BULLETIN 368 JUNE 1966 Bu3~dgeted (i1-sts of Producing Grade A milk BASED ON CONTROLLED FEEDING EXPERIMENTS AT THE PIEDMONT SUBSTATION, CAMP HILL, ALABAMA Agricultural Experiment Station AU BURN UNIVERSITY E. V. Smith, Director Auburn, Alabama SUMMARY The key to a successful dairy farm operation lies in following well-conceived plans based on best available information. Records of past dairy operations play an important part in providing data for use in plans or budgets for the future. Present-day conditions - increasing dairy farm and herd size, higher producing cows, increasing costs, and other related factors - make it necessary that a dairyman choose the feeding system that is best suited to his operation. However, dairymen who have not used several feeding systems do not have the records needed to develop budgets for possible alternative feeding systems. The major purpose of this report is to present detailed comparisons among three different feeding systems that may be used as a guide by interested dairymen. Primary data for this study were obtained from experiments conducted with the Grade A dairy of the Piedmont Substation, Auburn University Agricultural Experiment Station System, Camp Hill. The experiments covered a 5-year period beginning in 1958. The Substation dairy herd was divided into two groups. One group of cows was fed stored roughages in drylot while the other was on hay and conventional pasture. Both groups were fed the same level of grain. Cows in one group for a full lactation period were assigned to the other group for their next lactation to reduce effects of individual cow differences. Over the 5-year period, cows in drylot averaged producing 10,883 pounds of 4 per cent fat-corrected milk, as compared with 11,241 pounds for the pasture group. Both production records were on a calendar year basis. However, there were no significant differences in production on a calendar year vs. a lactation period basis. Likewise, the 3 per cent additional milk produced by the average cow on pasture was not statistically significant. The pasture group had slightly lower feed costs per hundredweight of milk produced 3 years out of the 5. Based on the 5-year findings at the Piedmont Substation, plans or budgets were developed to estimate total costs involved in milk production, exclusive of land and management. Feed, labor, and all other costs were determined for three different dairy feeding systems: drylot feeding, pasture feeding, and a combination of the two. All three systems were budgeted for 60 cows weighing an average of 1,250 pounds, and producing 10,000 pounds of 4 per cent fat-corrected milk. Feeding was based on 7,200 pounds of TDN per cow per year. This rate required the cows to be fed and managed at a high level of efficiency. Land used for the 60cow herd, with 31 replacement heifers, for each of the three systems was as follows: drylot, 152 acres; pasture, 220 acres; and combination system, 175 acres. Net returns to the 60-cow drylot system using stored roughages throughout the year were $9,279, as compared with $9,793 for the pasture system, and $9,760 for the combination grazing and stored forage system. Net returns to land and management, under Piedmont soil conditions, were $515 greater for the 60-cow herd on th pasture system than for the drylot system, but only $33 higher than the combination system. Total production costs per hundredweight of milk produced were $4.44 for the drylot system, $4.35 for the pasture system, and $4.36 for the combination method. These totals included all expenses normally included in cost accounting except for a land and management charge. The drylot feeding arrangement used more total hours of labor for feed production and herd management than either of the other two systems. The least land was used in the drylot system. These differences would often influence a manager's choice of feeding arrangement to use. It is possible that an individual dairy farmer in the Piedmont would find the drylot system more feasible if there were excess family labor available or if land were limited. Either of the three systems studied can be used profitably in the Piedmont area. Each dairy farmer must consider his situation relative to land, labor, capital, and managerial ability in deciding which method to use. CONTENTS Page SU MM ARY --- - INTRODUCTION PROCEDURE ------------ - - - -- -- - - - - -- - - - - - -- - 2 5 RATES AND PRACTICES USED IN BUDGETING -A MILK PRODUCTION SYSTEMS- GRADE 8 Rates Used in Estimating Crop Costs-8 Rates Used in Estimating Labor Costs-9 PRODUCTION--------10 PROJECTED BUDGETS FOR GRADE A MILK D airy Investm ent--------- -------------------------- 11 Annual Fixed Costs ------------------------------Annual Labor Feed 12 Requiremients -------------------------- 13 Requirem ents -------------------------------- 15 Land Requirement --------------------------------Receipts and 15 17 Expenses ------------------- ---------- Returns to Each System ----------------------------A PPENDIX ------------------------------ 18 20 FIRST PRINTING 31/M, JUNE 1966 Budgeted Costs of Producing Grade A Mlk* LARRY W. ROBERTS, Research Assistant in Agricultural Economics** E. L. MAYTON, Superintendent, Piedmont Substation*** J. H. BLACKSTONE, Professor of Agricultural Economics GEORGE E. HAWKINS, Professor of Dairy Science INTRODUCTION DAIRY INDUSTRY in recent years has been characterized by a decrease in number of dairymen, coupled with an increase in herd size of remaining producers. In 1958, there were about 1,700 Grade A dairymen in the State. By 1965, this number had decreased to approximately 1,250. During this period, 675 dairymen went out of business and 225 new producers entered the business. Herd size has increased from an average of about 40 cows to nearly 80 cows per farm. During the next 10 years the number of Grade A dairy farms may reduce to 1,000 or less, but with an average of 100 or more cows per farm. The increasing milk production per cow is expected to continue for the next several years. These expected changes make it important that dairymen consider alternative feeding systems. Present-day dairymen are faced with problems of selecting combinations of feed production and utilization techniques, and systems or types of milk production and herd management that are best suited to individual farms and to the quality of cows in their herds. Dairymen may choose one of several ways of providing feed and managing their dairy herds. Each of the several ALABAMA'S * The research project on which this report is based was financed by FederalGrant funds (Alabama Hatch project No. 128) and by State Research funds. * Resigned. 0* Acknowledgment is due J. A. Little of the Dairy Science Department, and Joseph Lott and John Sandy, formerly assistant superintendents of the Piedmont Substation, for their assistance in conducting the experiments on which this study is based. 6 ALABAMA AGRICULTURAL EXPERIMENT STATION feeding systems or management practices that may be used has different requirements for land, labor, capital, and management. Because of these variations, normally there will be differences in costs per cow and per hundredweight of milk produced. Within limits, dairymen have several choices they may make in the system of milk production followed, the herd management practices followed, and the methods used for raising replacements. Also, they have a choice in the crops they produce, and in seeding, grazing, harvesting, and storage methods they use. These choices are influenced by the kind and intensity of dairy program followed; availability of pasture and cropland; complementary and competitive relationship of crops; and availability of buildings, equipment, capital, labor supply, and other factors. Personal preferences also play an important role in these choices. To consider all these variables requires planning, and a useful tool to the dairy farm operator as he plans ahead is the development of a budget. The word "budget" ordinarily suggests a written detailed plan of farm operation. Budgeting, written or unwritten, is planning. The crux of a successful dairy farm operation under present-day conditions lies in following well-conceived plans. Records of dairy farm operations in the past play an important part in providing the data needed for making future plans. These records of past performance indicate some of the most dependable information available as to what the dairy farm operator may reasonably expect to accomplish in the future on his farm. Past farm records, however, do not always provide all of the information needed for planning. Especially is this true for a dairyman who has long used only one system of feeding his dairy herd, such as a conventional pasture system. Dairy farm planning must be forward looking. Increases in dairy farm and herd size, higher producing cows, changes in prices and costs, and other related factors make it necessary that past feeding systems be considered in the light of future possibilities. This means, for example, that drylot feeding systems and combination feeding systems should be considered as possible alternatives to pasture feeding systems. Research data should be used, in addition to farm records, as a guide in considering alternative feeding systems. Data in this report are presented in detail so that dairymen can make adjustments to fit their own situations before making comparisons among systems. BUDGETED COSTS of PRODUCING GRADE A MILK 7 Production costs for Grade A milk are usually divided into three major groups - feed, labor, and all other costs. While a dairyman has some control over each of these, he is usually able to exercise his greatest control over feed and labor costs. Although production practices on most dairy farms are similar, some dairymen may be particularly efficient in crop production, some in feeding, and some in other production phases. Forage production is a major enterprise on many dairy farms. A large proportion of the total investment required in dairying is associated with production, harvesting, and storage of forage crops. From an economic standpoint, each dairyman is interested in growing the kind and amount of forage that results in the most favorable net income. In attaining this, each dairyman must recognize: (1) the characteristics of his farm resources that remain relatively fixed in any given time period, (2) interrelated problems associated with production and use of forage, and (3) the costs and returns related to each alternative production method he might use. Neither the proper level of feeding nor the best combination of feed in the ration can be determined separately. Level of total feeding depends, in part, on the combination of feeds used, and the combination may depend, in part, on the level of feeding. Labor and all other costs are important in the economic framework of determining the best level of production. Each dairyman must consider these costs in terms of his total system. It is fortunate that most dairymen have a range of choices that may be used. The original objectives of this study were to determine physical and economic data on different feeding systems using a high producing dairy herd. This specific report considers, through the use of budgets, all costs except management and land for a well managed 60-cow Grade A dairy herd. All crop production and herd management practices follow current recommendations of the Agricultural Experiment Station. Practices are at a level obtainable by most Alabama dairymen. Detailed data provided may be used as a guide in developing one or more budgets for an individual dairy farm. PROCEDURE Records for planning or budgeting the three feeding systems reported in this study were developed as a part of a controlled re- 8 ALABAMA AGRICULTURAL EXPERIMENT STATION search program. The dairy herd of the Piedmont Substation was divided into two groups. One group of cows was kept on conventional pasture while the other group was on a drylot feeding program. Records were kept of all physical inputs, along with detailed costs for each system. The feeding experiment with the Grade A herd was conducted from November 1, 1958 through October 31, 1963 - a period of 5 years. Some items in the rations fed were, of necessity, produced the year before, they were fed. Consequently, some feed data were collected during the period 1958 to 1963. Information from the experiment consisted of data on amounts and costs of feed fed to each group of cows, milk production of each group, and other related data.' An analysis of input-output data from the controlled programs, along with complete financial data, were used in identifying, analyzing, and evaluating the problems involved in each feeding method. Findings from the controlled research were used to develop possible alternative systems or combinations of feeding systems. Budgets were developed with emphasis on three feeding systems for a 60-cow dairy: (1) complete drylot, (2) conventional pasture, and (3) a combination of these two systems. RATES AND PRACTICES USED IN BUDGETING GRADE A MILK PRODUCTION SYSTEMS Rates Used in Estimating Crop Costs The rates and practices used to develop dairy operation budgets are based on studies of crop production methods used at the Piedmont Substation primarily from 1958 to 1968. Rates or practices not available from the Piedmont Substation study were based on recommendations of staff members of the Cooperative Extension Service and Agricultural Experiment Station. No charge was made for land used in the crop budgets, but there was an interest charge on the operating capital used in crop production. Production rates used in the budgets reflect the experience and knowl1 Detailed year-to-year data are nomic phase of work are reported A Dairies in the Piedmont Area of W. Roberts, available through the physical data have been reported ducing Cows," Auburn University December 1965. not included in this report. Data on the ecoin "Economics of Feeding Systems for Grade Alabama," a Master of Science thesis by Larry Auburn University Library. Also, parts of the in "Forage Systems Compared for High ProAgricultural Experiment Station Bulletin 368, BUDGETED COSTS of PRODUCING GRADE A MILK 9 edge gained during the study, and are not to be considered as attainable every year. However, with good management they should represent an average for a future 5-year period. The crop budgets developed are the bases for feed costs used in the complete dairy farm budgets. Alfalfa hay costs were based on the practice of making two applications of insecticide in the spring. The life of the alfalfa stand was estimated at 4 years with a total establishment cost of $88 per acre. Fertilizer was applied annually at the rate of 1,000 pounds of 0-10-20. Hay was cut four times with an estimated total yield of 2.1 tons per acre. Millet was used for temporary summer grazing. The projected annual costs are subject to variation since three or four plantings were used and weather conditions caused land preparation costs to vary. A combination of ryegrass and crimson clover was used along with oats for winter grazing. There was no difference in the cost of oats and the ryegrass-crimson clover mixture, but both were used to give longer grazing periods in extreme winter weather conditions. Annual costs of producing and harvesting corn silage, as shown in the budgets, included all expenses except storage and were based on an estimated harvested yield of 9 tons per acre. Costs of forage crop production and practices used are given in Appendix Tables 1-6. The annual costs of producing permanent pasture, consisting of white clover, improved dallisgrass, and crimson clover, totaled $25 per acre - $10 for establishment (prorated) and $15 for maintenance. Rates Used in Estimating Labor Costs Hours of labor used in budgeting were based on projected labor needs for both crop and livestock production. The labor involved in forage production is concentrated in a few months and may require some dairymen to hire extra labor for planting or harvesting. The amount of labor used per acre in alfalfa hay harvesting decreased with each annual cutting. Maintaining permanent pasture required fewer hours of labor than any of the annual crops. Annual crops were used in the budgets since they had proved to be more efficient in milk production than permanent pasture at the Piedmont Substation. Corn silage required a total of 18.2 manhours of labor per acre, most of it in the harvesting phase. An- 10 ALABAMA AGRICULTURAL EXPERIMENT STATION nual labor requirements for the forages used are given in Appendix Tables 7-11. PROJECTED BUDGETS FOR GRADE A MILK PRODUCTION Budgets were prepared for a complete Grade A dairy operation so that all costs incurred with each feeding system would be reflected in the net returns. The three feeding systems used were drylot feeding, a conventional grazing system, and a combination system using aspects of the other two methods. In the drylot system, cows were confined to a holding area on a year-round basis. They were removed from this area only for calving. All cows were fed a grain ration, with corn silage as the only roughage. Cows on the conventional grazing system were fed grain, as near year-round grazing as possible, and were fed hay when needed. Alfalfa hay was raised as a part of the feed program. Oats and ryegrass and crimson clover were grown for as much grazing as possible from November to May. Millet was used for grazing from May through October. Cows on the combination system were held in drylot for 8 months of the year and were on conventional grazing for 4 months. In drylot they were fed grain, and corn silage was the only source of roughage. During June through September the cows grazed millet. All budgets were based on 60 cows, weighing 1,250 pounds and producing 10,000 pounds of 4 per cent fat-content milk per year. The calf crop was based on a 90 per cent drop, or 54 calves per year. A death loss of 2 animals was assumed while 18 heifer calves were selected each year for replacements. The remaining 84 calves were sold at an early age. At the end of the first 83months, two additional heifers were culled and sold. It was also assumed that one heifer died at approximately 1 year of age. No bulls were kept under either system since all breeding was by artificial insemination. An analysis of the feeding systems under study at the Piedmont Substation raised questions of possible alternatives. The two roughage feeds for drylot cows - corn silage and alfalfa hay presented production problems and necessitated an investment in BUDGETED COSTS of PRODUCING GRADE A MILK 11 both silage and hay-making equipment. Providing grazing for cows of high-producing abilities presented the problem of distance to be traveled by cows; in many respects the grazing was expensive to produce, as well as being subject to high weather risks. The three feeding systems used in the budgets followed practices being used at the Piedmont Substation or they corresponded closely to operations at other substations. For instance, corn silage was fed as the only source of roughage to cows in the dairy herds at both the Gulf Coast and Sand Mountain substations during the past 3 years. Simplification of the feeding systems enables better management to be applied to both feed production and herd management, and lowers requirements for kinds and types of machinery and equipment needed. Budgets for each feeding system are presented in a series of tables under the following headings: investment, annual fixed costs, feed requirements, labor requirements, land requirements, and receipts and expenses. The next several sections of this report are devoted to a comparison of the three systems regarding each of the headings listed. Detailed data are presented for the drylot system in Appendix Tables 12-17, the pasture system in Appendix Tables 18-23, and the combination system in Appendix Tables 24-29. Dairy Investment Total dairy capital investments, excluding land and general farm machinery, for a 60-cow herd for each of the three feeding systems are itemized in Table 1. The original or new costs for the 60-cow drylot system was $55,899. This was for a system of feeding concentrates and corn silage only. Provision was made for feeding of extra grain outside the milking parlor. Also, provision was made (fencing) for the use of some permanent pasture for replacement heifers. The investment included two silos of 555-ton capacity each, along with unloader, feeding bunk, and a feeding shed. Average total dairy investment for the drylot system was calculated at $39,583, based on one-half the new value of all items except the herd. It was assumed the herd and replacements would not change in value because of the method of keeping a constant number of animals of the same ability. The comparable new cost investment for the pasture system was $46,754, which is $9,145 less investment capital than for the 12 12 ALABAMA AGRICULTURAL EXPERIMENT STATION HERD, GRADE A MILK TABLE 1. ESTIMATED DAIRY INVESTMENT FuR A PRODUCTION, THREE FEEDING SYSTEMS, PIEDMONT AREA, ALABAMA 60-Cuw Item- Drylot Unit Value No. Dot. 18,000 5,270 880 5,460 3,937 3,920 180 7,000 3,300 60 31 1 Pasture Unit No. 60 31 1 Cows .- - - - - - - Replacement heifers and calves Feed storage bin Milking parlor and milk room Pipeline milkers Bulk tank (800 gallons) Water facilities (not including well and pump)- Concrete pavement and holding pen, square fe e t -- - - - - - - - - - - - - Wagon (silage and m anure)--------- --Silo s- - - - - - - - - - - - - - - - Silage unloader-------Feeding bunk _-------Feeding shed (silage-grain) _------- Value Dot. 18,000 5,270 880 5,460 3,937 3,920 180 Combination Unit Value Dot. No. 60 18,000 31 1 5,270 880 5,460 3,937 3,920 180 7,000 2 (770)1 7,000 3,300 3,300 1,200 1,200 1 2 (1,100 )1 8,400 1,500 1 600 1 180 252 1,648 1 55,899 2,307 3,500 46,754 1 1 1 640 6,400 1,500 600 3,000 876 Fencing, rods.--------Barn (hay storage and feeding).-------_ TOTAL------------ -- 54,523 1 Tons of storage capacity. drylot system. The combination system required about the same capital investment as the drylot system. milking parlor and milk room, 800-gallon milk tank, and pipeline milkers. Silage equipment was not needed for the pasture system, but it did require a combination hay storage and feeding barn that was unnecessary for the other two systems. The dairy investment did not include investment costs for regular farm equipment, such as a tractor or planting equipment. This type equipment was provided for in the crop and pasture budgets, Appendix Tables 2-11. Therefore, it is not listed as a part of the specialized dairy investment. The investment for all three systems included feed storage, Annual Fixed Costs Included in annual fixed costs for the dairy operation were charges for interest, repairs, depreciation, taxes, and insurance. BUDGETED COSTS of PRODUCING GRADE A MILK 1 13 1 TABLE 2. ESTIMATED ANNUAL FIXED COSTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, THREE FEEDING SYSTEMS, PIEDMONT AREA, ALABAMA Item Drylot Pasture Combination Dollars Dollars Dollars Cow s ---------------------------------------1,152.00 1,152.00 1,152.00 Replacement heifers and calves-----337.20 337.20 337.20 Feed Storage bin -------------------101.20 101.20 101.20 Milking parlor and milk room--------471.80 471.80 471.80 Pipeline milkers 478.14 478.14 478.14 Bulk tank-----------------------------------473.60 473.60 473.60 Water facilities-----------------------------19.50 19.50 19.50 Concrete holding pen 236.00 236.00 236.00 W agon---------------------------166.50-166.50 Silos----------------------------------802.00-602.00 Silage unloader -------------------------------352.00-352.00 Feeding bunk-----------------------------------97.00-97.00 Feeding shed-----------------------------------290.00-290.00 Fencing-------------------------26.65 209.18 102.78 Barn ------- -- ----- ---- ------- -34 0 .00TOTAL .--------------.-----------------------5,003.59 3,818.62 4,879.72 ------- -------------------------------- ---------------------- 1 Fixed costs include interest on average investment, depreciation, repairs, taxes, and insurance. All costs were figured on the average dairy investment since this represented the capital investment in dairy items over their time. Total annual fixed costs were $5,003.59 for the drylot operation, Table 2, about the same as the combination system. Pasture system annual fixed costs were $1,200 (24 per cent) less than for the drylot system. Annual fixed costs charged in the budgets are necessary for one to remain in the dairy business for a long period. Parts of these costs occur each year as direct cash costs, such as repairs, taxes, and insurance, while others like interest on investment and depreciation are non-cash cost items. A dairyman may fail to charge these non-cash costs in the short run and remain in the dairy business. Over a long period, however, these costs must be covered if the dairy operation is to be successful. Should the dairy farmer have no profitable alternatives, he could keep producing milk as long as his cash costs and labor costs are covered. This would- be possible, at least, until buildings and equipment became unserviceable. Annual Feed Requirements life- Cows were fed at the rate of 7,200 pounds of total digestible nutrients per year. Forages used in the budgets were produced on the farm.. Because of the high cost of producing corn in the Pied- 14 ALABAMA AGRICULTURAL EXPERIMENT STATION mont Area, it is often advisable to purchase grain rather than to grow it. Budgets used in this report are based on buying all concentrate feeds. The mixed feed purchased contained 16 per cent protein, with 7 per cent maximum fiber, in small pellet form. It was bought F.O.B. the farm at $62 per ton in 12-ton lots. Concentrates were fed at the rate of 1.36 tons per cow, 0.50 ton per yearling, and 0.14 ton per calf per year, Table 3, the same for all forage feeding systems. Corn silage feeding amounted to 1,100 tons for the drylot group and 762 tons for the combination group based on harvest weights. This difference between the two systems reflects the difference in time silage was fed - 12 months for the drylot group and 8 months for the combination group. Silage weights were based on a harvested weight to figure land requirements in planting silage. Permanent pasture, consisting of white clover, crimson clover, and improved dallisgrass, was furnished for replacement stock at the rate of two-thirds acre per head for the drylot group. Cows in the pasture feeding system were on a conventional type of hay and grazing program. In the hay barn developed for this study, hay was stored from the ground level up and pushed into racks for feeding. Cows were fed from two sides of the barn. The combination system used millet for summer grazing with drylot feeding the remainder of the year. Calves raised in all systems were fed 360 pounds of milk each, for a total of 5,800 pounds. This amount was taken from the herd milk production. All phases of the feed program used with the systems budgeted were used 3 TABLE 3. ESTIMATED ANNUAL FEED REQUIREMENTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, THREE FEEDING SYSTEMS, PIEDMONT AREA, ALABAMA Item Silage, harvested weight 3 Concentrate (pellets) Improved pasture Alfalfa hay Millet Ryegrass-crimson clover Oats Milk for replacement calves' Drylot 1,100 tons' 91.4 tons 20 acres' -.. 5,800 lb. Pasture 91.4 tons 78 tons' 80 acres 75 acres 25 acres 5,800 lb. Combination 762 tons2 91.4 tons 80 acres 5,800 lb. S17.5 tons per cow, 3.0 tons per yearling, and 0.25 ton per calf. 2 11.75 tons per cow, 3.50 tons per yearling, and 0.25 ton per calf. S1.36 tons per cow, 0.50 ton per yearling, and 0.14 ton per calf. 0.66 acre per replacement. S1.0 ton per cow, 1.0 ton per yearling, and 0.2 ton per calf. ' 360 pounds per replacement calf. BUDGETED COSTS of PRODUCING GRADE A MILK 15 or more years with some dairy herd in the Agricultural Experiment Station System. Labor Requirements Labor requirements for each forage system were divided into two major groups - herd care (management) and feed production. Labor needed for either purpose could be family or hired labor, but it was charged in the budgets at $1 per hour. In all budgets, 3,100 hours of labor was shown as needed for herd management, Table 4. This included time for feeding, breeding, milking, barn sanitation, care of replacement stock, and all other chore work. The management system was not identical in the three systems. Some jobs in the drylot system, such as cleaning the holding lot, did not occur in the pasture system. Likewise, the pasture herd had to be moved to and from grazing areas. All data available indicated that total time required for herd management was about the same despite some differences in jobs. TABLE 4. ESTIMATED LABOR REQUIREMENT FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, THREE FEEDING SYSTEMS, PIEDMONT AREA, ALABAMA Labor use Drylot Pasture Combination Herd management ._________ Silage P asture --------------- -------------Millet----------------------... Alfalfa hay _______592 Oats Ryegrass and clover ....... TOTAL-............. Hours 3,100 2,220 60 Hours 3,100 376 112 345 Hours 3,100 1,547 376 5,380 4,525 5,023 Labor requirements for feed production varied by enterprises, as shown by detailed records kept each year. Labor requirements are shown by months of the year for each system in the Appendix Tables. Labor requirement for feed production was 855 hours less for the pasture system than for the drylot herd. Silage production and harvesting increased labor requirements for the drylot system. Land Requirement Cows in the drylot system were kept in a 10-acre lot and barn area. This was more land than would be needed on many farms. However, this amount was budgeted as a guide for the Piedmont 16 ALABAMA AGRICULTURAL EXPERIMENT STATION TABLE 5. ESTIMATED LAND REQUIREMENT FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, THREE FEEDING SYSTEMS, PIEDMONT AREA, ALABAMA Use Holding area Corn silage Permanent pasture Millet Oats Alfalfa hay .....Ryegrass and clover ...... Drylot Acres 10 122 20 ....- Pasture Acres 3 80 25 37 75 220 Combination Acres 10 85 80 152 TOTAL ...------------------------ 175 Area. Other land needed for this system included 122 acres for corn silage and 20 acres of permanent pasture for replacement heifers, a total of 152 acres, Table 5. There was no double-cropping of land used in the budgets. Double-cropping was attempted in some years in the control work in terms of winter grazing followed by millet, and with an early and late millet planting on the same area. In all cases, doublecropping led to a number of problems. Consequently, the conclusion was reached that no attempt should be made to double-crop as a means of reducing land requirements for any of the feeding systems. Good management is required to have grazing of the quality needed over a long part of the year for the pasture system. It is better that proper management be used to get the quantity and quality of grazing needed than to use management and labor in an effort to reduce land requirements. Land requirements were highest in the pasture system since a large proportion of the forages was harvested by the cows. The combination system provided some saving in land. Each system had 60 cows and 31 replacements for a total of 72 mature animal units. Acreage used for feed crops, per animal unit, amounted to 1.97 for drylot system, 2.29 for combination, and 3.01 for the pasture system. Farm operators might find land requirements to be greater or less than that budgeted for either system because of differences in land quality, fertilization rates, or other management practices. As land values become higher, it becomes important that farm operators use high production crops that will enable a given number of cows to be fed from a smaller acreage of land. In this study, a land value of $100 per acre was used for open land usable for crops or pasture. BUDGETED COSTS of PRODUCING GRADE A MILK 17 Receipts and Expenses In all systems, the budgeted total receipts amounted to $35,910, Table 6. Total milk sold was 594,200 pounds, at a blend price of $5.50 per hundred pounds. Other sales included cull cows and heifers and surplus calves. All phases of this study were restricted to the dairy enterprise as a source of income or expenses. Expenses charged to each budget should cover all items occurring on any dairy operation, both cash and non-cash, except for a charge for land and management. In this study, "net returns" (the difference between receipts and expenses) is a return to land and management - the two unpaid items. All feed crops and pasture costs were entered as an expense by multiplying cost per acre by the number of acres. For example, corn silage cost for the drylot operation was based on $65 per acre TABLE 6. ESTIMATED RECEIPTS AND EXPENSES FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, THREE FEEDING SYSTEMS, PIEDMONT AREA, ALABAMA Item Drylot Pasture Combination Dollars Receipts Dollars 32,681.00 2,639.00 510.00 80.00 35,910.00 Dollars 32,681.00 2,639.00 510.00 80.00 35,910.00 Milk, 5,942 cwt. @ $5.50 Cull cows, 14 @ $188.50 Calves, 84 @ $15 Cull heifers, 2 @ $40 TOTAL RECEIPTS 32,681.00 2,639.00 510.00 80.00 35,910.00 500.00 7,930.00 5,666.80 79.17 30.00 2,079.70 360.00 300.00 480.00 360.00 240.00 208.00 3,100.00 294.11 5,003.59 .. .... .. .. 26,631.37 9,278.63 Expenses Permanent pasture, 20 acres @ $25--Corn silage @ $65 acre Concentrates (pellets) @ $62 ton Marketing cull cows Hauling cull cows Milk hauling @ 350 cwt.Veterinary expenses Electricity Artificial breeding Dairy supplies Miscellaneous Cleaning holding lot Dairy labor @ $1 per hour Interest on operating capital Fixed costs (Table 2) Ryegrass and clover, 75 acres $35.62. Oats, 25 acres @ $35.80 Millet, 80 acres @ $33 .. Alfalfa, 37 acres @ $84 ............. TOTAL COST 5,666.80 79.17 30.00 2,079.70 360.00 300.00 480.00 360.00 240.00 3,100.00 287.87 3,818.62 2,671.50 895.00 2,640.00 3,108.00 26,116.66 9,793.34 5,525.00 5,666.80 79.17 30.00 2,079.70 360.00 300.00 480.00 360.00 240.00 118.00 3,100.00 291.41 4,879.72 2,640.00 26,149.80 9,760.20 Net returns (to land and management) 18 ALABAMA AGRICULTURAL EXPERIMENT STATION times 122 acres. Charges for producing and harvesting an acre of silage are detailed in Appendix Table 6. The charges for silage production include machinery and equipment, power, and all other charges. Costs for storage of silage were included as a "fixed cost" and are transferred from Table 2. Production costs for the dairy operation fall into three major groups - feed, labor, and all other expenses. The percentage of total costs used for each of these purposes, by systems, was as follows: Percentage of total, by system Feed Labor All other----------------TOTAL------ - Drylot 52.9 11.6 835.5 100.0 Pasture 57.4 11.9 30.7 100.0 Combination 52.9 11.9 35.2 100.0 Total costs for each system varied by only about $500. There were much larger differences than this between feed costs and other costs from one system to the other. Feed costs, as shown in Table 6, amounted to $14,096.80 for the drylot system, $14,981.80 for the pasture, and $13,831.80 for the combination system. These costs were for the production and harvesting of crops, pastures, and hay. Storage costs were charged as fixed costs, and these were highest for the drylot and combination systems and least for the pasture system. It was these expenses that made total costs about the same for each system. Dairy operators have an opportunity to lower their milk production costs in all major cost groups. However, the opportunity to do this is perhaps greatest with feed, followed by labor second and other costs third. Total production costs per hundredweight of milk produced, excluding land and management costs, were $4.44 for the drylot system, $4.35 for the pasture system, and $4.86 for the combination method. These costs included all items normally included in costs accounting except for a land charge and a management cost. By adding a land charge of $5 per acre, production costs per hundredweight of milk produced become $4.54 for the drylot, $4.50 for the pasture, and $4.48 for the combination method. Returns to Each System Net returns to land and management for the three feeding systems were $9,793 for the pasture, $9,279 for drylot, and $9,760 BUDGETED COSTS of PRODUCING GRADE A MILK 19 for the combination method. The pasture system was only $83 above the combination system but $514 over the drylot system in net returns. Although returns were about the same, there are some major differences in the uses of land, labor, and capital investments in the three systems. If a charge were made for land, the remaining return becomes a reward to management. The land used in this study was valued at $100 per acre. If a charge of 5 per cent interest were made ($5 per acre), this amount times the acreage used can be subtracted from net return to calculate the return to management. The combination system provided the highest returns to management, the pasture system next, and the drylot method lowest, Table 7. Net returns to management only were: combination system, $8,885; pasture, $8,693; and drylot, $8,519. The value of labor used for both herd management and feed production, charged at $1 per hour, was $5,380 for the drylot system, $5,023 for the combination system, and $4,525 for the pasture system. This would be of importance to the dairyman with a labor problem or to the dairyman with available family labor. A dairyman with limited land could substitute some labor for land by using the drylot or combination system. If a family could furnish all labor needed, a dairyman would be interested in returns to both labor and management. Net returns to labor and management were $13,899 for the drylot system, $18,908 for the combination system, and $13,218 for the pasture method. TABLE FOR A 7. COMPARISONS HERD, OF DRYLOT, GRADE A PASTURE, AND COMBINATION PIEDMONT TYPE BUDGETS 60-Cow MILK PRODUCTION, AREA, ALABAMA Item (152 acres) Dollars 9,279 760 8,519 5,380 13,899 Drylot (220 acres) Dollars 9,793 1,100 8,693 4,525 13,218 Pasture Combination (175 acres) Dollars 9,760 875 8,885 5,023 13,908 Net returns to land and management... Charge for land @ $5 per acre_....... Returns to management only Value of labor @ $1 per hour Returns to labor and management.--- 20 20 ALABAMA AGRICULTURAL EXPERIMENT STATION APPENDIX APPENDIX TABLE 1. RATES CHARGED PER HOUR FOR THE USE OF PRODUCTION ITEMS, PIEDMONT SUBSTATION, CAMP HILL, ALABAMA, 1959-1963 Iem hour Item hour Item Rate per hour Tractor (large)Tractor (medium) --Tractor Dollars 1.25 1.15 1.05 0.39 0.28 0.60 0.75 0.45 Dollars Fertilizer spreader----Light Dollars Mower-0.66 Rake---------Hay baler----- (small)-----_ Plow (3-disk) __ Plow (2-disk) __ Tool bar_-_-__ Disk barrow --2-row planter_. Cultivator----Grain distributor.-. Silage harvester disk ----- 0.30 0.40 0.26 0.55 1.90 1.17 0.30 0.45 0.71 2.40 Combine -----Truck Trailer --------- 5.00 1.15 0.10 Silage blower Cultipacker___Hay conditioner Man labor----- -------- 1.00 Pre-emergence equipment--_-0.24 0.37 Spray rig------ APPENDIX TABLE 2. PROJECTED ANNUAL COSTS PER ACRE FOR GROWING ALFALFA HAY, PIEDMONT AREA, ALABAMA Cost item Establishment costs, one-fourth of total. Fertilizer, 1,000 pounds of Rate Amount Dollars Spreading and insecticide----Insecticide, two applications---------Cut, condition, and bale four cuttings--fertilizer 0-10-20----- 22.00 /acre 1.90 /cwt. 7.75 /acre 2.15/ application 5.36 /cutting 1.69 /cutting 0.35/acre T ax e s . - - - - - - - - - - - - - - - - - - - - - - - - - - Interest on operating capital---------T O AL -T ---------------------- -- Haulbay from four cuttings- Production per acre, tons------------_ Cost of hay per ton, 1 Storage dollars------------ Dollars 22.00 19.00 7.75 4.30 21.45 6.75 0.35 2.40 84.00 2.1 40.00 costs are included in fixed costs of the budget. APPENDIX TABLE 3. PROJECTED ANNUAL COSTS PER ACRE FOR PRODUCING MILLET, PIEDMONT AREA, ALABAMA Cost item Rate Amount Dollars Millet seed, 30 pounds----------Fertilizer, 267 pounds of 13-13-13 Ammonium nitrate, 110 pounds Labor, 4.7 hours--Power and equipment----------Ta xe s -- - - - - - - - - - - - - - - - - - - - F ence-- - - - - - - - - - - Interest on operating 0.20/pound 3.00 /cwt. 3.90 /cwt. 1.00 /hour 7 .20 /acre 0.35/acre 1.50/acre TO T AL -- ---------------- --- capital ------ Dollars 6.00 8.01 4.29 4.70 7.20 0.35 1.50 0.95 33.00 BUDGETED COSTS of PRODUCING GRADE A MILK APPENDIX TABLE 4. PROJECTED ANNUAL COSTS PER ACRE FOR PRODUCING RYEGRASS AND CRIMSON CLOVER, PIEDMONT AREA, ALABAMA 21 2 Cost item Ryegrass seed, 42 pounds---------------------------------Crimson Clover seed, 28 pounds -----------------------Fertilizer, 215 pounds of 13-13-13 Ammonium nitrate, 125 pounds------------------------Power and' equipment------------------Labor, 4.6 hours ---------------------------Ta xe s -------------------------------------------------------------------Fence-----------------------Interest on operating capital---------------------------1.04 T O TA L --- -------------------------APPENDIX TABLE Rate Amount Dollars 0.08/pound 0.21/pound 3.00/cwt. 3.90/cwt. 7.56/acre 1.00/hour 0.3 5 /a c re 1.50/acre Dollars 3.36 5.88 -------------------6.45 4.88 7.56 4.60 0.35 1.50 -35.62 5. PROJECTED ANNUAL' COSTS PER ACRE FOR PRODUCING OATS, PIEDMONT AREA, ALABAMA Cost item Oats seed, 3 bushels--------------------------Fertilizer, 260 pounds of 13-13-13--------------------Ammoniun nitrate, 200 pounds.-----------------------Labor, 4.5 hours----------------------Power and equipment-----------------Fence -----------------------------/acre Taxes Interest on operating capital T O TAL -----------------------------35.80 Rate Amount Dollars 1.50/bushel 3.00/cwt. 3.90/cwt. 1.00/hour 8.30/acre 1.50/acre 0.35--- Dollars 4.50 7.80 7.80 4.50 8.30 1.50 0.35 10-----------5--- APPENDIX TABLE 6. PROJECTED ANNUAL COSTS PER ACRE FOR PRODUCING AND HARVESTING CORN SILAGE, PIEDMONT AREA, ALABAMA Cost item Corn seed, 8 pounds---------------------Pre-emerge chemical, 1.5 pounds----------Fertilizer, 265 pounds of 13-13-13.---------Ammonium nitrate, 131 pounds------------Tractor, 12.4 hours.-------------------- Rate Amount' Dollars 0.22/pound 2.50/pound 3.00/cwt. 3.90 /cwt. 1.20 /hour Dollars 1.76 3.75 7.95 5.11 14.88 Equipment, harvester and blower----.------Truck and trailers -----------------------Labor, 18.2 hours-----------------------Taxes.-------------------------------- -Interest on operating capital---------------TO TA L -- - -- - - -- - - ---- -- - -- - -- -- - - - - - -- 8.46/acre 3.35 /acre 1.00/hour 0.35 /acre Production per acre, tons harvested weight---7Costs per ton ---------------------------1 8.46 3.35 18.20 0.35 1.19 65 .00 ' .22 .2 Storage costs are in the fixed costs of the budgets. 22 ALABAMA AGRICULTURAL EXPERIMENT STATION APPENDIX TABLE 7. ESTIMATED LABOR REQUIRED PER ACRE TO PRODUCE AND HARVEST ALFALFA HAY, PIEDMONT AREA, ALABAMA Operation Date Hours per acre Spread fertilizer-------Apply insecticide First cutting-- - - - - - Second cutting Third cutting Fourth cutting-----------TOTAL----.....-- - - March March April May June July or August 1.5 1.2 4.0 3.5 3.0 2.8 16.0 1Based on a harvested yield of 2.1 tons per acre. APPENDIX TABLE 8. ESTIMATED LABOR REQUIRED PER ACRE TO PRODUCE OATS, RYEGRASS AND CRIMSON CLOVER, PIEDMONT AREA, ALABAMA Hours per acre Operation Operation Break-- - - - - - - -- - - - - - - Fallow _--- -- --- --- ---- --Plant------ -- -- ------ -- Topdress---------------------T O TAL ............... ...................... APPENDIX TABLE 9. Date Date June July August September Oats 1.0 1.0 2.0 0.5 4.5 Ryegrass and crimson clover 1.0 1.0 2.0 0.6 4.6 . ESTIMATED LABOR REQUIRED PER ACRE TO MAINTAIN PASTURE, PIEDMONT AREA, ALABAMA PERMANENT Operation Fertilizer spreading Mowing Mowing T OT AL ------------------------------------------------------------ Date April June July Hours per acre 1.2 .7 1.1 3.0 APPENDIX TABLE 10. ESTIMATED LABOR REQUIRED PER ACRE TO PRODUCE MILLET, PIEDMONT AREA, ALABAMA Operation Prepare and Date Hours per acre plant April 4.0 Topdress TOTAL May 0.7 4.7 BUDGETED COSTS of PRODUCING GRADE A MILK APPENDIX 23 2 TABLE 11. ESTIMATED LABOR REQUIRED PER ACRE TO PRODUCE AND HARVEST CORN SILACE, PIEDMONT AREA, ALABAMA Operation Plowing-- - - - - - - - - - - - Plow ing -- - - - - - - - - - -Disk and Pre-emerge, fertilizer and Date January February April May May May June August Hours per acre 0.6 0.3 1.3 0.9 2.2 0.7 0.7 11.5 18.2 H arrow --- -- - - - - - -- -- - -- -- -- harrow-------------_ plant------------------- C ultivate Cultivate and sidedress-------Harv est --- -- - - -- - - - - - - -- - - -T O TA L -- --- -- -- -- --- -- -- -- APPENDIX TABLE 12. DAIRY INVESTMENT FOR A 60-Cow HERD, GBADE A MILK PRODUCTION, DRYLOT FEEDING, PIEDMONT AREA, ALABAMA ESTIMATED Item Number - Value New Average Dollars C o w s - - - - - - -- - - - - - - -- - - - - - -- - - - - - Replacement heifers and Feed Pipeline Dollars 18,000 5,270 440 2,730 1,968 1,960 90 1,650 600 4,200 750 300 1,500 125 39,583 Water facilities (not including well and pum p)-----------------Concrete pavement (7,000 square feet manure)---------Wagon (silage and 555 tons each) ----Silos (24 X 50 ft., with holding pen) Milking parlor and milk room-------------------------Bulk tank (800 gallons) m ilkers ------------- storage ---------------------- calves 60 31 1 1 5 1 18,000 5,270 880 5,460 3,937 3,920 180 3,300 1,200 8,400 1,500 600 ---------------- Unloader and feeder--------------B u nk -- - - - - - - - - - - - - - - - - - - - - - - - - Feeding shed (silage and outside grain feeding) ------------------Fencing (180 rods) ----------------T O TA L --- --- -- -- --- -- -- -- --- - -- 1 3,000 252 55,899 24 24 ALABAMA AGRICULTURAL EXPERIMENT STATION APPENDIX TABLE 13. ESTIMATED ANNUAL FIXED COSTS FOR A GRADE A MILK PRODUCTION, DRYLOT FEEDING, PIEDMONT AREA, 60-Cow HERD, ALABAMA Annual fixed costs Item Number Interest Deprecia- Taxes and tion and repairs insurance Total Dollars Cows-- - Replacement stock Feed storage Milking parlor and milk room milkers----- Dollars Dollars 52.80 273.00 334.56 330.00 13.80 132.00 180.00 120.00 60.00 420.00 300.00 18.75 2,234.91 72.00 21.00 22.00 35.00 25.50 26.00 0.30 5.00 20.00 10.50 1.00 130.00 7.00 0.40 375.70 Dollars 1,152.00 337.20 101.20 471.80 478.14 473.60 19.50 236.00 290.00 166.50 97.00 802.00 352.00 26.65 5,003.59 60 31 1 1 1,080.00 316.20 26.40 163.80 118.08 117.60 Pipeline Bulk milk Concrete W ater facilities------ tank 5 1 1 1 1 1 ------ Feeding Feeding pavement-.------ 5.40 99.00 90.00 36.00 36.00 252.00 45.00 7.50 2,392.98 shed W agon ----------- -Silo s -- - - - - - - - - - - - -Unloader and feederFencing.-------- --TOTAL--------- bunk------- 2 1 -- APPENDIX TABLE 14. ESTIMATED ANNUAL FEED REQUIREMENTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, DRYLOT FEEDING, PIEDMONT AREA, ALABAMA Feed item Silage Unit ------91 on Quantity (co rn) 17.5 tons per cow -------------------- 1,100.0 3.0 tons per yearling .25 ton per calf Concentrates (pellets)---------------1.36 tons per cow .50 ton per yearling .14 ton per calf Pasture (white clover, crimson clover, and improved dallisgrass)-.66 acre per replacement 91.4 a cre :wt. 20.0 58.0 M ilk.- - - - - - - - - - - - - - - -c, 360 pounds per replacement Quantities fed are reported as harvested weights. BUDGETED COSTS of PRODUCING GRADE A MILK 25 APPENDIX TABLE 15. ESTIMATED LABOR REQUIREMENTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, DRYLOT FEEDING, PIEDMONT AREA, ALABAMA Month Herd management management Corn silage (122 acres) Permanent pasture (20 acres) Total Hours Hours January 290 73.2 February 260 36.6 March 270 73.2 April 235 195.2 May 240 353.8 June .................................... 241 85.4 244 July August 249 1,403.0 September 248 October------------------. 258 N ovember -------------------------273 Decem ber-------------------------292 TOTAL---------------------------3,100 2,220.4 24 14 22 363.2 296.6 343.2 454.2 593.8 340.4 266.0 1,652.0 248.0 258.0 273.0 292.0 5,380.4 60 APPENDIX TABLE 16. ESTIMATED LAND REQUIREMENTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, DRYLOT FEEDING, PIEDMONT AREA, ALABAMA Use Usespace Herd 1 Corn 2 silage Permanent pasture Total Acres Row crop land Grazing land Holding area TOTAL-------------- Acres 122 Acres 20 10 10 122 20 Acres 122 20 10 152 1 Includes 60 cows, 15 yearling heifers, and 16 calves. 2 Based on a harvested yield of 9 tons per acre. 26 26 ALABAMA AGRICULTURAL EXPERIMENT STATION APPENDIX TABLE 17. ESTIMATED ANNUAL RECEIPTS AND EXPENSES FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, DRYLOT FEEDING, PIEDMONT AREA, ALABAMA Item Receipts Milk, 10,000 pounds per cow less 96 pounds for Calves, total 5,942 hundredweight Cull cows, 14 head' weighing 1,300 pounds each --------------- --------------------------------Calves, day-old, 34 head --------------------------------Cull heifers, 3 months old, 2 head -------------TOTAL RECEIPTS-35,910.00 Rate Dollars Amount Dollars 5.50/cwt. 188.50/head 15.00/head 40.00/head 32,681.00 2,639.00 510.00 80.00 Expenses Pasture, 20 acres 2 -------------------Corn silage, 122 acres-----------------Concentrates, 91.4 tons-----------------------------------Marketing 14 cull cows, share of $2,639 total-.03/dollar Hauling cull cows, 200 miles-----------Milk hauling, 5,942 hundredwcight-.35/cwt. Veterinary expense, 12 mouths.----------------------Electricity, 12 months ------------------Artificial breeding, 60 cows--------------Dairy supplies, 60 3 Miscellaneous, 60 cows Cleaning holding lot, 10 Labor, 3,100 Interest on operating capital, 25.00/acre 65.00/acre 62.00/ton .15/mile 30.00/month 25.00/month 8.00 /head 6.00/head 4.00/head 20.80/time 1.00 /hour .06 500.00 7,930.00 5,666.80 79.17 30.00 2,079.70 360.00 300.00 480.00 360.00 240.00 208.00 3,100.00 294.11 cows ------------------ -----------------times------------- hours ---------------------- Fixed costs (Appendix Table 13)----------TOTAL EXPENSES--------------------- $4,901.85 ----- 5,003.59 26,631.37 9,278.63 Net returns (to land and management)------ 'A death loss of 1 is assumed out of the 15 cull cows. 2Costs for grazing crops do not include a land charge. 'Dues,, fees, and other. Half of $9,803.70. BUDGETED COSTS BUDGETED PRODUCING COSTS of~PRODUCING GRADE A MILK2 of GRADE A MILK 27 APPENDIX TABLE 18. ESTIMATED INVESTMENT FOR A 60-Cow HERD, MILE PRODUCTION, PASTURE TYPE FEEDING, PIEDMONT AREA, ALABAMA Item GRADE A Number New VleAverage C ow s - - -- - -- - -- - -- - -- - -- - -- - -- - -- - -- - -- - -- - Replacement heifers and calves F eed storage--------- ----------- ----- Milking parlor and milk room Pipeline m ilkers------------------------Bulk tank (800 Water facilities (not including gallons)------------------_ ----------------- 60 31 1 1 5 1 Dollars 18,000 5,270 880 5,460 3,937 3,920 180 Dollars 18,000 5,270 440 2,730 1,968 1,960 90 1,650 well and pum p)----- Concrete pavement (7,000 square feet with holding pen) ----------------Barn (hay storage and feeding) ------------ 1 3,O00 1 Fencing (1,648 rods of 4-strand barbed wire) TOT A L --- -- --- -- -- -- -- --- -- -- -- -- -- APPENDIX TABLE 3,500 2,307 46,754 1,750 1,153 35,011 19. ESTIMATED ANNUAL FIXED COSTS FOR A GRADE A MILK PRODUCTION, PASTURE TYPE FEEDING, PIEDMONT AREA, ALABAMA 60-Cow HERD, Annual fixed costs Item Number Deprecia- Taxes Interest and tion and repairs insurance Total Dollars Cow s------------- Replacement heifers and calves Dollars 60 1,080.00 Dollars 72.00 21.00 22.00 Dollars 1,152.00 337.20 101.20 471.80 478.14 473.60 19.50 236.00 340.00 209.18 3,818.62 ------- Feed storage Milking parlor and milk room-------Pipeline milkers----Bulk tank 31 1 1 316.20 26.40 163.80 52.80 ---------- 5 1 1 1 1 118.08 117.60 5.40 99.00 105.00 69.18 2,100.66 Water facilities .---Concrete pavement-Barn ------------ -Fencing -- -- -TOTAL--- 35.00 273.00 25.50 334.56 26.00 330.00 0.30 13.80 5.00 132.00 25.00 210.00 2.00 138.00 1,484.16 233.80 28 ALABAMA AGRICULTURAL EXPERIMENT STATION 28 ALBA4A AGRICULTRLEPIMN SAIO APPENDIX TABLE 20. ESTIMATED ANNUAL FEED REQUIREMENTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, PASTURE TYPE FEEDING, PIEDMONT AREA, ALABAMA Item Unit Quantity Concentrates (pellets)--------------------1.36 tons per cow .50 ton per yearling .14 ton per calf H ay (alfalfa)---------------------1.0 ton per cow 1.0 ton per yearling .2 ton per calf Grazing, summer (millet) .------------Grazing, fall and winter (ryegrass and crim son clover)---------------------Grazing, fall and winter (oats)--------------M ilk --- - --- ----- -- - -- - -- -- --- --- - -360 pounds per replacement ton 91.4 ton 78.0 acre acre 80.0 75.0 acre cw t. 25.0 58 .0 APPENDIX TABLE 21. ESTIMATED LABOR REQUIREMENTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, PASTURE TYPE FEEDING PIEDMONT AREA, ALABAMA Ryegrass Month Herd management Hours Millet (80 acres) Hours Alfalfa hay (37 acres) Oats (25 acres) and cloer clve acres ) Hours Hours Hours Hours 290.0 January ---- 290 February-------------March---------------April----------------May------------------ June-----------------July-----------------August---------------September.-----------October--------------- 260 270 235 240 241 244 249 248 258 80 94 94 94 14 99.9 148.0 129.5 111.0 103.6 25.0 25.0 50.0 12.5 75 75 150 45 260.0 369.9 463.0 463.5 546.0 438.0 566.6 305.5 258.0 November------------- December------------TOTAL-------------- 273 292 3,100 376 592.0 112.5 345 273.0 292.0 4,525.5 BUDGETED COSTS of PRODUCING GRADE A MILK 29 BUDGETED CO:STS of PRODUCING GRADE A MILK2 APPENDIX TABLE 22. ESTIMATED LAND REQUIREMENTS FOE A 60-Cow HEED, GRADE A MILK PRODUCTION, PASTURE TYPE FEEDING, PIEDMONT AREA, ALABAMA Use HerdAlfalfa He illet Use space' pace Milet Acres Acres 80 33 3 80 Oats ats Acres 25 hay Acres 37 Ryegrass and crimson clover Acres 75 Total Acres 180 37 220 Grazing land--------------------Cropland -------------------- H olding area .------------------TOTAL.--------------------------' 25 37 75 Includes 60 cows, 15 yearling heifers, and 16 calves. 2 Based on a yield of 2.1 tons per acre. APPENDIX TABLE 23. ESTIMATED ANNUAL RECEIPTS AND EXPENSES FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, PASTURE TYPE FEEDING, ,PIEDMONT AREA, ALABAMA Item Receipts Milk, 10,000 pounds per cow less 96 pounds for calves, total 5,942 hundredweight--------Cull cows, 14 head' weighing 1,300 pounds each----------------------------------------Calves, day-old, 34 head Cull heifers, 3 months old, 2 head------------------TOTAL RECEIPTS ------------------------------ Rate Dollars Amount Dollars 5.50/cwt. 188.50/head 40.00/head 32,1.00 2,639.00 80.00 510.00 --------------------------------15.00/head -35,910.00 Expenses Ryegrass and crimson clover, 75 acres 2 ----------Oats, 25 acres ---------------------------------------M illet, 80 acres-------------------------Alfalfa, 37 Concentrates, 91.4 35.62/acre 35.80/acre 33.00 /acre 84.00 /acre 62.00/ton - 2,671.50 895.00 2,640.00 3,108.00 5,666.80 79.17 30.00 acres ------------------------ tons ------------------ Marketing 14 cull cows, share of $2,639 total Hauling cull cows, 200 --------------------------- miles----_--------- .03 /dollar .15/mile Milk hauling, 5,942 hundredweight--------Veterinary expense, 12 months------------' Electricity, 12 months------------------Dairy supplies, 60 cows-----------------3 Miscellaneous, 60 cows -----------------Artificial breeding, 60 cows--------------Labor, 3,100 hours---------------------Interest on operating capital, $4,797.84'----Fixed costs (Appendix Table 19)----------TOTAL EXPENSES--------------------- .35 /cwt. 30.00/month 25.00/month 6.00/head 4.00/head 8.00/head 1.00/hour .06 2,079.70 360.00 300.00 360.00 240.00 480.00 3,100.00 287.87 3,818.62 26,116.66 9,793.34 Net returns (to land and management)----' A death loss of 1 is assumed out of the 15 cull cows. 2Cost for grazing or hay does not include a land charge. ''One-half Dues, fees and other. of $9,595.67. 30 ALABAMA AGRICULTURAL EXPERIMENT STATION 30 APPENDIX ALAB~AMrA AGRICULTUA XEIMN TTO TABLE 24. ESTIMATED INVESTMENT FOR A MILK PRODUCTION, COMBINATION TYPE FEEDING, PIEDMONT 60-Cow New HERD, GRADE A ALABAMA AREA, Item Number Value Average Dollars C o w s --------------------------------- Dollars 18,000 5,270 440 2,730 1,968 1,960 90 1,650 3,200 438 600 750 300 1,500 38,896 Replacement heifers and calves Feed storage-- -- -- -- -- --- Milking parlor and milk room Pipeline milkers- -- ----- -- -Bulk tank (800 gallons)Water facilities (not including w ell and pump)---------------- -----Concrete pavement (7,000 square feet with holding pen)---------------Silos (20 X 50 feet, _---------- 60 31 1 1 5 1 18,000 5,270 880 5,460 3,937 3,920 180 385 tons) Fencing (640 rods of 4-strand barbed wire). Wagon (silage and manure) .------------Unloader and feeder-------------------B u nk - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - F eeding 1 2 1 1 1 1 shed--------------------- ----- 3,300 6,400 876 1,200 1,500 600 3,000 54,523 T O A --- -- -- -- -- -- -- -- --- -- -- -- -- TL APPENDIX TABLE 25. ESTIMATED ANNUAL FIXED COSTS FOR 'A 60-Cow HERD, GRADE A MILK PRODUCTION, COMBINATION TYPE FEEDING, PIEDMONT AREA, ALABAMA Annual fixed costs Item Number Deprecia- Taxes Interest tion and and repairs insurance Total Dollars C ow s------------Replacement heifers Dollars Dollars 72.00 21.00 22.00 35.00 25.50 26.00 0.30 5.00 110.00 1.50 10.50 7.00 1.00 20.00 356.80 Dollars 1,152.00 337.20 101.20 471.80 478.14 473.60 19.50 236.00 602.00 102.78 166.50 352.00 97.00 290.00 4,879.72 60 31 1 1 5 1 1 2 1 1 1 1 1,080.00 316.20 26.40 163.80 118.08 117.60 5.40 99.00 192.00 26.28 36.00 45.00 36.00 90.00 2,351.76 52.80 273.00 334.56 330.00 13.80 132.00 300.00 75.00 120.00 300.00 60.00 180.00 2,171.16 and calves-------Feed storage ------Milking parlor and milk room ------Pipeline milkers ----Bulk tank ---------W ater facilities-----Concrete pavement-S ilo s - -- - - - - - - - - - - - Fencing ----------W agon----------- -Unloader and feederB unk ------------- Feeding shed ------TOTAL---------- BUDGETED COSTS of PRODUCING GRADE A MILK 31 3 APPENDIX TABLE 26. ESTIMATED ANNUAL FEED REQUIREMENTS FOR A 60-Cow HERD, GRADE A MILK PRODUCTION, COMBINATION TYPE FEEDING PIEDMONT AREA, ALABAMA Feed item Unit Quantity 91.4 Concentrates (pellets) ---------------------------------------ton 1.86 tons per cow .50 ton per yearling .14 ton per calf Silage (co in)1--------------------------------ton 11.75 tons per cow 3.50 tons per yearling .25 ton per calf Grazing, summer (millet) ------------------------------acre Milk - - -- - -- --- - -- - -- - -- - - -- - -- - -- - -- cw t. 860 pounds per replacement 1 Quantities fed are reported as harvested weights. 762.0 80.0 5 8.0 APPENDIX TABLE 27. ESTIMATED LABOR REQUIREMENTS FOR A 60-CowvHERD, GRADE A MILK PRODUCTION, COMBINATION TYPE FEEDING, PIEDMONT AREA, ALABAMA Month Herd management Hours 290 260 270 235 240 241 244 249 248 258 273 292 3,100 Millet (80 acres) Hours Silage (85 acres) Total Hours 341.0 285.5 321.0 451.0 580.5 394.5 1,240.5 248.0 258.0 273.0 292.0 5,023.0 HERD, January-----------------------------February---------------------------M arch-----------------April ---------------------------------M ay-----------------------------------June -------------------------------July -----------------------------------August -----------------------------SeptemberOctoher --------------N ovember ------------December---------- --TOTAL -------------- 80 94 94 94 14 Hours 51.0 25.5 51.0 186.0 246.5 59.5 977.5 338.0 376 1,547.0 APPENDIX TABLE ESTIMATED LAND REQUIREMENTS FOR A 60-Cow GRADE A MILK PRODUCTION, COMBINATION TYPE FEEDING, PIEDMONT AREA, ALABAMA 28. Use Haedile space' Ars Grazing land.---------- Mle Acres 80 siae Acres 85 Corn Toa Tol Acres 80 Row crop land --------Holding area----------TOTAL -------------1 Includes 10 10 80 85 85 10 175 60 cows, 15 yearling heifers, and 16 calves. 2Based on a harvested yield of 9 tons per acre. 32 32 ALABAMA AGRICULTURAL EXPERIMENT STATION APPENDIX TABLE 29. HERD, GRADE ESTIMATED ANNUAL RECEIPTS AND EXPENSES FOR A 60-Cow A MILE PRODUCTION, COMBINATION TYPE FEEDING, PIEDMONT AREA, ALABAMA Item Rate Amount Dollars Receipts Milk, 10,000 pounds per cow less 96 pounds for Calves, total 5,942 hundredweight 5.50/cwt. Cull cows, 14 head' Weighing 1,800 pounds each ----------------------188.50/head Calves, day-old, 34 head. 15.00/head Cull heifers, 3 months old, 2 head 40.00/head TOTAL RECEIPTS --------------------Expenses Millet, 80 acres ___________________________________ 33.00/acre2,640.00 Corn silage, 85 acres 65.00/acre Concentrates, 91.4 tons 62.00/ton Marketing 14 cull cows, share of $2,639 total ----------------.03/dollar Hauling cull cows, 200 miLes__________________________ .15/mile 3 Milk hauling, 5,942 hundredweight . Veterinary expense, 12 months 30.00/month Electricity, 12 months .__________________ 25.00/month Dairy supplies, 60 cows ._________________ 6.00 /head Miscellaneous, 60 cows'__________________ 4.00/ head Dollars 2,681.00 2,689.00 510.00 80.00 35,910.00 ------------------ - - --------------------------------5,525.00 -------------------- 5,666.80 79.17 30.00 2,079.70 5/cwt. Artificial breeding, 60 cows Cleaning holding lot, 5 times______________ Labor, 3,100 hours ._________------------ --------------- 360.00 300.00 360.00 240.00 480.00 8.00 /head 23.60/time 1.00 /hour 118.00 3,100.00 Interest on operating capital, $4,856.84. Fixed costs (Appendix Table 25)___________ TOTAL EXPENSES__________----------- .06 291.41 4,879.72 26,149.80 9,760.20 Net returns (to land and management)._--__ 2 'Adeath loss of 1 is assumed out of the a15 cullcharge. cows. Costs for grazing crops do not include land "One-half of $9,713.67. 2Dues, fees, and other.