Analysis of closed versus operating dairies in the south-eastern United States.

Significant changes have occurred in the US dairy industry in the last decade, involving the number of dairy farms, herd size, milk quality, and management practices. Although the number of dairy cows in the United States has remained relatively constant over the past decade, at approximately 9 million head, the number of dairy operations has decreased by 30%, resulting in larger dairy farms. This trend is even more prevalent in the south-eastern United States, where the number of dairy farms has decreased by 39% from 5315 in 2008 to only 3235 in 2017. Additionally, downward pressure on bulk tank somatic cell count, which is used as a milk quality metric and has implications regarding animal health, intensified with US processors’ introduction of incentive and penalty systems for quality milk production, necessitating better management of mastitis in dairy herds. In this study by Dr J. Ellis and co-workers, differences between dairies that have closed compared with dairies still operating in the south-eastern United States were analyzed to find the main reasons for the differences.  The results were published in the Journal of Dairy Science, Volume 103 of 2020, page 5148 to 5161, with the title: Analysis of closed versus operating dairies in the south-eastern United States,

                                                                                                                                                                                                                                                 The  study examined factors that affect the persistence of dairy farms by using primary survey data collected in 2013 through a mail survey of Grade A dairies in Georgia, Mississippi, Kentucky, North Carolina, South Carolina, Tennessee, and Virginia. Dairies that were no longer operational had exited the industry from 2007 through 2014. A probit regression was used to determine which farm and operator characteristics were associated with the dairy’s operational status.                                                                                                                                                                                                                       

The results showed that dairy farms with more cows and higher average milk production per cow were more likely to be operational. For an additional 10 kg per day of milk production per cow, the dairy was 1.5% more likely to be operational. For each 100 additional cows a dairy had, it was 4% more likely to be operational. The analysis also identifies non-pecuniary determinants of operational status for south-eastern US dairies, such as mastitis management practices.                                                                                                                                                                                                                                 

The findings suggest that operations capable of leveraging scale effects are more likely to remain operational, with results affirming the consolidation of the US dairy industry and demonstrating that more productive farms are more likely to stay in operation. Results also suggest that factors other than farm size affect a dairy’s operational status, such as mastitis management. The situation in South Africa is not different. Costs and low returns necessitate increased operations and yields per cow and associated improved management, especially in mastitis control. This is positive in terms of efficiency of production and sustainability.