Dairy Financial Drivers

Jun 03, 2021


Dairy Cow

What Drives Financial Success?

There is no question that the state of the dairy industry, as it has been since my time began at Premier in 2017, has been nothing short of a rollercoaster ride. While there are plenty of moving parts not in a consultant’s or producer’s control, there are still several ways to improve profitability on our dairies today.

Compeer Financial is a major provider of Agricultural lending and financial consulting services in the upper Midwest.  A couple of years ago our team came across a presentation that a group of dairy consultants from Compeer Financial put together. Compeer’s goal was to use data from their current clientele to identify specific measurements that are correlated with the financial health of the dairy. The data was collected from the farms represented in Table 1. NFI/cwt in Table 2 represents the net farm income/cwt energy corrected milk between the best third and lowest third in their study.


The first financial driver on Table 2 shows us that Energy Corrected Milk/Cow/Day was amongst the highest correlation for profitability on the dairy. The top third of the dairies came in at 92.7 pounds/cow, whereas the bottom third came in at 72.7 pounds/cow.

One way to get more milk per cow is to improve the pregnancy rate and reduce the days in milk across the herd, with the top third of herds coming in at a 27.4% pregnancy rate.

Heifer survival and overall management is essential, as raising replacements is one of the largest expenses on the dairy.

As Death Rate, Somatic Cell Count, and Net Herd Turnover Cost increased, profitability went down. Based on Compeer data, for every 100,000 increase in SCC, milk production decreases 5.5 pounds.

All in all, Compeer did a nice job of benchmarking these key financial drivers on the dairy. We can only manage what we measure. When was the last time your dairy took a hard look at each of these key areas? At Premier Cooperative, our nutrition team can offer an array of services. Whether it be benchmarking your calf and heifer program or analyzing herd records for performance and potential improvements, we would be glad to help in any way we can.


Amber Yager

Nutrition Consultant

Latest Posts

Sep 01, 2025
By the time you are reading this, south central Wisconsin will be just over 45 days since vegetative growth stage (VT), otherwise known as tassel. Although many factors are taken into place, 42 to 47 days post tassel is a signal that the plant is ready to be harvested for corn silage. With how busy and chaotic this season may be, it is important to remember the basics to maximize your feed quality for the upcoming year.
Sep 01, 2025
Current headlines surrounding the fertilizer markets tend to focus on high prices and affordability issues, especially with falling commodity prices. Ratios comparing the bushels of corn needed to buy a ton of fertilizer have, in some cases, reached record levels. Multiple factors including supply, tariffs, geopolitical tensions, and other global events are influencing markets today. Together, these factors have led to volatility in the market and current high costs.
Sep 01, 2025
I hope everyone had the chance to enjoy Labor Day weekend with family and friends. As summer begins to wind down, and with the many fairs throughout the area coming to a close, I’d like to congratulate all the kids who participated this year. If you haven’t done so already, there’s still time to check out our website for details on how our members’ kids can earn cash for showing livestock at the fair. In addition to awarding thousands of dollars to participants each year, Premier is also proud to sponsor many of the trophies presented at some of the local fairs. In some cases, we also provide products and financial support to local 4H groups traveling to the state fair. Good luck to all of you as you wrap up another show season.