Economics of homestead dairy goats

We often state that raising our own animals and doing our own milking & cheesemaking saves us money, but how true is that? And would it be economical to sell raw milk (we’re not licensed to sell any other dairy product)? I recently did some calculations to offer a rough answer to that question, which should be of interest both to folks considering homestead animals and to anyone else thinking about the economics of farming. All the following calculations are for one goat bearing two kids in a year.

Also, while our milk and meat are NOT certified organic, I do consider their value roughly comparable because we’re using higher-priced organic feeds that affect the caluclations. A truly certified producer would have even higher costs than this due to other red tape & costs that we aren’t dealing with for the animals.

From kidding through the end of fall, the goats live on pasture with a portable shelter that is moved once a month and grazing areas changed weekly. So they have access to lots of fresh, diverse browse that limits the amount of purchased feed we need to use. During the winter they live in a more established structure in a set paddock, with higher needs for purchased feed, though we try to get them out onto another pasture when the weather is practical.

We feed our dairy goats a grain mix as well as alfalfa and grass hay. The amounts vary during the year, with very little hay being fed out during the grazing season and far more during the depth of winter when little else is available. Does who are pregnant or lactating get a daily ration of mixed grains to ensure good nutrition for gestation and milking. Kids are left on their mothers until fall butchering, taking away some of our milk supply but producing a tastier meat and reducing our milking schedule to once a day, thus saving a lot of time and bother.

We purchase our hay from several local growers who sign our organic certification paperwork that no herbicides or other such things have been applied to the hay. (The organic paperwork ultimately relates to the produce, since hay ends up in our compost piles and is therefore an input to vegetable fields.) We custom-mix our own grain, buying certified organic grain in bulk through Littrell Feed & Seed in Audrain County.

Buying in bulk, our organic grain mix ends up costing around $.32/lb. This is roughly twice the cost of a conventional goat premix, such as this one from a dealer in Chillicothe which costs around $.15/lb. We feed up to 3lb/day in winter and early spring, reducing that to around 1lb/day when grazing conditions are good. So at an average of 2lb/day year-round, that’s $233 or so per goat.

Hay ranges from 1-2 bales a week per goat in winter to very little in summer. Last year we went through approximately 35 bales per goat (grass & alfalfa), so at $4/bale that works out to another $140.

Then there’s the cost of driving around to get this feed. Assuming two trips to fetch hay of around 30 miles round trip each, that’s 60 miles x $.50/mile (for time, wear, gas) = $30. Also include a visit to the feed dealer at 66 miles round trip, two times a year, for another $66. (We actually pick up feed more often than that, but these trips are not exculsively for just one goat. For the sake of this calculation, we’ll consider two trips per year.)

So overall our feed costs are $233+$140+$66=$439. Plus, there are a number of other expenses including water, the occasional vet bill, milk filters, power for the electric fence, and so on that collectively bring the annual expenses closer to at least $500, probably closer to $600.

Milk production varies significantly over the course of the year. Because we leave kids on the doe through the season, we get about half her true production, balancing that loss with better meat and easier management (milking once vs. twice a day, plus the option to leave the kids on and skip milking for a day if we’re extra busy). So from May through December we’ll estimate an average of 1 quart per day per goat, accounting for the natural drop in production going into the winter. So for a milking season of 240 days, that’s 60 gallons (closer to 100 if we weaned the kids). This is a conservative estimate; many goats can give far more than this.

Considering just the actual money spent per year (not time or infrastructure), we spend $600 to produce 60 gallons of milk, for a cost of roughly $10/gallon. For comparison, organic cow milk at one local grocery store goes for $6-$8/gallon depending on brand, and non-organic local goat milk is higher than that.

Of course, if we weren’t keeping the kids on, we’d be producing 100+ gallons/year for a cost of $6/gallon or less, which is at least competitive. But the kids each yield around 30lb of meat (deboned), so in a good year we’re also getting 60lb of meat from two kids. I actually have no idea what meat costs overall, since we almost never buy it, but a search on turned up a general range of goat kid meat prices of $5-$15/lb depending on cut (not organic). So the value of two very good, milk-fed, ranged kids, could easily exceed $300.

So for an outlay of approximately $500, we’re getting $480 of milk at average prices, but also maybe $300 of meat. So we’re making/saving maybe $300 for doing this ourselves, more if you consider our products equivalent to top-of-the-line ranged organic products. I think we need to judge relative to organic prices, since our feed costs are double that of conventional feeds; if we just fed out cheap GMO corn & beans, this would be a lot more lucrative. As it is, we’re getting a positive return on the monetary investment, if we were to buy all the equivalent organic or comparable products at retail.

Of course, all of that doesn’t count any of the time spent doing this, or the infrastructure needed. I spend an average of 30-45 minutes/day doing chores including milking, feeding out hay, changing water, checking fences, etc. Then there are the occasional tasks like moving grazing paddocks, trimming hooves, and so on. Vet bills for the occasional problem take a toll. It takes a fair amount of time to handle the milk. And all this time we could be spending growing more vegetables for sale in order to pay for others’ cheaper milk & meat. Plus it takes a fair amount of money to get started in goat-raising and milking; we had no fencing, structures, or equipment when we started.

On the other hand, we don’t drink our milk, but turn almost all of it into value-added products such as yogurt and cheese. Depending on how you calculate the time budget for that, we’re almost certainly saving ourselves money there. Let’s say we turn 2/3 of our milk into cheese. 40 gallons will produce about 40lb of cheese. Locally, Goatsbeard Farm charges around $5 for a 5oz round of chevre; that’s roughly $15/lb. So we’re producing $600 worth of cheese as opposed to $240-$400 worth of raw milk. Again, the time budget to do this makes a big difference, but the numbers at least set the context.

Goats produce another highly prized product that is difficult to attach a value to: manure. Much of the manure goes directly into the paddocks, adding fertility to the soil and improving the value of the land. Some of the manure is deposited in the mobile goat shelter, and this is what we collect for our compost piles. As far as we’re concerned, this manure is priceless. We know what went into the animals, we know that the animals are healthy, the goat bedding makes hot composting relatively easy, and thus we’re happy to use this on our vegetable plantings. In addition, the goats help to manage brushy land that’s not good for much else. They love plants such as poison ivy and multiflora rose, and they help to turn overgrown brushy land into better pasture. Again, an improvement in the value of the land.

Although the numbers work reasonably well for home production, if we wanted to sell raw milk, we’d have to charge a lot to account for the time investment, potential for losses, marketing costs sales tax, and more. So while it makes sense to do all this for ourselves, it’s not at all clear that the numbers make sense to do this commercially. With enough goats, certain economies of scale would start to kick in. More goats might mean that we could justify the time to move the goat paddocks more often, meaning even less need for hay and grain.

Part of what makes all the work & cost worthwhile is the pride in independence, the value of truly fresh food, and the confidence in its sourcing, treatment, and quality. Those are all ethical judgements with no clear price, though we value them highly.

Coming some other time, a similar calculation for chickens and eggs.

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