Research Reports
How to Improve the Financial Conditions of Dairy Farmers
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AuthorHuh, Duk
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Publication Date2008.09.01
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Original
The financial condition of dairy farms became worse during the past 6 years because the raw-milk price received by dairy farmers stays constant although the feed price and TMR price rose a lot. The result of analyzing the financial condition of dairy farmers shows that the net profit of dairy farmers in 2008 will drop substantially because the cost of making raw milk will increase by 20 percent from the previous year.
There are many kinds of dairy policies in other developed countries such as the U.S.A, E.U., and Japan. The policies are for stabilizing the financial conditions of dairy farmers. They can be categorized into three parts. One group is about international trade policies such as export subsidy or import tariffs. Another group is about domestic policies such as price support, marketing orders, or direct payments. The last group is about subsidies to dairy farmers for sustaining environments such as clarifying air conditions or reducing water pollutions.
This study suggests following several options for domestic dairy policies to help the financial conditions of domestic dairy farmers. 1) Collecting money for stabilizing feed prices 2) Preparing one-stop service consulting network 3) Improving marketing channels of roughage, 4) Admitting the farmers’ corporations to have import quota 5) Re-considering the plan of reducing the quota of roughage 6) supporting dairy-cow reforms and technical improvements 7) Research to increase milk consumptions 8) Introducing price differentiations for raw milk according to its final use, its use in time (seasonality), and its components 9) Improving the quality of raw milk 10) Making complexes for dairy farms
Researchers: Huh Duk and Kim Hyun-Joong, Jeon Sang-Gon, Lee Myung-Ki, Kim Jin-Nyun
Research period: 2008. 7. - 2008. 9(2 Monthes).
E-mail address: huhduk@krei.re.kr
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