IFCN Dairy Report 2012 (Extract - 17 pages)

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IFCN Dairy Report 2012 (Extract - 17 pages)

Dairy Report 2012

For a better

understanding of

milk production

world-wide

IFCN

International Farm

Comparison Network

Extract


© IFCN Dairy Report 2012

Dear friends,

It is a pleasure for us to summarise

the highlights of our research and

network activities in 2012.

The IFCN Mission

When looking at the dairy chain as a whole, the majority of costs,

resources used, emissions generated and political challenges fall

in the milk production segment. That is why the IFCN work is driven

by our mission:

We create a better understanding of

milk production worldwide

Status of the network in 2012

A milk production profi le was created for 91 countries, representing

about 97.5% of the world’s milk production. In the farm

comparison 171 typical farms from 61 dairy regions (51 countries)

were analysed. We are very happy to welcome the countries / regions

Colombia, Costa Rica and Ethiopia, Mongolia, Turkey, and US-

California in the IFCN work. Signifi cant progress has been made in

Australia, India, Iran, Mexico, and USA.

Highlights 2012

IFCN Dairy Conference 2012: With 47 countries participating we

have made signifi cant progress in representing world milk production.

2011 – A dairy year of new records

In 2011 milk production grew by 22 million t which was the highest

growth ever observed. Relatively high milk and beef prices have

led to good farm economic results in most dairy countries.

IFCN method work has focused on

• ECM milk standardising formula

• Milk quality diff erences of farms

• Analysis of milk collection costs

• Variation of interest rates between countries

• The IFCN world milk price indicator

Concentration of milk processing: The analysis of the top 10 milk

processors permits an overview on the concentration of milk processing

per country and also a benchmarking between countries

Feeding systems: With rising feed prices it has become more and

more important to understand and improve feeding systems. In

2012 IFCN has made a signifi cant step forward in this fi eld.

The IFCN Supporter Conference 2012: This conference was held

in Cork, Ireland, 17th to 19th September with the Irish Dairy Industries

Association acting as host.

Institutional partners

of the IFCN Dairy Network

International

Dairy

Federation

Introduction

IFCN Dairy Report 2012

Chapter 1: Cost comparison: This chapter summarises results

on costs, returns, profi tability and productivity of dairy farms

worldwide.

Chapter 2: Global monitoring: This chapter gives a broad

monitoring on specifi c dairy issues such as milk prices, feed

prices and milk : feed price ratio.

Chapter 3: Milk production fact sheets: This profi le, prepared

for 91 countries, gives a comparable overview related to:

• Milk supply and demand developments

• Monthly milk prices and production data

• Consumer prices and margins in the chain

• A list of 10 major processors.

Moreover, the key results are summarised at the beginning of

the chapter via world maps.

Chapter 4: Special studies: This chapter summarises special

studies on method issues and other important studies performed.

A word of thanks

We would like to extend our heartiest thanks to all our scientifi

c partners, agribusiness partners, our institutional partners

and also to the people working in the IFCN Dairy Research

Center. It was a pleasure to serve the network in 2012 and we

are looking forward to our activities in 2013.

Although growth and profi tability were mainly good in 2011

we already now know that great changes during 2012 have

infl uenced our business and make our continued work important

to monitor and understand our dynamic environment.

Torsten Hemme Anders Fagerberg

Managing Director Chairman of the IFCN Board

1


Participating dairy economists / co-editors of the IFCN Dairy Report

Djellali Abderrazak

Horizons Agro-alimentaires Boufarik,

Algeria

2

Dairy Expert

Hugo Quattrochi |

Unión Productores de Leche Cuenca

Mar y Sierras, Argentina

Vardan Urutyan, Arpine Arakelyan |

International Center for Agribusiness

Research and Education (ICARE),

Yerevan, Armenia

Jon Hauser | Xcheque Pty Ltd, Glen

Alvie, Victoria, Australia

Leopold Kirner | Federal Institute

of Agricultural Economics, Vienna,

Austria

Mohammad Uddin | IFCN Dairy

Research Center, Kiel, Germany,

Bangladesh

Институт системны х исследованийв АПК

Национальной академии наук Беларуси

Anatoli Takun, Sviatlana Takun |

Institute of System Research in

Agro-industrial Complex, Minsk,

Belarus

Erwin Wauters | Institute for

Agricultural and Fisheries Research,

Merelbeke, Belgium

Henrique C. Junquieira | Cooperativa

Agropecuária Castrolanda, Castro,

Paraná, Brazil

Lorildo A. Stock | Embrapa Gado de

Leite (Embrapa Dairy Cattle), Juiz de

Fora, Minas Gerais, Brazil

Henri Bayemi, Asaah Ndambi |

Institute of Agricultural Research

for Development (IRAD) Bambui,

Cameroon; IFCN Dairy Research

Center, Kiel, Germany

Steve Couture | Dairy Farmers

of Canada, Ottawa, Canada

Mario E. Olivares |

Cooprinsem, Osorno, Chile

Sam Shi | Dairy Consultant, Beijing,

China

Enrique Ortega | DMV U.N., CNLM,

Colombia

Iveta Bošková | ÚZEI – Research

Institute of Agricultural Economics

and Information, Prague,

Czech Republic

Susanne Clausen | Knowledge Center

for Agriculture, Aarhus, Denmark

Adel Khattab | Tanta University,

Faculty of Agriculture, Animal

production department, Tanta, Egypt

Zelalem Yilma | Heifer International,

Addis Ababa, Ethiopia

Sami Ovaska, Jukka Tauriainen;

Timo Sipiläinen; Matti Ryhänen

| MTT Economic Research, Helsinki;

University of Helsinki, Helsinki;

Seinäjoki University of Applied

Sciences, Seinäjoki, Finland

Jean-Luc Reuillon | Institut de

l’Èlevage, Département Actions

Régionales, Aubière, France

Dorothee Boelling | IFCN Dairy

Research Center, Kiel, Germany

Annett Rindfl eisch, Ingo Heber |

Sächsisches Landesamt für Umwelt,

Landwirtschaft und Geologie, Dresden,

Germany

TN Datta, AK Saha, GG Shah |

National Dairy Development Board,

Anand, India

Devi Prasad Rao | Arohana Dairy

Private Limited, Vallam, Tamil Nadu,

India

Bambang Ali Nugroho | Faculty

of Animal Husbandry, University of

Brawijaya (UB), Malang, East Java,

Indonesia

Farhad Mirzaei | Animal Science

Research Institute of Iran, Karaj, Iran

Massoumeh Nasrollahzadeh | IFCN

Dairy Research Center, Kiel, Germany,

Iran

Fiona Thorne | Rural Economy

Research Centre, Teagasc, Dublin,

Ireland

Liron Tamir | Israel Dairy Board,

Rishon-Le´Zion, Israel

Alberto Menghi | CRPA – Centro

Ricerche Produzioni Animali, Reggio

Emilia, Italy

Dairy Research Center

Othman Alqaisi | IFCN Dairy Research

Center, Kiel, Germany, Jordan

Simone Adam | Ministère de

l’Agriculture, Service d’Economie

Rurale, Luxembourg

Enrique Vazquez | Universidad

Veracruzana, Mexico

Rigoberto Becerra Pinedo | Establo

Gibraltar, Durango, Mexico

Btissam Kessab | Centrale Laitière,

Casablanca, Morocco

Nicola Shadbolt | College of Sciences,

Massey University, Palmerston North,

New Zealand

Isah Annatte | Livestock and Fisheries

Program, NAERLS/ABU, PMB 1067, Zaria,

Nigeria

Ola Flaten, Bjørn Gunnar Hansen |

NILF – Norwegian Agricultural

Economics Research Institute; TINE,

Norwegian Dairies, Oslo, Norway

Haroon Lodhi | Waseem Shaukat,

Solve Agri Pak (Private) Limited, Lahore,

Pakistan

© IFCN Dairy Report 2012


Carlos A. Gomez | Universidad

Nacional Agraria La Molina, Lima, Peru

Michał Switłyk, Ewa Kołoszycz |

West Pomeranian University of

Technology in Szczecin, Department

of Management, Szczecin, Poland

Evgeny Kuplyauskas | Russian Dairy

Union, Moscow, Russian Federation

Rade Popovic | University of Novi Sad,

Faculty of Economics, Subotica, Serbia

Koos Coetzee | Milk Producers‘

Organisation, Pretoria, South Africa

Ernesto Reyes | TRAGSATEC – Ministerio

del Medio Ambiente, Medio Rural y

Marino, Spain

Agneta Hjellström | Swedish Dairy

Association, Stockholm, Sweden

Christian Gazzarin | Agroscope

Reckenholz-Tänikon Research Station

(ART), Agricultural Economics, Tänikon,

Switzerland

Michel de Haan | Animal Sciences

Group, Wageningen-UR, Lelystad,

The Netherlands

Dhiaeddine M‘Hamed | Centrale

Laitière du Cap-Bon Délice, Saliman,

Tunisia

© IFCN Dairy Report 2012

Participating dairy economists / co-editors of the IFCN Dairy Report

Muhittin Özder |Turkish Milk Council,

Ankara, Turkey

Olga Kozak | National Scientifi c Centre

“Institute of Agrarian Economics”, Kyiv,

Ukraine

Karolina Klaskova | Agriculture &

Horticulture Development Board,

Market Intelligence, Kenilworth,

Warwickshire, United Kingdom

Chad Harris | Glanbia, Idaho, USA

Ed Jesse | Babcock Institute,

University of Wisconsin, USA

William Schiek | Mike Francesconi,

Annie AcMoody | Dairy Institute of

California; California Department of

Agriculture; Western United Dairymen;

California, USA

Bill Zweigbaum, Christopher Noble |

Farm Credit East, Greenwich, NY,

USA; Linwood Management Group,

Linwood, NY, USA

Gabriel Bagnato | Instituto Nacional

de la Leche, Montevideo, Uruguay

Researchers participating only in the

country profi le analysis

Ilir Kapaj | Hohenheim University,

Stuttgart, Germany, Albania

Andrew Weinert | Department of

Agriculture, Perth, Australia

Felix Menzel | Dairy Farmer, Mezza

Sucre, Bolivia

Zlatan Vassilev | Dairy Expert, Bulgaria

Douming, Wennie Liu | Beijing Orient

Dairy Consultants Ltd, China

René A. Pérez R., Luisa Fernanda

Quiceno | DMV U.N., CNLM, Colombia

Francisco Jose Arias Cordero |

Dos Pinos, Costa Rica

Jasmina Havranek | Faculty of Agriculture,

University of Zagreb, Croatia

Rafael Vizcarra | Centro de la Industria

Láctea, Quito, Ecuador

Katri Kall | Estonian University of Life

Sciences, Estonia

Eva Schröer-Merker | IFCN Dairy

Research Center, Kiel, Germany

Daniel Mándi-Nagy | Research

Institute for Agricultural Economics

(AKI), Budapest, Hungary

Baldur H. Benjamínsson | Association

of Icelandic Dairy and Beef Cattle

Farmers, Reykjavik, Iceland

Dr. A. K. Srivastava, Smita Sirohi |

National Dairy Research lnstitute,

Karnal, India

Istiqomah | Fakultas Ekonomi Universitas,

Jenderal Soedirman Purwokerto

Central, Java, Indonesia

Hamid Monazami | Ganje Kavir. Co,

Mashhad,, Iran

Kenji Namiki | Japan Dairy Council,

Tokyo, Japan

Galiya Akimbekova | Scientifi c

Research Institute of Agricultural

Economics, Almaty, Kazakhstan

David Waititu Kimani | TechnoServe,

Nairobi, Kenya

Lee Jung Min | Korea Rural Economic

Institute, Seoul, Korea

Almasbek Chonov | Project DGRV

(Deutscher Genossenschafts- und

Raiff eisen Verband) in Kyrgyzstan

„Development of rural co-operatives“,

Kyrgyzstan

Agnese Krievina | Latvian State

Institute of Agrarian Economics, Riga,

Latvia

Deiva Mikelionyte | Lithuanian

Institute of Agrarian Economics, Vilnius,

Lithuania

Blagica Sekovska | Veterinary Faculty,

Institute for Food, Skopje, Macedonia,

The Fmr Yug Rp

Zakaria Abd Rahman | Dairy Farmer,

Redagri Farm Sdn Bhd, Hulu Terengganu,

Malaysia

Jaime Jurado Arredondo |

Universidad Autonoma de Chihuahua,

Chihuahua, Mexico

Amgalanbaatar Odonmajig, Tsetsgee

Ser-Od, Batchimeg Tumurjil |

Ministry of Food, Agriculture and light

Industry of Mongolia; Mongolian Dairy

Research Association, Ulaanbaatar,

Mongolia

Romy Das | Agriculture Researcher,

Nepal

Naomi K. Torreta | National Dairy

Authority, Quezon City, Philippines

António Moitinho Rodrigues |

School of Agriculture - Polytechic

Institute of Castelo Branco, Portugal

Michel Noordman | Dairy Farmer, S.C.

Boes Lapte S.R.L., Romania

Margita Stefanikova | Slovak Association

of Milk Producers (SZPM), Nitra,

Slovakia

Ben Moljk | Agricultural Institute of

Slovenia, Ljubljana, Slovenia

Hemali Kothalawala | Department

of Animal Production and Health,

Peradeniya, Sri Lanka

Xenia Hsiao | Forefront Enterprise Co.,

Ltd., Taipei, Taiwan, ROC

Adul Vangtal | Thai Holstein Friesian

Association (T.H.A.), Thailand

John Anglin | Paramount Dairies (2010)

Ltd, Uganda

David Balikowa | TechnoServe Inc.,

Kampala, Uganda

Evelina Budjurova | Justus-

Liebig-Universität, Gießen, Germany,

Uzbekistan

Vu Ngoc Quynh, Tieu Duc Viet |

Vietnam Dairy Association,

Vietnam

3


Table of contents

Institutional partners

of the IFCN Dairy Network

4

Preface

IFCN Dairy Report - developments 2000-2011 6

Regional maps and the typical farms 7

Questions and Answers about IFCN Dairy 8

1 Comparison of the typical farms 2011

1.1 Summary – Farm comparison 2011 13

1.2 Regional overview on costs and

returns of the dairy enterprise 14

1.3 Milk supply curves 2011 16

1.4 Cost of milk production in average sized farms 2011 18

1.5 Cost of milk production in larger farms per country 2011 19

1.6 Description of the dairy farms analysed 20

1.7 Cost of milk production only 22

1.8 Total costs and returns of the dairy enterprise 24

1.9 Returns: Milk price, non-milk returns and

decoupled payments 26

1.10 Description of direct payments and policies 28

1.11 Dairy enterprise: Profi ts and return to labour 30

1.12 Asset structure and return on investment 32

1.13 Overview of all typical farms analysed – costs and returns 34

1.14 Farm level time series analysis 2000-2011 36

2 Global monitoring dairy economic indicators 1996-2011

2.1 Summary: Monitoring dairy economic indicators 41

2.2 Global trends in oil, milk and feed prices 1981-2012 42

2.3 Milk prices in 2011 in US-$ 44

2.4 Monitoring milk prices 1996-2011 46

2.5 Monthly developments and key facts 48

2.6 Monitoring feed prices 1996-2011 50

2.7 Monitoring milk : feed price ratio 1996-2011 52

International

Dairy

Federation

3 Dairy sector and chain profi le

3.1 Summary – Status and trends in the dairy sector 58

3.2 Status and development of milk production 60

3.3 Top 20 dairy countries in 2012 62

3.4 Status of milk surplus, defi cit and self-suffi ciency 63

3.5 Importance of dairy trade and milk price transmission schemes 64

3.6 The dairy chain 66

3.7 World milk consumption 68

3.8 World population 69

3.9 Method explanation of the Country Page 2012 70

Dairy sector & chain profi les

3.10 Afghanistan 71

3.11 Albania 72

3.12 Algeria 73

3.13 Argentina 74

3.14 Armenia 75

3.15 Australia 76

3.16 Austria 77

3.17 Bangladesh 78

3.18 Belarus 80

3.19 Belgium 81

3.20 Bolivia 82

3.21 Brazil 83

3.22 Bulgaria 84

3.23 Cameroon 85

3.24 Canada 86

3.25 Chile 87

3.26 China 88

3.27 Colombia 90

3.28 Costa Rica 91

3.29 Croatia 92

3.30 Cyprus 93

3.31 Czech Republic 94

3.32 Denmark 95

3.33 Ecuador 96

3.34 Egypt 97

3.35 Estonia 98

3.36 Ethiopia 100

3.37 Finland 101

3.38 France 102

3.39 Germany 103

3.40 Greece 104

3.41 Hungary 105

3.42 Iceland 106

3.43 India 107

3.44 Indonesia 108

3.45 Iran 110

3.46 Ireland 111

3.47 Israel 112

3.48 Italy 113

3.49 Jamaica 114

3.50 Japan 115

3.51 Jordan 116

3.52 Kazakhstan 117

3.53 Kenya 118

3.54 Korea, Republic of 120

3.55 Kyrgyzstan 121

3.56 Latvia 122

3.57 Lithuania 123

3.58 Luxembourg 124

3.59 Macedonia 125

3.60 Malaysia 126

3.61 Mexico 127

3.62 Mongolia 128

3.63 Morocco 130

3.64 Nepal 131

3.65 The Netherlands 132

3.66 New Zealand 133

3.67 Nigeria 134

3.68 Norway 135

3.69 Pakistan 136

3.70 Panama 137

3.71 Paraguay 138

3.72 Peru 139

3.73 Philippines 140

3.74 Poland 141

3.75 Portugal 142

3.76 Romania 143

3.77 Russian Federation 144

3.78 Saudi Arabia 146

3.79 Serbia 147

3.80 Slovakia 148

3.81 Slovenia 149

3.82 South Africa 150

3.83 Spain 151

3.84 Sri Lanka 152

3.85 Sweden 153

3.86 Switzerland 154

3.87 Syria 156

3.88 Taiwan 157

3.89 Tajikistan 158

3.90 Thailand 159

3.91 Tunisia 160

3.92 Turkey 161

3.93 Uganda 162

3.94 Ukraine 163

3.95 United Kingdom 164

3.96 USA 165

3.97 Uruguay 166

3.98 Uzbekistan 167

3.99 Venezuela 168

3.100 Vietnam 169

© IFCN Dairy Report 2012


4 Special studies

4.1 Normative analysis on future alternative

feeding system in Jordan 174

4.2 Greenhouse gas emissions of milk production worldwide:

Assessment and analysis 176

4.3 Method development: Milk quality adjustment 178

4.4 Method development: Interest rate 180

4.5 Farm supply reaction 182

4.6 Opportunity costs of land use 184

4.7 Method development in global dairy

processor analysis 186

4.8 World market price for milk – Development

of a new IFCN world milk price indicator 188

Institutional partners

of the IFCN Dairy Network

© IFCN Dairy Report 2012

International

Dairy

Federation

Table of contents

A.1

Annex

13th IFCN Dairy Conference 2012

June 4– to 6– 2012 in Kiel, Germany 192

A.2 9th IFCN Supporter Conference –

September 26th to 28th 2011 in Monastier Treviso, Italy 193

A.3 Typical farm approach and data quality assessment 194

A.4 Description of the typical dairy farms analysed 196

A.5 Details on Country Page analysis: calculations and

defi nition of parameters on the example of India 202

A.6 Specifi cations of world regions 203

A.7 Assumptions for the calculations 204

A.8 IFCN Dairy publications 205

A.9 Exchange rates 1996 – 2011 206

A.10 Abbreviations 207

A.11 Who is who 208

5


IFCN Dairy Report – Developments 2000 – 2012

Which countries are participating in the IFCN Dairy Report activities in 2012?

6

Year Countries included in No. of farm types analysed* Topic of Country Report IFCN Dairy Conferences

farm comparison country profi le analysis

2000 8 8 21 Ex-post analysis 1996–2000 Sep-00

2001 20 20 52 Country reports on milk production Jun-01

2002 24 24 72 Dairy production systems survey May-02

2003 27 24 76 Farm structure analysis 1990-2001 May-03

2004 31 31 92 Dairy sector profi le 1981-2001 Jun-04

2005 33 41 102 Milk production fact sheet 1996-2003 May-05

2006 34 60 103 Dairy sector & chain profi le 1990-2004 May-06

2007 38 73 120 Milk production fact sheet 1996-2005 Jun-07

2008 44 78 134 Dairy sector & chain profi le 1996-2007 Jun-08

2009 46 80 147 Milk production fact sheet 1996-2008 Jun-09

2010 44 86 143 Dairy sector & chain profi le 1996-2009 Jun-10

2011 49 90 157 Milk production fact sheet 1996-2010 Jun-11

2012 51 91 171 Dairy sector & chain profi le 1996-2011 Jun-12

* Farms analysed in Chapter 1 and 4

Institutional partners

of the IFCN Dairy Network

International

Dairy

Federation

51 countries analysed in the Farm Comparison

+40 countries participated in the Country Pages

© IFCN Dairy Report 2012


North America

Idaho (ID)

1000, 2000

California (CA)

1100, 3000

Institutional partners

of the IFCN Dairy Network

Mexico

54S, 2000To

South America

Colombia

6, 30, 100

Africa

Morocco

3N, 8N

Chile

53

100

412

428++

1070

Nigeria

5

50

Peru

7

17

Argentina

170

400

600

© IFCN Dairy Report 2012

Wisconsin (WI)

80, 500

Brazil

25 SE

100 SE

20 S

50 S

Uruguay

64

122

371

Algeria

Tunisia

6, 18 2, 4, 5, 10, 12, 290

Cameroon

2

11

35

50

South Africa

210

470

630

Canada

49

83

New York (NY)

65, 500, 2029

120 PR

571 PR

Egypt

3, 4,

6, 14, 150

Ethiopia

4, 50

Uganda

1

3

13

International

Dairy

Federation

West Ludhiana

4N, 18N

Gujarat

3 W

Regional maps and the typical farms

Europe and Middle East

Germany

30 S

80 S

108 S

98 N

98 N++

120 N

240 N

85 E

400 E

650 E

650 E++

1150 E

Ireland

62

117

Luxembourg

52

117

Punjab

72NW

Pakistan

4

18

Karnataka

3S

UK

150 NW

245 SW Belgium

Spain

50 NW

105 NW

74 S

59 CN

40N

90N

Denmark

150

275

NL

76

197

France

38 MC

72 C

50 W

120 W

Switzer-

land

18

22

62

Norway

20

35

Italy

154

229

Sweden

55

70

139

230

Finland

24

70

132

Poland

15, 65, 110

Czech Republic

80, 425, 730

Austria

12-bio

22

45

Serbia

2

10

84

South East Asia and Oceania

India

Bangladesh

2, 14

Tamil Nadu

6SE

10SE

23SE

China-Heilongjiang

5HJ, 10HJ, 40HJ

Indonesia

3 NG, 10 NG,

2 JA, 10 JA,

Israel

71

365

China-Beijing

17BE, 340BE

Belarus

1, 620, 1153

Australia

Victoria

300

750

Ukraine

150, 425

Russia

1082, 1328

Jordan

3

30

75

400

Armenia

5, 7, 35

Turkey

15, 50

Iran

2, 27, 90,

120, 276, 458

New Zealand

355

1066

Legend: Legend: Numbers indicate the number of cows in the typical farms. N = North, E = East, S = South, W = West, NW = North

West, SE = South East, SW = South West, CA = California, BE = Beijing, bio = Organic, C = Central, CN = Central North, ++ = Farms

better managed than average, HJ = Heilongjiang, US-ID = US-Idaho, JA = Jabung, MC = Massif Central, NG = Ngatang, NY = New

York, PR = Parana, To = Torreon, WI = Wisconsin

7


Questions and answers about IFCN Dairy

What is IFCN?

IFCN stands for International Farm Comparison Network. The dairy

branch of the IFCN was founded in 1997.

1. IFCN Vision

We are the leading, global knowledge organization in milk production

2. IFCN Mission

We create a better understanding of milk production worldwide.

3. IFCN identity, competence, values and concept

The IFCN is a global network of dairy researchers related to companies

and other stakeholders of the dairy chain.

The IFCN has a Dairy Research Center (DRC) with approx. 10 researchers

coordinating the network process and running dairy research

activities.

Focus on milk production

In the dairy chain the major share of a) the costs, b) resources used,

c) emissions created and d) the political challenges come from producing

the milk itself.

That’s why the IFCN focuses on milk production and related topics

like milk prices, dairy farm economics, etc.

Core competence

The IFCN core competence is in the network of dairy people who

have built trust the last 10 years to openly share and discuss dairy

issues. This and the annual working process make the IFCN an ongoing

knowledge creation system.

Core values

The IFCN is independent from third parties and is committed to

truth, science and reliability of results.

The IFCN and all its partners commit themselves not to get involved

in any discussions or activities that may infringe any applicable competition

law.

Why is the IFCN useful for a dairy region?

To have a prospering dairy region, a clear strategy of all stakeholders

is required. The participation in IFCN provides information about the

global developments of the dairy sector and the competitiveposition

of a dairy region in it. Moreover, it identifi es potential points for

improvement.

Who benefi ts from the IFCN work?

1. Dairy farmers

Dairy farmers benefi t from knowing about their competitiveness in

a globalized dairy world. Moreover, they get access to information

about alternative production systems.

2. Milk processors

Information about the production costs in specifi c milk regions is a

key element for the competitiveness of the milk processor.

3. Farm input suppliers

Information about farm economics and global dairy developments

are very good tools to guide strategic discussion and decisions

within the company.

8

The concept of three circles

The IFCN network concept is based on three circles and the related

win-win partnerships.

The 3 circles of IFCN

Circle 3

get public goods of

IFCN – free of charge

Circle 2

get servises from IFCN

+ provide funding

Circle 1

Reserchers

creating the IFCN

knowledge

(the network goods)

Circle 1: The participating dairy researchers and the people in the DRC

create the IFCN knowledge by sharing and managing information.

Circle 2: Dairy related companies and organisations get services

from the IFCN. In return they fi nance the IFCN activities of the center

(DRC) and in the countries.

Circle 3: Part of the IFCN knowledge defi ned by the DRC can be

made available as a public good for the global dairy industry

4. Policy makers

The link with the IFCN knowledge provides the policy makers with

facts and fi gures for political discussions. Moreover, the IFCN tools

permit the evaluation of alternative policy scenarios.

5. Research organisations

Cooperation with IFCN off ers access to methods, models and data

which increases the capacity in dairy research and teaching. Technically,

the IFCN provides:

· Benchmarking: Analyse your dairy region in a global context.

· Networking: Link yourself to the leading network of experts

in your research topic.

· Access to data: Send in 2 farm types and get the world in return.

· Promotion: Promote your institution nationally and internationally.

Partnership with the IFCN network

The IFCN off ers diff erent kinds of partnership for the various stakeholders

of the dairy chain. For further information please contact us

(info@ifcndairy.org)

© IFCN Dairy Report 2012


The IFCN Dairy Research Center

Torsten

Hemme

Mikhail

Ramanovich

Othman

Alqaisi

Eva

Schröer-Merker

© IFCN Dairy Report 2012

Eva

Asmussen

Christoph

Sommer

Agribusiness partners of the IFCN

Milk processing

Milking and barn equipment

Health and hygiene

Feed

Genetics

Other branches of the dairy chain

Dorothee

Boelling

Nadira

Sultana

Franziska

Goergens

Mohammad

Uddin

Katja

Horten

Questions and answers about IFCN Dairy

Karin

Wesseling

Judit

Kühl

Lukasz

Wyrzykowski

Rebecca

Kühl

Eberhard

Bönemann

Massoumeh

Nasrollahzadeh

Elgin

Giff horn

Asaah

Ndambi

Peritus Farm DMCC

9


Colombia

Colombia pictures by T. Hemme.

12

Chapter 1 – Comparison of the typical farms 2011

Authors: Asaah Ndambi, Dorothee Boelling, Mohammad Mohi Uddin, Christoph Sommer, Othman Alqaisi,

Rebecca Kühl with the contribution from researchers mentioned on page 2-3 of this report

1.1 Summary – Farm comparison 2011 13

1.2 Regional overview on costs and returns of the dairy enterprise 14

1.3 Milk supply curves 2011 16

1.4 Cost of milk production in average sized farms per country 2011 18

1.5 Cost of milk production in larger farms per country 2011 19

1.6 Description of the dairy farms analysed 20

1.7 Cost of milk production only 22

1.8 Total costs and returns of the dairy enterprise 24

1.9 Returns: Milk price, non-milk returns and decoupled payments 26

1.10 Description of direct payments and policies 28

1.11 Dairy enterprise: Profi ts and return to labour 30

1.12 Asset structure and return on investment 32

1.13 Overview of all typical farms analysed – costs and returns 34

1.14 Farm level time series analysis 2000-2011 36

© IFCN Dairy Report 2012


Previous and this double page: IFCN Dairy Conference 2012

40

Chapter 2 – Global monitoring dairy economic indicators 1996 – 2011

Authors: Eva Schröer-Merker, Karin Wesseling, Massoumeh Nasrollahzadeh

with the contribution from researchers mentioned on page 2-3 of this report

2.1 Summary: Monitoring dairy economic indicators 41

2.2 Global trends in oil, milk and feed prices 1981-2012 42

2.3 Milk prices in 2011 in US-$ 44

2.4 Monitoring milk prices 1996-2011 46

2.5 Monthly developments and key facts 48

2.6 Monitoring feed prices 1996-2011 50

2.7 Monitoring milk : feed price ratio 1996-2011 52

© IFCN Dairy Report 2012


This and previous double page: Milk production in India.

Chapter 3 – Dairy sector and chain profi le

Authors: Karin Wesseling, Massoumeh Nasrollahzadeh, Eva Schröer-Merker, Judit Kühl, Łukasz Wyrzykowski

with the contribution from researchers mentioned on page 2-3 of this report

3.1 Summary – Status and trends in the dairy sector 58

3.2 Status and development of milk production 60

3.3 Top 20 dairy countries in 2011 62

3.4 Status of milk surplus, defi cit and self-suffi ciency 63

3.5 Importance of dairy trade and milk price transmission schemes 64

3.6 The dairy chain 66

3.7 World milk consumption 68

3.8 World population 69

3.9 Method explanation of the Country Page 2012 70

3.10 – 3.100 Country Pages 71

© IFCN Dairy Report 2012

3.xx xxxxxxxxx

57


Dairy Research Center

DAIRY SECTOR AND CHAIN PROFILE

© IFCN Dairy Report 2012

Eva Schröer-Merker

Status 2011

• Self-sufficiency in milk: 127%

• Milk production (cow‘s): 31.1 mill t ECM

• Export: approx. 65% of production

• Import: approx. 56% of local consumption

Key developments 2006-2011

• Milk production (cow‘s): +1.6% per year

Dairy consumption per capita: +1.7% per year

• Population: -0.2% per year

Milk equivalent (ME) calculation based on fat and protein only

Key variables of the dairy sector

Illustration of the dairy chain

3.39 Germany – Dairy sector and chain profi le

Milk production

mill t milk (ECM)

Change in monthly milk delivered

% change

annual change

1996 1998 2000 2002 2004 2006 2008 2009 2010 2011 '01-'06 '06-'11

Milk production (cow's)

Production (mill t ECM) 29.88 29.44 29.34 28.82 29.29 28.76 29.39 30.01 30.47 31.08 -0.3% 1.6%

Cows (in 1,000's) 5,195 4,833 4,564 4,373 4,287 4,054 4,229 4,169 4,182 4,190 -2.0% 0.7%

Milk yield (t/cow/year) 5.75 6.09 6.43 6.59 6.83 7.10 6.95 7.20 7.29 7.42 1.7% 0.9%

Dairy consumption (from all dairy species)

Consumption (mill t ME) 23.63 23.00 22.11 24.87 21.66 22.71 22.93 22.70 23.12 24.48 0.6% 1.5%

Population (mill people) 81.84 82.00 82.08 82.31 82.38 82.26 82.01 81.77 81.60 81.44 0.0% -0.2%

Consumption (kg ME/capita) 289 281 269 302 263 276 280 278 283 301 0.5% 1.7%

The dairy chain

Milk delivered in % 94% 94% 95% 95% 96% 96% 96% 97% 97% 97% 0.1% 0.1%

Share (Processor, retailer) in EUR/100 kg ECM 30.9 27.2 22.9 28.6 26.3 28.7 33.4 29.8 28.7 28.8 2.9% 0.1%

Farmers' share of consumer price 45% 50% 54% 49% 49% 46% 48% 42% 49% 51% -3.0% 1.9%

Farm gate milk prices

EUR / 100 kg milk (ECM)

45

40

35

30

25

20

15

10

5

0

National price

IFCN milk price indicator (world)

2006 2007 2008 2009 2010 2011 2012

monthly

Consumer & farmers' prices

EUR / 100 kg milk (ECM)

Explanations

Method: See Chapter 3.9 for details. Sources: National statistics supplemented by data from FAO, IMF, OANDA. Other dairy species: Sheep and goat.

Data: 2012 data preliminary and partly estimated. Cooperatives‘ share on milk intake shown in the list is an IFCN estimate based on partner information.

Consumer price (raw data) for: Fresh milk, 1 litre packing with 3.5% fat, 3.17% protein.

Change in milk production: Change in milk production/delivery: Febuary 2008/2012 adjusted to 28 days (leap years).

35.0

30.0

25.0

20.0

15.0

10.0

5.0

0.0

80

70

60

50

40

30

20

10

0

1996

1996

1998

Milk not delivered to dairies

and milk from other animals

Milk delivered to dairies

VAT

Share (Processor, retailer)

"Farmers' milk price"

Consumer price

1998

2000

2000

2002

2002

2004

2004

2006

2006

2008

2008

2010

2010

15%

10%

5%

0%

-5%

-10%

-15%

% change to previous year

Average annual % change

2007 2008 2009 2010 2011 2012

monthly

Milk processors list 2010

Milk intake in 1,000 tons (natural content)

DMK 6800

Hochwald 2013

Müller 2000

Milch-Union Hocheifel eG 1238

Molkerei Ammerland eG 1077

Uelzena eG 1007

Omira Oberland Milchverwertung GmbH 952

Zott GmbH und Co. KG 852

Rücker GmbH 800

Bayerische Milchindustrie eG 782

Cooperatives: 62% of milk intake shown

Share on national milk delivery

Rest 39%

Processor 1

Processor

2-10

103


Mexico – pictures by Torsten Hemme

Chapter 4 – Special studies

4.1 Normative analysis on future alternative feeding system in Jordan 174

4.2 Greenhouse gas emissions of milk production worldwide: Assessment and analysis 176

4.3 Method development: Milk quality adjustment 178

4.4 Method development: Interest rate 180

4.5 Farm supply reaction 182

4.6 Opportunity costs of land use 184

4.7 Method development in global dairy processor analysis 186

4.8 World market price for milk – Development of a new IFCN world milk price indicator 188

© IFCN Dairy Report 2012

173


This double page: IFCN Dairy team and its activities in 2012

Annex

A.1 13 th IFCN Dairy Conference 2012 – June 4 – to 6 – 2012 in Kiel, Germany 192

A.2 9 th IFCN Supporter Conference – September 26 th to 28 th 2011

in Monastier Treviso, Italy 193

A.3 Typical farm approach and data quality assessment 194

A.4 Description of the typical dairy farms analysed 196

A.5 Details on Country Page analysis: calculations and

defi nition of parameters on the example of India 202

A.6 Specifi cations of world regions 203

A.7 Assumptions for the calculations 204

A.8 IFCN Dairy publications 205

A.9 Exchange rates 1996 – 2011 206

A.10 Abbreviations 207

A.11 Who is who 208

© IFCN Dairy Report 2012

191


Partners of the IFCN Dairy Network

Dairy researchers representing 90 countries

Institutional partners

Agribusiness partners

Milk processing

Milking and barn equipment

Health and hygiene

Feed

Genetics

Other branches of the dairy chain

ISSN 1610-434X

International

Dairy

Federation

Peritus Farm DMCC

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