow
Herds of 100 cows +
Number of cows
Total milk (Bil. Lbs)
Milk per cow
All herds
Number of cows
Total milk (Bil. Lbs)
Milk per cow
Estimated annual growth rates, Wisconsin herds:
(What has been occurring since 1993)
• Herds of less than 50 cows:
Number of cows
Milk per cow
- 9.58%
2.15%
• Herds of 50 to 99 cows:
Number of cows
Milk per cow
- 3.85%
1.33%
• Herds of 100 cows or more:
Number of cows
Milk per cow
7.34%
1.54%
Forecast Cows, Milk Per Cow, and Total Milk,
2010, if Trends Hold
Factors
Herds of less than 50 cows:
Cows
Milk per cow
Total milk (Bil. Lbs.)
Herds of 50 to 99 cows:
Cows
Milk per cow
Total milk (Bil. Lbs)
Herds of 100 cows or more:
Cows
Milk per cow
Total milk (Bil. Lbs.)
All Herds:
Cows
Milk per cow
Total milk (Bil. Lbs.)
Forecast
110,462
19,116
2.11
356,930
18,815
6.72
1,077,194
21,111
23.82
1,544,586
21,135
32.65
Will these forecast come true? Most likely not
exactly; but
•
•
•
•
•
•
It depends
Environmental regulations
State and county regulations on animal units
State assistance—financing, business planning
Producer to producer encouragement
Attitude—stop blaming all problems on federal
orders and dairy policy
• These traditional dairy states have some real
pluses for milk production---feed, climate,
infrastructure