Dairy farmers not only saw more demand for their production in 2017 but enjoyed lower feed costs, says the latest provincial report on the economics of milk production.

The cost of producing milk in Alberta decreased by five per cent in 2017 compared to 2016, said research analyst Pauline Van Biert.

“The total cost for one hectolitre was $75.23, or almost $7,000 per cow, a decrease of $3.65 per hectolitre or $330 per cow,” said Van Biert, adding that figure includes depreciation and family labour.

This was despite an increase in butterfat “to meet the renewed interest in higher fat products such as butter and cheese,” she said.

The dairy cost study found the average herd size in Alberta was 165 milking and dry cows (260 when replacement heifers and calves were factored in). The average operation has the equivalent of three full-time employees and the average pay was $22 an hour. Milk prices were “quite stable” and the return to equity (gross income less total cost) was about $1,060 per cow or eight per cent (versus $600 per cow or around five per cent in 2016).

The study ‘Economics of Milk Production’ can be found at the Alberta Agriculture website.