April 2000
Volume 3, Issue 3
INSIDE THIS ISSUE
Funerals for the Small Dairy Farms: Part I - Normand St-Pierre
Safety Training - Terry Beck
Scarlet & Gray Ag Day - Heather Vaubel
Calendar of Events
I have written and talked many times in the last three years about economies of scale in dairy. Using records from the New York Dairy Business Summary, we have shown that average, large Northeast dairy farms are far more efficient than small ones. In 1997, large NY dairy farms (average of 582 cows per herds) produced 11,750 lb of milk per acre compared to 4,870 lbs per acre for small farms (average of 47 cows per herd). Thus, land was used 251% more efficiently on large dairy farms. From a labor standpoint, large farms shipped 1,011,165 lbs of milk per full-time equivalent worker (FTE) compared to 432,956 lbs per FTE on small farms. Therefore, labor was used 233% more efficiently on large farms. Lastly, large farms required $25.00 of farm assets per cwt of milk produced, compared to $50.37 for small farms. Hence, large farms are 201% more efficient with their capital. Consequently, some have inferred that these results imply an inevitable death for all of our small dairy operations. Although some will have to exit the dairy business in the coming years, it doesn’t mean that all must follow this path. Here is why.
The law of averages
We used the net farm income (NFI) per farm for NY dairy farms on the 1996 NY Dairy Business Summary (1996 was the last “average” year in dairy). Farms were first divided into three groups based on number of cows: small (less than 150 cows; average 70 cows), medium (150 to 300 cows; average 550 cows). Within each group, farms were sorted in descending order of net farm income. Net farm income was averaged for the top 10%, the next 10% (20th percentile) and so on for each group. Results are presented in Table 1. Producers do not have to be reminded that net farm income is anything but net and certainly does not represent the amount available to cover family living expenses. For an average Ohio family, a benchmark of $60,000 per year of net farm income is a good target. Keeping this number in mind, one quickly realizes the problem facing the average small dairy farm: the median NFI is only $35,777. The top 20% of small farms, however, did very well. Net farm income on these smaller dairies is sufficient to maintain a good family standard of living. These farms are very competitive and generate a NFI per cow in excess of three times the average observed across all farms. In contrast, a large farm did not have to excel in order to provide sufficient earnings to cover family living expenses. In fact, as long as large farms avoided being in the bottom 10% of large farms, NFI was sufficient to cover family living expenses of one full family. Being in the bottom third may not be sustainable on a long-term basis for large herd operators, but in the short and medium, the top 90% can “survive”. Small farms do not have this luxury, this cushion. They must be much sharper managers.
Table 1. Net income per farm per percetile class within dairy farms
grouped by size, New York, 1996.
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| 10 | $88,760 | $186,160 | $498,538 |
| 20 | 62,353 | 121,682 | 355,590 |
| 30 | 52,706 | 92,523 | 255,215 |
| 40 | 42,686 | 77,745 | 210,999 |
| 50 | 35,777 | 53,375 | 163,907 |
| 60 | 25,901 | 38,496 | 139,850 |
| 70 | 11,541 | 27,801 | 122,533 |
| 80 | -358 | 14,994 | 101,876 |
| 90 | -10,185 | 5,641 | 67,632 |
| 100 | -26,410 | -33,233 | -18,832 |
How can you manage your operation to reach the results observed for
the top 20% of small dairy farms? As we looked at the financial results
of each operation, we saw four patterns of management emerging. These
four patterns will be summarized in the next issue of Buckeye Dairy News.
Safety Training
Terry Beck
Agriculture and Natural Resources Agent, The Ohio State University
Extension
Wayne County
What do you tell your new employees about safety? The “old timers” I have talked to say that their safety training was, “There is the shovel, there is the pile, now get busy”. Not much of an orientation on farm safety!
By now everyone has heard that agriculture is one of the most dangerous occupations. So, why would a farm business skip a safety orientation for someone new on the job? Would a good reason be “no time to do it?” How about, “I was smart enough to still have all my fingers so you should be too!” Obviously, it may be hard to find a valid reason to ignore safety training for farm employees.
Everyone has a “close call” safety story; here is mine. I was 14. The family had been baling hay all day. It was 5 p.m. and it was time to quit, if for no other reason than everyone was hungry. I went with my uncle to get the last load of hay in the field. The wagon that we were loading was a metal floor wagon that had a floating metal bed with a great ability to tip. I do not know if it was made that way or not, but I remember the day we got rid of it and there were no tears shed! Anyway, I helped hitch the wagon to the tractor and climbed up on top of the hay for the ride home. After all, riding on a Farmall 300 as the second person is dangerous! The field had steep hills and as we crossed the hillside the wagon tilted and sliding off came the hay about two tiers at a time and I rode it down to the ground. Wheee! I did not even have time to think about jumping it happened so fast! I have a vivid picture to this day of my uncle’s face as he watched the hay and me go towards the ground! I think the tilt bed wagon saved the tractor from being tipped. It never crossed my mind as a 14 year old that the wagon would tip. After all, my uncle had enough skill and had been working in that field for years and nothing had ever happened! After he saw that I was okay his next thought was probably how do we get this all reloaded without anyone seeing it!
Cute story, but what is the point? The point is this: do farms give their family members employee safety orientations? I am going to let that topic go, but do not forget the family when it comes to safety.
Incorporating safety into the first day training tells an employee that he or she is important to the operation and you do not want them to hurt themselves. If a new employee is just part-time this adds more complexity on just how much training is needed.
We need to be honest and remember that most employees on their first day are concerned about when they will get paid, where is the break room and where do they fit in. That does not lend itself to meaningful safety training.
More safety training is retained when it is done in small doses. Yes, the first day should include the general/specific job rules and reasons for the rules. One might have to tell employees that they are not trained to do certain things and cannot do the work until fully trained. Employees should be told to report near misses, potential hazards and accidents. Above all, be sure the message comes across to the employee that safety is serious business and that all accidents are preventable.
A trusted veteran employee is also a good trainer to help the employee
learn the job for the first couple of days. He should be someone
the employee can ask questions to and ensure that the new employee can
work safely.
After the first couple of days you will need to touch base with the
new employee. Is the employee following the rules and instructions
that are given? If it is a simple misunderstanding, retraining is
necessary. If not, a heart to heart talk is needed. A farm
business does not need the heartache of the accident that a careless employee
can cause. Weed out the non-compliant, non-motivated employees early!
We all have heard the saying about someone “owning the farm”.
Just be sure it does not become a reality!
After a couple of days a refresher is in order. You or a trusted employee can ask some simple questions to see if the new hire retained the information provided the first day. Ask them questions that pertain to their job. Where is smoking permitted, what should they do if they saw someone unconscious in a silo, a machine guard off and the like. When they get their first paycheck is a good time to review safety. It may not hurt to link the concept of safety with money.
Further training will depend upon how long the employee is hired for and what their specific job(s) will be.
I wish I could give a long list of safety training rules but everyone needs to make up their own depending on the situation. On a farm there are many areas to be aware of safety, fire extinguisher use, working around large equipment, large animals, chemicals, shop work, and so on.
Do not skip some form of safety training and “bet the farm” that nothing
will happen!
Scarlet and Gray Ag Day
Heather Vaubel
Chair - Media for Ag Day
Students at the Ohio State University have taken it upon themselves to educate the consumers of tomorrow. Members of the Agricultural Education Society will be conducting the 2nd annual Scarlet and Gray Day on April 28, 2000. The group has organized the event as an educational experience for over 500 Worthington and Southwest 5th grade students to learn about agriculture and apply knowledge they gain from the day to their subjects in school. Also over 100 Ohio State students will be volunteering to help with the day. The event will be held at the Ohio State University Agriculture campus and the Waterman Dairy Farm.
“The purpose is to educate urban children about the importance of agriculture and how it relates to their everyday lives,” said Sue Hoop, an agricultural education major and co-chair for the event. The students will have the opportunity to not only see live farm animals, but also understand what they are raised for. “At Ag Day we try to base the presentations around the science aspect of agriculture and how things are developed,” said Hoop. Students will participate in a variety of 20-minute hands-on sessions presented by industry leaders, representatives from commodity groups, professors, research technicians, graduate students and farm managers from the Departments of Animal Sciences, Natural Resources, Entomology, Food, Agricultural and Biological Engineering and Food Science and Technology. Activities include making plastic out of corn, seeing first hand the making of a bratwurst, and scientific experiments with soybeans. Students will also learn about food safety, hog byproducts used everyday in their classroom, and the role photosynthesis plays in a plant’s life.
Students will take what they learn at Ag Day back to the classroom. The event serves as a way to prepare the elementary school students for the future lessons in agriculture. “In the sixth grade, they will do a unit on Agricultural Economics presented by the Ohio Farm Bureau”, said Jennifer Jameyson, co-chair of the event and agricultural education major at OSU. “The event serves as a way to prepare them for it.” They will take the knowledge they gained from the day and apply it to their science, math and health classes to prepare for the proficiency test they take in 6th grade. “Many of the presenters deal with issues that the students are tested on in their proficiencies,” said Hoop.
Hoop said that the program offers something for teachers as well as the students. “Teachers get the opportunity to attend an inservice which will help them to learn how to instruct the students about agriculture,” she said. They also receive a packet that contains lesson plans and information to use in the classroom.
Hoop said students who attend Ag Day have an advantage over others because
they receive a hands-on learning experience. “This event brings OSU
students, faculty, agricultural industry leaders and youth together for
a positive day,” said Jameyson.
Calendar of Events
2000 Ohio Dairy Management Conference
The second biannual Ohio Dairy Management Conference has been scheduled
for December 4, 2000 at the Ramada Plaza Hotel in North Columbus.
This new site should be of easier access to most attendees while maintaining
the concept of a central location to all dairy producers in Ohio.
This time, the Conference Advisory Committee which is made-up of producers,
industry and OSU-Extension people decided to condense the program to a
one day event. This should help producers who cannot get away from
the farm for two days. Also, most of the program will consist of
break-out sessions where the content will be tailored to a specific clientele.
Details will follow in the next few months. In the meantime, block
the day of December 4 on your calendar!