Wednesday, June 23, 2010

The amazing increase in cow productivity in Wisconsin

I came across this graph at carpe diem and thought people might be interested in understanding the competitive pressures that our primary industry faces. The number of cows has nearly halved yet production per cow is up enormously. Click through the link for an interactive graph using Tableau.


Anonymous said...

If only the public service showed similar levels of productivity.

The thing with cows is - if they don't produce you have 'em put down

if we used the same system to govern NZ
the country would be much much richer
and they'd be no lefties anywhere!

barry said...

Interesting - and its a real surprise it hasnt happened earlier - not just in the US, but also in those other agri countries - eastern europe and S.America. The only thing one can be certain about with commodities is that as price goes up, more start producing or manufacturing it.

and Talking about performance. There was this guy called Hitler. He took over the dutch railways (as one does when one invades another country)and the dutch rail was hopeless. He fired half of the employees and then told the other half "make it work or you will get a free railway ride (to a recreation camp in eastern poland)" - and they ran on time from that day forth.

David said...

The US dairy industry has always shown this sort of elastic response to price signals. Because they feed the cows indoors, and because the cows have been bred to be enormously large stationary converters of feed to milk in volume terms, the output is a direct function of measured inputs.
To change the type of cow would be a much longer response time so the ability to make the changes demonstrated in the graph is demonstrably inherent in the animals in question.

In NZ for example, you can't stuff a lot more grass down the throat of the cows that have been bred for our production system. You could switch to higher quality (much more expensive) feed types and get a significant response but the economics of production would get shot to hell and the valuable milk components under the NZ payment system (protein principally) would not increase to the same ratio as volume does in the US.
nb US milk is priced on a weight/volume basis.

Anonymous said...

Yeh. What David said. Also, it seems that over the last 80 years, the more milk produced per cow the lower the wholesale price.

Where will that end?

Anonymous said...

I wouldn't be too worried about this sage - As most kiwi farmers know per cow production isn't the end all of everything.

The most important thing is profit per unit of production. Kiwi cows produce say around 400kg MS per cow. American ones produce say 900kg MS.

However in NZ cost of production is likely around 35% of payout where as in the US it is around 110% and without federal subsidies most farms there would go bust.

In NZ before deciding a change in feeding the first thing a farmer does is work out the cost of the input and the likely return in Milk Production. The return must out weigh the input cost otherwise there is no point doing it.

NZ greatest competitive pressures comes from countries with similar climate and low cost production structures to NZ (South America in particular)


Anonymous said...

Don't forget to look at the hi-tech additives that increase milk production. They may be more productive but I'm not sure I'd want to drink what they produce.