Technical Efficiency Of Dairy Farms Research Articles

Technical efficiency of dairy farms in rural Nigeria

The study assessed the technical efficiency of Nigerian dairy farms. Information on 73 dairy farms was obtained from the General Household Survey (GHS Panel) for the year 2018-2019 wave, and the method of analysis employed include descriptive statistics and Data Envelopment Analysis Model. The findings show that not all the farms sampled are technically efficient, which means they can still utilize their input resources more effectively. The average level of technical efficiency of sampled farms was 83%; this suggests from the technical point of view that there exist an opportunity for expansion of milk production and revenue using the same level of inputs at present and putting to use effectively available technologies by 17%. Furthermore, results also show that farms that practice grazing systems, those located in the northern part of Nigeria and small farm sizes, have higher T.E. overall.
 JEL Classifications: Q12, Q1, R15

Analyzing The Effects of Livestock Policies on Farm-level Efficiency in Turkey; Thrace Region Case

The effect of agricultural subsidies on the efficiency of farms is one of the main issues discussed today. Dairy farming benefits from various types of subsidies and take a lion share from the agricultural support budget. In this context, this study has four important aims. Firstly, to analyze the technical efficiency of dairy farms, secondly, to investigate the effects of policy tools on efficiency, thirdly to determine factors affecting efficiencies and finally to bring proposals. This study was carried out in Thrace Region of Turkey and interviewed with 140 dairy farmers. The three-stage method was applied in this study. The technical efficiency and policies effects on efficiency were determined by using Data Envelopment Analysis. Tobit Analysis was used to investigate the relationship between efficiency and farmer or farms-oriented characteristics. The results of Data Envelopment Analysis show that average efficiency scores are 0.700 under constant return to scale, 0.795 under variable return to scale and 0.886 for scale efficiency. The technical efficiency increases by 1.13%-2.43% thanks to subsidies and the scale efficiency is 1.35% higher. It is noteworthy that subsidies affect efficiency positively but provide a small improvement, also the effects vary across the farm-scale groups. According to Tobit Analysis, the education level of farmers, the share of livestock in total income, family size and whether tend to give up farming are significantly affecting efficiency. It is recommended for governments should provide subsidies to increase the scale of small farms that work with increasing return to scale and to improve the technology of larger farms that work with decreasing return to scale.

TECHNICAL EFFICIENCY OF DAIRY FARMS IN CENTRAL KOSOVO

Kosovo has the key resources needed for a developed agriculture. However, Kosovo’s agriculture consists of very small farms which are featured with the fragmentation of their land, old buildings and equipment, though functional. Ministry of Agriculture (MAFRD) started to support farmers with direct payments in 2009, but only for a few agricultural cultures. Support for dairy cows started in 2012, and support for milk quality started in 2014. In this context, the purpose of this paper is to accurately portray the characteristics, and technical efficiency of dairy farms in Central Kosovo, respectively in the region of Pristina - beneficiaries of direct payments for milk quality. Consequently, through Data Envelopment Analysis (DEA), under Variable Return to Scale (VRS) using output orientation, the efficiency rate of dairy farmers is calculated. Therefore, findings show that not all the farms are fully efficient, or fully utilizing their assets and their inputs. Additionally, the study revealed that the size of the farm, and the feeding system affect the TE. Therefore, large-size farms and farms who used seasonal grazing had overall higher TE. However, the level of education does not have a significant effect on the farm’s efficiency.

Short communication: The relationship between farm debt and dairy productivity and profitability in New Zealand

For a variety of reasons, dairy sector indebtedness has increased in recent years. However, it is not clear whether increased debt boosts or damages the economic performance of dairy farms. This paper provides empirical evidence by exploring the effects of farm debt measured by debt-to-asset ratio on dairy productivity and profitability, using the New Zealand DairyBase data of 2,637 dairy farms for a 10-yr period 2005 to 2014. A fixed-effects panel data model is utilized for the empirical analysis. The findings show that farm debt is significantly and negatively associated with both dairy productivity and profitability. We find that dairy productivity is positively determined by production intensification, irrigation intensity, milking frequency, cattle breeds and stocking rate, whereas dairy profitability is positively affected by milk price, business type, milking frequency, and stocking rate. Further analyses reveal that the debt ratio significantly decreases both the technical efficiency of dairy farms and return on assets; a high debt ratio increased dairy productivity between 2005 and 2009, whereas it decreased dairy productivity between 2011 and 2014; the effects of the debt ratio on dairy profitability vary over time. The analysis for a 10-yr balanced panel data (250 farms) shows that debt ratio does not significantly affect both dairy productivity and profitability, which suggests that the presence of farm-specific attributes such as farm life cycle and managerial ability of dairy farmers may also affect the debt ratio and through this farm performance.

Technical Efficiency of Dairy Farms: An Empirical Study of Producers in Poland

Purpose: The main objective of this article was to determine the technical efficiency of Polish dairy farms in 2008-2017, taking into account the dependence on the herd size, the milk yield of cows and the effects of scale. Design/Methodology/Approach: The non-parametric DEA method based on the concept of border efficiency was used to assess technical efficiency. The research uses models assuming constant (CCR) and variable returns to scale (BCC). The source of the data was information collected by the Farm Accountancy Data Network (FADN) in Poland. Data came from farms specializing dairying (type 45), with more than 15 cows. Findings: The results of the conducted research indicate a higher share of efficient farms using the model assuming variable returns to scale. The average efficiency ratio increased along with the increase in the size of the herd of cows and the improvement in the milk yields of cows. Practical Implications: The results of this study will be used to determine rationally the combination of inputs in dairy production. The result of these activities is an increase of efficiency and the use of economies of scale. The article clearly presents among which farm groups exists the lowest efficiency (cow herd size and milk yield). Originality/Value: The study fills a gap in approach methods to conducting research on dairy farm efficiency. On the one hand, the value of the article is built by the size of observation field, on the other – dairy farms classification by cow herd size and milk yield.

Modelling environmental technical efficiency and phosphorus pollution abatement cost in dairy farms

The dairy sector is an important sector in Northern Ireland being the single largest contributor to its agricultural economy. However, the sector contributes more to soil phosphorus (P) surplus compared to other agricultural sectors. Consequently, the goal of this research is to analyse the environmental technical efficiency of dairy farms making use of a novel parametric hyperbolic distance function approach. The model is able to internalise P surplus as undesirable output in the dairy production process by treating desirable and undesirable outputs asymmetrically. The stochastic production frontier model is analysed simultaneously with an inefficiency model to explain variability in efficiency scores assuming the existence of heteroskedasticity in the idiosyncratic error term. Additionally, we estimated the shadow price and pollution cost ratio of P surplus in dairy farms. This paper contributes to the existing literature as it provides the first attempt to empirically estimate the pollution abatement cost of P surplus in dairy farms. Besides, the hyperbolic environmental technology distance function methodology employed to achieve the study objectives is less restrictive compared to the radial output/input distance function approach employed in previous studies. This allows for the estimation of a more robust environmental efficiency measure and shadow price of P surplus that is consistent with public policy goals that seek to simultaneously reduce pollution and increase production of desirable outputs. Our results showed that the average environmental technical efficiency estimates for dairy farms in Northern Ireland is 0.93 and the shadow price (marginal abatement cost) of P surplus evaluated at the mean is £12.29/kg. Intensification resulting in increased use of concentrates feed was found to be negatively related to environmental technical efficiency. We also found that age of the farmer and share of milk output have a positive relationship with environmental technical efficiency.

Efektywność techniczna gospodarstw mlecznych w latach 2008-2017

Efektywność techniczna gospodarstw mlecznych w latach 2008-2017

Animal health and welfare state and technical efficiency of dairy farms: possible synergies

AbstractThis study sought to investigate whether animal health and welfare state and changes were associated with technical efficiency in a sample of 34 Austrian dairy farms. Health and welfare were assessed twice using the Welfare Quality® (WQ) assessment protocol for dairy cattle. Following a baseline welfare assessment, farm-specific health and welfare planning was conducted on the farms. This included the identification, selection and implementation of measures in housing and management that aimed at improving health and welfare states. One year after implementation, farms were reassessed to evaluate changes in health and welfare states and consequences for farms’ technical efficiency were analysed using the Malmquist index. Our results indicated that farms with a higher health state (WQ principle score ‘Good health’) achieved higher technical efficiencies. However, we could not show that changes in the welfare state within a one-year period affected technical efficiency: across all farms, technical efficiency remained stable and Malmquist indices (indicating efficiency and technological change) could not be explained by the different welfare scores. Nevertheless, our study showed data envelopment analysis to be a valuable method for analysing the relationship between animal welfare and farm success and our results indicate substantial potential synergies between these two aspects.

Estimation of technical efficiency of dairy farms in central zone of Tigray National Regional State

This paper was conducted to estimate technical efficiency in milk production of dairy farmers in central zone of Tigray National Regional State using stochastic frontier production function approach. Cross-sectional data collected from 163 dairy farmer households was used in the analysis. The result shows that the average technical efficiency of sampled dairy farmer households is about 63.7%. It also shows that labor input by households and average amount of daily cost of crop residue/byproduct do not influence amount of milk produced when stochastic frontier and inefficiency effects are estimated in combination. The estimates of coefficients of other explanatory variables of stochastic frontier production function (i.e. number of lactating cows, average daily cost of purchased supplements, average daily health/veterinary expenditure and average amount of water consumed daily) are found to influence amount of milk produced positively. From the explanatory variables incorporated in inefficiency model sex of household head, extension contact and households off farm income do not influence inefficiency of dairy farmer households while age of household head, years of education of the household head and cattle size are found to influence inefficiency of dairy farmer households negatively. Age squared of household head and household sizes influence inefficiency of dairy farmer households positively. Thus, it can be concluded that by improving dairy farmers' access to education, family planning program and improving bureaucratic environment in providing extension services it is possible to increase amount of milk produced.

Analysing the determinants of technical efficiency of dairy farms in Brazil

PurposeThe purpose of this paper is to analyse the determinants of technical efficiency (TE) in dairy farms located in the South of Brazil, aiming for a better understanding of the topic for academics, dairy farmers and policymakers to improve the productivity and competitiveness of dairy farms.Design/methodology/approachThis study was developed using a two-stage approach. Data envelopment analysis was used to estimate the TE level and regression models to understand the factors affecting TE in dairy farms. The sample size is 253 dairy farms in the South of Brazil.FindingsThe variation in the mean TE indexes reported in the literature can be explained by the attributes of the analysed studies, including the education of the farm operator, farm size (number of cows and milk), feed and labour costs, and use of services. Additionally, the results suggest that dairy farmers in the sample could increase milk output by 50.1 per cent (level of inefficiency) on average if they improve their TE.Originality/valueThis study makes three important contributions: first, it formulates hypotheses from the previous literature’s propositions on the estimation of TE in dairy farms; second, it tests the hypotheses in an empirical study to understand the main factors affecting the TE in dairy farms of the selected municipalities in the South of Brazil; and third, it compares previous findings on the determinants of TE in dairy farms serving different stakeholders, such as researchers, farmers and government representatives, to improve the productivity and competitiveness of dairy farms.

Feed use intensification and technical efficiency of dairy farms in New Zealand

In recent years, the traditionally pasture‐based dairy farms in New Zealand have become more intensive by using higher proportions of supplementary feed. This trend has been attributed to a range of factors, such as productivity enhancement, overcoming pasture deficits and the improvement of body condition scores. However, there is a lack of knowledge as to how feed use intensification affects the technical efficiency of dairy farms in New Zealand. This paper addresses the research gap by estimating the impact of feed use intensification on the technical efficiency of New Zealand dairy farms, using a fixed effects stochastic production frontier model and a balanced panel of 257 farms from 2010 to 2013. The empirical results show that technical efficiency on New Zealand dairy farms is positively and significantly influenced by feed use intensification, herd size and milking frequency.

How do herd’s genetic level and milk quality affect performance of dairy farms?

The effects of genetic level and output quality characteristics on technical efficiency (TE) of dairy farms were studied. The average total relative breeding value (RBV) at herd level was considered a parameter of the genetic level and production potential of the main input (dairy cows), while somatic cell count (SCC) and milk composition characterise the quality of the main output (milk) of dairy farms. The analysis was carried out in two stages: data envelopment analysis was used in the first stage and fractional regression model in the second stage, combining the data collected by the Estonian Farm Accountancy Data Network with the data from the Estonian Livestock Performance Recording Ltd. The results showed that the TE of fully efficient dairy farms is positively affected by the total RBV (P < 0.05), number of dairy cows in the herd (P < 0.05), and negatively affected by the SCC (P < 0.001) and costs of purchased feed per kg of produced milk (P < 0.01). Among the inefficient farms, the TE was positively affected by the lifetime daily milk yield (P < 0.05), and average milk fat (P < 0.1) and protein (P < 0.05) contents. The results confirm our hypothesis that the genetic level of dairy herd and milk quality have a positive effect on the TE of dairy farms.

EFFICIENCY AND PRODUCTIVITY CHANGE IN FIELD CROP AND MILK FARMS IN LUBLIN PROVINCE IN 2014-2016

The aim of the study was assessment of efficiency and productivity of farms in the Lublin province in the years 2014-2016. The analysis was based on the Data Envelopment Analysis (DEA) model oriented on inputs and Malmquist indices with its components. The calculations were made for medium-sized field and dairy farms that continuously collected data for the FADN system during the period under consideration. In our research all efficiency indicators for dairy farms were larger than for field crop farms. In the years 2014-2016, the average technical efficiency of dairy farms was 0.752, which means that in those farms it is possible to reduce inputs on average by 25% and the value of production will remain at the same level. In the case of field crop farms, inputs should be limited by 33%. The applied decomposition of calculated Malmquist indices allowed to define what factors influenced changes in productivity.

Technical efficiency in dairy farms

PurposeThis systematic literature review integrates the findings of existing studies regarding technical efficiency (TE) in dairy farms. The purpose of this paper is to offer a research framework that assembles TE descriptors, a classification of previous literature that provides the basis for the synthesis and research agenda.Design/methodology/approachThis paper systematically reviews 86 survey research studies using rigorous and reproducible procedures. The review is applied to published survey research.FindingsThe framework relates context, inputs, outputs and metrics of TE. There is no agreement among the authors on the context and determinants of TE. The main determinants of TE are geographical location, farm size, investments in veterinary care, feeding and milking practice, TE model estimation techniques, public policy, and management-related variables. This paper offers ten propositions for future research on the controversial results on the determinants of TE. The authors also explore the reasons for the discrepant results based on the Debreu-Farrell’s definition of TE, the contingency theory and the resource-based view of the firm, elucidating the literature and serving as a basis for future investigation. Implications for dairy farmers and researchers close the review.Originality/valueMeta-analysis and meta-regression studies were long at the forefront of reviews in the TE of dairy farms. This paper offers a novel qualitative research synthesis with frameworks and the classification of previous literature and a research agenda, which provides a new and different perspective for analysis, by innovating over the available quantitative procedures to combine statistical results.

Factors affecting the technical efficiency of dairy farms in Kosovo

A possible accession into the World Trade Organization (WTO) and an expected membership in the European Union raise significant opportunities and challenges for the agricultural sector in Kosovo. As a result of these changes, the sector will have to improve efficiency and competitiveness. This research is motivated by the need to understand better the forces that drive competitiveness in the Kosovo dairy sector. This study estimates the technical efficiency (TE) of 243 dairy farms in Kosovo and relates TE variation to farm size and other primary determinants of TE. A stochastic frontier production function is estimated using a two-stage procedure. Results reveal that concentrate feed intake, land use per cow, and the number of days cows had been kept on pasture have statistically significant impacts on milk productivity per cow. The mean technical efficiency of dairy farms was estimated at 0.72. The major determinants that increase efficiency are breed improvement, intensification of corn production on the farm, improving concentrate feed intake, and using free-range production systems. Given the results from the technical efficiency analysis, it is crucial for the Government of Kosovo to redesign their dairy policy—specifically their grant investment schemes—and target assistance on improving national herd genetics, promoting free range systems and expanding area planted in corn.

THE SENSITIVITY OF TECHNICAL EFFICIENCY ESTIMATIONS USING DIFFERENT METHODS OF ESTIMATING (INDUSTRIAL DAIRY FARMS IN CHAHARMAHAL AND BAKHTIARI PROVINCE IN IRAN)

Background: Qualitative increase in production and achieving commercial and competitive production in the world market requires the application of scientific and economic methods . Obviously, limited factors and sources for production reveal the importance of this issue more than before . Methods: The aim of this study was to compare the technical efficiency of dairy farms in Chaharmahal and Bakhtiari province in Iran, and for this end three methods including OLSCOLS, and MLE as well as linear programming (LP) were used for calculations . Fitted production function is Cobb - Douglas in which milk production is the dependent variable and the amount of concentrate input , forage consumption and labor are independent ( explanatory) variables of the model . Results: The detection rate of the estimation method Ordinary Least Squares (OLS) shows that independent variables explain about 81 % of the dependent variable changes ( milk production). F statistical so indicates the significance of the estimated model ; while most estimated traction is related to concentrate inputs . According to the findings of this study, the average technical efficiency calculated using three different methods of Corrected Ordinary Least Squares ,

A stochastic frontier approach to study the relationship between gastrointestinal nematode infections and technical efficiency of dairy farms

The impact of gastrointestinal (GI) nematode infections in dairy farming has traditionally been assessed using partial productivity indicators. But such approaches ignore the impact of infection on the performance of the whole farm. In this study, efficiency analysis was used to study the association of the GI nematode Ostertagia ostertagi on the technical efficiency of dairy farms. Five years of accountancy data were linked to GI nematode infection data gained from a longitudinal parasitic monitoring campaign. The level of exposure to GI nematodes was based on bulk-tank milk ELISA tests, which measure the antibodies to O. ostertagi and was expressed as an optical density ratio (ODR). Two unbalanced data panels were created for the period 2006 to 2010. The first data panel contained 198 observations from the Belgian Farm Accountancy Data Network (Brussels, Belgium) and the second contained 622 observations from the Boerenbond Flemish farmers' union (Leuven, Belgium) accountancy system (Tiber Farm Accounting System). We used the stochastic frontier analysis approach and defined inefficiency effect models specified with the Cobb-Douglas and transcendental logarithmic (Translog) functional form. To assess the efficiency scores, milk production was considered as the main output variable. Six input variables were used: concentrates, roughage, pasture, number of dairy cows, animal health costs, and labor. The ODR of each individual farm served as an explanatory variable of inefficiency. An increase in the level of exposure to GI nematodes was associated with a decrease in technical efficiency. Exposure to GI nematodes constrains the productivity of pasture, health, and labor but does not cause inefficiency in the use of concentrates, roughage, and dairy cows. Lowering the level of infection in the interquartile range (0.271 ODR) was associated with an average milk production increase of 27, 19, and 9L/cow per year for Farm Accountancy Data Network farms and 63, 49, and 23L/cow per year for Tiber Farm Accounting System farms in the low- (0–90), medium- (90–95), and high- (95–99) efficiency score groups, respectively. The potential milk increase associated with reducing the level of infection was higher for highly efficient farms (6.7% of the total possible milk increase when becoming fully technically efficient) than for less efficient farms (3.8% of the total possible milk increase when becoming fully technically efficient).

Measuring technical efficiency of dairy farms with imprecise data: a fuzzy data envelopment analysis approach

This article integrates fuzzy set theory in the data envelopment analysis (DEA) framework to compute technical efficiency scores when input and output data are imprecise. The underlying assumption in conventional DEA is that input and output data are measured with precision. However, production agriculture takes place in an uncertain environment, and, in some situations, input and output data may be imprecise. We present an approach of measuring efficiency when data are known to lie within specified intervals and empirically illustrate this approach using a group of 29 dairy producers in Pennsylvania. Compared to the conventional DEA scores that are point estimates, the computed fuzzy efficiency scores are interval bound allowing the decision maker to trace the performance of a decision‐making unit at different possibility levels.

Technical Efficiency of Dairy Farms: A Stochastic Frontier Application on Dairy Farms in Jordan

The present study was conducted to determine the level of technical efficiency of dairy producing farms in Jordan by applying the stochastic production frontier (SPF) methodology. Technical efficiency estimates were generated for 100 dairy farms in Jordan. The results of the study indicated that technical efficiency of milk production by most of dairy farms in Jordan is low. The mean technical efficiency was estimated to be only 39.5% for the sampled dairy farms. This means that an average farm in the sample could in principle increase its level of milk production by 60.5% using the current input quantities. The results also implies that the dairy farms in Jordan are producing milk to only about 40% of the potential frontier production levels of this industry, implying that the production is about 60% below the frontier due to technical inefficiency. To enhance farm efficiency there is a need to improve farmers’ access to extension services. The need to involve farmers more in the extension process itself should be encouraged.

PCA Technical to diagnose the technical efficiency of dairy farms in Galicia (NW Spain)

Improving the production efficiency of dairy farms is a hot topic. The current competitiveness in the dairy industry requires detailed investigation of the mechanisms that lead to optimal holdings. Yet, optimality is dependent on the production process developed on the farm, its size and type. This paper presents a research conducted on 50 dairy farms that are representative of Galician dairy farms with herd sizes in a range between 27 and 85 cows. The estimated yield is expressed in kilograms of whole milk per hour worked (kgFCmilk hour-1), we use the methodology of dairy farms congress indicating that we are at values well below the UE. We have analysed production efficiency by directly measuring the time spent by workers performing farm operations and determining the typological features of the farms. Based on the data obtained from dairy farms, we have classified farms into three groups according to their levels of efficiency by using multivariate analysis. Our research line aims at enhancing the profits of dairy farms in Galicia by providing farmers with ideas for improving the efficiency records of their productive processes.