Cost of Production Estimate for Willamette Valley, Oregon

November 2001

Assumes:	$2,000 investment per cow in land (50% borrowed)
	$2,000 investment per cow in bldgs & equipment (80% borrowed)
	$1,200 investment in cow (30% borrowed)
	$ 12 gross milk price

Simple Annual Dairy Cash Flow
Sample herd: Willamette Valley, Oregon
100 cows each producing 21,000 pounds 3.7% fat milk

			PER COW	PER CWT	PER YEAR
INCOME
Milk Sales Value of calves & Manure Cull cows 30%	203.7 cwt 1300 lbs.	$12.00 $ 0.28	$2,444 100 109	$12.00 0.49 0.54	$244,440 10,000 10,920
TOTAL INCOME			$2,654	$13.03	$265,360
EXPENSES
Feed: Grain Hay Silage Mineral	3.5 ton @ 2.0 ton @ 9.0 ton @	$185 $140 $ 36	648 280 324 40	3.18 1.37 1.59 0.20	64,750 28,000 32.400 4,000
TOTAL FEED			$1,292	$6.34	$129,150
Labor (Hired & Family) Veterinary & medicine Breeding fees DHIA (production testing) Supplies Bedding Dairy vehicle costs Hauling & Marketing Utilities Repairs, Taxes, Insurance Herd Replacement Depreciation (Bldgs/Equip) Miscellaneous	14 hours @ 30% of	$10.00 $1,170	140 35 30 20 35 25 18 132 30 70 351 150 50	0.69 0.17 0.15 0.10 0.17 0.12 0.09 0.65 0.15 0.34 1.72 0.74 0.25	14,000 3,500 3,000 2,000 3,500 2,500 1,800 13,241 3,000 7,000 35,110 15,000 5,000
EXPENSES W/O DEBT SERVICE			$2,378	$11.67	$237,800
TOTAL DEBT SERVICE
-Principal and Interest	$ DEBT	RATE	YEARS
Bldgs, Improvement, Machinery, Equipment	160,000	8.0%	20		16,296
Land	100,000	8.0%	30		8,883
Cow Herd	84,000	10.0%	5		22,159
Operating Loan Interest	10,000	12.0%	1		1,200
TOTAL ANNUAL DEBT SERVICE			485	2.38	48,538
			$3,540 DEBT/COW
TOTAL EXPENSES WITH DEBT SERVICE			$2,863	$14.06	$286,338
RETURN TO CAPITAL & MANAGEMENT			($210)	($1.03)	($20,978)

OREGON STATE UNIVERSITY EXTENSION SERVICE			Dairy Enterprise Data Sheet Holstein Replacement Heifer
0 - 3 Months
	Milk Replacer Calf Starter grain Alfalfa Hay	50 lbs 100 lbs. at 30 lbs. at	$290/ton $140/ton	$34.00 14.50 2.10
			FEED COSTS	$50.60
	Labor (hired & family) Veterinary & medicine Bldgs, Pens, Equipmt Bedding	9 hours at	$8/hour	$72.00
			NON-FEED COSTS	$91.00
		TOTAL CASH COSTS (0-3 MONTHS)		$141.60
	*Interest Calf Cost Death loss	10.0% 10%		26.16 120.00 19.08
		TOTAL COST TO 3 MONTHS		$306.84
4 - 26 Months
	Grain Hay Silage Pasture Minerals & salt	1800 lbs at 6000 lbs. at 1.5 ton at 9 mo. at	$220./ton $90/ton $30/ton $10/month	198.00 270.00 45.00 90.00 10.00
			FEED COSTS	$613.00
	Labor Breeding fees Veterinary & medicine	14 hrs. at	$8/hour	112.00 20.00 10.00
			NON-FEED COSTS	$142.00
		TOTAL CASH COSTS (3-26 MONTHS)		$755.00
	Depreciation (bldg/eqpt) * Interest Death loss Culls for repro. failure	10.0% 2.0% 5.0%		14.00 49.75 12.78 31.96
		TOTAL COST (3-26 MONTHS)		$863.49
		TOTAL COST (0-26 MONTHS)		$1,170.33

* Interest is charged as if all money for heifer growing is borrowed. This varies from farm to farm. Interest on borrowed money must be repaid and is a cash expense.

Prepared by Mike Gamroth, Extension Dairy Specialist, Oregon State University, Corvallis, OR 97331 (15-Nov-01)