Organizing milk harvest: A producer perspective on infrastructure and human resources

Abstract

One of the major considerations in operating a dairy production enterprise is the development and execution of a strategy for milk harvest. The production of milk as a business enterprise is generally governed by commodity based financial consid­erations. That is, the price of the final product is driven by the relationship between supply and demand. Both price and cost associated with the final product will be cyclical, and producers with lowest cost will, on average, gain market share over time just as those with high cost will lose market share over econom­ic cycles and may exit the business. Thus, the major consider­ation in organizing milk harvest is how strategic decisions will affect the final cost of the product. Some of the costs associated with the milking center can be considered direct costs while other aspects of the strategy can be considered indirect costs or opportunities. There are still other less tangible aspects of the harvest strategy that may not impact costs directly or indirectly at the milking center, but nonetheless have a bearing on what may be considered success in dairy production on a broader hu­man scale.