CALCULATIONS IN MILK PRODUCTION ON FAMILY FARMS
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Abstract
Milk production in Serbia is mostly practiced by family farms characterised by small herds of cattle, low milk yield per cow, high feed costs, and variable milk quality. Both small and specialised farms housing up to 10 lactating cows are often unable to maintain their cost-effectiveness. A study was conducted on two family farms i.e. farm A and farm B during 2013-2015 to record production data. Total production value, variable costs and contribution margin were calculated. For easy comparison between the farms, results were expressed per lactating cow. The sensitivity analysis of milk yield and farmgate milk prices showed that, at low values, contribution margins were more sensitive to changes in farmgate milk price. Through subsidies and premium payments, family farms maintain the cost-effectiveness of their production. However, small-scale producers are facing the largest threat, given low milk yields per cow and poor milk quality.
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