Missouri 3,500-cow dairy business plan
Abstract
"This dairy farm business plan demonstrates one path forward for the next generation of Missouri's dairy farmers. This path involves producing milk in Missouri with a 3,500-cow single site dairy, a capital and labor efficient scale. This dairy plan gives Missouri dairy producers a vision of a new scale and style of dairying common in growing dairy regions. This report is designed to guide planning a completely new dairy. The dairy model uses next generation confinement housing solutions: freestalls with sand bedding and tunnel ventilation to improve cow comfort and cooling. A 72-cow rotary parlor is used to milk the herd three times per day. This model serves as a complete business template for starting a new greenfield dairy. Capital investments, operating costs, production plans, rations, forage systems, housing systems and manure systems are designed as integrated systems. Currently operating dairies seldom start a greenfield dairy by designing a completely new dairy system. However, this strategy can be an option for a group of crop and dairy farmers jointly planning to transition to the next generation of dairying by pooling resources and forming a new entity. This template can also be helpful for existing dairy producers evolving on-site in their current facilities as they examine various technologies for the dairy's expansion path. This model uses a systems approach to integrate cropland planning, irrigated forage production, specific rations tied to production, comprehensive nutrient management, labor-efficient facilities and modern cow housing solutions. This integrated system reduces obstacles to higher milk production at scale. These production practices and management techniques, along with the economic analysis, can be applied to other herd sizes. Dairy producers can use these plans to establish production goals and to evaluate how the various performance measures influence their financial statement. Financial statements show how various components of the dairy operation impact the cash flow, the income statement and the five-year budget. A comparison of key system components and financial indicators for the dairy model can be found in Exhibit A1. This model represents a dairy using 100% equity financing with no debt. Although unrealistic, this simplifying assumption allows lenders to quickly analyze the free cash flow to determine how much debt the operation could service."--Introduction
Rights
Archive version. For the most recent information see extension.missouri.edu.
OpenAccess.
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