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Dairy operation is moo-ving on up
Family-owned farm proposes significant expansion
A Rosser area dairy farmer plans to expand his successful family-owned operation by 50%.
Henry Holtmann, co-owner of Rosser Holsteins Ltd., hopes to expand his Rosser-based operation from 400 to 600 dairy cows.
Rosser Holsteins is already one of the larger dairy farms in the province. Typically, Manitoba dairy farms average about 100 cows, Holtmann said.
Holtmann said expansion is necessary to ensure the continued survival of the operation as a family-run business.
"This expansion is a good opportunity for us and it is something that we are very good at," he said.
"Keeping farm kids on the farm is a challenge for any operation. You have to make sure there is enough income for that farm to support that next generation, and you have to make sure the next generations’ interest lays in farming."
Holtmann added Manitoba is actually producing more milk than it has in the past even though there are fewer dairy farms in the province.
Rosser Holsteins was started in 1929 with just 13 dairy cows and has been in Holtmann’s family for three generations.
Holtmann said the operation is now jointly owned by three families and currently has 13 employees.
Jared Carlberg, a University of Manitoba associate professor of agribusiness and agricultural economics, said expansion is becoming increasingly common in the agricultural industry.
Carlberg said that the pressure to expand farm operations continues to grow as do the sizes of farms.
"The factors that have led to increasing farm sizes are things like economies of scale and relative factor use changes," he said.
"Once upon a time people had little farms and lots of kids so labour was the cheap thing. But most of those kids now grow up and move to the city as I did."
Carlberg said the changing labour situation forced farm operations to hire more expensive outside help to keep up with the workload. Eventually, changes in technologies allowed fewer people to farm more land.
"As labour got more expensive, machinery got to be relatively cheaper because of improvements in production technology," he said.
"So that changed the ratio of capital costs versus labour costs towards capital costs."
Carlberg said he doesn’t expect that trend to change anytime soon.
"I expect farm expansion to continue to grow as the number of farms continues to shrink," he said. "Just not as quickly right now because times are relatively good in respect to commodity prices."
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(1 of 15 articles for this week)04/21/2015 1:00 AM 0