JDS
HOME HELP FEEDBACK SUBSCRIPTIONS ARCHIVE SEARCH TABLE OF CONTENTS
QUICK SEARCH:   [advanced]


     

Journal of Dairy Science Vol. 85 No. 9 2207-2214
© 2002 by American Dairy Science Association ®
This Article
Right arrow Full Text
Right arrow Full Text (PDF)
Right arrow Alert me when this article is cited
Right arrow Alert me if a correction is posted
Services
Right arrow Similar articles in this journal
Right arrow Similar articles in PubMed
Right arrow Alert me to new issues of the journal
Right arrow Download to citation manager
Right arrow reprints & permissions
Citing Articles
Right arrow Citing Articles via HighWire
Right arrow Citing Articles via Google Scholar
Google Scholar
Right arrow Articles by Hyde, J.
Right arrow Articles by Engel, P.
Right arrow Search for Related Content
PubMed
Right arrow PubMed Citation
Right arrow Articles by Hyde, J.
Right arrow Articles by Engel, P.

Investing in a Robotic Milking System: A Monte Carlo Simulation Analysis

J. Hyde and P. Engel

Department of Agricultural Economics and Rural Sociology The Pennsylvania State University University Park, PA 16802

Corresponding author:
J. Hyde; e-mail:
jeffhyde{at}psu.edu.

This paper uses Monte Carlo simulation methods to estimate the breakeven value for a robotic milking system (RMS) on a dairy farm in the United States. The breakeven value indicates the maximum amount that could be paid for the robots given the costs of alternative milking equipment and other important factors (e.g., milk yields, prices, length of useful life of technologies). The analysis simulates several scenarios under three herd sizes, 60, 120, and 180 cows. The base-case results indicate that the mean breakeven values are $192,056, $374,538, and $553,671 for each of the three progressively larger herd sizes. These must be compared to the per-unit RMS cost (about $125,000 to $150,000) and the cost of any construction or installation of other equipment that accompanies the RMS. Sensitivity analysis shows that each additional dollar spent on milking labor in the parlor increases the breakeven value by $4.10 to $4.30. Each dollar increase in parlor costs increases the breakeven value by $0.45 to $0.56. Also, each additional kilogram of initial milk production (under a 2x system in the parlor) decreases the breakeven by $9.91 to $10.64. Finally, each additional year of useful life for the RMS increases the per-unit breakeven by about $16,000 while increasing the life of the parlor by 1 yr decreases the breakeven value by between $5,000 and $6,000.

Abbreviation key: NB = net benefit, , NPV = net present value, , RMS = robotic milking system

Key Words: robotic milking system • Monte Carlo simulation • capital budgeting • economic analysis




This article has been cited by other articles:


Home page
 J DAIRY SCIHome page
E. Lof, H. Gustafsson, and U. Emanuelson
Associations Between Herd Characteristics and Reproductive Efficiency in Dairy Herds
J Dairy Sci, October 1, 2007; 90(10): 4897 - 4907.
[Abstract] [Full Text] [PDF]

Home page
 J DAIRY SCIHome page
R. Bijl, S. R. Kooistra, and H. Hogeveen
The Profitability of Automatic Milking on Dutch Dairy Farms
J Dairy Sci, January 1, 2007; 90(1): 239 - 248.
[Abstract] [Full Text] [PDF]

Home page
 J DAIRY SCIHome page
T. F. Burks, L. W. Turner, and W. L. Crist
Distribution fitting and parameterization of individual operator work routine times for small dairy parlors.
J Dairy Sci, June 1, 2006; 89(6): 2343 - 2352.
[Abstract] [Full Text] [PDF]

Home page
 J DAIRY SCIHome page
C. A. Rotz, C. U. Coiner, and K. J. Soder
Automatic Milking Systems, Farm Size, and Milk Production
J Dairy Sci, December 1, 2003; 86(12): 4167 - 4177.
[Abstract] [Full Text] [PDF]


HOME HELP FEEDBACK SUBSCRIPTIONS ARCHIVE SEARCH TABLE OF CONTENTS
Copyright © 2002 by the American Dairy Science Association ®.