Financial performance of beginning dairy farmer in Minnesota

Abstract

Demand for dairy products has increased over the past 45 years and it is necessary to ensure there is sufficient supply to meet demand (USDA-ERS, 2021). This research focuses on beginning farmers entering the industry and uses FINBIN data from Minnesota dairy farms from 1997-2021 to determine what strategies impact a beginning dairy farmer’s profitability. Results indicate that beginning dairy farms can increase profitability by increasing their acreage and that increasing herd size decreases their operating profit margin. Potential policy modifications can be driven through the research findings.