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Profit and Cost Analysis of Dairy Cow Breeding

Posted on: December 2, 2019, by Victoria

How much profit does a cow make a year? At present, dairy farming is still hot, and it produces more value. Whether it produces milk or calves, it has a good income. Milk breeding belongs to the kind of project that has a lot of investment in the early stage and takes some time to make a profit, but it has a good annual income. Let's analyze the profit and cost of dairy farming.

Profit and Cost Analysis of Dairy Cow Breeding
Profit and Cost Analysis of Dairy Cow Breeding

Does cow breeding make money?
Although the development of the dairy industry has been flat in successive years, the demand for domestic dairy products has increased, and dairy farming still has certain profitability. The research shows that it is better to keep 5 - 10 dairy cows in a couple of farms where dairy cows are raised professionally. In this way, they can not only not delay agricultural work, but also ensure a well-off living standard.

Influenced by the policy in recent years, dairy industry has developed very rapidly in all parts of the country, but because of the blind introduction of overheating and some profit-making attempts by cows vendors, dairy farmers have been deceived into losing money and the imbalance of milk sources, which has led to the sharp rise and fall of cows prices, the loss of confidence of farmers and the downturn of dairy farming. However, it benefits from the support of the state to the agriculture and aquaculture industry, it is estimated that within five years, the dairy farming community will be popularized throughout the country, the sale and processing of milk and breeding of cows will form a good relationship chain. The leading effect of large-scale dairy farms in various places will be dominant, and the price of dairy cows will tend to rise steadily.

Profit and Cost Analysis of Dairy Cow Breeding
Profit and Cost Analysis of Dairy Cow Breeding

A cow's annual profit
Cows' profits need to take costs and benefits into account. The cost of raising dairy cows includes feed, water and electricity, epidemic prevention, treatment and so on. The feed of dairy cows includes silage, hay feed, straw, root block feed and concentrate feed and it costs about 4000 yuan a year. About 600 yuan per head for water and electricity, breeding, epidemic prevention, and treatment. The purchase cost of dairy cows is about 1000 yuan, the depreciation cost is about 2000 yuan a year, and the total feeding cost is about 6600 yuan. The milk yield of dairy cows can be calculated as 5 tons of milk per year, 1800 yuan per ton, and 9000 yuan per head of fresh milk per year.

Also, when a cow gives birth to calves, there is a part of the income. The annual profit of an adult cow is calculated to be between 3000 and 6000 yuan. Moreover, the price of fresh milk will be affected by market efficiency and will fluctuate frequently, which will also affect the income of dairy farmers. And the above profit analysis for a dairy cow does not consider the cost of farm construction, land use, and labor. If you want to invest in a large dairy farm, you need to carry out more professional investment benefit analysis.

Under normal feeding conditions and milk production, and no major epidemic, calculated based on 5 tons of fresh milk per year produced by an adult cow, the annual net profit of it is 3,000 to 6,000 yuan, and that of five dairy cows is 25,000 yuan. Taking a dairy cow as an example, the specific calculation method of its annual profit is as follows:

The annual feeding cost of a cow is 6030 yuan per head.

The feed cost is 3500 yuan. Include:
(1) Six tons of silage, calculated at the local market price of 100 yuan/ton and  it requires 600 yuan of capital;

(2) One ton of hay, calculated at 200 yuan per ton and it requires 200 yuan of capital;

(3) Two tons of straw, calculated at 50 yuan/ton and it requires 100 yuan of capital;

(4) One ton of root-block feed, calculated at 200 yuan per ton and it requires 200 yuan.

(5) Two tons of concentrate feed, calculated at 1200 yuan/ton and it requires 2400 yuan.

FeedSilageHayStrawRoot-block feedConcentrate feed
Unit(ton)61212
Cost(yuan/ton)100200502001200
Total (yuan)6002001002002400

The feeding cost is 530 yuan (excluding staff salary).

(1)Water and electricity: 40 yuan per cow per year;

(2) Breeding fee: 150 yuan per cow per year;

(3)Anti-epidemic fee: 40 yuan per cow per year;

(4) Treatment fee: 300 yuan per cow per year.

Dairy cows depreciate themselves at 10,000 yuan per cow for five years and depreciate them at 2,000 yuan per year.

Profit created by a cow
The annual income per calf is 9,200 yuan.
1. The income of fresh milk: annual production of 5 tons of fresh milk, calculated at 1800 yuan/ton, the income is 9000 yuan.

2. The income of calf: annual calf birth price is 200 yuan.

The annual income per female calf is 13,000 yuan.
1. The income of fresh milk: annual production of 5 tons of fresh milk, calculated at 1800 yuan/ton, the income is 9000 yuan.

2. The income of female calf: annual female calf birth price is4000 yuan.

Profit and Cost Analysis of Dairy Cow Breeding
Profit and Cost Analysis of Dairy Cow Breeding

Profit and Cost Analysis of Dairy Cow Breeding
Cost of Dairy Cow Breeding

1. Site cost
At present, cows are generally kept indoors and outdoors. Outdoor is generally free grazing, which can save a lot of costs. Of course, if you need to book the whole site, it's usually hundreds of yuan about 666 m². If you build a small cowshed by yourself, it will be slightly rudimentary at 50-60 yuan per square meter. If the function is more perfect, such as a laundry tank, feeding trough, lighting control, etc., the cost will start at 100/m. Large-scale Cow Pasture usually start in tens of thousands if they are adapted to local conditions.

2. Feeding cost
The price of dairy calf generally increases in varying degrees according to age. The price of 2-3 months starts at 2000 yuan, and the price of 3-6 months starts at 4000 yuan. The larger is determined by origin, ranging from thousands to tens of thousands of yuan. A dairy cow feeds about 10 tons of forage and feeds a year. The price needed is about 6,000 yuan, of which feed cost accounts for 4,000 yuan and forage cost accounts for 2,000 yuan. The annual cost of vaccines and medicine is about 600 yuan, and the cost of raising a dairy cow is about 7000 yuan.

3. Profit of Dairy Breeding
The income of dairy cows lies in the production of milk and calves themselves. Generally, the price of a calf varies from 2000 to 4000 yuan. The milk yield is calculated according to the current average of 4000 KG, and the price is about 2500 yuan per 1000 KG. Its total income is about 10,000-14,000 yuan, and its deposit profit is about 3,000-7,000 yuan. Overall, Overall, dairy farming is a good option. If you have 20 heads, you'll make 60,000 to140,000 yuan, which is still a long-term situation.

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