RESEARCH ON MILK COST, RETURN AND PROFITABILITY IN DAIRY FARMING

The paper aimed to the relationship between milk cost in terms of material cost and labor cost and estimate the influence of these costs on returns coming from milk and profitability in 5 small dairy farms from the Southern Romania. The main economic indicators taken into consideration were: material cost, Xi, (feeding cost, replacing heifer, equipment and shed depreciation, electricity and water cost, fuel and lubricants cost) , labour cost, Y, and income coming from milk, Z. The Cobb-Douglas regression function Z= a xα yβ was used to determine the variation of the studied economic indicators and relationships between them. Taking into account the close relationship between income from marketed milk and material cost and labor cost, it is enough to use it as the only criterion in farm classification. Profitability in dairy farms depends both on cost input and milk output as well as milk market price.