Cost of cow's milk production in a semi-specialized system in the mountainous area of Veracruz, Mexico

Abstract

Objective: to analyze the cost of milk production in livestock production units of a semi-specialized system in the mountain area of the state of Veracruz, Mexico.Design/methodology/approach: A questionnaire was applied to milk producers and visits were made to their farms.Results: The main components of the variable cost of milk production were: food, health and fuel (86% of the total). Labor represented between 35 and 60% of fixed costs. The production cost per liter of milk ranged between USD $ 0.26 and $ 0.352 and the sale price between USD $ 0.28 and $ 0.30, which leaves a low profit margin. The profit fluctuated between USD $ 0.02 and -0.04 per liter of milk. Profitability can be increased by improving milk quality.

Limitations on study/implications: The analysis focuses on the last year of operations and considers only six production units, so the conclusions are only valid in this context.

Findings/conclusions: some UPPs have positive utility, but the mix of production factors needs to be reviewed and the necessary adjustments made to ensure profits.