Background and Present Situation
The exact beginnings of dairying in Hawai'i are not clearly defined. It probably began as early as 1793, with the importation of beef cattle into the islands. After this beginning, dairying became a separate entity in the mid-1800s, when cattle were first imported for the purpose of producing fresh milk, butter, and cream. The first recorded commercial dairy dates back to 1869. By 1919, there were dairies of sorts on all islands, some commercial and others worked in conjunction with the plantations.
The commercial dairy industry in Hawai'i is mostly involved in the production, processing, distribution, and marketing of fresh fluid milk. It has geared its production for Class 1 milk and is regulated by state law. Consumption of fluid milk within the state on a month to month basis determines the price paid to the dairymen. Compared with the Mainland average, the industry in Hawai'i specializes and represents large-sized producers with an average herd size of more than 500 animals in production. The sales of milk in 1994 totaled 142 million pounds, of which 100 million pounds were produced on Oahu and 42 million pounds on the neighbor islands. For 1994, the value of milk sales was $22.8 million for Oahu and $9.1 million for all other islands, resulting in a state income of $32 million.
The industry in Hawai'i is a concentrated, animal-intensive operation. The majority of dairies in the state are housed on 9-12 acres. More than 75 percent of all milk cows are on Oahu, with approximately 60 percent in the Waianae district, a primary area of livestock concentration. The majority of locally produced heifer replacements spend more than 50 percent of their early life on pasture. These animals are pastured on the neighbor islands as well as on Oahu. Some are reared in drylot.
Cull dairy animals, approximately 4,000 head per year, are slaughtered primarily on Oahu. Price differential between cull and replacement animals is very wide. There is some potential market for bull calves and dairy beef.
Factors influencing the potential of the fluid milk market in Hawai'i are population increase, competition from imitation milk, high cost of milk, nutrition education, and imported fluid milk. The dairy industry is capable of producing what the market demands. Expansion will tend to be based on population increase, which is about 2 percent per annum. Growth in the visitor industry should also be considered. Improved advertising and marketing of milk might also lead to expansion by increasing consumption per capita. Approximately 7.5 percent of the milk consumed in the state is filled milk, normally referred to as imitation milk in Hawai'i. There is a potential for replacing this with fresh fluid milk.
The cost of producing milk in Hawai'i is relatively high, primarily because of the large amounts of expensive imported feeds and the high cost of labor. An increase in per capita consumption of whole milk and the use of more whole milk in place of imitation milk would be encouraged by lowering the cost of producing milk in the state by allowing producers to take further advantage of economies of scale.
Specific Components of the Industry
Most dairy operations are situated on small acreages and run basically as dry-lot operations. Some are on leasehold land; thus, land tenure can be a problem at times. In recent years, as marginal sugarcane plantations have gone out of production, some of these lands have become available for feed and forage production. As a result, it is possible that coordinated or integrated dairy feed and forage operations could develop.
The dairy industry is dependent upon outside sources of feed. Cereal grains, protein supplements, and mineral supplements are all imported at costs increased by ocean freight and handling expenses. Some byproducts have been developed locally and are used as a source of roughage. Pineapple bran, a byproduct of the pineapple canning industry, is a high-energy roughage and is used exclusively by the cattle industry. Byproducts from the sugarcane industry include sugarcane strippings, bagasse, and molasses. Of these, only molasses is used in reasonably large quantities. The livestock industry in the state uses approximately 25,000 tons of molasses each year in its feeding programs. Efforts are being made to increase the use of the fibrous sugar waste products to replace a portion of the imported feeds. The high cost of feeds is a major limiting factor to more efficient milk production in the local industry. Grain prices to the industry are about $60 to $90 per ton higher than on the Mainland. Because of the lack of quality roughages, dairymen feed large quantities of grains to obtain a good production response. Before the heptachlor problem, when pineapple green chop was estimated that feed represented about 50 percent of the total cost to produce milk. Today, feed cost probably represents about 55 percent of the total. Roughages that are being imported include alfalfa cubes, baled alfalfa, cottonseed hulls, and almond hulls. The lack of readily available roughages has resulted in depressed fat tests, fat cow problems, and many of the other metabolic disorders associated with restricted roughages intake.
The local dairy industry has not developed storage systems to maintain a sizable inventory of feeds. The imported feeds are generally fed on a short-term basis, with most farms storing approximately two to three weeks' supply. Any local forages that are used, such as green chop, are used on a day-to-day basis, with very limited amounts being stored on farms in the form of silage. Most local forages cannot be secured properly and thus have a high water content and tend to ensile poorly. Mixing local roughages of high moisture content with dry grains in the ensiling process may be worthy of investigation.
Because all milk produced is sold as fluid milk, Holsteins are the predominant breed. Artificial insemination is used extensively, with an estimated 70 percent of the breeding females bred artificially. A large percentage of the local herds participate in local production testing. Conception rates of dairy cattle in the state are low compared with those on the Mainland. The average first-service conception rate, taken on a monthly-to-month basis for dairies, is estimated to be about 30 percent. First-service conception rates in the state range from a high of about 50 percent in some of the better herds during the cooler periods of the year to a low of about 15 percent in herds in the Waianae are during the hot period. Identifiable factors affecting reproduction are nutrition, climate, and management.
The nutritional aspects of this problem are associated with the situation of high-grain, limited-roughage feeding and are compounded by climate. An equally important nutritional factor is the abnormal mineral profiles contained in some of the byproducts and crops produced in the state. Identifiable thus far are the very low copper and selenium and relatively high molybdenum contents, along with the high iron and manganese contents, in local forages.
Climate is an important factor that affects cattle reproduction in the state. Poor reproductive performance is observed in late summer--July through October--and during the wet months from December through March. Research to date has shown that conception rate decreases by 5 percent for each temperature-humidity index (THI) change from 69 through 79. There appears to be a critical point at a THI of 75 to 76. This is observable in daily milk production as well as in reproductive performance. Seasons in which there are continuous days above THI 76 contribute to a very depressed reproductive performance.
Intensive dairy operations that maintain large numbers of animals on limited areas contribute to disease and reproduction problems. Calving in muddy or dusty corrals, such as exist during parts of the year, may be causing problems as yet unidentified. It has been observed that many animals are not clean on their 30-day postpartum check, which suggests that the animals are having difficulty coming back to a normal reproductive cycle. Because of the many possible contributing factors involved in reproductive efficiency, it has been difficult to pinpoint exact causes on specific operations.
First-calf heifers entering the herds tend to be lower producing than second-calf and more mature animals within the herd. First-calf heifers are usually grown on the neighbor islands and suffer many of the same problems described by the beef industry as postweaning slump. In the past, Hawaii dairymen have depended upon imports from the Mainland for their replacement animals. High price combined with poor quality often made this practice a costly one. Most replacement heifers now are locally produced.
Information by Dr. Lawrence K. Fox, updated by Dr. Brent Buckley