“In every category, costs per cow are lower than on a confinement farm,” says Dale Johnson, principal farm management agent for the Western Maryland Research and Education Center. It’s important to note that “the vast majority of the grazers were not organic,” so organic price premiums were not a significant factor.

The grazing herds produced less milk per cow – about 4,000 pounds on average per year, and their milk sales generated an average of $691 per year less than that of the confined herds. But reduced feed and hired labor costs, plus less money spent on equipment repairs, fuels, custom services, seed, fertilizer and pesticides meant less expense to produce each pound of milk. 

One category that showed significant differences between grazing and confinement herds was the combined cost of veterinary care and breeding. Grazing-based herds had less than 50% of the expenses of confined dairy herds. 

“This is indicative of the health of the cows,” Johnson explains. “It’s a big motivation to a lot of our farmers.” 

In a 2015-17 survey of 29 Maryland dairy farms, organic farms continued to have higher per-cow profits despite lower income from milk sales, even when the non-organic farms were broken into high- and low-performing sectors. The profit per cow averaged $854 per year for five highest performing non-organic farms and $1,085 per year for the seven certified organic dairies surveyed. 

In today’s milk market, Johnson believes non-certified organic grazers may show a bit less profit than confined herds if surveyed today. The organic premium has become important, especially as the number of very large dairies grows.

Johnson encourages dairy farmers to focus on per-cow costs, not per hundredweight. “What you’re really interested in, is getting the most out of each cow. It’s getting very hard to compete with these large farms. We’ve got to find a way to do it. If your situation is pretty bad with confinement, grazing is not going to pull you out very fast,” Johnson says. “Transitioning to grazing is one thing – transitioning to organic is another.” 

Confinement to grazing

Yet converting to grazing may be the answer for some conventional dairy farmers seeking to remain profitable without economies of scale. Eric Ziehm began a certified organic dairy, High Meadows Farm, in Hoosick, New York, in 2018. Ziehm, who also farms at his family’s 1,200 head confinement dairy, was ready for a radical change.

A five year “cost plus” contract with Stonyfield, then owned by Danone, was key to securing the financing needed for the 300-acre certified organic dairy farm. With this contract, the price paid for the milk varies, but is always enough to cover production costs and provides a consistent margin, Ziehm says. 

“I felt like I was in search of a basic marketing strategy that would really align with how I wanted to raise my cattle. We just got really lucky,” Ziehm says. “It would have been difficult to convince lenders without the contract.”

Ziehm’s original organic herd began with open heifers transitioned from the conventional herd. Jerseys make up 75% of the herd, along with smaller breeds and crosses, selected for grazing ability. High Meadows Farm began milking in spring 2018 and now has over 200 head, with a goal of 250 cows total “to keep this farm in balance,” Ziehm says.

While the economics are important, Ziehm has already seen other benefits from grazing cows instead of confining them. 

In the family’s conventional confined herd, daily production is at 90-100 pounds of milk per cow. Feeding is managed to provide consistency in milk production. Cow longevity is four-and-a-half years. 

“One of my goals was to increase cow longevity,” Ziehm says. “Being on grass, being off concrete, has been huge. Vet costs are considerably lower. Green grass heals a lot of illnesses.” 

Far from the hormonal synchronization breeding programs practiced conventionally, the organic herd follows Mother Nature’s schedule. Being able to observe the cows 24/7 out in the pasture has been a big help, and heats are readily detected.

“Our cows have performed very well reproductively,” with a pregnancy rate over 30% the first year, he says. “The cows just express heat very well.” 

Ziehm has found that the organic dairy requires a bit less labor, with 55 cows requiring one full-time equivalent (FTE) employee compared to one FTE per 45 cows at the confined dairy. The conventional dairy has lower feed costs per cow when purchased feed is factored into the equation. He’s put a cap on the amount of grain at 15 pounds per head per day at the organic farm, and his management focus is on keeping enough dry matter in the pasture long term. 

While the intricacies of rotational grazing haven’t proven to have too much of a learning curve, heat stress and flies are two unexpected challenges. Keeping the cows grazing at night to reduce heat stress is a focus this summer.

“We are living and learning every day we graze,” he says. 

Doug Martin of Pleasant Valley Jerseys LLC in Chambersburg, Pennsylvania, has been “endeavoring to learn how to grow grass” for the last 25 years. Inspired by a visit to England, where observing a rotationally grazed dairy farm “was a profound learning moment.” 

He returned home to the family’s conventional Holstein confined dairy, and the acres of alfalfa, corn and soy grown for feed. Martin gradually began to transition the dairy to a grazing-based Jersey dairy. In 2018, they had successfully reached the goal of a 100% grass-fed dairy.

“Keeping our cows on the pasture is our main focus,” Martin says. “We’ve had to develop our cows to adopt to that.” 

He’s been able to grow the number of cows without having to add more buildings, which, in part, has helped them to double the income generated by the confined herd. He no longer needs silos and feeds baleage in a covered bedded pack in winter. 

The farm has grown over the years to include additional land and supports several generations. While they do miss some of the high-producing peak profits a confinement dairy can capture, they now produce milk “at least at cost and riding through the low times without crashing,” Martin says. 

With 700 acres – 500 of those fenced – the milking herd is rotationally grazed on 200 acres and moved to fresh grass after each milking. The remainder of the land is used for pasturing the rest of the herd and for growing baleage. 

“Green grass and brown cows. That’s what we do,” Martin says.  

Tamara Scully, a freelance writer based in northwestern New Jersey, specializes in agricultural and food systems topics.

PHOTO 1: Eric Ziehm built a new barn on his farm when converting. The infrastructure to begin the farm was a costly investment and without the "cost plus" contract with Stonyfield may not have been possible, he says. 

PHOTO 2: The herd is being moved to fresh pasture at High Meadows Farm. Laneways and fencing were part of the infrastructure needed to establish this new grazing-based, certified organic dairy farm. Photos provided by Eric Ziehm.