Economics of milk production and animal welfare on dairy farms: tradeoffs or win-wins?

This study investigates the relationship between animal welfare and cost efficiency on dairy farms in Flanders, Belgium. Both animal welfare and cost efficiency were approached as integrated scores before analysing the relationship between its component parts. A sample of 263 farms was used to estimate farm specific cost efficiency with data envelopment analysis (DEA). On 41 of these farms, animal welfare was assessed with the Welfare Quality® (WQ) protocol and an Alternative Welfare Index. Average efficiency scores were 0.66, 0.87, and 0.57 for technical, cost allocative, and cost efficiency, respectively. Correlation analysis revealed a negative correlation between technical and cost allocative efficiency. Technically efficient farms used proportionally more concentrates compared to roughage, whereas cost allocative efficient farms used proportionally less concentrates compared to roughage. Efficiency scores did not differ between farms that were categorized as 'enhanced' (n=10) and those categorized as 'acceptable'(n=31) in terms of animal welfare according to the WQ protocol, and none of the efficiency scores was correlated with the Alternative Welfare Index. However, efficiency scores were correlated with single welfare measures. Farms with higher technical efficiency scores showed a lower prevalence of mastitis (R = -0.344), but higher prevalence of hairless patches (R= 0.318).On cost allocative efficient farms, more cows were lying outside the lying area (R = 0.311), and these farms tended to have a higher prevalence of cows with dirty flanks and upper legs (R= 0.305; P<0.1). Finally, cost efficiency and absence of lesions in the dairy herd were positively correlated. Our results indicate that pursuing both cost efficient milk production and improved levels of animal welfare is feasible, but achieving one goal does not necessarily imply coming forward to the other goal.