Dairy activity in family farming in Minas Gerais, Brazil: production costs and cost-effectiveness analysis

Abstract

The aim of this study is to analyze and compare the cost-effectiveness of three family dairy farms, located in the municipality of Limeira do Oeste, MG, Brazil, as well as to identify the break-even points and the factors that most influenced the final costs, and their impacts on each property. The analyzed data comprised the period from May 2015 to May 2016 and were collected using forms developed by EMATER-MG (Technical Assistance and Rural Extension Company of the State of Minas Gerais) and MDA (Ministry of Agrarian Development). Gross and net margins as well as results (profit or loss) were considered as cost-effectiveness indices. It was realized that the dairy activity in the properties studied exhibited low efficiency in the use of inputs, implying idle productive capacity, an increase in the proportion of fixed costs in the composition of total costs, and low productivity per animal per unit area. Therefore, diary activity was highly dependent on the sale of animals in order to afford and present positive results. Among the components of the effective operating cost, feeding is the most representative (averaging 63.09%), in the three studied properties, being the tax rates considered as fixed (9.41%) and miscellaneous expenses (9.49%) also expressive. The properties showed high fixed costs and break-even points; in one property, these could not be determined as the unit variable cost was higher than the average selling price in the market. In the economic analysis, the three systems showed positive net margins and results, indicative of production viability in the long term. Key words: Dairy cattle. Effective operating cost. Break-even point. ResumoObjetivou-se analisar e comparar as rentabilidades de três propriedades familiares produtoras de leite, situadas no município de Limeira do Oeste-MG, bem como identificar o ponto de equilíbrio e os fatores que exerceram maiores representatividades nos custos finais e os impactos ocasionados por eles em cada propriedade. Os dados analisados compreenderam o período entre maio de 2015 a maio 2016 e foram coletados utilizando-se formulários desenvolvidos pela EMATER-MG (Empresa de Assistência Técnica e Extensão Rural do Estado de Minas Gerais) e MDA (Ministério do Desenvolvimento Agrário). Considerou-se as margens bruta e líquida, bem como o resultado (lucro ou prejuízo) como indicadores de rentabilidade. Percebeu-se que a atividade leiteira, nas propriedades estudadas, apresentou baixa eficiência de utilização dos fatores de produção o que implicou capacidade produtiva ociosa, elevação da participação dos custos fixos na composição do custo total e baixas produtividades por animal e por área. Em função disso, a atividade foi altamente dependente da venda de animais para conseguir se custear e apresentar resultados positivos. Dentre os itens componentes do custo operacional efetivo, destacase a alimentação como sendo o de maior representatividade (média de 63,09%), nas três propriedades estudadas, sendo a participação de impostos considerados fixos (9,41%)...

Determination of factors affecting competitiveness through technical and economic analyses of dairy cattle enterprises in Balıkesir province

“…Compared to results obtained in other studies, labor expense rates were similar for small-scale enterprises and lower for medium and large-scale enterprises (13,22,24,31,36). The reason for this difference is the development of technology and increased use of machinery and technology in production in recent years; thus, highly boosting the rate of machinery use in medium and large-scale enterprises.…”

“…Despite the dairy cattle enterprises in Balıkesir province failing to cultivate their coarse fodder crop at low costs with their own means, the share of feed expenses in the grand total of costs was lower than the rates found by other researchers (13,22,24,31,36), as the share of livestock depreciation and energy costs were high.…”

Factors affecting the price of raw milk in Turkey using panel data analysis

“…In the study conducted, the use of pasture is important in increasing farm productivity (BOZOGLU et al, 2017). In the current literature, the share of feed cost in operating costs has been calculated to be between 48.65-65.30% (SANTOS et al, 2018;ÖRS & OĞUZ, 2019;TAPKI, 2019). Furthermore, the feedstuff prices are adversely affected by erratic exchange rate fluctuations, dependence on foreign raw materials, and additives used in feed production (CBRT, 2020).…”

The effect of dairy farm size on the economic structure and feed consumption: A case study of the Aegean Region

“…This was attributed to the intensive use of pasture and forage areas for animal feeding in the region. In a study conducted by Santos et al (29) in Brazil, which examined three family farms, it was determined that the share of feed expenses in the total costs was 63.09%. The high share of feed expenses was explained by the direct relationship of feed costs with milk production, and the fact that cows were allowed to feed freely without being dependent on milk yield.…”