The Dairy Business Math
I was camping in a forest. Nearby villagers used to come to graze their cows. I got chatting with one of them. He explained the math of dairy. Here it follows for 1 cow:
Daily milk yield: 8 litres @ 20 rs per litre: 160 rs = 4800 rs per month
Cow dung: 0.5 kilta per day @50 rs per kilta = 25 rs = 750 rs per month.
Daily concentrate/Feed cost: 2kg@20 rs per kg, 40 rs =1200 rs per month
Fodder cost: almost nil in summers. About 4000/ in winters if purchasing. Otherwise you can get grass in exchange for cow dung. Will reduce your cost. Lets assume 1500 rs per month.
Labour cost: 2000 (approx)
Misc expenses: 500 rs
Remove 3 months of milk production when the cow is not lactating. Ideally it is 2 but account for lower milk production due to dry grass in cold winters. 4800*3/12 = 1200 rs per month
Total = 4800+750-1200-2000-1500 -500-1200= -850. All in all a small loss.
Here comes the optimizaton.
Sell milk products@40 rs per litre. +4800 -1200 =3600
Make vermicompost: +1000 rs
Sell worms from vermicompost: 300
Sell cow urine: +1500
Additional labour cost: -1000
Net profit increase: 5300
Total profit: 4500.
Add buffer of 750
Total profit per cow: 3800rs. Now calculate the RoI: It is easily in the range of 5-10% per month.
The optimization will be better if you get high yielding cows. There is a small income from calves. You can add it in the buffer. Interest etc. Can be taken out from the buffer. I have started my business assuming a yield of 13 litres. That increases the profit by at lease 30 percent.
Daily milk yield: 8 litres @ 20 rs per litre: 160 rs = 4800 rs per month
Cow dung: 0.5 kilta per day @50 rs per kilta = 25 rs = 750 rs per month.
Daily concentrate/Feed cost: 2kg@20 rs per kg, 40 rs =1200 rs per month
Fodder cost: almost nil in summers. About 4000/ in winters if purchasing. Otherwise you can get grass in exchange for cow dung. Will reduce your cost. Lets assume 1500 rs per month.
Labour cost: 2000 (approx)
Misc expenses: 500 rs
Remove 3 months of milk production when the cow is not lactating. Ideally it is 2 but account for lower milk production due to dry grass in cold winters. 4800*3/12 = 1200 rs per month
Total = 4800+750-1200-2000-1500 -500-1200= -850. All in all a small loss.
Here comes the optimizaton.
Sell milk products@40 rs per litre. +4800 -1200 =3600
Make vermicompost: +1000 rs
Sell worms from vermicompost: 300
Sell cow urine: +1500
Additional labour cost: -1000
Net profit increase: 5300
Total profit: 4500.
Add buffer of 750
Total profit per cow: 3800rs. Now calculate the RoI: It is easily in the range of 5-10% per month.
The optimization will be better if you get high yielding cows. There is a small income from calves. You can add it in the buffer. Interest etc. Can be taken out from the buffer. I have started my business assuming a yield of 13 litres. That increases the profit by at lease 30 percent.
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