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Seasonality and Costs of Production on Irish dairy farms from 1994-2008
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2010
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P. Smyth, L. Harte and T. Hennessy. (2010) Seasonality and Costs of Production on Irish dairy farms from 1994-2008. RERC Working Paper Series PUT 10-WP-RE-01
Abstract
Previous research has highlighted the economic advantages of spring calving in
countries such as Ireland that have a long spring/summer grazing season. However,
the widespread adoption of such a production system leads to a highly seasonal milk
supply and a range of problems that are associated with seasonality. The objective of
this paper is to use historical data to quantify the economic benefits of a spring
calving system. Data from over 400 dairy farms in Ireland over a period of 15 years is
examined. Fixed, random and between effects panel models are estimated to test the
significance of calving season on production costs. The results show the effect of
calving season is significant at lowering production costs. These models returned
results suggesting that high compact early Spring herds have significantly lower costs
than over seasons. However the fixed effect model demonstrates little difference
between production costs in different seasons suggesting individual effects such as the
ability of the farmer may play a role in reduction of costs. Herds that are calved over a
shorter period tend to have lower production costs.