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How much does it cost to feed on your farm?

Carla Wardin, Michigan Dairy Farmer

March 22, 2021

Assigning, analyzing, and performing activity analysis allows farmers understand their detailed loading and mixing feed costs, said Jason Karszes of PRO-DAIRY during Cornell University’s “The Economic Costs of Loading & Mixing.”

Researchers at Cornell analyzed data over the years at different farms to evaluate costs. On Northeast dairy farms, feed center operations accounted for about 10% of labor hours. Labor efficiency corresponded with how much time per load it took and how many cows were fed per hour.

“Generally, when we have minutes per load come down, we have our cost per ton come down,” he said.

For labor and feeding efficiency, farmers can evaluate several variables:

  • Location of facilities — How close they are to each other?

  • Driveways —How well they are maintained and ability to move quickly?

  • Loaders — Is it for loading or transporting? How much time is spent driving from place to place?

  • Size of loader — Bucket size and how many trips?

  • Size of mixer — Tons of feed it can carry.

  • Mixer utilization — Is it full to capacity?

“That ties to our investment — what was our ownership cost, the depreciation, the opportunity interest, and how well are we using our investment of capital versus labor?” Karszes said.

Using the equipment to capacity made a big difference when looking at both costs and labor. “Every time the mixer left the feed center, the closer it was to full, we brought our total costs down, and that’s a combination of labor cost, plus the investment ownership cost,” he said. “If we’re using the equipment more efficiently, if it’s full, then my investment per ton is actually lower. Our lower cost per ton feed tends to have a lower investment per ton and quite significantly, because of that utilization component.”

Get the feed into cows’ mouths Shrink has become more of a management focus, as the different types of storage have varying percentages of loss. “What can the feeders be doing? What can we be doing as daily activities to lessen shrink and decrease the amount of feed that is purchased and not used effectively?” he asked of feed that gets on to the farm but never makes it into a cow. As a whole, managing the feed center as a cost center can improve performance. “We do have a range of costs associated with loading, mixing, and delivering loads,” he said. “Investment decisions impact both operating and ownership costs, and shrink is a significant estimated expense.”



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