Estimating environmental efficiency in dairy production using by-production technology

Abstract

CONTEXT

Milk production in developing countries is characterized by low per animal yield and disproportionately high GHG emissions. Specific policy recommendations are necessary to improve the technical as well as environmental efficiency of dairy production, especially for small farms. However, limited financial resources owned by producers lead to high transaction costs of introducing change. Both, concentrate feed and roughage, that is dry nonconcentrates, are used in milk production. These inputs are also responsible for methane emissions through enteric fermentation. Especially cellulose-rich dry nonconcentrates are fueling methane emissions through enteric fermentation.

OBJECTIVE

Based on a systems approach including nutritional foundations, we estimated technical and environmental efficiency of dairy producers in the rural-urban interface of Bengaluru, India. We studied the shortfall in milk production and excess methane emissions for each dairy farm and their drivers.

METHODS

Using panel data of 245 dairy producers, we fitted the production frontier for estimating technical efficiency and treated the emission generating technology like a cost frontier for estimating environmental efficiency – using stochastic frontier analysis. This study uses the parametric application of by-production technology.

RESULTS AND CONCLUSIONS

High heterogeneity in enteric methane emissions at low levels of milk yield are related to excessive feeding of dry nonconcentrates by producers. Plotting excess methane emissions beyond the fitted frontier against the share of concentrates in the total feed ration indicated that a global low is reached at around 40 % concentrates in the cows' diet. Therefore, farmers should intensify production by increasing the share of concentrate feed in dairy cattle rations to this level. Also, we suggest promoting the construction of cattle sheds and increasing the proportion of cows with high milk production potential in the herd to improve environmental efficiency.

SIGNIFICANCE

With economic growth as well as an increase in population, the demand for dairy products in developing countries will increase and lead to an expansion of dairy production. GHG emissions such as methane from livestock rearing will have to be managed and adequate policy measures will have to be implemented to reduce their share in global GHG emissions. By integrating animal nutrition perspectives and environmental efficiency from economics into a systems approach, we propose specific recommendations for public policy in terms of the target group of producers and the correct proportion of concentrate feed and dry nonconcentrates in total feed rations for dairy cattle in India. This will ensure that producers reach their full potential in milk production and environmental sustainability.