AGRICULTURAL 'COSTINGS COMMITTEE. 



INTERIM REPORT 



ON AN 



INVESTIGATION INTO THE COST OF MILK PRODUCTION, 



I .ORIGIN AND ORGANISATION OF THE INVESTIGATION. 



The Food Controller in September, 1919, requested the Agricultural Costings Committee 

 to undertake an investigation into the cost of producing milk in G reat Britain for a period of 

 seven months from 1st October, 1919. (.This period was subsequently extended to twelve 

 months) . The object of the investigation was to obtain information from detailed cost records 

 kept on the necessary number of farms during this period. 



The necessity for the investigation arose out of the importance and urgency of the ques-, 

 tion of milk prices, and the lack of reliable data as to the cost of production. 



This Report covers the first period of the investigation (from 1st October, 1919", to 30th 

 April, 19-20, for England and Wales, and 1st November, 1919, to 30th April, 19'20, for Scot- 

 -and) , and summarises the information obtained on some important items. 



The time available for the preliminary arrangements of the Scheme, engaging a temporary 

 staff, aod organising the co-operation of the necessary number of. farmers throughout the 

 country, was very limited. A conference was immediately convened by the Costings Com- 

 mittee with representatives of the National Farmers' Union, British Dairy Farmers' 

 Association, Consumers' Council, the Ministry of Food, and other organisations interested, to 

 determine the best methods of undertaking the investigation, and to obtain their co-operation in 

 carrying out the Scheme. 



It was necessary to approach a large number of farmers throughout the country to obtain 

 their co-operation in keeping the necessary detailed Cost Records, and in doing this considerable 

 assistance was received from the above organisations and other sources. From the names of 

 farmers so ascertained, a selection was made of those considered to be the most typical pro- 

 ducers in the various districts. 



England and Wales was divided into twelve local districts and Scotland into six districts. 

 Each district comprised one or more counties, which were grouped so far as possible in accord- 

 ance with similarity of local conditions. Table " E " in the Appendix shows the areas covered 

 by these various districts, and the distribution of the farms. 



A temporary staff of 14 Milk Costing Officers for England and Wales, and 7 Officers for 

 Scotland, was engaged. The officers were selected primarily for their agricultural experience, 

 and also their knowledge of accounts and costing methods. The Chief Costings Officers of 

 the Agricultural Costings Committee were responsible for the supervision of the local record- 

 ing work done by the Milk Costings Officers. 



In each local district a Group of Farms was formed which was placed in the charge of 

 one of the Costings Officers. These officers visited the farms under their supervision as 

 frequently as possible, supervised the detailed records, assisted in their compilation 

 where necessary, and verified the Milk Yields and the Rations fed. The detailed records 

 kept on each farm were completed by the Costings Officer each month, and transmitted to 

 the Head Office of the Costings Committee for tabulation. 



The Costings Records were kept in considerable detail on the farms for each week of the 

 Costing Period. Account was kept of the time spent by the dairy workers on Milk Produc- 

 tion, and in the cae of part-time workers the necessary apportionment of hours was made. 

 Records were kept of the quantities and value of the various Purchased and Homegrown 

 foods fed to Cows in Milk, Dry Cows, and Other Dairy Stock respectively. The 

 total yield of milk was recorded each week, together with the manner of its disposal. A 

 Herd Register was also kept which contained the detailed Inventory and Valuation of the 

 Herds at the beginning and end of the period, and also a record of all sales, purchases, trans- 

 fers, births a-nd deaths, of the stock. An account was kept of the Cash Receipts and Pay- 

 ments in respect of the Dairy or of the Farm as a whole, but in a number of cases difficulty 

 was experienced in keeping these cash records satisfactorily. 



These records were kept on a uniform system on all the farms so that the final cost re- 

 sults could be presented on a comparative basis. 



An Inventory and Valuation of the Dairy Stock and Foodstuffs was taken on eacE farm 

 at the commencement and close of the Costing Period. The Dairy Equipment was inven- 

 toried and valued at the commencement, and the value at the close obtained by taking ac- 

 count of purchases and sales in the meantime. The basis of Valuation of the Equipment 

 was either cost, less depreciation, or, where this information was not available, -at rates some- 

 what under the present market value. 



(307031 Wt.23(i09 3605 2000 11/20 H. St.- a. 2. A 2 



462988 



