PRODUCING MARKET MILK IN EASTERN NEBRASKA, 



13 



Table 9. — Percentage of the total costs represented by feed, labor, and other costs, by 



seasons. 



Cost item. 



1 

 Winter. Summer. 



Entire 

 year. 





Per cent. Per cent. 



Si. 4 10. 9 



1.7 10.0 



Per cent. 

 44.3 





11.7 









:\o. 1 

 8.9 

 12.:? 



•20. 9 

 7.9 

 12.3 



.56.0 





16.8 





24.6 









56.3 

 1.3 



41.1 

 1.3 



97. 4 





2.6 









.57.6 



42.4 



100.0 







Credits: 



.3.6 

 6.9 



2.6 

 .5 



6.2 





7.4 









10.5 



3. 1 



13.6 







The first two columns of Table 9 show that the difference of 15.2 

 per cent in the cost of producing milk in winter and in summer was 

 due principally to the difference in cost of the feed, bedding, and 

 pasture. 



The high prices received for cows sold tended to reduce the depre- 

 ciation charge. The depreciation charge is reported separately, 

 so that the amount and its effect on the total cost can be seen. 



AVERAGE COMPARED WITH BULK-LINE COSTS. 



During the last few years attempts have been made to use the 

 average cost of production as a basis for determining the selling 

 price of milk. Where the average cost basis is recommended it is 

 evident that practicall}^ all those producers whose costs are above 

 the average will find their profits small even if they are so fortunate 

 as not to suffer an actual loss. This will tend to discourage produc- 

 tion and reduce the available supply. 



It is to be expected that the cost of producing 100 pounds of milk 

 will vary in different dairies and in the same dairy from season to 

 season. The varying costs per 100 pounds of milk have been tab- 

 ulated in ascending order in Table 10. 



In the scale of costs there is a line below which the greater quantity 

 of the milk is produced. This is kno^\^l as the bulk line. The 

 determination of the limits of the bulk-line cost depends in part 

 upon the supply needed. However, it is usually set at some point 

 which includes from 80 to 90 per cent of the total supply. An ex- 

 amination of the second, fourth, and fifth columns of each season in 

 Table 10 shows one or more points where the bulk line could be 

 located. It will be noted that during the winter of 1919-20. 82.5 

 per cent of the milk was produced at a cost of S3.45 or less per 

 hundred. At S3. 5 1 or less 86.7 per cent of the total supply of 

 milk was produced. Thus 4.2 per cent more milk was obtained at an 

 increased cost of 6 cents per hundred. Then there was a sharp 



