By Dori Modney

Alberta Dairy ‘cost study’ program begins January 2022

Nov 24, 2021 | 5:33 PM

LETHBRIDGE, AB. — A prime objective of any business is to have a good understanding of how well it is performing. Important parts of measuring that performance include tracking revenues, expenses, and profit margins.’

With that in mind, enrolment is now open for the next Dairy Cost Study program beginning January 2022.

The Study is an annual program where dairy farmers provide farm information over the course of a year. This information is compiled, creating a business analysis on the cost and returns of producing milk at their farm and the analysis is used as a tool to help identify potential manage changes to allow or cost savings.

The data of all the participating farms are then combined to produce an Alberta benchmark document called the Economics of Milk Production.

Alberta Agriculture, Forestry and Rural Economic Development research analyst, Pauline Van Biert, comments that farming is increasingly more complex, requires continual scrutiny.

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`There is a need to go back to the basics to really know how your business is performing. It is important to know the details. Only once you have a complete picture of your business can you better manage its opportunities. Annual budgeting and planning are better when you use your own numbers. Having your own numbers in front of you helps assess farm management options.`

Van Biert outlines the questions that the Dairy Cost Study final farm analysis will help answer:

— How will the dry conditions of 2021 and increase in feed, fuel and electricity prices affect my cost of production?

— How will the proposed increase to farm gate milk price affect my income?

— My total vet costs are higher than I thought. Why? What can I do about it?

— How much are my cows producing? Is this satisfactory, or should I try to up my production to fill my quota or buy some more cows?

— What is my cost per kilogram of butterfat?

The cost for the detailed analysis of a farm, is simply the producers investment of time.

Van Biert says the payback can be huge, as it helps make decisions based on factual data and she will even visit your farm to help make the analysis as easy as possible.

“Whether you join for one year or stay for many, I will come out to the farm and explain the details. We make it as easy as possible to provide the requested farm information. I can work with the farm’s accountants or feed providers to fill in some of the blanks.

Find out more and sign up for Dairy Cost Study.