Title A Model Study on Determination of Economic Evaluation Criteria for Dairy Cattle Farms
Authors Adnan √úNALAN
Abstract In this study, it was aimed to determine the effects of concentrate feed cost (TL/kg) and raw milk sale price (TL/kg) on financial evaluation criteria such as the Net Present Value (NPV), Benefit Cost Ratio (BCR) and Internal Rate of Return (IRR) for the established a dairy cattle enterprise owned 100 cows as a model investment for 20-years perspective in Turkey. In the study, both current investment and annual operating costs were calculated for optimal care, feeding and health protection for this kind of dairy cattle farms, and the mean lactation milk yield per milking cow was assumed as 7000 kg. In the study, taking by the current cost of concentrate feed as to be 0.92 TL/kg and the real interest rate of capital as to be 7%, the effects of the different raw milk sales price on NPV, BCR and IRR values were investigated. It was shown that while the cost of concentrate feed was 0.92 TL/kg, raw milk sale prices had to be at least 1.22 TL/kg therefore a dairy cattle farm could maintain their activities economically. From these values, the parity of raw milk sale price to the cost of concentrate feed has to be 1.326 (1.22/0.92). In other word, economical sustainability of dairy cattle farms in our country, raw milk sale price has to be greater at least 32.6% than the cost of concentrate feed. In addition, if the other assumptions were stable, the 45% of the possible increasing rate of the cost of concentrate feed has to be also reflected to the raw milk sale price for sustainable economic dairy cattle farming in Turkey.
Keywords Milk Sale Price, Dairy Cattle, Investment, Financial Analysis, Feed Cost
Journal IJSES - International Journal Of Social And Economic Sciences
Issue Issue 1
Page 069-073
Year 2016
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