Increasing Intensity of Pasture Use with Dairy Cattle: An Economic Analysis

Abstract

Intensive grazing is a fast growing dairy production system in the USA, New Zealand, and Ireland. The key concept underlying intensive grazing systems is the substitution of cow-harvest for machinery harvest of forages. Study objectives were: (i) to determine whether randomly selected, representative dairy farms using intensive grazing were profitable, (ii) to determine whether grazing was more or less profitable than other crop enterprises, and (iii) to identify factors statistically associated with increasing intensity of grazing. Data were collected on 53 farms in a prominent dairy region of Pennsylvania in 1993. Results indicated that moderate intensive grazing achieved a $129/acre return to operator management and labor, compared with $20 and $58 returns for all hay and corn silage enterprises, respectively. Dairy enterprise returns averaged about $317/cow. Debt per cow was substantially higher for farmers increasing grazing intensity. Pasture acres per cow, high debt-to-assets, and negative cash flows were statistically associated with increasing intensity of pasture use. Thus, this study suggests that farm financial constraints of high debt and poor cash flows provide an important motivation to increase grazing intensity. A major drawback of intensive grazing is the likelihood of achieving slightly lower milk production than with confinement feeding. The primary economic benefit of intensive grazing was the reduction of costs associated with the production of pasture forage vs. production of other crops.