IDEAS home Printed from https://ideas.repec.org/a/caa/jnlage/v68y2022i6id40-2022-agricecon.html
   My bibliography  Save this article

Break-even point analysis for milk production - Selected EU countries

Author

Listed:
  • Jan Syrůček

    (Department of Cattle Breeding, Institute of Animal Science, Prague, Czech Republic)

  • Luděk Bartoň

    (Department of Cattle Breeding, Institute of Animal Science, Prague, Czech Republic)

  • Jiří Burdych

    (Department of Nutrition and Feeding of Farm Animals, Institute of Animal Science, Prague, Czech Republic
    VVS Verměřovice s.r.o., Verměřovice, Czech Republic)

Abstract

Unstable conditions in the milk market in the Czech Republic (CR) and in the European Union (EU), mainly due to volatility of milk prices, are increasing pressure on dairy farmers to maximise production at the lowest possible production costs. Break-even point (BEP) analysis is a useful tool in dairy herd management for determining minimum requirements for profitability. BEP values for milk yield and milk price were calculated based on data obtained from 95 dairy farms in the CR. BEP values were estimated also for another eight EU countries based upon production and cost data from the EU Farm Accountancy Data Network (FADN). With the milk price ranging from EUR 28 to EUR 38 per 100 L and while excluding subsidies, zero profitability would be achieved on Czech dairy farms with milk yields ranging from 6 706 L to 13 151 L per cow and from 7 450 L to 14 088 L per cow in Czech Fleckvieh (C) and Holstein (H) herds, respectively. In order to achieve 5% profitability, the milk yield would need to increase by 21%. Considerable variability exists among EU countries in estimated BEP values depending upon average milk yields, input prices, and milk prices in different countries.

Suggested Citation

  • Jan Syrůček & Luděk Bartoň & Jiří Burdych, 2022. "Break-even point analysis for milk production - Selected EU countries," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 68(6), pages 199-206.
  • Handle: RePEc:caa:jnlage:v:68:y:2022:i:6:id:40-2022-agricecon
    DOI: 10.17221/40/2022-AGRICECON
    as

    Download full text from publisher

    File URL: http://agricecon.agriculturejournals.cz/doi/10.17221/40/2022-AGRICECON.html
    Download Restriction: free of charge

    File URL: http://agricecon.agriculturejournals.cz/doi/10.17221/40/2022-AGRICECON.pdf
    Download Restriction: free of charge

    File URL: https://libkey.io/10.17221/40/2022-AGRICECON?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Jan Syrůček & Luděk Bartoň & Dalibor Řehák & Jindřich Kvapilík & Jiří Burdych, 2019. "Evaluation of economic indicators for Czech dairy farms," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 65(11), pages 499-508.
    2. Dillon, Carl R., 1993. "Advanced breakeven analysis of agricultural enterprise budgets," Agricultural Economics, Blackwell, vol. 9(2), pages 127-143, August.
    3. Monika MICHALIČKOVÁ & Zuzana KRUPOVÁ & Peter POLÁK & Ladislav HETÉNYI & Emil KRUPA, 2014. "Development of competitiveness and its determinants in Slovak dairy farms," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 60(2), pages 82-88.
    4. F. Střeleček & P. Kollar, 2002. "Searching the proportional level of operating costs - specification of the minimum volume of production," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 48(3), pages 106-116.
    5. Carl R. Dillon, 1993. "Advanced breakeven analysis of agricultural enterprise budgets," Agricultural Economics, International Association of Agricultural Economists, vol. 9(2), pages 127-143, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rūta Savickienė & Aistė Galnaitytė, 2024. "Unveiling Determinants of Successful Dairy Farm Performance from Dairy Exporting EU Countries," Agriculture, MDPI, vol. 14(7), pages 1-24, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Blank, Steven C. & Orloff, Steve B. & Putnam, Daniel H., 2001. "Sequential Stochastic Production Decisions For A Perennial Crop: The Yield/Quality Tradeoff For Alfalfa Hay," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(1), pages 1-17, July.
    2. Jan Syrůček & Luděk Bartoň & Dalibor Řehák & Jindřich Kvapilík & Jiří Burdych, 2019. "Evaluation of economic indicators for Czech dairy farms," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 65(11), pages 499-508.
    3. Jan Syrůček & Luděk Bartoň & Dalibor Řehák & Magdaléna Štolcová & Jiří Burdych, 2023. "Recent development of economic indicators on Czech dairy farms," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 69(2), pages 45-54.
    4. Gandonou, Jean-Marc & Dillon, Carl & Shearer, Scott & Stombaugh, Tim, 2006. "Precision Agriculture Equipment Ownership versus Custom Hire: A Break-even Land Area Analysis," Journal of the ASFMRA, American Society of Farm Managers and Rural Appraisers, vol. 2006, pages 1-11.
    5. Alžbeta FOLTÍNOVÁ & Jindřich ŠPIČKA, 2014. "The use of controlling in agricultural enterprises and their competitiveness," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 60(7), pages 314-322.
    6. Dusan SIMO & Ladislav MURA & Jan BULECA, 2016. "Assessment of milk production competitiveness of the Slovak Republic within the EU-27 countries," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 62(10), pages 482-492.
    7. P. Kopeček & I. Foltýn & M. Bjelka, 2009. "Modeling of slaughter cattle fattening profitability," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 55(10), pages 481-491.
    8. Piotr Bórawski & Aneta Bełdycka-Bórawska & Andrzej Parzonko & Tomasz Rokicki & Lisa Holden, 2022. "Changes in the comparative advantage of Polish dairy products," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 68(12), pages 464-475.
    9. Powers, Laura & Dillon, Carl R. & Isaacs, Steven G. & Shearer, Scott A., 2003. "Risk Management Tools In Precision Agriculture," 2003 Annual Meeting, February 1-5, 2003, Mobile, Alabama 35129, Southern Agricultural Economics Association.
    10. Jan SYRUCEK & Jindrich KVAPILIK & Ludek BARTON & Mojmir VACEK & Ludek STADNIK, 2017. "Economic efficiency of suckler cow herds in the Czech Republic," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 63(1), pages 34-43.
    11. Rūta Savickienė & Aistė Galnaitytė, 2024. "Unveiling Determinants of Successful Dairy Farm Performance from Dairy Exporting EU Countries," Agriculture, MDPI, vol. 14(7), pages 1-24, July.
    12. Andrzej Parzonko & Piotr Bórawski, 2020. "Competitiveness of Polish dairy farms in the European Union," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 66(4), pages 168-174.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:caa:jnlage:v:68:y:2022:i:6:id:40-2022-agricecon. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ivo Andrle (email available below). General contact details of provider: https://www.cazv.cz/en/home/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.