The productivity and financial performance of dairy farms in New Zealand and Japan (Hokkaido) were analysed. Relative to Hokkaido, New Zealand has lower yield of milk solids per cow, but higher production per hectare because of their pasture grazing systems. The value of milk solid is much higher in Hokkaido than New Zealand (NZ$14.7 vs. NZ$3.5/KgMS), and the total expenses of producing milk solids are much higher in Hokkaido than in New Zealand (NZ$11.5 vs. NZ$3.0/KgMS). New Zealand has a lower variable cost, but higher fixed expenses and higher cash surplus ratio per farm compared with Hokkaido. There is also remarkably high interest expenditure in New Zealand caused by non-subsidised loan procurement from finance organisations. Total farm expenses per cow in New Zealand is only at about 1/10 of Hokkaido expenses. There is a marked difference in financial structures between the two countries, especially in turnover ratios of gross assets. The results suggest that it is important for dairy farmers in Hokkaido to consider not only cost savings achieved through grazing systems, but also to consider that grazing systems make only poor utilisation of capital.
Proceedings of the New Zealand Society of Animal Production, Volume 61, Christchurch, 203-206, 2001
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