A comparison of profitability between culture and native-breed dairy farms (case study of eastern part of Turkey)

The comparison of the profitability of culture and native-breed dairy fanns was aimed in this study. The hypothesis that culture-breed dairy farms are more profitable as well as more cost-efficient in producing one unit of milk and that the profitability increases in proportion to farm size was tested. The material was collected from 40 culture and 16 native-breed dairy farms in Center town of Van province, Turkey. The data belong to 1999 production period. The number of cow per farm, dady milk per cow, lactation period, milk production per cow per lactation and total milk production per farm was 8.3, 7.63 kg, 225.5 days, 1720.6 and 14289.7 kg, respectively for culture-breed dairy farms. The same figures were relatively lower for native-breed dairy farms with 4.4, 3.24 kg, 208.13 days, 674.3 and 2.967 kg, respectively. Economical profitability was positive with 3.27% for culture-breed farms while this figure was negative for native-breed farms with -1.14%. Both economical and financial profitability increased in parallel to farm size. The cost of 1 kg of milk was calculated as $0.47, which is 60% higher than that of culture-breed dairy farms. This figure decreased in proportion to farm size. The total production elasticity of inputs found by coob-douglas production function for culture-breed dairy farms was 2.97, winch means there is an increasing return to the scale. We can suggest that the scale is effective on the profitability and expanding the culture-breed dairy enterprise could increase the profitability due to economies of scale. © 2006 Academic Journals Inc.