The cost of nearly everything has gone up for dairy farmers and farm margins are being squeezed, writes Nate Donnay. What markets do care about is how much supply is available, and there is better news for farmers there.
Understanding farm margin calculations can help veterinary teams and those calling directly on dairies to align services with opportunities to avoid costs and improve profits. Donnay indicates the net margin estimate has dropped to its lowest level since 2009.
Source: Hoard’s Dairyman, November 29, 2021. Link. Donnay discusses switching his analytical approach from gross margin to the net margin calculation which puts more financial stress at the farm level.
INSIGHTS: Infrastructure, technology and labor increase as dairies grow in size and compete for acreage to generate feedstuffs. As animal health pros, it is important we remain focused on prevention and cost-effective interventions as market opportunities adjust post-pandemic.