D2o—Lancaster Farming, Saturday, June 18,1983
Production costs
(Continued from Page Dl9)
prices. Why should management
cost more or less, as feed prices
increase or decrease, respec
tively? The prices of feed, since
they are valued at market prices in
the USDA-COP studies, are largely
outside the control of the dairy
farm manager.
Milk equivalents
Milk equivalents of income from
the sales of cull cows and calves
are now excluded from the
denominator in computing the cost
of producing milk on a hun
dredweight basis. The rationale
the USDA used for making the
change was that distortion in the
estimates of the “true” cost of
producing milk would otherwise
occur during periods of wide
variation in the price of milk
relative to the price of beef. What
is ignored, however, is the more
important, even wider variation in
feed prices that also occurs over
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tune. And yet the USDA continues
to include feed at market value
rather than at the cost of producing
it, which accentuates the effect of
fluctuations in feed prices on the
estimates of the cost of producmg
milk.
The major weakness of the
approach now being taken with
regard to the handling of income
from the sales of cull cows and
calves is that the per hun
dredweight cost for the several
cost items are overstated they
are assisted totally to the milk
produced, whereas they were in
fact used to produce the joint
products, meat and milk. There is
a final adjustment to costs that
accounts for the value of cull cows
and calves, sold, of course, but one
can only hope that other users of
the USDA reports read that far.
Furthermore, the danger exists
that someone will compare feed
costs per hundredweight of milk
VotT'evJrncd
>«ur
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WAYNE'S
DBY GOODS
)■■■■■]
WOUWS Duly > MAM 108OOPM F*.d«v iItOOAU
271 W MAIN STREET-KUT2TOWN. PA PHONE 215-683-7686
>r W
produced in the 1974 and 1979
reports, and assume all the change
was due to changes in either or
both feed prices and quantities. In
tact, part of the change was due
simply to the change in the way the
sales of cull cows and calves were
incorporated into the com
putations. Thus a cursory look at
the estimates across time may be
misleading to readers of the USDA
reports.
Other weaknesses or short
comings of the USDA-COP studies
may be mentioned. Many of these
were recognized by the developers
of those reports, and this is not
meant to be personally critical of
those workers. The 1974 results, in
particular, were prepared under
severe time restrictions and had to
be hurried at a rate beyond what
might reasonably be expected to
yield good results. Furthermore,
the questionnaire that was used for
the dairy survey was but a
modified version of the one that
was designed for surveys of crop
costs, it was not a very good in
strument to use for the diversity
and multiplicity of enterprises that
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Germansville, PA
215-767-3819
Bath. PA
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Troy. PA
717-297-2880
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717-398-1391 814-383-2798
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are found on many dairy tarms.
Some dairy farms in Pennsylvania
have as many as six or eight dif
ferent crops, with fields from
which several crops are taken.
Furthermore, some crops yield
multiple products such as grain
and straw, or hay, silage, and seed.
For each crop on the farm, the
dairyman was asked to recall
information concerning acres
rented, acres harvested, yields,
seed quantities and costs, fertilizer
quantities, and costs for each
different formulation and ap
plication, and the kinds, quantities,
and costs of herbicides, in
secticides, and fungicides that
were used during each chemical
application. Then, detail for each
crop operation plowing, disking,
mowing, loading, hauling, etc.
was requested. Included here were
such things as acres covered;
tunes covered; truck, tractor, and
other equipment used; price paid
and year of purchase for each
piece of equipment used; total
acres on which the equipment was
used; and total hours the equip
ment was used during the year. All
ikc ...madttbiast
IS w
W) i£
o
JAMES L GOOD GUTSHALL'S SILO
Sal |ox & iMB “ REPA,R WORH TERRE HIU SILO CO., IRC.
W Pi Womelsdort, PA Terre Hill, PA
2525&52 7X7-933-4616 216-445-6736
of the foregoing would have been
difficult enough to recall for a
crop wheat farm in South Dakota.
The effect of interviewer and
respondent fatigue on accuracy oi
answers on a typical Pennsylvania
dairy farm must have been
notable.
There were also serious
weaknesses in the design or format
of the questionnaire itself. For
example, estimates of the numbers
of dairy cattle on hand at the
beginning and end of the year and
of the number that died during the
year appeared on page 3 of the
questionnaire. The number of
calves born appeared on page 2fj,
and the number of dairy animals
sold was on page 36. Finally, the
number purchased was recorded
on page 38. Thus, dairy cattle
numbers could be reconciled only
by referring to data on four dif
ferent pages! Worse yet is the fact
that interviewers did not attempt
any such reconciliation while in the
field because they were not in
structed to do so. When thej
schedules were later edited
I
«ifin»coeroc.. n FARM BUREAU
SOLLENBERGER SILO Soilderton, PA
Chambersburg, PA 215-723-4355
717-264-9588 Mitflinburg. PA
717-966-1047
(Turn to Page D2l)
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