The Efficiency of Collect Production and Processing Business of Dairy Cooperative in Saraburi Province

Abstract

This paper aimed to explore the efficiency of the milk collected by nine dairy cooperatives in Saraburi province. The research employed the Data Envelopment Analysis technique (DEA) to explore the efficiency of the collected milk of dairy cooperatives between 2017-2021. The study set two input factors: fixed assets and the expense of dairy cooperatives. The output factor is comprised of the quantity of milk collected by dairy cooperatives and the income of dairy cooperatives. It was found that:

In terms of collecting milk from dairy cooperatives, all 9 dairy cooperatives had 45 DMU. There were 12 DMU in the stage of increasing return to scale, and 3 DMU were in the stage of constant return to scale (2 dairy cooperatives). In addition, the dairy cooperative that has the most efficiency is the one that doesn’t have a processing factory but collects milk from its members and sends it directly to the supplier. As a result, we should remind them about the policy to promote the dairy cooperatives to have the processing factory by themselves because of the cost of investment and need to consider other factors such as marketing, the cost of production, the environment factor, and the cow disease as well. Thus, the government agency needs to be careful about the policy of the dairy cooperative, as mentioned above.