Thesis, Undergraduate (BS Agribusiness Economics) -- U.P. Mindanao

Studies show that there is an increasing local demand for milk and fresh milk products. It is observed that there are certain problems in the dairy industry of the country such as poor animal management practices and low milking capacity per milking cow that cause the domestic milk supply way far from meeting domestic demand. To contribute in addressing this concern, a technical efficiency analysis on dairy farmer milk supplies of the Federation of Davao Dairy Farmers Cooperative (FEDAFFC). Furthermore, the study also aims to describe the raw milk production practices of dairy farmers in the area. The variables included were average monthly milk production as dependent variable; number of milk animals, farm area, labor (manhours/month), costs of feeds, veterinary, electricity and water supply. Other factors that can affect production efficiency which are the socio-demographic and production factors were also assessed using the Tobit Regression Analysis. Basically, the different problems encountered by farmers in their milk production are the diseases among milking cows, shortage and high cost of veterinary and feed supplies, and low milk retail price set at the cooperative. Results from DEA calculated showed that 34 out of the 57 respondents were fully efficient with TE score of 1.0. The Aklat Dairy Farmers Cooperative with its relatively lower stated cost in electricity, feeds and veterinary supplies, was the most efficient among the nine dairy cooperative with a mean farm TE score of 0.999. From the inputs used, electricity and water cost is the most underutilized while the most overutilized input is labor. The milk production of the farmers is fully efficient in general relative to the production frontiers created within the sample but may not be efficient when compared to the theoretical maximum.