Die Bodenkultur - Journal for Land Management, Food and Environment

L. Kirner:

Analysis of competitiveness of milk production in Austria


The competitiveness of milk production is analysed using two approaches: a comparison of data from the accounts voluntarily provided by a network of farms (FADN) and an assessment of the opportunity costs of land and labour.

The results confirm higher profitability and economic stability for dairy farms in mountain areas in comparison to non-mountain areas. Therefore and due to the lower opportunity cost of grassland in comparison to arable land, milk production in mountain areas is expected to further increase whereas milk production in non-mountain areas will continue to decrease. However, movements of milk production volumes within these areas will be greater than between them. The opportunity cost of labour as determined by alternative employment opportunities was not significantly correlated with the movement of milk production volumes between mountain and non-mountain areas.

Key words: Competitiveness, milk production, production potential, natural disadvantage, opportunity costs.