Are Dairy Cow Replacement Decisions Economically Justified? Evidence from Swiss Farms

Farmers frequently face the decision to retain or replace dairy cows, with 20% to 40% of cows replaced annually. In Switzerland, this translates to over 100,000 cows replaced each year, representing a significant financial investment for farms and the dairy industry. The average productive lifespan of a dairy cow is currently three to four parities worldwide as in Switzerland, shorter than the optimal five to six parities, leading to financial losses from premature culling. Factors influencing suboptimal replacement decisions include inaccurate valuation of production parameters, replacement costs, and health issues. This study bridges the gap between theoretical models and real-world practices by analyzing replacement decisions from 29 Swiss dairy farmers over five years, comparing them to theoretical models and evaluating economic impacts. On average, suboptimal decisions resulted in an economic loss of 161 ± 164 CHF per farm per month (1.55 ± 1.58 CHF per cow per month), with losses from retaining unprofitable cows being approximately three times greater than those from premature culling. The results indicate that farmers typically make economically sound decisions regarding cow replacement; this contrasts with findings from previous studies on the topic. Nonetheless, replacing cows prematurely, particularly during their first parity, is not ideal from ecological, animal welfare, and sustainability standpoints. Consequently, enhancing animal health and fertility becomes essential for reducing culling rates and improving the longevity of dairy cows.