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Publications

NIBIOs employees contribute to several hundred scientific articles and research reports every year. You can browse or search in our collection which contains references and links to these publications as well as other research and dissemination activities. The collection is continously updated with new and historical material.

2003

Abstract

Norwegian dairy farmers are facing changes in the economic environment. Prices of products and concentrates are falling, while area and headage payments are increasing. The availability of grasslands has become more abundant. Impact of changes in economic conditions on production systems and profitability are examined. Linear programming models of dairy farms, with grain and beef as alternative enterprises, are designed to analyse the adjustments. Optimal production systems are largely determined by a combination of economic factors associated with the various inputs, outputs and support schemes together with availability of farm resources. The typical Norwegian dairy farm has a small quota compared to other farm resources. Producing a fixed milk quota with moderate yielding cows is then most profitable (1999-conditions). Early cut silage offered ad libitum is most profitable. Changes in the milk price have no effects on production as long as the quota is effective. If all of the land is utilised and grassland is the only possible land use, increased area payments have no production effects. If some grassland is not in use, area payments increase land utilisation as cows are fed less concentrate. If grain is also grown, increased grassland area payments result in more land allocated to grass. Forage and milk production become less intensive. By increasing headage payments, milk yield falls, as it is optimal to have more cows to produce the fixed quota output. This contributes to keep more grassland in production and in a more intensive forage production. Lower concentrate prices lead to increased use of concentrates and higher milk yields.