Costs and benefits of improved milking practices in smallholder dairy farms in the 10th region of Chile

Chile is keen to expand exports of dairy products and so has introduced regulations to improve milk quality through financial incentives. Penalties for BMSCC start at 250,000 cells/ml and go up to minus 22% of the milk price at >750,000 cells/ml and penalties for TBC start at 20,000 cfu/ml and go up to minus 10% of the milk price at >400,000 cfu/ml. A study was carried out to investigate the principal management factors that influenced bulk milk somatic cell count (BMSCC) and total bacterial count (TBC) of 150 smallholder dairy farms in the main dairy area of Chile (Van Schaik et al., 2005). The predictions of the TBC and BMSCC models were used to estimate the TBC and BMSCC levels of herds with specific management measures. A division could be made in management practices that required low, moderate and high investment from the smallholder dairy farms and based on that three scenarios were considered. In the best case scenario all management practices were successfully applied, in the worst case scenario none of the beneficial practices were carried out, and in the cheap scenario only the low cost management practices were applied. The calculations were carried out for an average smallholder with 11 lactating cows that produce about 30,000 kg with an average milk price of 116 pesos (€0.16) with the standard penalties and bonuses. The extra net present value after 10 years was calculated for the three scenarios. The study predicted that in the best management scenario a herd had a mean TBC of 1525 colony forming units (cfu)/ml and a BMSCC of approximately 46,166 cells/ml. Whereas a herd in the worst management scenario had a predicted TBC of 59x10⁹ cfu/ml and a mean BMSCC of 2x10⁶ cells/ml. In the cheap management scenario a herd would have a predicted TBC of 235x103 cfu/ml and a mean BMSCC of 215x103 cells/ml. The extra net present value that the worst, best and cheap management herd would gain after 10 years amounted-€4072, €980, and €333, respectively. The worst management herds would loose a considerable amount and the best and cheap management herds would have an extra increase in their yearly income from milk of 4.6% and 1.6% respectively.