Sustainable Dairy Farming: Evaluating the Economic Impacts of Greenhouse Gas Mitigation Strategies Using Simulation Models

Alexander R. Chase

No 336699, Master's Theses and Plan B Papers from University of Minnesota, Department of Applied Economics

Abstract: The dairy industry's commitment to achieving net zero greenhouse gas (GHG) emissions by 2050 has placed significant pressure on dairy farms, as emissions from field-to-farm gate account for the majority (78%–83%) of total emissions. This research employed the Integrated Farm System Management (IFSM) software modeling tool using Life Cycle Analysis (LCA) methodology to analyze field-to-farm gate emissions associated with various mitigation options across five heterogeneous dairy farms. A total of 70 economic models were estimated with the goal of informing stakeholders and policymakers on maintaining dairy farm economic viability while reducing GHG emissions. The IFSM modeling indicates that dairy farms have multiple mitigation options available, with the most significant reduction in GHG emissions achieved through adding pasture grazing and changing feed requirements with carbon footprint reductions from 2.7% to 26.7%. When employed alongside anaerobic digestion (AD) systems, these mitigation options resulted in a reduction in emissions ranging from 16.0% to 37.3%, albeit with a corresponding decrease in return to management (RTM) of 0.4% to 14.8%. In contrast, the most profitable approaches without utilizing AD systems, such as the use of larger Holsteins for increased milk production or increased cropland utilization, were found to yield higher profits ranging from 1.3% to 19.5% but showed a limited reduction in the carbon footprint of milk by 0.0% to 6.7%. Results demonstrate that the largest consistent increase in dairy farm profitability did not result in significant reductions in the carbon footprint of milk, and the largest mitigation options did not provide a guarantee of being cost-neutral or better.

Keywords: Farm Management; Livestock Production/Industries (search for similar items in EconPapers)
Pages: 99
Date: 2023-07
New Economics Papers: this item is included in nep-agr, nep-env and nep-inv
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Persistent link: https://EconPapers.repec.org/RePEc:ags:umapmt:336699

DOI: 10.22004/ag.econ.336699

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