Permalink : http://hdl.handle.net/2115/65977

The cost of feed fuel and other material inputs in the dairy industry rose sharply in 2000 and continued to rise thereafter particularly between 2005 and 2008. The purpose of this paper is to analyze and to clarify how these rising costs have impacted dairy farming.The following results were obtained. First, these costs rose rapidly over a short period of time. The cost of formula feed, bulk blended fertilizer, and diesel fuel rose by factors of 1.6, 1.4, and 2.1 respectively. Second, for dairy operations of under 100 head of cattle, purchases of concentrated feed were reduced by 10-20%. On the other hand, while operations of 101 head or more also tended to reduce purchase amounts, the quantity of concentrated feed per animal per day continued to be high. Third, by reducing purchases of concentrated feed and chemical fertilizer, operating costs fell by 0.4-5.5 million yen. Fourth, the bigger the operation the higher the cost increases, particularly for feed, with agricultural income showing a decrease of 0.3-8.9 million yen. This decrease was especially severe for large-scale operators. Fifth, although interest payments and land rent payments could be met by increases in the price of milk, this price rise could cover only a part of the family labor portion of production costs. This was particularly true for larger operators. In conclusion, due to the rising input costs of recent years, economic risk loomed greatest for large-scale farms. For this reason, when looking into the future of pasture-style dairy farm operations, it will be necessary to begin with the premise that the behavior of dairy farm operators under these cost challenges will not be uniform.