Costs and Returns on Ohio Dairy Farms

Dr. Cameron Thraen, Milk Marketing Specialist, The Ohio State University

A chart is attached which shows the net returns to dairying in Ohio by month over the 2003 through 2008 period. Net returns are expressed per hundredweight of milk. The data source is the USDA Cost and Returns data for Ohio. Gross returns are calculated for Ohio using the monthly Ohio Mailbox price. The mailbox price for January and February 2008 were based on projections. Non milk income and Milk Income Loss Contract (MILC) income is not included in the calculation of gross return. As you can see, over the long pull, net returns are generally negative on the typical Ohio dairy farm. However, 2008 stands out as a stark exception. With the mailbox price declining and input costs continuing to rise, the net return has declined substantially for the first two months of 2008. Without a strong rebound in the skim milk powder and whey markets, this may hold for the remainder of 2008.

For more information on the dairy industry, prices, and policy, link to my OhioDairyWeb 2008 at: