article · Sustainability
An economic and management investigation examines the production costs of raw milk across 59 peri-urban farms in Algiers, representing 422 livestock units managed under varying labour and housing conditions. Applying a mathematical model based on a variant of the Cobb-Douglas production function, the research determines the optimal cost per litre of milk in relation to herd sizes. The analysis identifies two distinct operational stages in unit costs. For holdings with one to ten animals, the cost per litre rises in a steady, linear pattern. For herds ranging from 10 to 30 animals, the cost increases linearly at a markedly steeper rate. A specific critical herd size separates these two operational dynamics. Additionally, the study notes that utilising farm wastes as agricultural fertilizers supports circular economy initiatives and relevant Sustainable Development Goals.
Peri-urban dairy farming faces unique economic pressures that influence milk pricing and farm viability. Identifying clear herd size thresholds helps producers understand where operating costs escalate most rapidly. Furthermore, integrating livestock waste into agriculture as fertilizer advances circular economy targets and supports sustainable food production in urban and peri-urban regions.
The mathematical models can assist peri-urban dairy producers, farm managers, and agricultural planners in optimising herd sizes to control per-litre production costs. Additionally, the waste-to-fertilizer approach provides an applied pathway for circular resource use. The analytical methods represent applied research tested on real-world farm data, making them relevant for farm financial planning tools and agricultural advisory services.
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This study focuses on the search for the optimal value of the cost per liter of raw milk. The sample included 59 farms with different types of labor, containing 422 elements maintained in different accommodation conditions. The farms are located in an urban area in the country’s capital. This study was essentially based on mathematical methodology close to a variant of the Cobb–Douglas function used by many economists. This made it possible to find expressions of the relationships linking different parameters involved in the evaluation of the optimal value of the cost per raw liter, as well as certain critical values of the number of elements to be determined. The results show that the variation in the cost per liter follows two levels; the first relates to a number of elements between one and ten, where the increase occurs in a linear and progressive manner. The second level concerns the range between 10 and 30 elements. It is characterized by a linear increase and is more accentuated than in the previous case. The results also suggest that a critical number indicates the separation between the two levels. Application of these wastes as fertilizers aligns with the EU Action Plan on the Circular Economy and can contribute to achieving SDGs 2 and 12.
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DOI: 10.3390/su172410912
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