Commercial Dairy Goat Farm in Vermont Focusing on the Numbers

Authors Jordan Le Roux, Vermont Butter and Cheese Company Glenn Rogers, UVM Extension

Acknowledgements The authors acknowledge help from the following persons who are involved with the goat farm business in Vermont at varying levels. The authors would like to thank Carol Delaney who participated in bringing her knowledge on Vermont dairy goat business and beyond Vermont. Thanks to Daniel. L. Scruton from the Vermont Agency of Agriculture and John Porter from University of New Hampshire Cooperative Extension. The authors would like to thank the local producers who have shared their financial information, and to local builders, suppliers and other professionals who assisted with background information.

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Table of Contents I

ABSTRACT.............................................................................................................. 1

II

INTRODUCTION ...................................................................................................... 2

III

ASSUMPTIONS ....................................................................................................... 3

1.

Size Operations.......................................................................................................................3

2.

A Few Numbers- Herd Management ...................................................................................3

3.

Example...................................................................................................................................5

4. A. B. C. D. E.

Herd Management..................................................................................................................5 General .................................................................................................................................5 Breeding period ....................................................................................................................6 Kids ......................................................................................................................................6 Out of Season .......................................................................................................................6 Summary ..............................................................................................................................7

5.

Assets .......................................................................................................................................7 A. Land......................................................................................................................................7 B. Buildings ..............................................................................................................................7 C. Equipment ............................................................................................................................9 D. Milking Parlor & Equipment................................................................................................9 E. Livestock ............................................................................................................................10 F. Summary ............................................................................................................................10

IV

INCOME SOURCES .............................................................................................. 12

1.

Milk Sales ..............................................................................................................................12 A. Vermont Butter and Cheese Company Milk Price.............................................................12 B. Assumptions .......................................................................................................................12 C. Milk Income .......................................................................................................................13

2.

Animal Sales..........................................................................................................................13

3. A. B. V

Other Sources of Incomes....................................................................................................14 Directly from the goat operation ........................................................................................14 Other Income......................................................................................................................14 EXPENSES CATEGORIES ................................................................................... 16

1. A.

Feeding Program and Costs ................................................................................................16 Presentation ........................................................................................................................16

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B. C. D. E. F.

The French System.............................................................................................................16 Feed rations ........................................................................................................................17 Feedstock............................................................................................................................20 Feed costs ...........................................................................................................................21 Summary ............................................................................................................................23

2.

Bedding..................................................................................................................................23

3.

Vaccination and Health Care ..............................................................................................24

4.

Dairy Herd Improvement Association (DHIA) .................................................................26 A. General ...............................................................................................................................26 B. DHIA Monthly Cost...........................................................................................................26

5.

Hauling Costs........................................................................................................................26

6.

Hired labor............................................................................................................................27

7.

Supplies and Miscellaneous .................................................................................................27

8.

Diesel, Fuels and Lube .........................................................................................................28

9.

Utilities...................................................................................................................................28

10.

Repairs and Maintenance................................................................................................29

11.

Taxes..................................................................................................................................29

12.

Interest and Principal ......................................................................................................29

VI

CASH FLOW SHEETS .......................................................................................... 31

VII

DISCUSSION ..................................................................................................... 35

VIII

CONCLUSION.................................................................................................... 37

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I Abstract

The Vermont dairy goat business is not as important to Vermont Agriculture compared to dairy cow farms. In fact, with approximately 30 dairy goat farms for more than 1,100 dairy cow farms, it might seem minuscule. However, it is a growing business and a study has been conducted to figure out what are the costs to produce and ship goat milk to Vermont Butter and Cheese Company. Although dairy goat farms data are not numerous but thanks to five farms located in Vermont and published studies (mainly French), these budgets have been built. This document contains various assumptions concerning assets and herd management programs which allows one to approach the cost of production for three different sizes of farm (100, 200 and 400 goats) including three feed ration program variables. In this study, a 100 goat operation is not sufficient to allow for a living income for a family without any off farm income. In fact there exists a negative cash flow of $518 and $2,109 for two regimens and positive cash flow of $1,500 for a 100 goat operation. The variation is largely due to differing feeding regimens. 200 and 400 goat operations are able to produce a family living. A 200 goat operation will have $11,763 - $19,535 net cash flow depending on feeding regimens. A 400 goat dairy farm, with additional outside labor, has $11,068 - $27,718 net family income. All examples are purchased feed rations and pasture and haying programs may provide cost savings on individual farms. Moreover, the incomes in those scenarios are performed by milk and animal sales only, thus it is highly possible that having other farm incomes will enhance net farm income depending on your situation.

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II Introduction Dairy farming is well developed in the State of Vermont with more than 1,100 bovine farms and 145,000 cows. While sheep and goats dairies are small in number (approximately 40-50 in 2005) the market seems to indicate room for growth. Given the current lack of goat milk supply for Vermont Butter and Cheese Company, this led to the development of a cost study on dairy goat farm. Overall, management is the most important factor to the success of the farm. This includes all aspects of crop management, goat dairy management, labor management and financial management. As a part of that management producers should understand the costs and returns of their operation and enterprise budgeting is helpful for making decisions either in short or/and long term. This paper includes the cost of production for three different size and three feeding regimens for dairy goat farms. Examples of 100, 200 and 400 dairy goat operations have been chosen as realistic dairy goat farm sizes, each with three different feeding programs. These theoretical farms are set up with unproductive land (no crop and hay) therefore; in this study, all feed is purchased. Your operation may be able to utilize pasture or make hay as a more efficient source of spring, summer and fall feed. This document allows one to compare current dairy goat farms and/or to help farmers and other institutions to build dairy goat farm financial budgets.

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III

Assumptions

The figures presented here are calculated based on average figures on general management from a wide range of data coming from the field. Thus, the numbers below presume good management practices but are at the same time realistic for a commercial operation. 1. Size Operations Three different size operations are chosen to show what income possibilities are but it does not mean it will be yours. Your choice again depends on your living costs, income goals, available labor, capital investment, and numerous other factors. Those factors must be calculated in a completed precise business plan before going into the commercial goat business. The following assumptions have been applied for each size of farm enclosed in this document. The sizes chosen are 100, 200 and 400 goats. Given the aim of this document, (to have a glance of what is the revenue for each farm size), we have considered a 100 dairy goat operation as a reasonable starting size for commercial dairy farm. The two hundred goat farm has been taken because a couple can manage 200 goats. However, beyond this limit often requires additional outside labor. Thus, we have included a 400 goat dairy to evaluate the profitability of that size goat dairy managed by a couple plus one employee. Although many factors utilize data from one size operation to another, individual size variations are expected. For example: to go from 100 to 200 goats the number of bucks double but freight & trucking, bedding & real estate tax costs do not double. Other costs may more than double due to added building size and added debt vs. utilization of older existing facilities. 2. A Few Numbers- Herd Management All female goats in a herd are not productive for the entire year due to disease problems, nonfertility, dry periods, and other factors. In this paper, we assume that 92% of goats give birth at a 1.7 kidding rate per goat. Moreover, even though a goat generally gives birth to two kids, a ratio of 1.7 kid per goat is realistic over the life of the operation. A french study used a 1.7 conception rate for an adult goat and 92% conception rate (S’Installer en Elevage Caprin, Institut de l’Elevage Poitou-Charentes, February 2001). For the whole herd including the unproductive goats, the conception rate goes down to 1.56 kids per goat [(92 X 1.7) /100]. However, it is important to note that not all mature goats will kid as some just will not conceive, will not kid properly, or will have other metabolic and disease issues. Thus, do not expect 100 goats to kid each year. A replacement rate of 25% is used to improve the genetics’ herd potential and to avoid health issues linked to old goats. That would mean the herd is entirely replaced every 4 years. However, french studies show that the replacement rate varies from 10% to more than 40% of the herd. The average rate in France for the farms that ship fluid milk is about 38%. (Institut de l’élevage, February 2005. http://www.inst-elevage.asso.fr/html1/IMG/pdf/1369-Result_techneco_atel_capr_lait_et_from.pdf). Although we could use a 30 – 35% replacement rate it would

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not significantly affect cash flow however, it could affect expansion, or genetic improvement rate. Replacement kids are chosen by her mother’s history (milk production and quality, diseases, behaviour…) in this case, choosing from does in their second lactation, at least. A 10% kid mortality rate is assumed which includes birth difficulties, infection, and other kid weaknesses. A wide range is likely possible as care at the birth date and the first hours are critical. (S’Installer en Elevage Caprin, Institut de l’Elevage Poitou-Charentes, February 2001). A ratio of one buck for twenty goats is assumed and no artificial insemination is used. However, by doing out of season breeding, a french study shows that the total buck population should 1.5 to 2 bucks per 20 goats. (Pour une installation réussie en élevage caprin, March 2005). Summary Assumptions Goats Goats (G) Productive Goats (PG) (92%) Milk Production (1,700 lbs per PG)

Unit Head Head Lbs

100 92 156,400

200 184 312,800

400 368 625,600

Kids Prolificity (1.7 Kid/PG) Replacement (25%) Kid mortality (10%)

Head Head Head

156 25 15

312 50 31

625 100 62

Total Kids

Head

141

281

563

Bucks Bucks (B) (Ratio 1:20 (B/G)) Bucks Added (Out of Season) Total Bucks

Head Head Head

5 5 10

10 10 20

20 20 40

Cull Animals Cull Goats (25%) Cull Bucks (32%) Male Kids Sold yearly Female Kids sold (not needed to maintain herd)

Head Head Head Head

25 4 70 46

50 7 140 90

100 13 280 180

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Herd size

3. Example Here an example of a 400 goat operation 40 Bucks

13 Cull Bucks

400 Does

368 Productive Goats

100 Cull Does

Annual Sales

13 Cull Bucks 560 Kids

460 Kids Sold 626,500 lbs Milk 100 Cull Does

100 Replacement Kids

460 Kids Sold (180 female, 280 male)

4. Herd Management A. General The natural breeding season for does is August to December (stimulated by decreasing daylight) thus most kidding is from January to June. Artificially increasing daylight during December thru March-April will simulate the goats and breeding will take place during the spring therefore kidding period will be off-season (fall-winter) thus allowing the farm to produce milk year around at consistent levels. Does are bred in-season (August-December) and out of season (March to June) primarily because of a better repartition of work and an advantageous milk price during off-season. Kids are born five months after breeding. An estimated 10% kid loss is assumed. Does are bred at an optimal size at 7 – 9 months of age, thus kidding at 12 – 14 months of age. However, this depends on the growth and health of the kids to doeling breeding and kidding age. Female kids are generally weaned at two and half months of age, however this again depends on the growth and health of the kids. Breeding management is essential to predict kidding days and to maintain milk production for extended periods of time. In this paper, it is assumed that the dairy goat farm sells all milk to Vermont Butter and Cheese.

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B. Breeding period The bucks replacement rate is 32% meaning that buck’s life on the farm would be 3 years. It is better to have quick turnover in bucks to increase herd genetics and consequently milk protein, and butterfat rates. Bucks replacement rate can be as high as every 2 years and artificial insemination can also be used to increase the genetic potential of the herd. Doelings are bred if and only if when they reach 65-75 lbs weight as well as having excellent growth and having high dairy characteristics. The 8 months of age is used as a reference to reach the 65-75 lbs weight (PEP Caprin, L’élevage des chevrettes). C. Kids Goats to be bred are chosen by the future of their babies, they choose the babies in term of the milk productivity and the goat’s history (difficulty to kid, hoof problems, milk quality…) The kids unsuitable for replacement are sold early to avoid increased rearing costs. However, raising kids for breeding stock can be an alternative as an additional source of income. D. Out of Season Out of season breeding, for fall kidding, allows one to benefit from the higher winter milk price. This technique is further described in the “Out of Season Breeding” (Available at Vermont Butter and Cheese Company)

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E. Summary Operation

Duration

Period

Feeding program

12 Year around months

Breeding

6 months Aug – Dec

Breeding out of season

4 months March – Jun 12 Year around months 12 Year around months 12 Year around months

Kidding Weaning Milk production

5. Assets Assets are an important part on your farm and including land (including fields and pastures), buildings, equipment, livestock and other depreciable items with useable life over one year. In this paper, the assets contain land (including small outdoor exercise lots), buildings, milking and milk house equipment, livestock and one medium sized tractor (50 – 60 HP). The value of assets on the five interviewed farms were not entirely available. However, we did approximate the land, buildings, equipment, and livestock that reflected actual Vermont values. A. Land This study utilized all purchased feed as Vermont dairy goat farms are mostly confined (goats stay mainly in the barn) and secondly, it is easier to predict total feed cost. However, one may use partial budgets to determine the profitability of raising and harvesting the feed on your farm as well as utilizing pasture to reduce feed costs. In this paper, we assumed that one hundred goats operation is on 15 acres with five additional acres per 100 additional goats. Thus 20 acres for 200 goats and 30 acres for 400 animals. We used this as often the farmer’s house and surrounding buildings are part of the farm property. We used the farmstead site as two acres. Consequently, for each farm, two acres are deducted for the farmstead area. Only the house is taxed at full value. All other property is assumed to be in the “Vermont Use Value/Current Use Program and taxed accordingly. B. Buildings There are many types of barns and housing for goats. Barns for goats can be adapted from old cow barns, or can be a new construction or a rental operation. Therefore, the value of buildings has been done by consulting companies that build housing for livestock. We started by taking

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into consideration goat requirements (square footage, air and feeder space) and estimated the cost for a new barn. Obviously, you may be in a different position, have already barns and may need to adapt them for goats. The goat requirements used in this paper are:

Housing Requirements Goat Unit Animals Added (20%) Head Air per Goat Cubic Foot Space per Goat Square Foot Bunkline Space per Goat Foot Alley Space per Goat Foot

Housing Requirements Doeling Unit Space per Doeling Square foot Bunkline Space per Doeling Meter Alley Way Meter Kids Space per Kid

Square foot

Example 100 120 247 20 1.1 6.56

1 10.7 0.25 2 2.7 to 3.6

The total animal space is 20% higher because of the animal flows. In fact, during the year, certain periods are much more intense than others. For example, kidding periods create additional space for short periods of time. Minimum feed alley width in this case is 2 meters wide, (6.56 feet). The size of the feed alley depends on the type of feeding mechanism. (tractor or by hand), additional use of the alley (storing equipment), and the type of feed (round bale, small square bale, or large square bale). Generally, the cost per square foot for building a barn goes from $15 to $40. John Porter, University of New Hampshire Extension, gives a cost at $20 to $25 per square foot for a pole barn. A goat needs from 15 to 40 square feet including space exercise and feed alley. Values of the buildings assume a 20% Lost Capital and a useable life of 20 years. For each farm, we assume three buildings that house lactating and dry does; yearlings and kids; and one for bucks. For the 400 goat operation, we assumed four barns with two barns for lactating and dry does. Barn sizes and the explanations on how the barn size has been calculated are presented in the appendix section. For more details on how to assess the building size for your herd, go onto the appendix section. A note to the reader about buildings: Ventilation is keenly important to the health of the doe, the buck and the kids in a dairy goat operation. Proper ventilation can lead to high production levels, decreased sickness, and excellent growth and high vigor rates. However, the opposite is true and can lead to higher vet costs, slower kid growth, lower milk production, and other issues. Thus you need to evaluate this closely when modifying old buildings or when putting in new buildings. Do not under estimate how critical this factor is to the overall health of the animal and to the operator.

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The main elements to take into consideration related to ventilation are: temperature, moisture and the amount of ammonia in the air. Temperature Goats will survive in cold weather but only when it is introduced over a period of time. Abrupt variations will change humidity levels, leading to condensation on the buildings, as well as Building optimum temperatures are 10-12°C (50-53.6 °F), by avoiding sudden differences. Maximum temperature is about 27°C (80.6°F) as possible as you can and a minimum would be simply to avoid frozen water and goats need to eat more. Moisture A goat lost 1.2 to 1.5 liter per day (40-50 Oz) and adding the urine from the bedding. It is recommended to do not pass the 80% of moisture. The optimum hygrometric measure would be 70 to 75%. Ventilation A goat needs at least 5 to 6 cubic meter of air (177 to 212 cubic foot). Air should be renewed during winters about 30 m3 per hour per goat (1060 cubic foot) and during summers about 120 to 150 m3 per hour and per goat (4238 to 5298 cubic foot). Given these recommendations come from France, Vermont winters are colder and the air renew would be less. However, an air renew still have to be performed in order to avoid respiratory issues. Those recommendations have to be adapted at each situation because building layout and ventilation system (static or dynamic) play significant roles on in-house ventilation. C. Equipment Minimal equipment is needed on a dairy goat farm with no use of the land. Equipment needed is milking machine and a tractor with bucket loader. The tractor with a bucket loader is used to haul hay, haylage, feed and/or corn silage, move manure and other activities. The used small tractor on the 100 and 200 goat operation has a $12,000 value for the first two example farms while the 400 goat operation has a tractor valued at $50,000. (It is important to remember that you must wash the tractor and especially the bucket between moving manure and then using the tractor for feeding purposes). D. Milking Parlor & Equipment According to the herd size, we assume each has a different size of milking parlor. The value of the milking center depends on several factors, including the bulk tank size, type of milking parlor (Herringbone, Straight-through, Parallel, Rotary), number of stanchions and others. The type of the milking parlors has to be chosen according to the housing layouts, herd size, labor availability, time of milking (goats/hour), capital investment and expansions planned, distribution of feed or not and animals flows. These factors have to be taken into consideration without losing sight of the main targets of high quality milk and a milking parlor adapted to the milk handler.

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The milking equipment contains bulk tank, milking machine with the claws, vacuum pumps, stainless steel pipelines, hot dipped galvanized parlors along with the associated milk house sink, hot water tank and miscellaneous items. The size of the milking parlor changes relative to the herd size. Therefore, we assumed that for 100 goats, a double four or single 8 goat parlor; for 200 goats, a double 8 parlor, and for 400 goats, a double 12 is necessary. For more details, go onto appendix and find the explanations for the “Other Equipment” line. When planning a goat operation it is wise to consider potential expansion to a larger size even though you may not expand to that size. This consideration will allow one to evaluate the practicality and profitability of various pieces of milking parlors and equipment. 100 Double 4 or single 8 hot dipped galvanized goat parlor

200 $ 2,600

Double 8 hot dipped galvanized goat parlor

$ 5,200

500 gallon used bulk tank

$ 3,500

1 000 gallons used bulk tank

$ 7,000

Other milking equipment

$ 6,810

Other milking equipment

$ 14,210

Total Cost

$ 10 400

400 Double 12 hot dipped galvanized goat parlor

$ 7,900

2 000 gallon used bulk tank

$ 14,000

Other milking equipment

$ 12,440

$ 25,300

$ 34,300

Bulk tank size varies by the number of goats milked each day, goat milk production and milk storage time 2 – 4 days. The milk room size must meet Vermont state inspection standards although it is recommended at least 200 square feet unless you are “bulkheading” the tank to the outside. E. Livestock In this paper, a goat has a value of $150, a yearling of $100 and a buck of $200. Consequently, a 100 goat farm will have 100 goats at $150 each, 10 bucks at $200 each and 25 yearlings at $100 each, with a total herd value of $19,500. Thus, the 200 goat farm has a $39,000 livestock capital and the 400 goat farm has $78,000 invested in livestock. Unfortunately, only two farmers in our study had this critical information and we had to rely on averages. The value of each category of animals must be assessed by the individual performance, data and genetics.

F. Summary

Land Buildings Equipment Livestock Total Assets

Unit Acre $ $ $ $

Farm 1 15 $65,000 $85,500 $24,910 $19,500

Farm 2 20 $90,000 $118,000 $34,600 $39,000

Farm 3 30 $165,000 $199,000 $84,300 $78,000

$

$194,910

$281,600

$526,300

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The assumptions above are very important and further explanations will allow you to understand how and where we came to our numbers. The above assumptions are references that a dairy goat farmer should reach; it does not mean that it is the ideal farm. Assumptions come from french studies whereas the actual numbers are from Vermont dairy goat farms and applied to the three sample farms. Again, this document should be used as a guideline to compare your current existing farm or give you an idea on what numbers must be taking into consideration. You need to apply your situation to the sample farms to improve your operation.

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IV

Income Sources

1. Milk Sales A. Vermont Butter and Cheese Company Milk Price In the Vermont Butter and Cheese Company agreement signed between VBCC and the “sample farmers” in this study the milk pricing is calculated as: “Payment to the Producer for milk purchased by Vermont Butter and Cheese Company will be bi-weekly with the applicable quality bonuses being paid after the end of each month. Current pricing formula recognizes two payment periods: 1. Quota and 2. Over Quota periods. The Quota Milk is considered as the total of all pound of milk protein lbs. per week with pickups made between October 1st through January 31st (17 weeks) or November 1st through February 28th (16 weeks) or November 1st through March 31st (22 weeks) whichever is the highest weekly average number. Milk purchased during this period is rated in 2006 at $11.50 per pound of protein up to the limit set by the Quota Period, and $9.00 per pound of protein beyond the Quota limit.” Please note that there are 17 weeks between October and January and 16 weeks between November and February but 22 weeks between November and March. Thus, the weekly production must be calculated to determine the highest weekly average milk protein lbs. production for the quota period. These prices are subject to change as the goat milk market changes. B. Assumptions In these farms, the milking goats produce 1,700 lbs of milk per year. This means a 5.6 lb/day average for a lactating goat producing for 300-day or 6.8 lbs/day for 250-day lactation. We assumed that the average protein level is 3.34% for all the year within a range of 2.9% to 3.7% and the butterfat level is 3.64% within a range from 3.3% to 4.25%. These calculations are based on an average of all the farms that shipped their milk, in 2005, to Vermont Butter and Cheese Company. The over-quota protein level has been calculated by taking a year similar to 2006. A bonus is paid for milk quality, depending on raw bacteria count, somatic cells count, preliminary incubation count and laboratory pasteurized count. In this scenario, we assumed that each month the quality milk reached “Level Two” meaning $3.45 per hundredweight, which corresponds to about 10% of the milk income. For the current dairy goat farms, some reach $5.00 per hundredweight, some have no income and few get penalties since they are beyond the regulation limits (Grade “A” Pasteurized Milk Ordinance). Moreover, a winter premium is given at $0.50 per hundredweight from October through January. This winter premium is included in the bonus. For more details, go to the appendix section.

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C. Milk Income Milk income

Unit

Herd size 100

Milk production Incomes

200

400

Lbs $

156,400 $ 54,866

312,800 $ 109,733

625,600 $ 219,466

$

$ 6,261

$ 12,523

$ 25,046

$

$ 61,128

$ 122,256

$ 244,512

Bonus Total Incomes

The total income per goat is $611 and per hundredweight is $39.10 for any farm size. 2. Animal Sales In Vermont, dairy goat farmers sell their cull does, bucks, and goat kids to different locations. Goats can be sold to a cooperative that raise kids until 2 or 3 months old, to another dairy goat farm which wants to increase its herd, to an auction broker or other coop, or to a retailer. The meat goat market fluctuates every season depending mainly on the ethnic events thus we utilized a lower than average price to take into consideration the range in prices that may occur with the seasonal fluctuation. Typically, goat kids are sold at one week old, and cull animals are sold as needed, thus income from selling animals is not significant compared to milk income and are not the aim of a dairy goat farm. In this paper, we used the following prices: $8 per kid, $64 per doe culled and $100 per buck. These prices have been reported from farms which sell goats to others and animal buyers in Vermont. Selling animals income: Animal Kids Cull animals Bucks Total Incomes

Rate $8.00 $64.00 $100.00

100 Quantity 116 25 3

200 Income $ 928 $ 1,600 $ 300 $ 2,828

Quantity 230 50 7

400 Income $ 1,840 $ 3,200 $ 700 $ 5,740

Quantity 460 100 13

Income $ 3,680 $ 6,400 $ 1,300 $ 11,380

These numbers may be underestimated because of the market trend. In fact, during the ethnic and /or religious events (Eastern, Christmas, Aid al Fitr…), the meat market is much stronger and the incomes may be more important. Note that by breeding out of season fall kids can be good candidates for Christmas holidays when prices are stronger. Both of these goat dairy animal markets should be considered when planning a goat dairy operation. For more information on the goat meat market www.sheepgoatmarketing.info is a USDA-funded project to improve the marketing infrastructure for goat and sheep producers. However, if you already know someone who is ready to pay more or less, in the appendix section a table shows different levels of income depending on the market price.

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Raising breeding stock is a possible way to increase income. A partial budget might be useful to show the profitability or not of raising. Selling breeding stock can be cost-effective and consequently a good source of income if records and goats are excellent. Breeding stock can be sold at $400 or more each. This can be significant if kids are available for sale. At a 25% cull rate and a 1.56 kidding rate per doe per year there will be excess kids for sale or “internal growth” of the goat herd. However, during some years one may find that the culling rate on the goat herd may increase to 30% or 35% for a variety of reasons. Unlike the bovine industry, this increase in cull rate may not significantly affect the net cash flow on the small goat herd as this percentage income change on cull goat income and kid income is not significant compared to the overall operational income and costs. It should be remembered that keeping cull rates low allows one to sell more high quality replacement kids and increase the goat herd but the genetic and production potential of the herd may not increase as rapidly as with a high cull rate herd. 3. Other Sources of Incomes Depending on your current or future situation, other related or diversified activities can increase your gross income. A. Directly from the goat operation Income coming directly from goats: Goats manure is more a cost than a revenue but processing this manure into compost and sold to the public may be a profitable venture in an urban or other niche market. Semen from bucks with high genetic potential can be sold, again that depends on buck’s performances and long-term dairy production records from the herd are essential to enter into this market. Processed milk (cheese, bottled milk, and other products) from the farm and into the retail market has not been taken into consideration because in this paper, all milk production is sold to Vermont Butter and Cheese Company. Processing milk on the farm is another business and needs much more investment, knowledge, product storage, and marketing expertise. In addition, retailing the milk and other products can be advantageous but it requires extensive business and marketing knowledge and experience. B. Other Income There are several other sources of income including: selling crops, maple syrup sales, forestry sales, and governmental payments among others. Governmental program can come from Natural Resources Conservation Service (Conservation Security Program, Conservation Reserve Program…) or other institutions (such as: Farm Service Agency and VT Agency of Agriculture…) thus allowing you to have income from the federal Government and the state under certain conditions. Do not underestimate the value of government programs because participating in government programs has been shown to help farm income significantly. Federally sponsored programs such as: EQIP (Environmental Quality Incentive Program), CRP (Conservation Reserve Program), CSP (Conservation Security Program) and state sponsored programs which help match state funds with those federal programs are available at some level for nearly all landowners and agricultural producers in Vermont. There are restrictions, cost share requirements, and limitations 14

for each program. For more information, contact your local Farm Service Agency office and the Agency of Agriculture to determine which programs you may qualify for.

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V

Expenses Categories

1. Feeding Program and Costs A. Presentation Feed is the largest part of the production cost and different feed rations are proposed based on 300 productive days and a 65 day dry period. A 150 lb. milk producing goat ingests approximately 1,000 kg (2,200 pds) of dry matter a year depending on the feeding system. Feed rations presented here are examples but not recommendations. Each farmer should evaluate the nutritional value of the feed, their goats, their feeding systems and other variables and then develop their own feeding regimen. For this paper we adjusted feed possibilities to include corn silage, hay and haylage. We have avoided the use of dehydrated alfalfa pellets although they are commonly used in France to feed goats. The price of this feed in Vermont was prohibitive at the time of this paper for the Vermont dairy goat operation. Unfortunately, the French feed calculation system can not be used in North America and the methods of calculation and units cannot be used in North America. However, feed quantities ingested by goats are the same as in France. We also know that there is a wide variation of feeding regimens thus that is why we propose three different rations. Feed rations below were made by personnel working at Institut de l’Elevage in France. In addition, there may be much to be learned from the French system (along with modifications from that system) to efficiently feed dairy goats which could lead to higher production in your herd. B. The French System The French calculation system differentiates, for a yearly production cycle, five stages that are defined mainly by the lactation and pregnancy stages therefore by the needs in energy and protein as well as dry matter needs. These five stages are: i.

Start of lactation

During this 30 – 60 day period, milk production is high. Energy needs typically cannot be balanced by only the ration, thus the body reserves are used. However, a high level of energy has to be provided to goats. Protein needs can typically be met by feeding high quality grains. Dry Matter Intake (DMI) may not be sufficient as well. ii.

Core of lactation

From the second – seventh month of lactation, milk production decreases and feed intake increases thus the rations ingested tend to equal the body and lactation needs. The DMI is highest during this period.

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iii.

End of lactation

This consists in preparing for the dry period therefore changing and decreasing slowly the amount of feed but not the nutrient concentration of the feed. Pregnant goats are fed with the best quality forage for the following two stages, which are: iv. 4th Month of Gestation (1st – 30th day of dry period, and one month prior to kidding) The 4th month of gestation has to aim to decrease the energy contained in the feed ration because the milk production is zero and it is preferable to not fatten goats during the dry period. v.

End of Gestation (30th to 60th day of dry period)

The energy contained in the feed ration is increased to cover the pregnancy’s needs and to prepare the goat for the following lactation. The first two months of lactation demand a lot of energy as well as calcium in the goats’ milk. C. Feed rations The “Dairy Goat Pellet” is a commercial purchased grain. It typically consists largely of corn, soybean, and wheat products. This feed typically has 16 - 20% protein and 78 - 84 Mcal/lb of NEL (Net Energy-Lactation).

i.

Ration 1: “Corn silage ration”

Milk Production: 1,700 lbs per Goat per Year.

Months Dairy Goat Pellet Corn Silage Hay (grass)

4th month of End of Gestation Gestation Ration Ration

Start of Lactation Ration

Core of Lactation Ration

End of Lactation Ration

2

6

2

1

1

1.54 3.08 2.20

1.32 2.64 2.20

1.10 2.20 2.20

0.88 0.00 3.96

1.32 0.00 3.96

Quantity in lbs per day. Corn silage and concentrate in lbs of dry matter whereas Grass hay is on an as fed basis.

17

ii.

Ration 2. “Haylage Ration”.

Milk Production 1700 lbs per Goat per Year.

Months Dairy Goat Pellet Barley Corn Haylage (Grass)

Start of Lactation Ration

Core of Lactation Ration

End of Lactation Ration

2 1.10 0.66 0.88 1.54

6 1.10 0.66 0.88 1.54

2 0.88 0.66 0.66 1.10

4th month of End of Gestation Gestation Ration Ration 1 0.44 0.66 0.00 0.00

1 0.66 0.66 0.22 0.00

Hay (grass) 2.86 2.86 2.86 3.96 3.96 Quantity in lbs per day. Grass hay in lbs per day as fed whereas the other feeds lbs per day of dry matter.

iii.

Ration 3. “Dry ration”: Alfalfa and Grass Hay.

Milk Production 1700 lbs per Goat per Year. End of 4th Month of Gestation Gestation Ration Ration

Start of Lactation Ration

Core of Lactation Ration

End of Lactation Ration

2

6

2

2.75

2.75

2.42

2

2

2

2

2

2

2

Barley

1.76

1.76

1.54

0.88

0.88

Soybean

0.33

0.33

0. 22

0.00

0.00

Months Alfalfa Hay Hay

1

1

Quantity in lbs per day. Alfalfa and Grass Hays on as fed daily basis. Barley and Soybean can be substituted by a commercial feed.

iv.

Kids and Yearlings

The five interviewed farms typically wean kids from 2 months to 3 months. However, all have individual variations to that program. The sample farms added hay and concentrate at one or two weeks after kidding. Breeding age ranges from 8 – 12 months of age depending on size and weight of doelings. The kids and replacement milk replacer feeding programs vary widely in the field. Thus Langston University provides recommendations on kids management especially on the quantity of milk replacer. Their recommendations below are: Age Amount of Fluid/Feeding 1 to 3 days 4 ounces 3 days to 2 weeks 8 to 12 ounces 2 weeks to 3 months 16 ounces 3 to 4 months 16 ounces

Feeding Schedule 5 times a day 4 times a day 3 times a day 2 times a day

Source:Dr. Lionel Dawson, 2006, http://www2.luresext.edu/goats/library/field/dawson06.pdf

18

Weaning time advised by Langston University is at 4 months of age whereas, In France, an eightweek weaning (P.E.P Caprin, L’élevage des chevrettes) can be performed under certain weight gain conditions. Kids must reach 20 lbs weight by one month of age and 26 lbs. at two months of age with proper body growth as well. This objective must be reached to breed goats at seven months old. One of the keys to early weaning is to have high quality water, hay and concentrate available at the earliest possible date (1 – 2 weeks of age). However, this balancing act of having high quality feed at early age must be balanced with providing high quality milk replacer at the amounts needed. From weaning to 4 months old, body growth is important and a good quality feed should be available. By 4 months of age, replacement kids should be grouped by the bodyweight and is a good way to provide feed for optimum consumption. Moreover, at this particular age, the risk of excess concentrate ingestion is reduced. Therefore, we assumed that a 2.5-month-old age is the weaning period and the breeding period should be at 7 to 8 months.

Feeding program Animal

All kids All kids

Stage

From one to three days old From 3 to 7 days old From 1 week to 2 week old

From two week to two month old Kids From 2 to 2.5 month replacement From weaning to 4 month old From 4 to 7 month old 7 - 8 month old (breeding period)

Number of Day

Weight Colostrum Milk Feed per day Quantity Replacer Fed (Lbs) (Oz) (Oz)

3

Hay (Lbs)

20 oz

4

40

7

40

0.4

1.8

48

0.4

1.8

32

0.4

1.8

0

0.9

2.4

0

1.1

2.9

0

1.3

3.1

45

1month = 20 lbs

15 45

At least 26 lbs

90 30

At least 65-75 lbs

For ease of calculations, we assumed that kids are fed only milk replacer. Farmers use half milk replacer, half goat milk, to decrease the cost of feeding animals. Goat’s milk that cannot be shipped to Vermont Butter and Cheese because of the colostrum to be given during the first three days of life can be stored in the freezer and given after a heat treatment (CAEV disease). Remark: In France, goat’s milk within the first seven days after kidding is not sold to any creamery thus colostrum and milk is feed to the new kids up to seven days of age. In this study, we used a full milk replacer feeding program for the new goat kids on the three sample farm sizes included in this study.

19

D. Feedstock To calculate the total feed needed per year per ration type, we need to consider consumption and feed waste per year. This waste of corn silage and hay is due to quality, feed selection, and other factors. Forages (grass & alfalfa hay) losses amount to 15%. However, some of this waste can be re-used as bedding. Corn Silage losses are generally 10% or more. (La Chèvre, 1991). However, we did not calculate any grain rejection. i.

Ration 1

Total Consumption (Lbs/goat/year)

Feedstock (US Ton) 100

ii.

400

Dairy Goat Pellet

468

23.4

46.8

93.7

Corn Silage

2510

126.6

276.1

552.1

Hay (grass)

910

48.2

104.7

209.3

Total

3888

198.2

427.6

855.2

Ration 2 Total Consumption (lbs/goat/year)

iii.

200

Feedstock (US Ton) 100

200

400

Dairy Goat Pellet

355

17.7

35.5

70.9

Barley

241

12.0

24.1

48.2

Corn

261

13.1

26.1

52.2

Haylage (Grass)

442

22.1

44.2

88.3

Hay (grass)

1111

55.5

111.1

222.2

Total

2409

120.5

240.9

481.9

Ration 3

Total Consumption (Lbs/goat/year)

Feedstock (US Ton) 100

Alfalfa Hay

950

54.6

200 109.3

Hay

803

46.2

92.4

167.9

Barley

576

28.8

57.6

104.6

Soybean

94

4.7

9.4

17.0

134.3

268.6

508.2

Total

2423

20

400 218.6

E. Feed costs Below are the prices per ton for feeds in Vermont and the surrounding states. Price ($ / US Ton)

Feed Forages and Silages Haylage (Grass) Hay (grass) Alfalfa Hay Corn Silage Grains

$50.00 $150.00 $175.00 $30.00

Barley Corn Dairy Goat Pellet

$150.00 $110.00 $235.00

Feed prices change often and you need to calculate your own cost accordingly. The prices above are realistic and we obtained them by consulting UVM professors, feed companies and farmers. Obviously, your situation may be different depending on the feed availability around your farm, purchasing in large quantity, type payment plan (prepayment, cash, check, payment upon delivery, deposit, 30 days, as you can, or bank payment check), season, and market fluctuation. In general, the more you buy and the closer payment is to “cash” prior to delivery the more discounts that are available to you.

21

i.

Goats (1) Ration 1

Total Consumption (Lbs/goat/year)

Price ($) / US Ton

468 2,510 910 3,888

$235.00 $30.00 $150.00

Dairy Goat Pellet Corn Silage Hay (grass) Total

Cost ($) per year $55.04 $37.64 $68.26 $160.95

(2) Ration 2 Total Consumption (Lbs/goat/year)

Price ($) / US Ton

Dairy Goat Pellet

355

$235.00

$41.68

Barley

241

$150.00

$18.07

Corn

261

$110.00

$14.36

Haylage (Grass)

442

$50.00

$11.04

1,111

$150.00

$83.32

Hay (grass) Total

2,409

Cost ($) per year

$168.46

(3) Ration

Alfalfa Hay Hay Barley Soybean Total

Total Consumption (Lbs/goat/year) 950 803 576 94 2,423

Price ($) / US Ton $175.00 $150.00 $150.00 $300.00

Cost ($) per year $83.15 $60.23 $43.17 $14.05 $ 200.60

22

ii.

Doelings and Kids

Kids are sold at one week old and that number of kids corresponding to 25 % of the herd size is kept at the farm for replacement. The milk replacer and the concentrate is a commercial feed available on Vermont farms. 100 Feed

Price ($) /US Ton

Quantity (US Ton)

Milk replacer Hay Concentrate

$3,170.00 $150.00 $74.43

0.37 7.20 2.60

Total cost

200 Costs ($) $1,161.67 $1,079.48 $193.22 $2,434.37

400

Quantity (US Ton)

Costs ($)

Quantity (US Ton)

0.73 14.39 5.19

$2,323.35 $2,158.95 $386.44

1.47 28.79 10.38

$4,868.74

Costs ($) $4,646.70 $4,317.90 $772.88 $9,737.48

F. Summary

Ration 1 + kids Ration 2 + kids Ration 3 + kids

100 Total Per goat Per cwt $19,930 $199 $12.74 $23,055 $231 $14.74 $24,646 $246 $15.76

200 Total Per goat Per cwt $39,860 $199 $12.74 $46,109 $231 $14.74 $49,291 $246 $15.76

400 Total Per goat Per cwt $79,720 $199 $12.74 $92,218 $231 $14.74 $98,582 $246 $15.76

Feed cost may reach as high as 50% of all expenses. In this paper, we found that it goes from 34% to 46%. However, in 2005 on the five sample farms in this study, the cost went from 18% to 30%. This difference may be explained by accrual adjustments such as inventorying how much was purchased vs. how much was fed throughout the year. To do the accrual adjustments farmers need to take a feed inventory at the beginning and at the end of the year as well as amount spent throughout the year. In addition, there may have been some minimal feeding outside of the barn, in exercise lots, and pastures. Decreased losses may have also attributed to this variance. Feed commodities prices fluctuate weekly and amount fed/herd throughout the year fluctuates. 2. Bedding A goat needs about 300 kg of straw as bedding & litter per year however most Vermont farmers use wood shavings as bedding. A survey (April 2006) shows that the price, in Vermont, for wood shavings goes from $200 to $300 per ton and the straw is more than $400 per ton. However, wood shavings availability is variable and is often an issue. Given the high price of straw as compared to wood shavings, the latter is used for goats in Vermont and we assume that 450 kg is needed per goat per year based on Vermont farm data available. Another source of litter is the hay waste. Wasted hay is roughly 15% of the total quantity distributed or 80 kg and most of it ends up at bedding. The cost would be $25/goat/year for a 100 dairy goat operation.

23

Typically, larger farms get a 10% discount on bedding costs thus the cost per goat and per year is $25 for a 100 goat operation, $22.50 for 200 goats and $20.25 for 400 goats.

Goat Herd (Head) Quantity (US Ton) Bedding Cost ($)

Dairy Goat Farm 100 200 400 37 75 148 $ 2,500 $ 4,500 $ 8,100

It is interesting to note that older information on bedding in other states show the cost of bedding much less than in Vermont. In fact, a New Jersey University Extension paper, published in 1996 showed a study mentioning a bedding cost at $7.5 per goat ($50 per ton of straw and 330 lbs per goat per year). The state of Pennsylvania published in 1998 showed a dairy goat budget giving the same amount of money per goat per year. Moreover, from $2.00 to 3.00 costs per head are taken into consideration on goat meat farm budget (University of Kentucky, Maryland Cooperative Extension). However, it is recognized that shavings cost have more than doubled since the 1990’s and one should expect these costs to be higher than in previous years. There may be room for improvement in this cost with proper management. 3. Vaccination and Health Care Goat health and vaccination programs differ from farm to farm and rely on historical performance at the farm but we found that a majority of people used the medicine mentioned below. No vaccination was required by the state of Vermont during the preparation of this paper, so procedures here are recommended by veterinarians in Vermont. Although animal identification is not a law at the time of this writing, it is highly recommended and benefits of animal identification far outweigh any minor costs for identification. Vaccination and medicines used include CD-T vaccines (Enterotoxemia and Tetanus), rabies, foot rot, deworming and mastitis. According to the field practices, kids are vaccinated twice against Enteroxemia and Tetanus. Against foot rot, kids and goats receive two shots and one shot respectively against rabies. Goats are also dewormed three times. Total cost for vaccines was $8.50. Mastitis, one of the most costly and damaging infections for goats, (as well as cows, and every other milk producing animal) costs $10.00 per head for treatment. We presume that mastitis will appear on every farm because of several things including environment (weather, stress, clean bedding…) and farm practices (pre-and post-dip teats, vacuum levels, changing inflations, stripping milk, …). Although the level of infection may be minimal or very high, the authors have set at the level of infection 5 % of the herd during a year when proper sanitation practices are used. That means, only five goats on 100 goats will have mastitis. Hoof trimming and dehorning costs are not included in Vet & Medicine cost as they are completed by the farmer, however not always. Thus, we have included 10% miscellaneous cost to the veterinary & medicines budget to cover these costs. More details on the vaccination program are available in the appendix section.

24

Unit

Dairy Goat Farm

Head $ Head $

100 $ 950 25 $ 125

200 $ 1,900 50 $ 250

400 $ 3,800 100 $ 500

Others (hoof trimming/dehorning)

$

$ 108

$ 215

$ 430

Total Cost Cost per Animal

$ $/Goat

$ 1,183 $ 11.8

$ 2,365 $ 11.8

$ 4,730 $ 11.8

Goats Replacement Kids

For the purposes of this paper, we assumed a constant cost per farm size. Although travel and time per goat costs may go down its anticipated that management factors may increase costs as the farm gets larger thus offsetting per goat savings. Our costs appear to be higher than other states however, those budgets were completed in the 1990’s and corrected for inflation those budgets may be comparable to ours in 2006. Meat goat data from University of Kentucky, Rutgers, and The Ohio State University show costs at $4.00 to $7.00 in the 1990’s. For a dairy goat operation, the University of Pennsylvania (http://pubs.cas.psu.edu/FreePubs/pdfs/ua260.pdf), in 1198, shows a $10.00/head cost. As a conclusion, the cost in this budget is higher than what the other states have taken into consideration. These disparities can be explained by higher standards of vaccination, care and 2006 pricing. Source: http://aede.osu.edu/Programs/FarmManagement/Budgets/AS-14-0211.pdf, www.sheepandgoat.com/spreadsheets/meatgoatbudget2004.xls agalternatives.aers.psu.edu/livestock/meatgoat/meat_goat.pdf www.uky.edu/Ag/AgEcon/pubs/software/GoatBudgets.xls.

25

4. Dairy Herd Improvement Association (DHIA) A. General DHIA is used to improve the farmer’s knowledge of individual and overall milk production (milk weight, protein, butterfat and somatic cells), herd age, breeding and kidding date and other records. These objectives allow higher profitability margins, animal selection and finally better management. The Vermont DHIA office has provided this information. The farmer has a wide range of options with DHIA services. However we assume the following options are used on the farm: • Milk weight/butterfat/protein/SCC tests • Sampling and recording made by a DHIA technician • Software PCDART (reports of individual animal: production, goats to kid, to dry off, to breed…) • Renting milk meters B. DHIA Monthly Cost Herd size Meters Standard cost (MW) MW + SCC MW/BF/Prot MW/BF/Prot/SCC MW/BF/Prot/SCC/MUN

100 8

200 16

400 24

$ 188. 24 $ 208. 24 $ 213. 24 $ 228. 24 $ 253. 24

$ 288. 32 $ 328. 32 $ 338. 32 $ 368. 32 $ 418. 32

$ 486. 00 $ 566. 00 $ 586. 00 $ 646. 00 $ 746. 00

MW: Milkweight, BF: ButterFat, Prot: Proteins, SCC: Somatic Cells Count, MUN: Milk Urea Nitrogen

As you can see there are plenty of options but for purposes of this paper we assumed that farmers chose milkweight/ butterfat/ protein/ somatic cells count as the standard package. The DHIA cost per year, as an example, for 100 goats, is $2,739($228.24 X 12 months). DHIA should be considered a long-term investment as well as a standard operating cost. It is also useful tool to take advantage of animal potential and to cull many undesirable animal traits. 5. Hauling Costs Hauling is provided by Pouliot & Corriveau for Vermont Butter and Cheese Company. The total hauling cost is shared between Vermont Butter and Cheese Company and farmers. Hauling costs are calculated by a stop charge depending on the farm location from Vermont Butter and Cheese Company and farm location, plus a charge per hundredweight. We also included the dues and promotion fee. For this paper, we assumed a $50 stop charge (20 miles from the plant) with a cost at $0.50 per hundredweight (cwt) of milk.

26

The milk promotion fee is a contribution to the Vermont milk industry promotion at 10 cents per cwt weight of milk. The funds are used to research and promote goat milk and goat milk products. Hauling

Herd size

Unit

100

200

400

Stop Charge

$

$5,200

$5,200

$5,200

Charge per Hundredweight

$

$807

$1,615

$3,230

Dairy Promotion Fee

$

$162

$323

$646

$ $/head

$6,169 $61.69

$7,138 $35.69

$9,076 $22.69

$/cwt

$3.82

$2.21

$1.40

Total Hauling Cost

Please note the “economies of scale” available at higher herd sizes. 6. Hired labor A Labor rate of $10 per hour for a hired person is used. It includes wage, Social Security and Medicare taxes, FICA, workman’s compensation and FUTA taxes where applicable. This may be different in your area. The time spent to milk goats is about 6 hours per day for the herd size listed with the parlors listed, however, your time may vary depending on number of goats milk, parlor size, procedures used, age of goats, and other factors. It also takes one hour per milking to clean the milking parlor, milk house, and milking equipment regardless of goat herd numbers. The second largest amount of time is spent feeding animals and then the third most time is goat management. Efficiencies in milking time can be made by increasing parlor size and automation of milking. Other efficiencies can be made with feeding by sizing the feed storage facility, utilizing mixer wagons, bucket tractors, and other mechanical means to reduce labor costs. We have seen cases where 400 goats can be milked in three hours per milking. The employee on a 400 goat operation typically milks the goats with the farm operator and provides many tasks such as feeding, breeding, goat management functions, and perhaps some building and machinery repair. Typically, a farm employee will work 50 – 60 hours a week with one – 1.5 days off/week. Although labor costs show $26,000/year additional costs may be “hidden” in benefits such as housing, insurance, produce and other items. 7. Supplies and Miscellaneous This line item typically contains a variety sort of expenses such as: neck chains - to identify animals, paper towels, pre & post teat dipping products, nipple buckets, expendables, outdoor supplies and other items that are used once and thrown away or have a life of less than one year. The financial data from four farms (excluding one because of the marketing costs included in this category) give a range from $29 to $49 per head. Chemicals were categorized separately and thus we used a $30/head average.

27

Milkhouse chemicals were estimated at $639, $735 and $865 for the 100, 200 and 400 goats herd respectively. These calculations show a price decrease per goat from $6.39 to $2.16. 8. Diesel, Fuels and Lube It is assumed that each farm has a tractor to distribute feed, clean barns and other activities. We assumed different horsepower tractors between the three farm sizes, 40, 60 and 80 HP for the 100, 200 and 400 goat dairies, respectively. No costs were associated with growing crops as the goat herds in the program did not raise crops and had minimal pasture. Typically, corn silage rations utilize the tractor more than with hay and haylage rations. Costs were one hour per day with corn silage and half hour per day with dry hay and haylage systems. Lubrication costs were allocated at 15% of the total fuel costs. Barn cleaning was performed every two weeks depending on weather, at two hours per cleaning or 50 hours per year. Additional uses for the tractor were also calculated at 50 hours per year. Consequently, tractor use may be from 282 hours per year to 467 hours per year depending on feeding type, size of operation, tractor size, and outside activities. Diesel price considered here is $3.00 per gallon due to the inflation, the 2005 price were $2.28 per gallon. The cost calculations have been made by using American Agricultural Economics Association ‘s method enclosed in the Commodity Costs and Returns Estimation Handbook (http://www.economics.nrcs.usda.gov/care/Aaea/ p.5-32 - 5-34) 100

200

400

Ration Corn Silage (1)

$ 2,823

$ 4,234

$ 5,645

Ration Hay and Haylage (2 and3)

$ 1,717

$ 2,575

$ 3,433

9. Utilities For this category, the cost ranged from $20 to $50 per goat and related to size. This category also includes the cost for electricity and business phone.

28

10. Repairs and Maintenance In this cost category, livestock buildings and equipment are included to estimate the yearly cost. Given the data of the five farms surveyed, a range per goat is from $156 to $6,660. Thus with this wide variation it shows the difficulty to estimate the yearly cost. However, Doane (Farm Management Guide, 1985) estimates repair and maintenance of buildings at 2-3% of original purchase or construction cost. Thus, we assumed an estimate for the cost of repairs and maintenance based on the value of the buildings and equipment rather than utilize the data provided by the sample farms. Value Buildings Milk Equipment Equipment Repairs and Maintenance

100 $85 520 $12 910 $12 000

200 $118 000 $22 600 $12 000

400 $199 040 $34 340 $50 000

$3 313

$4 578

$8 501

11. Taxes Real estate taxes vary from state to state and between towns. There are also Current Use Taxation Programs that allows the taxation of real estate based on its current agricultural or forestry use rather than its developmental possibilities. The following table has estimated taxes expense in this study: Value Surface (acre)

100 15

200 20

400 30

House (acre)

2

2

2

Farm (acre)

13

18

28

Acres Value ($) Buildings Value ($)

$ 65,000 $ 85,520

$ 90,000 $ 118,000

$ 140,000 $ 199,040

Taxes ($)

$ 4,515

$ 6,240

$ 10,171

Taxes are obtained by the following calculation: Taxes expense = (Acres Value + Buildings Value) * 3% The three percent value is the Vermont average tax factor in 2005. That means for each $100 building or acre value, $3 will correspond to the tax. Equipment is not subjected to the real estate taxes. 12. Interest and Principal The farm business expense interest corresponds to the farm mortgages or/and other obligations (loans) that you incur in your farm business. In Vermont, the interest rate is about 7% of the total loan value. We caution the reader to understand that the different assets are financed over a different period of time. Most of the time, loans on land and buildings assets are paid off over 20 years while equipment loans are on 7

29

years payback periods and livestock are financed over 5 years. Livestock can be financed over 3 or 7 years depending on the replacement rate. However, it is advisable to pay off the livestock mortgage at the same rate as animals are culled from the herd. Thus, a culling rate of 30% means that animals should be financed over 3 years whereas a cull rate of 20% means financing over 5 years. Generally, the greater the number of animals, the higher the debt, as financing becomes more a part of the overall business strategy. The smaller operations tend to have loans against the real estate but not against the goat herd itself. (Or at least not to the same level per goat as at the larger goat herds). Thus for the purposes of this paper we assumed that the 200 and 400 goat size herds are financed at the 50% level by the bank whereas the ownership of the small 100 goat operation is 100% by the owner and the land and equipment is financed at the 50% level. 100 200 400 Personally Owned Value Personally Owned Value Personally Owned Value Land + Buildings 50% $150,500 50% $208,000 50% $364,000 Equipments 50% $24,910 50% $34,600 50% $84,300 Livestock

100% $19,500

50% $39,000

50% $78,000

$194,910

$281,600

$526,000

Total Value

In this case, the interest rate chosen is 7%. Assets

Years

Land + Buildings Equipments

20 7

Livestock

5

100

200

400

Interest per Year Interest per Year Interest per Year $5,210 $827

Total

$6,037

$7,202 $1,148

$12,603 $2,797

$1,258

$2,516

$9,608

$17,916

Principal Assets

Years

Land + Buildings Equipments

20 7

Livestock

5

Total

100

200

400

Principal per Year Principal per Year Principal per Year $1,790 $1,429 $3,219

30

$2,474 $1,985

$4,330 $4,837

$3,375

$6,751

$7,835

$15,917

VI

Cash Flow Sheets

The following sheets show sample cash flows for the three example herd sizes taking into consideration the explanations provided above and factors provided throughout the paper. All aspects of the cash flow sheets are critical but it is especially important to see the variation shown between the feeding regimens outlined on page 22 and utilized in the cash flow sheets listed on page 32. We have found that its also useful to look at the goat operation on a per goat and per hundredweight (cwt) basis as no operation has exactly 100, 200, or 400 goats and no operation has goats producing exactly 1,700 lbs per goat. Thus by doing it on a per goat and per cwt. basis we allow the reader to look at comparisons that may more closely compare their operation to the scenario in this paper.

31

Item

Farm 1

Number of goats Pounds of Milk Sold Milk Price

Farm 2

Farm 3

100 156400 $35.08

200 312800 $35.08

400 625600 $35.08

CASH RECEIPTS Milk Sales Bonuses Goat Sales Kids, bucks, and other Livestock

$ 54,867 $ 6,262 $ 1,600 $ 1,328

$ 109,733 $ 12,523 $ 3,200 $ 2,540

$ 219,466 $ 25,046 $ 6,400 $ 4,980

Total Cash Receipts

$ 64,056

$ 127,996

$ 255,893

$ 2,500 $ 639 $ 2,739 $ 17,496 $ 20,620 $ 22,211 $ 2,434 $ 6,008 $ 2,823 $ 1,717 $ 2,533 $ 6,037

$ 4,500 $ 735 $ 4,420 $ 34,991 $ 41,240 $ 44,422 $ 4,869 $ 6,816

$ 8,100 $ 863 $ 7,752 $ 69,982 $ 82,481 $ 88,845 $ 9,737 $ 8,328

CASH EXPENSES Bedding Chemicals DHIA Ration 1 (Corn Silage) Ration 2 (Haylage) Ration 3 (Hay) Feeding Kids and replacement Freight and trucking Gasoline, fuel and oil Ration 1 Ration 2 – 3 Insurance (other than health) Interest Labor hired, pension and profit sharing Repairs and maintenance Taxes Utilities Veterinary fees and medicine Animal Purchased Supplies & Miscellaneous

$ $ $ $ $ $

3,313 4,516 3,000 1,300 1,000 3,000

$ $ $ $

4,234 2,575 3,286 9,608

$ $ $ $ $ $

4,578 6,240 6,000 2,600 1,750 6,000

$ 5,645 $ 3,433 $ 7,000 $ 17,916 $ 26,000 $ 8,311 $ 10,171 $ 12,000 $ 5,200 $ 3,250 $ 12,000

Total Cash Expenses Ration 1

$ 59,337

$ 100,627

$ 212,257

Ration 2

$ 61,355

$ 105,217

$ 222,543

Ration 3

$ 62,946

$ 108,399

$ 228,907

Ration 1

$ 4,720

$ 27,370

$ 43,636

Ration 2

$ 2,701

$ 22,779

$ 33,349

Ration 3

$ 1,110

$ 19,597

$ 26,985

Principal

$ 3,219

$ 7,835

$ 15,917

Net For Family Fiving Ration 1

$ 1,500

$ 19,535

$ 27,718

Net For Family Fiving Ration 2

$ (518)

$ 14,945

$ 17,432

Net For Family Fiving Ration 3

$ (2,109)

$ 11,763

$ 11,068

Net Cash Flow

32

Per Goat Basis Number of goats Pounds of Milk Sold Milk Price

Farm 1

Farm 2

Farm 3

100 1564 $ 35.08

200 1564 $ 35.08

400 1564 $ 35.08

CASH RECEIPTS Milk Sales Bonuses Goat Sales Kids, bucks, and other Livestock

$ 549 $ 63 $ 16 $ 13

$ 549 $ 63 $ 16 $ 13

$ 549 $ 63 $ 16 $ 12

Total Cash Receipts

$ 641

$ 640

$ 640

$ 25 $ 6 $ 27 $ 175 $ 206 $ 222 $ 24 $ 60

$ 23 $ 4 $ 22 $ 175 $ 206 $ 222 $ 24 $ 34

$ 20 $ 2 $ 19 $ 175 $ 206 $ 222 $ 24 $ 21

CASH EXPENSES Bedding Chemicals DHIA Ration 1 (Corn Silage) Ration 2 (Haylage) Ration 3 (Hay) Feeding Kids and replacement Freight and trucking Gasoline, fuel and oil Ration 1 Ration 2 – 3 Insurance (other than health) Interest Labor hired, pension and profit sharing Repairs and maintenance Taxes Utilities Veterinary fees and medicine Animal Purchased Supplies & Miscellaneous

$ $ $ $

28 17 25 60

$ $ $ $

21 13 16 48

$ $ $ $ $ $

33 45 30 13 10 30

$ 23 $ 31 $ 30 $ 13 $ 9 $ 30

$ 14 $ 9 $ 18 $ 45 $ 65 $ 21 $ 25 $ 30 $ 13 $ 8 $ 30

Ration 1

$ 593

$ 503

$ 531

Ration 2

$ 614

$ 526

$ 556

Ration 3

$ 629

$ 542

$ 572

Ration 1

$ 47

$ 137

$ 109

Ration 2

$ 27

$ 114

$ 83

Ration 3

$ 11

$ 98

$ 67

Principal

$ 32

$ 39

$ 40

Net for family living ration 1

$ 15

$ 98

$ 69

Net for family living ration 2

$ (5)

$ 75

$ 44

Net for family living ration 3

$ (21)

$ 59

$ 28

Total Cash Expenses

Net Cash Flow

33

Per CWT Basis Number of goats Pounds of Milk Sold Milk Price

Farm 1 100

Farm 2 200

Farm 4 400

$ 35.08

$ 35.08

$ 35.08

CASH RECEIPTS Milk Sales Bonuses Goat Sales Kids, bucks, and other Livestock

$ 35.08 $ 4.00 $ 1.02 $ 0.85

$ 35.08 $ 4.00 $ 1.02 $ 0.81

$ 35.08 $ 4.00 $ 1.02 $ 0.80

Total Cash Receipts

$ 40.96

$ 40.92

$ 40.90

CASH EXPENSES Bedding Chemicals DHIA Ration 1 (Corn Silage) Ration 2 (Haylage) Ration 3 (Hay) Feeding Kids and replacement Freight and trucking Gasoline, fuel and oil Ration 1 Ration 2 – 3 Insurance (other than health) Interest Labor hired, pension and profit sharing Repairs and maintenance Taxes Utilities Veterinary fees and medicine Animal Purchased Supplies & Miscellaneous X Total Cash Expenses

$ 1.60 $ 0.41 $ 1.75 $ 11.19 $ 13.18 $ 14.20 $ 1.56 $ 3.84 $ 0.00 $ 1.80 $ 1.10 $ 1.62 $ 3.86 $ 0.00 $ 2.12 $ 2.89 $ 1.92 $ 0.83 $ 0.64 $ 1.92

$ 1.44 $ 0.23 $ 1.41 $ 11.19 $ 13.18 $ 14.20 $ 1.56 $ 2.18 $ 0.00 $ 1.35 $ 0.82 $ 1.05 $ 3.07 $ 0.00 $ 1.46 $ 1.99 $ 1.92 $ 0.83 $ 0.56 $ 1.92

$ 1.29 $ 0.14 $ 1.24 $ 11.19 $ 13.18 $ 14.20 $ 1.56 $ 1.33 $ 0.00 $ 0.90 $ 0.55 $ 1.12 $ 2.86 $ 4.16 $ 1.33 $ 1.63 $ 1.92 $ 0.83 $ 0.52 $ 1.92

Ration 1

$ 37.94

$ 32.17

$ 33.93

Ration 2

$ 39.23

$ 33.64

$ 35.57

Ration 3

$ 40.25

$ 34.65

$ 36.59

Ration 1

$ 3.02

$ 8.75

$ 6.97

Ration 2

$ 1.73

$ 7.28

$ 5.33

Ration 3

$ 0.71

$ 6.27

$ 4.31

$ 2.06

$ 2.50

$ 2.54

Net Cash Flow

Principal Net for family living ration 1

$ 0.96

$ 6.69

$ 4.92

Net for family living ration 2

( 0.33 )

$ 5.22

$ 3.27

Net for family living ration 3

( 1.35 )

$ 4.21

$ 2.26

34

VII Discussion People interested in milking goats for sale to Vermont Butter and Cheese Company or doing something else, need to understand the crucial aspect of building a business plan and have a financial approach before proceeding with the operation. This document has been written as a guideline highlighting some areas that someone interested in goat has to think about. Our choice of building different operation sizes is to illustrate and demonstrate the possibilities of “economies of scale”. This does not mean that this will in fact include all the income and costs associated with each size nor are the authors pretentious enough to say that one size is better than another nor is goat farming always profitable or not. Moreover, this document does not say what is going to happen in your particular case. Every case is different and a business plan is needed to provide guidance, find Strengths, Weaknesses, Opportunities, Threats, (SWOT) to your business and to provide you with a road map to success. The assumptions made in this study are numerous and theoretically bring some errors. However, the assumptions have been made from published studies from France and U.S. as well as collected data from the sample farms. Unfortunately, there was a lack of statistically significant data from the field that explains the use of studies to expand on the data from the field. The absence of records on Vermont dairy goat farms is important to realize and thus in many cases we did not have actual data to back up the published data from France and U.S. There are unique financial data taken into consideration with this survey on Vermont Goat farms which are different or similar to other studies. For instance, goats in France are fed Alfalfa pellets, which is not done here, and Current Use Taxation is unique to Vermont. In addition, there are many other areas that are different. However, there are some areas of similarities including that: goats are productive (92%), 10% loss on kids, a 1.7 kidding rate per goat and a 1,700 lbs milk production per goat (which is reachable). The milk fluid income is based on the milk price from Vermont Butter and Cheese Company and shows that milk income represents 95% of the total farm income. By comparison, to the five farms, the milk receipts in this study are higher. It does not inevitably mean that the milk income is higher, it can be the animal sale income that would be underestimated or other sources of income are not utilized, for example: government payments for conservation practices. All the commercial dairy farms presented here, have the same level of production with an average payprice of $ 35.08 per hundredweight (cwt) and the same amount of total income per cwt at $ 40.79. Consequently, the biggest differences appear to be on the expense side and this study shows some economies of scale in the following costs: bedding, fuel, freight and trucking and chemicals. Not all dairy goat farm sizes have positive cash flows. In fact, the 100 dairy goat operation shows negative cash flow with two regimens while this with corn silage give a positive one’s. A 100 goat operation, in this study, shows a loss from $ 518 to $ 2,109 and at the same a profitability of $1,500 which is not sufficient to provide family living. The two other farm sizes appear more viable. Farmers may have enough net cash flow to pay their own wages either with 200 or 400 goats. At the maximum in the 200 goat case, the amount available for reinvestment, principal payments and owners draw (or salary) is $ 19,535 and for 400 goats, it is $ 27,718.

35

In comparing these theoretical farms by goat or per hundredweight basis, the 200 goat operation seems the most profitable one with $ 4.21 to $ 6.69 per hundredweight income translating $ 59 to $ 98 income per goat basis. Generally, the 200 and 400 goat operations are more profitable than the 100 dairy goat operation. Incomes can be increased by many different ways: 1. 2. 3. 4. 5. 6.

Improving the milk quality and quantity production levels Raising breeding stocks Selling semen surplus animals to others Other sources of incomes (governmental payment, dividends…) Synergistic effects can be had by combining 1-4 above Diversification of the operation to fully utilize resources

Expenses can be decreased in many different ways as well: Expenses can be improved by utilizing advantages surrounding your farm such as near a feed company, ease to find good quality and price for feed (hay, haylage…), possibilities to produce your own feed which cost less than to buy it, be close to Vermont Butter and Cheese Company (freight and trucking), and other expenses related to the assets. Expenses can also vary according to feed availability, quality forage land base, and management styles. Here, assets include buildings, milking equipments, livestock and one tractor of varying size with a bucket loader. The assets may be more or less different depending on what you own.

36

VIII Conclusion

This study shows the farm possibilities to produce and ship milk to Vermont Butter and Cheese Company in Websterville, Vermont. As this study shows a 100 goat operation is not profitable enough to provide a farm living income while bigger operations seem adequate to provide it. However, a small herd can be an interesting hobby to have another income and perhaps grow into a full time dairy goat operation. Nevertheless, a goat business, however as small as it is, must be assessed thanks to a business plan and a financial approach taking into consideration technical numbers, management styles, goals, and long-term vision of the owners.

37

References Books: BOSWORTH. S, 2006. Corn Silage Forage Quality in Vermont for 2005. http://pss.uvm.edu/vtcrops/articles/ForTestLab/HaylageSum1105.pdf BOSWORTH. S, 2006. Haycrop Silage Quality in Vermont 2005. http://pss.uvm.edu/vtcrops/articles/ForTestLab/CornSilageQuality05.pdf, 2005 Corn Silage COFFEY L., HALE M., WILLIAMS P., 2004. Dairy goats: Sustainable production. ATTRANational Sustainable Agriculture Information Service. p32. http://www.attra.org/attrapub/PDF/dairygoats.pdf COFFEY L., HALE M., WILLIAMS P., 2004. Dairy goats: Sustainable production overview. ATTRA-National Sustainable Agriculture Information Service. p24. http://www.attra.org/attrapub/PDF/goatoverview.pdf COFFEY L., REYNOLDS J., HALE M., 2004. Small ruminant sustainability checksheet. ATTRA-National Sustainable Agriculture Information Service. p44. http://www.attra.org/attrapub/PDF/ruminantcheck.pdf CORCY J-C., 1991. La Chèvre. Paris : La maison rustique, 255 p. DAWSON. L, 2006, Basic Goat Husbandry, 6 p. http://www2.luresext.edu/goats/library/field/dawson06.pdf DOANE. 1985. Farm Management Guide. “Farm Building Economics.”St. Louis, MO:

EIDMAN. V , HALLAM. A , MOREHART. M , KLONSKY. K , 2000. Commodity Costs and Returns Estimation Handbook. http://www.economics.nrcs.usda.gov/care/Aaea/ FARM FINANCIAL STANDARDS COUNCIL. 1997. Financial Guidelines for Agricultural Producers. 90p. GIRAUD D., KLONSKY K M., LIVINGSTON P., 2005. Sample costs for a 500 dairy goat operation. University of California Cooperative Extension. p14. http://coststudies.ucdavis.edu/uploads/new_cost_returns/dairygoatsnc05.pdf GUINAMARD. C, CARAMELLE-HOLTZ. E, BOSSIS. N, ANICAP, 2005. Pour une installation réussie en élevage caprin. Institut de l’élevage. P 124. ISBN n° 2-84148-132-8 INSTITUT DE L’ELEVAGE, February 2001. S’installer en élevage caprin. Repères pour une réussite. Institut de l’Elevage. P62.

38

KNAPP. J, 2003. Formulating and Evaluating Rations based on Metabilzable Energy and Metabolizable Protein Requirements for Lactating Goats. SARE Project: Implementing Goat Nutrition Programs for Improvement of Farm Sustainability. 6 p. Nutrient Requirement Calculators. http://www2.luresext.edu/goats/research/nutr_calc.htm REVEAU. A, FOUILLAND. C, LETOURNEAU. P, GUILLON. M.-P, BOSSIS. N, LARGEAU. C, CHERBONNIER. J, JENOT.F , LAURET. A, POUPIN. B. 1998. Les Batiments d’Elevage Caprin. L’éleveur de Chèvres. N°5. http://www.itplc.asso.fr/pdf/ELEVEUR_5-1.pdf VERMONT DAIRY GOAT PROMOTION BOARD and THE VERMONT DEPARTMENT OF AGRICULTURE, FOOD and MARKETS., 1995. Vermont Dairy Goat Manual. 18p. ZEISS. C, 2000. Vaccination in Goat Herds. 3p.

Contacts : AMERICAN DAIRY GOAT ASSOCIATION. [email protected]. SMITH. J. A&B Barns. [email protected]. http://www.abbarns.com PORTER. J. Dairy Specialist, University of New Hampshire Extension, Retired. [email protected]. DELANEY. C. Small ruminant Dairy Specialist. UVM University extension. [email protected]. BOSSIS. N. Regional Project Manager. Institut de l’Elevage. [email protected]. VIENS. .P. Nutrionist and Consulting. Quebec, Canada. Dr. MURPHY K. A.; Derby, VT. Dr. ROSSITER-BURHANS C, Newport, VT. Dr. MORASKA A. Charlotte, VT. Co-operative Insurance Company of Middlebury. 99 Washington. St Barre, VT 05641. Dairy Herd Improvement Association: NAULT. M. VT DHIA General Manager. DHIA. [email protected]. SCRUTON. D. Dairy Systems Coordinator, Milk Quality Enhancement, Dairy Management, Small Ruminent Dairying, Stray Voltage, Anaerobic Digesters. Vermont Agency of Agriculture. [email protected]. 39

Appendix Tables and Explanations

Table of Contents I

Milk Income ______________________________________________________________1 1.

Milk Production Calculation ______________________________________________1

2.

Over Quota Protein Level Calculation ______________________________________2

3.

Milk Payment___________________________________________________________3

4.

Bonus Payment _________________________________________________________3

II

Milk Income Summary______________________________________________________4 1.

100 Dairy Goat Operation ________________________________________________4

2.

200 Dairy Goat Operation ________________________________________________5

3.

400 Dairy Goat Operation ________________________________________________6

III

Milk Composition ________________________________________________________7

1.

Test Results on Protein Level (%) __________________________________________7

2.

Test Results on Butterfat Level (%) ________________________________________8

IV V

Milk MailBox Price ______________________________________________________9 DHIA Cost ______________________________________________________________10

VI

Animals Sales __________________________________________________________10

VII

Chemical Cost__________________________________________________________11

VIII

Vaccination Program ____________________________________________________12

IX

Kids and Yearling Feed Program __________________________________________13

1. A. B.

100 Dairy Goat Farm Operation __________________________________________13 Feed Quantity Used per Year ____________________________________________13 Yearly Cost for Raising Kids and Yearling _________________________________13

2.

200 Dairy Goat Farm Operation __________________________________________13 A. Feed Quantity Used per Year ____________________________________________13 B. Yearly Cost for Raising Kids and Yearlings_________________________________14

3.

400 Dairy Goat FarmOoperation__________________________________________14 A. Feed Quantity Used per Year ____________________________________________14 B. Yearly Cost for Raising Kids and Yearlings_________________________________14

X

Fuel, Diesel and Lube _____________________________________________________15

XI

Buildings Budget _______________________________________________________16

1.

Goats Requirements ____________________________________________________16

2.

Buildings Size and Budget _______________________________________________18

2

I

Milk Income

1. Milk Production Calculation It is assumed that the 92% of the goats produce in average of 1,700 lbs milk per year. With this starting assumption, we calculated the yearly milk production expected (Total). For example: a 100 goat operation normally has 92 goats in production at any one time. For a total yearly production of 170,000 lbs. However, one cannot say that the production will be 14167 lbs per month to get monthly production (170,000/12). In fact the monthly production will vary tremendously due to the seasonality effect of breeding and kidding. To make this clearer, we have outlined an example of the goat milk produced on a “real dairy goat farm”. The numbers below represent one producer who shipped milk year round from the study. You will note a large variation from an average monthly amount produced throughout the year. The total milk production for the year was 107,028, however 9,102 lbs. were shipped in January as opposed the calculated amount of 8,919 lbs (107,028/12). This variance becomes even more evident during the months of February, March, and December as outlined below. Month Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Total

Milk Production (lbs) 9102 5160 6203 8811 11209 10913 10100 9625 10367 9721 10402 5415 107028

% of production 8.50% 4.82% 5.80% 8.23% 10.47% 10.20% 9.44% 8.99% 9.69% 9.08% 9.72% 5.06% 100%

We also used averages for protein and butterfat levels based on production levels from each farm in the study. Vermont Butter and Cheese Company pays the dairy goat farms by protein but does vary payments based on milk quality. We did use their payment schedule and Vermont Butter and Cheese Company does test the milk for protein, butterfat, somatic cell counts (SCC), laboratory pasteurized count and PI counts from each shipment.

1

2. Over Quota Protein Level Calculation As it is mentioned in the VBCC Agreement, “the Quota Milk is considered as the total of all milk pickups made between 1. October 1st through January 31st or 2. November 1st through February 28th or 3. November 1st through March 31st whichever is the highest number. Milk purchased during this period is rated at $11.50 per pound of protein up to the limit set by the Quota Period, and $9.00 per pound of protein beyond the Quota limit.” Consequently it would be advantageous to the producer to increase the production of milk during those prices setting months and to match production to nearly meet quota during non-price setting months. Note: the price setting months have a different number of weeks in the period 17 – 15 - 22 weeks thus use the appropriate when calculating the quota lbs per month.

Month

Total Protein Shipped (lbs)

Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec

380.2 295.9 385.9 460.7 534.4 548.8 474.6 495.8 414.8 484.7 551.1 307.7

Quota Protein (lbs) 430.9 430.9 430.9 430.9 430.9 430.9 430.9 430.9

In the above scenario, we assumed that the previous year (2005) milk production was exactly same as the year 2006. Although that never happens it does provide a good example. Consequently, this farm shipped from October 1st 2005 to January 31st 2006, 1,723.70 lbs of protein for the 4 continuous months for a monthly quota of 430.93 lbs of protein. (484.7+551.1+307.7+380.2 = 1,723.7/4= 430.9 This number is higher than the monthly quota founded from 1st November through 31st March which is 386.16 lbs of protein (551.1+307.7+380.2+295.9+385.9) =1930.80/5 = 386.2) and the calculated number for November through February which is (551.1+307.7+380.2+295.9) =1930.80/4 = 482.7)

2

3. Milk Payment After this calculation, the quotas applied from 1st February to 31st September (or 1 April – 31 Oct. whichever is higher). The protein produced until the 432.9 lbs/month is reached would be paid at $11.50 per lbs of protein and beyond this limit of 432.9 lbs of protein /month is paid $9.00/lb of protein. Example:

Jan Feb Mar Apr

8.05 5.60 6.26 8.10

Milk Total Protein Quota protein production % Protein % Butterfat shipped (lbs) (lbs) 12,587 3.58 4.29 450.2 8,763 3.39 4.18 297.4 432.9 9,792 3.74 3.83 366.5 432.9 12,664 3.46 3.53 438.5 432.9

Incomes Bonuses $ 5,177.7 $ 3,419.7 $ 4,214.4 $ 4,928.0

$ 659.4 $ 302.3 $ 337.8 $ 436.9

Price per Cwt $ 46.37 $ 42.47 $ 46.49 $ 42.36

For the month of January, 450.2 lbs of protein have been shipped, given the milk production is in the quota period, the milk income is $11.5 X 450.2 = $5,177.70. For the month of April, non-quota period, 438.5 lbs of protein have been produced, with an over quota level of 5.6 lbs, we come up with (432.9 lbs X $11.5/lb) + (5.6 lbs X $9.00) = $ 4,928. 4. Bonus Payment The bonus rate is $3.45 per cwt of milk; therefore for 100 goats which produce 156,400, the farm earns a total of $6,162.6. Moreover, a winter premium is paid for the quota period (October 1st through January 31st) at $0.50 per pound of protein.

3

II

Milk Income Summary

1. 100 Dairy Goat Operation %

Milk Production (lbs)

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

8.05 5.60 6.26 8.10 10.07 10.72 10.07 9.14 8.43 7.99 10.12 5.45

12,587 8,763 9,792 12,664 15,755 16,761 15,742 14,295 13,179 12,498 15,835 8,527

Total

100.00

156,400

Number of Goats Goats Productive (92%) Average Milk Production (lbs/day)* Total Production per Goat (lbs) Total Production (lbs)

* On 300 days lactation basis

% Protein

100 92 5.67 1,700 156,400

% ButterFat Total Protein Shipped

3.58 3.39 3.74 3.46 3.20 3.09 2.98 2.89 2.93 3.68 3.37 3.37

4.29 4.18 3.83 3.53 3.70 3.54 3.42 3.35 3.53 3.47 3.41 3.57

Quota Protein (lbs)

450.2 297.4 366.5 438.5 503.5 518.5 468.6 413.0 385.7 459.8 534.0 287.5

432.9 432.9 432.9 432.9 432.9 432.9 432.9 432.9

$ 5,177.7 $ 3,419.7 $ 4,214.4 $ 4,928.0 $ 4,342.4 $ 4,207.6 $ 4,656.6 $ 4,749.0 $ 4,435.9 $ 5,288.0 $ 6,140.7 $ 3,306.6

$ 659.4 $ 302.3 $ 337.8 $ 436.9 $ 543.6 $ 578.3 $ 543.1 $ 493.2 $ 454.7 $ 661.1 $ 813.3 $ 437.9

Price per Cwt $ 46.37 $ 42.47 $ 46.49 $ 42.36 $ 31.01 $ 28.55 $ 33.03 $ 36.67 $ 37.11 $ 47.60 $ 43.91 $ 43.91

$ 54,866.6

$ 6,261.6

$ 39.96

Income

Bonuses

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

8.05 5.60 6.26 8.10 10.07 10.72 10.07 9.14 8.43 7.99 10.12 5.45

12,587 8,763 9,792 12,664 15,755 16,761 15,742 14,295 13,179 12,498 15,835 8,527

$ 450 $ 400 $ 400 $ 450 $ 450 $ 450 $ 450 $ 450 $ 450 $ 400 $ 450 $ 400

$ 62.94 $ 43.82 $ 48.96 $ 63.32 $ 78.78 $ 83.81 $ 78.71 $ 71.47 $ 65.89 $ 62.49 $ 79.18 $ 42.63

$ 4.075 $ 5.064 $ 4.585 $ 4.053 $ 3.356 $ 3.185 $ 3.359 $ 3.648 $ 3.915 $ 3.700 $ 3.342 $ 5.191

Promotion Fees $ 13 $9 $ 10 $ 13 $ 16 $ 17 $ 16 $ 14 $ 13 $ 12 $ 16 $9

Total

100.00

156,400

$ 5200

$ 782.00

$ 3.956

$ 156

%

Milk Production (lbs) Stop Charge Charge per cwt Hauling Cost/Cwt

4

2. 200 Dairy Goat Operation %

Milk Production (lbs)

% Protein

% ButterFat Total Protein Shipped Quota Protein (lbs)

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

8.05 5.60 6.26 8.10 10.07 10.72 10.07 9.14 8.43 7.99 10.12 5.45

25,175 17,527 19,584 25,329 31,511 33,522 31,484 28,590 26,357 24,997 31,670 17,054

3.58 3.39 3.74 3.46 3.20 3.09 2.98 2.89 2.93 3.68 3.37 3.37

4.29 4.18 3.83 3.53 3.70 3.54 3.42 3.35 3.53 3.47 3.41 3.57

Total

100.00

312,800

3.31

3.65

Number of Goats Goats Productive (92%) Average Milk Production (lbs/day)* Total Production per goat (lbs) Total Production (lbs)

* On 300 days lactation basis

200 184 5.67 1,700 312,800

900.5 594.7 732.9 877.0 1,007.1 1,037.0 937.3 825.9 771.5 919.7 1,067.9 575.1

865.8 865.8 865.8 865.8 865.8 865.8 865.8 865.8

$ 10,355.4 $ 6,839.4 $ 8,428.9 $ 9,855.9 $ 8,684.7 $ 8,415.2 $ 9,313.2 $ 9,498.0 $ 8,871.8 $ 10,576.0 $ 12,281.4 $ 6,613.2

$ 1,318.8 $ 604.7 $ 675.7 $ 873.8 $ 1,087.1 $ 1,156.5 $ 1,086.2 $ 986.3 $ 909.3 $ 1,322.2 $ 1,626.6 $ 875.9

Price per Cwt $ 46.37 $ 42.47 $ 46.49 $ 42.36 $ 31.01 $ 28.55 $ 33.03 $ 36.67 $ 37.11 $ 47.60 $ 43.91 $ 43.91

$ 109,733.1

$ 12,523.2

$ 39.96

Income

Bonuses

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

8.05 5.60 6.26 8.10 10.07 10.72 10.07 9.14 8.43 7.99 10.12 5.45

25,175 17,527 19,584 25,329 31,511 33,522 31,484 28,590 26,357 24,997 31,670 17,054

$ 450 $ 400 $ 400 $ 450 $ 450 $ 450 $ 450 $ 450 $ 450 $ 400 $ 450 $ 400

$ 125.87 $ 87.63 $ 97.92 $ 126.64 $ 157.55 $ 167.61 $ 157.42 $ 142.95 $ 131.79 $ 124.98 $ 158.35 $ 85.27

$ 2.288 $ 2.782 $ 2.542 $ 2.277 $ 1.928 $ 1.842 $ 1.929 $ 2.074 $ 2.207 $ 2.100 $ 1.921 $ 2.846

Promotion Fees $ 25 $ 18 $ 20 $ 25 $ 32 $ 34 $ 31 $ 29 $ 26 $ 25 $ 32 $ 17

Total

100.00

312,800

$ 5,200

$ 1,564.00

$ 2.228

$ 313

%

Milk Production (lbs) Stop Charge Charge per cwt Hauling cost/cwt

5

3. 400 Dairy Goat Operation %

Milk Production (lbs)

% Protein

% ButterFat Total Protein Shipped Quota Protein (lbs)

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

8.05 5.60 6.26 8.10 10.07 10.72 10.07 9.14 8.43 7.99 10.12 5.45

50,350 35,054 39,169 50,657 63,022 67,044 62,968 57,179 52,715 49,994 63,341 34,108

3.58 3.39 3.74 3.46 3.20 3.09 2.98 2.89 2.93 3.68 3.37 3.37

4.29 4.18 3.83 3.53 3.70 3.54 3.42 3.35 3.53 3.47 3.41 3.57

Total

100.00

625,600

3.31

3.65

1,800.9 1,189.5 1,465.9 1,753.9 2,014.2 2,074.1 1,874.5 1,651.8 1,542.9 1,839.3 2,135.9 1,150.1

* On 300 days lactation basis

400 368 5.67 1,700 625,600

Bonuses

Price per cwt

$ 20,710.8 $ 13,678.8 $ 16,857.8 $ 19,711.8 $ 17,369.5 $ 16,830.4 $ 18,626.3 $ 18,996.0 $ 17,743.6 $ 21,152.0 $ 24,562.7 $ 13,226.5

$ 2,637.5 $ 1,209.4 $ 1,351.3 $ 1,747.7 $ 2,174.3 $ 2,313.0 $ 2,172.4 $ 1,972.7 $ 1,818.7 $ 2,644.4 $ 3,253.2 $ 1,751.8

$ 46.37 $ 42.47 $ 46.49 $ 42.36 $ 31.01 $ 28.55 $ 33.03 $ 36.67 $ 37.11 $ 47.60 $ 43.91 $ 43.91

$ 219,466.3

$ 25,046.3

$ 39.96

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

8.05 5.60 6.26 8.10 10.07 10.72 10.07 9.14 8.43 7.99 10.12 5.45

50,350 35,054 39,169 50,657 63,022 67,044 62,968 57,179 52,715 49,994 63,341 34,108

$ 450 $ 400 $ 400 $ 450 $ 450 $ 450 $ 450 $ 450 $ 450 $ 400 $ 450 $ 400

$ 251.75 $ 175.27 $ 195.84 $ 253.29 $ 315.11 $ 335.22 $ 314.84 $ 285.90 $ 263.57 $ 249.97 $ 316.70 $ 170.54

$ 1.394 $ 1.641 $ 1.521 $ 1.388 $ 1.214 $ 1.171 $ 1.215 $ 1.287 $ 1.354 $ 1.300 $ 1.210 $ 1.673

Promotion Fees $ 50 $ 35 $ 39 $ 51 $ 63 $ 67 $ 63 $ 57 $ 53 $ 50 $ 63 $ 34

Total

100.00

625,600

$ 5,200

$ 3,128.00

$ 1.364

$ 626

% Number of Goats Goats Productive (92%) Average Milk Production (lbs/day)* Total Production per Goat (lbs) Total Production (lbs)

1,731.6 1,731.6 1,731.6 1,731.6 1,731.6 1,731.6 1,731.6 1,731.6

Income

Milk Production (lbs) Stop Charge Charge per cwt Hauling cost/cwt

6

III

Milk Composition

1. Test Results on Protein Level (%) Below are listed the protein test results of milk shipped to VBCC in 2005. The protein rate is not true protein, but crude protein. Farms are randomized by number to protect individual farms. Vermont Butter and Cheese Company pays the producers by the pounds of protein produced. Obviously, the milk production is also a crucial factor since total lbs. of protein produced is related to total milk produced.

Number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Average

Jan 3.31 3.35 3.29 3.51 2.82 3.43 3.39 3.42 3.41 3.53 3.84 4.25 3.40 3.35 3.44 3.21 3.92 3.26 3.62 3.89

3.58

Feb 3.59 3.27 3.04 3.74 3.53 2.63 3.37 3.37 3.12 3.33 3.37 3.34

Mar 3.59 3.95 3.45 3.53 3.98 3.04 4.37 4.01 3.41 3.68 4.07 3.48

4.37 3.45 2.77 3.37 3.37 3.41 3.42 3.37 3.32 3.37

3.39

May 3.03 3.13 2.87 3.01 3.28 3.47 4.37 3.03 3.12 3.09 3.09 3.11 3.03 3.20 3.17 3.19 2.98 3.64 3.11 3.19 3.25 3.11

Jun 2.87 2.94 2.85 2.94 3.22 3.14 4.37 2.87 3.02 3.22 3.03 3.03

Jul 2.82 2.68 2.71 2.91 3.11 3.03 4.37 2.82 2.94 2.84 2.92 2.97

4.03 3.83 2.80 3.66 4.00 3.75 3.36 3.74 3.68

Apr 2.99 3.69 3.25 3.25 3.78 3.36 4.37 3.58 3.36 3.44 3.35 3.43 3.57 3.67 2.88 3.04 3.94 3.40 3.67 3.53 3.42 3.12

2.96 2.87 2.95 2.85 3.60 3.03 2.96 3.20 3.09

2.81 2.78 2.83 2.81 3.51 2.99 2.86 3.12 2.94

3.47

3.47

3.68

2.96

2.83

3.74

3.46

3.20

3.09

2.98

7

Aug 2.99 2.72 2.79 2.98 3.10

Sep 2.92 2.74 2.73 2.96 3.11

Oct 2.92 4.01 3.46

2.68 2.89 2.95 2.80 2.97 3.10

2.70 2.82 3.01 2.96 3.08 3.23

4.23 2.97 4.37 3.83 3.77 2.39 4.56 3.00

2.79 2.83 2.99 2.81 3.66 3.00 2.89 3.13 2.82 2.79

2.86 2.93 2.82 2.93 3.77 3.02 3.00 3.33 2.87 2.99

4.32 4.00 3.57 4.18 3.23 4.65 3.84 4.64 4.35 3.82

2.81 2.89

2.93 2.93

2.93 3.68

Nov 3.29 3.39 2.91 3.37 3.38 3.51 3.08 3.28

Dec 3.29 3.39 2.91 3.37 3.38 3.51 3.08 3.28

3.50 3.91

3.50 3.91

3.73 3.47 2.93 3.69

3.73 3.47 2.93 3.69

3.79 3.39 3.72 3.57 3.47

3.79 3.39 3.72 3.57 3.47

3.69 3.37

3.83 3.37

Average 3.13 3.27 3.02 3.21 3.47 3.15 3.71 3.26 3.21 3.18 3.48 3.25 3.61 3.49 3.25 3.02 3.34 3.61 3.45 3.29 3.54 3.31 3.32 3.28 3.24 3.31

2. Test Results on Butterfat Level (%) Below are the butterfat results from producers shipping to VBCC in 2005. Even though Vermont Butter and Cheese Company does not pay by the butterfat rate it can be interesting to know its evolution which can help to figure out a problem. Number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Average

Jan 3.69 4.18 4.22 4.38 3.57 4.43 4.35 4.65 4.19 4.38

4.77 4.38 4.38 3.93 4.75 3.18 4.25 5.13

4.27

Feb 4.04 3.84 3.74 5.20 4.71 2.98 4.19 4.34 3.84 4.10 4.19 3.97

Mar 4.04 3.74 3.50 3.63 4.01 2.99 5.44 4.01 3.48 3.75 4.23 3.39

5.44 4.41 3.25 4.19 4.19 4.59 4.29 4.19 4.15 4.19

4.18

May 3.53 3.88 3.20 3.63 4.24 3.45 5.44 3.83 3.59 3.55 3.52 3.56 3.07 3.50 3.66 3.59 3.63 4.27 3.58 4.06 3.78 3.60

Jun 3.31 3.41 3.10 3.36 4.16 3.63 5.44 3.71 3.53 3.33 3.55 3.27

Jul 3.06 3.18 2.95 3.37 3.92 3.48 5.44 3.55 3.35 3.67 3.19 3.25

4.26 3.88 2.59 3.64 4.17 3.80 4.35 3.93 3.78

Apr 3.32 3.75 3.27 3.41 3.87 3.80 5.44 3.65 3.38 3.35 3.36 3.47 3.64 3.85 3.45 2.87 3.98 3.46 3.69 3.67 3.45 1.51

3.27 3.33 2.90 3.28 4.07 3.37 3.71 3.58 3.59

3.18 3.00 2.86 3.27 4.08 3.38 3.37 3.44 3.54

3.60

3.60

2.98

3.05

2.81

3.83

3.53

3.70

3.54

3.42

8

Aug 3.04 3.03 3.22 3.46 3.85

Sep 3.14 3.11 3.29 3.75 3.96

Oct 3.14 3.39 2.99

3.49 3.27 3.42 3.50 3.24 3.26

3.56 3.37 3.58 3.79 3.74 3.60

3.31 3.57 5.44 3.23 4.41 2.02 3.82 3.52

3.20 3.18 3.09 3.40 4.06 3.42 3.24 3.54 3.46 2.94

3.50 3.38 3.40 3.34 4.41 3.55 3.52 3.81 3.85 3.12

3.63 3.36 3.11 3.61 3.60 3.80 3.25 3.73 3.45 3.30

3.35

2.85 3.53

2.85 3.48

Nov 3.14 3.31 3.51 4.19 4.41 3.80 3.63 3.11

Dec 3.14 3.31 3.51 4.19 4.41 3.80 3.63 3.11

3.39 2.02

3.39 2.02

3.73 3.82 2.99 3.61

3.73 3.82 2.99

3.45 3.61 3.30 3.23 3.36

3.45 3.61 3.30 3.23 3.77

2.85 3.42

4.81 3.54

Average 3.38 3.51 3.37 3.82 4.10 3.51 4.63 3.63 3.72 3.50 3.44 3.48 3.35 3.84 3.64 3.17 3.62 4.11 3.60 3.74 3.76 3.40 3.45 3.21 3.34 3.65

IV

Milk MailBox Price

Lbs $ $

Herd size 100 200 400 156,400 312,800 625,600 $ 54,866.6 $ 109,733.1 $ 219,466.3 $ 6,261.6 $ 12,523.2 $ 25,046.3

Total Incomes

$ $/Head $/cwt

$ 61,128.2 $ 122,256.3 $ 244,512.6 $ 611.3 $ 611.3 $ 611.3 $ 39.1 $ 39.1 $ 39.1

Hauling

Unit

Milk incomes Milk production Incomes Bonus

Unit

Herd size 100 200 $ 5,200 $ 5,200

400 $ 5,200

Stop Charge

$

Charge per cwt

$

$ 782

$ 1,564

$ 3,128

Milk promotion fee

$

$ 156

$ 313

$ 469

$ 6,138 $ 61.38 $ 3.92

$ 7,077 $ 35.38 $ 2.26

$ 8,797 $ 21.99 $ 1.41

Total Hauling cost

$ $/Head $/cwt

Milk Box

Unit

Milk Production Incomes (Sales + Bonus) Hauling

Lbs $ $

Herd size 100 200 400 156,400 312,800 625,600 $ 61,128.2 $ 122,256.3 $ 244,512.6 $ 6,138 $ 7,077 $ 8,797

$ $/Head $/cwt

$ 54,989.8 $ 115,179.5 $2 35,715.4 $ 549.9 $ 575.9 $ 589.3 $ 35.2 $ 36.8 $ 37.7

Total

Those numbers show incomes from $35.2 to $37.7 per hundredweight. Those numbers have been forecasted and by comparison, to the data on the field, we found that milk mailbox price is from $27 to $32 (2005 milk price). The milk price in 2005 was not the same as used in this study. In this study the milk price used is $11.50 per pound of protein and $9.00 while in 2005, it was $10.50 and $8.00. In order to compare the milk mailbox price excluding the milk quality, five dairy goat farms show us that milk mailbox price goes from $25 to $29 per cwt while in our calculation milk mailbox price income goes from $31 to $33.7/cwt. This marked difference is due to the level of milk production and the milk quality. Hauling goat milk is costly, given a stop charge fee, thus an economy of scale can be expected. In fact, a higher milk production allows having a higher milk mailbox price income

9

V

DHIA Cost

Monthly Costs Herd size Meters

100 8

Total Standard cost (MW) MW + SCC MW/BF/Prot MW/BF/Prot/SCC MW/BF/Prot/SCC/MUN

$ $ $ $ $

200 16

188.24 208.24 213.24 228.24 253.24

$ $ $ $ $

288.32 328.32 338.32 368.32 418.32

400 24 $ $ $ $ $

486.00 566.00 586.00 646.00 746.00

These costs include Technician fees and overhead costs, CMS fees (Benefit for DHIA), Meter fees, State fees (membership), DRMS fees and the option (tests performed).

VI

Kids (1week old) Cull animals (does) Bucks Income (400 hs*) Income (200 hs*) Income (100 hs*)

$4 $ 48 $ 80

$5 $ 52 $ 85

$ 7,680 $ 3,880 $ 1,904

$ 8,605 $ 4,345 $ 2,135

Animals Sales

$6 $ 56 $ 90

Market Price $7 $8 $ 60 $ 64 $ 95 $ 100

$9 $ 68 $ 105

$ 10 $ 72 $ 110

$ 11 $ 76 $ 115

$ 12 $ 80 $ 120

$ 9,530 $ 10,455 $ 11,380 $ 12,305 $ 13,230 $ 14,155 $ 15,080 $ 4,810 $ 5,275 $ 5,740 $ 6,205 $ 6,670 $ 7,135 $ 7,600 $ 2,366 $ 2,597 $ 2,828 $ 3,059 $ 3,290 $ 3,521 $ 3,752

*hs = Heads

The calculation for raising breeding stock has not been assessed. It would seem important to raise breeding stock not only for the farmer who raises them to increase his income but also to provide goats to people who is interested in buying them. The sale of breeding stocks may be an excellent source of additional income since finding quality replacement goats are an issue.

10

VII Chemical Cost These costs have been calculated for the chemical products used to clean and wash the milking machines, pipelines and other milkhouse & parlor equipment. As we mentioned earlier the milking parlor size are not always the same, and we assume that 8 stalls, 12 stalls and 24 stalls are used for 100, 200 and 400 goats respectively. (double 4, 6 and 12 parlor). Consequently, the quantity of water used to wash and clean the equipment are not the same.

Products Alkaline Acid wash Sanitizer

100 200 Price Concentration Water per oz Water system Cost (Gal) system (Gal) 0.25% $ 0.047 20 $ 219.58 23 0.15% $ 0.116 20 $ 325.17 23 0.18% $ 0.028 20 $ 94.19 23

Cost

$ 638.94

400 Water system (Gal) $ 252.52 27 $ 373.95 27 $ 108.32 27

Cost

$ 734.78

Cost $ 296.44 $ 438.98 $ 127.15 $ 862.57

Example of how we have calculated the quantity of water used. An example calculation for a double 6 parlor with 12 units.

Item

Gallons of Wash Solution Required

Pipeline, 80 feet, 2” 80’ @ 7’/gal = 11.4 gal 11.4/2 {50%} Receiver, 15 gal 15/2 {50%} Trap, 3 gal 3/2 {50%} Discharge pipe, 50 feet, 1-1/2” 50’ @ 13’/gal = 3.9 gal 3.9 {100%} Washpipe, 50 feet, 1.5” 50’ @ 13’/gal=3.9 gal 3.9/2 {50%} Sub total Add 10% (sink) Total

= = = = =

5.7 7.5 1.5 4.0 2 20.7 2.1 22.8

Liters

21.7 28.5 5.7 15.2 7.5 78.6 7.9 86.5

Calculation made by Daniel Scruton at the Vermont Department of Agriculture and Debbie Miller (Vermont Butter and Cheese Company)

11

VIII Vaccination Program

Kids

Disease Enterotoxemia (overeating disease) Tetanus Enterotoxemia (overeating disease) Tetanus Rabies

Age

Doses

2-3 months old (weaning period)

1

$ 0.50

1

$ 0.50

1

$ 2.00

2

$ 2.00

1

$ 0.50

3

$ 4.50

2 1

$ 2.00 $ 2.00 $ 10.00

4-6 weeks later After weaning

Foot rot

Goat

Enterotoxemia (overeating disease) Tetanus Deworming Foot rot Rabies Mastitis

12

Price per animal

IX

Kids and Yearling Feed Program

1. 100 Dairy Goat Farm Operation A. Feed Quantity Used per Year

Animal Feed

Kids until 1 week

Quantity Quantity per per Year Quantity per day Year (lbs) (lbs) 87 246 14,393 5,192

Quantity per day (Oz)

Milk Replacer Hay Concentrate

Replacement kids

40.00

Year Quantity (US Ton) 0.37 7.20 2.60

B. Yearly Cost for Raising Kids and Yearling

100 Feed Milk replacer Hay Concentrate

Price/Ton $3,170.00 $150.00 $74.43

Total cost

Qty (Ton) 0.37 7.20 2.60

Expenses (USD) $1,161.67 $1,079.48 $193.22 $2,434.37

2. 200 Dairy Goat Farm Operation A. Feed Quantity Used per Year

Animal Feed Milk Replacer Hay Concentrate

Kids until 1 week Quantity per day (Oz) 40.00

Replacement kids Quantity Quantity per per Year Quantity per day Year (lbs) (lbs) 174 492 28,786 10,384

13

Year Quantity (ton) 0.73 14.39 5.19

B. Yearly Cost for Raising Kids and Yearlings 200 Feed Milk replacer Hay Concentrate

Price/Ton

Quantity (US Ton)

$3,170.00 $150.00 $74.43

0.73 14.39 5.19

Cost ($) $2,323.35 $2,158.95 $386.44

Total cost

$4,868.74

3. 400 Dairy Goat Farm Operation A. Feed Quantity Used per Year Animal Feed

Kids until 1 week Quantity per day (Oz)

Milk Replacer Hay Concentrate

40.00

Replacement kids Quantity Quantity per per Year Quantity per day Year (lbs) (lbs) 348 984 57,572 20,768

B. Yearly Cost for Raising Kids and Yearlings 400 Feed Milk replacer Hay Concentrate

Price/Ton

Quantity (US Ton)

$3,170.00 $150.00 $74.43

1.47 28.79 10.38

Total cost

Cost ($) $4,646.70 $4,317.90 $772.88 $9,737.48

14

Year Quantity (US Ton) 1.47 28.79 10.38

X

Fuel, Diesel and Lube

The cost calculations have been made by American Agricultural Economics Association ‘s method enclosed in the Commodity Costs and Returns Estimation Handbook (http://www.economics.nrcs.usda.gov/care/Aaea/ p.5-32 - 5-34). We assume that with the corn silage ration, tractor is used more than the other rations. Therefore, concerning the transportation feed, we assume a one-hour use per day for using corn silage while the others use only half an hour per day. To clean the barn, farmers clean and remove manure every 2 weeks depending on weather, we assume here, a 2 hours every 2 weeks spending to clean the barn and a 50 hours per year for other use. Consequently, for a farm that uses corn silage tractor runs during 467 hours per year whereas a farm which uses other feeds spend 282 hours per year. Example: Ration 1, 100 goats Diesel (GPH) = 0.06 * (PTO max) * (0.73) Diesel (GPH) = 1.75 gallon per hour Consumption per year = Diesel * Total hours (feed, clean and other) Consumption per year = 1.75 * 467 Consumption per year = 817/25 gallons per year Price per year 2006 = 300 cts/gallon Cost fuel tractor per year = $ 2,455 The cost of lubrification is around 15% of the total cost of fuel (for only the cost coming from the tractor). We assume that the annual cost is $368 (including filters are changed every other oil change).

100

200

400

Ration Corn Silage (1)

$ 2,823

$ 4,234

$ 5,645

Ration Hay and Haylage (2 and3)

$ 1,717

$ 2,575

$ 3,433

15

XI

Buildings Budget

1. Goats Requirements We budgeted the cost for new buildings but most of the time, the existing barns can be modified and adjusted for goats without losing sight of the goats housing requirements. This will cut the cost of the investment. 1 Meter = 3.281 Feet 1 Square Meter = 10.76 Square Feet Assumptions Animals Goats Bucks Doelings Kids Housing Requirements Goat Animals Added Air per Goat Space per Goat Feeder per Goat Alley Way Housing Requirements Doelings Space per Doeling Feeder per Doeling Alley Way

Unit Head Head Head Head

Unit Head Cubic meter Square foot Meter Meter

Unit Square foot Meter Meter

Herd size 200 20 50 312

100 10 25 156

100 120 7 20 0.33 2

Herd size 200 240 7 20 0.33 2

Herd size 100 200 10.7 10.7 0.25 0.25 2 2

400 40 75 625

400 420 7 20 0.33 2

400 10.7 0.25 2

It is recommended having around 1.5 square meter per goat but we assumed a larger space of 2 square meters (20 square feet), 1 square meter (10 square feet) for doeling and 3 kids per square meter. For bucks, we assumed that the required space is 30 square feet. No information has been found on the bucks housing cost and requirements. The goat flows fluctuate during the year there are more or less animals sometimes therefore to prevent these periods 20% of all the herd has to be added in order to calculate the total animals space needed. For the feed way in the buildings, we assumed that 2 meters allow to unroll hay (for round bales), to spread easier feeds and to observe animals without needs to enter in the pen.

16

Housing needs

Goats Air Space Feeder Space for Feeder or Alley Way

Head Cubic meter Square foot Meter Square Foot

700 2,400 17 355

Herd size 200 1,400 4,800 33 710

400 2,800 7,200 66 1,420

2,755 256

5,510 512

8,620 801

100

Total Space

Square Foot Square Meter

Bucks Air Feeder or Alley Way Space

Head Cubic meter Meter Square Foot Square Meter

10

Head Cubic meter Square Foot Meter Square Foot

25

Doelings Air Space Feeder Space for feeder Total Space

Kids Space Feeder or alley way Total Space

Total Surface

20 50 1 300 28

40 100 1 600 56

50

200 1 1,200 112

100

175 323 0.25 67

350 646 0.25 135

700 1,291 0.25 269

390 36

780 73

1,560 145

468 1

936 1

625 1,875 1

Square Foot Square Meter

468 43

936 87

1,875 174

Square Foot Square Meter

3,913 364

7,826 727

13,256 1,232

Square Foot Square Meter Head Square foot Meter

17

165

325

2. Buildings Size and Budget Buildings Main Barn (Goats) Length Width Height Milk House Length Width Cost (Main Barn + Milk House) Materials Labor Total

Unit Feet Feet Feet

100 70 40 12

Herd size 200 90 60 12

400 75 & 90 40 & 60 12

Feet Feet

30 14

36 14

35 20

$48,000 $34,000 $82,000 $820

$67,000 $38,000 $105,000 $525

$97,000 $65,000 $162,000 $405

40 26 12

50 36 12

70 50 12

$10,500 $7,900 $18,400 $184

$16,500 $12,500 $29,000 $145

$38,500 $29,000 $67,500 $169

20 12 12

24 20 12

40 30 12

$3,600 $2,900 $6,500 $65

$7,700 $5,800 $13,500 $68

$11,000 $8,300 $19,300 $48

$ $ $ $/Goat

Doelings and kids Length Width Height Cost (Doelings and Kids Barn) Materials Labor Total

Feet Feet Feet $ $ $ $/Goat

Bucks Length Width Height Cost (Doelings and Kids Barn) Materials Labor Total

Feet Feet Feet $ $ $ $/Goat

Investments

Unit

Goat Barn + Milk House Doelings + Kids Bucks

$ $ $ $ $/Goat $/Square Foot

TOTAL INVESTMENTS

18

100 $82,000 $18,400 $6,500 $106,900 $1,069 $ 23.76

Herd size 200 $105,000 $29,000 $13,500 $147,500 $738 $ 18.02

400 $162,000 $67,500 $19,300 $248,800 $622 $18.03