Margin over feed is the dairy’s real revenue line — and the study’s job is to underwrite a commodity spread with living inventory.
Dairy underwriting is spread analysis: milk price minus feed cost, per hundredweight, times production — with both legs of the spread set by commodity markets the operator does not control. A credible study models margin-over-feed across the historical range rather than at the current price, tests coverage at the spread’s lean years, and treats the operation’s risk-management practice — forward contracting, margin-protection programs — as management-dimension evidence with direct coverage consequences.
Expansion credits add throughput logic: parlor capacity, herd growth schedules, and the biology of the ramp — springing heifers arrive on gestation timelines, not draw schedules. Facility design (freestall capacity, manure handling, feed storage) is technical-dimension content with regulatory edges, and the manure system increasingly doubles as a revenue question where digester economics reach the farm.
The firm’s dairy work spans production agriculture and the processing step above it — where USDA value-added programs reward the move from hundredweight to branded product — with herd-level production benchmarked against DHIA-type records and the milk-check’s component pricing modeled as the revenue architecture it actually is.
Engagements are typically initiated by the borrower, with lender or CDC confirmation obtained before work begins — institutions apply differing rules, so sponsors should confirm the required path with their lending contact — and are delivered in 10 to 15 business days from complete project data, and built to the program framework that governs the credit — SBA SOP 50 10 8 coverage minimums of 1.15x operating and 1.00x global, the 37-factor structure of USDA RD Instruction 5001, or the 1.20x convention of conventional credit policy — with a ten-year pro forma, sensitivity at ±5/10/15 percent, rate stress to +3.0 percent, and Monte Carlo analysis as standard equipment.
President, Wert-Berater, Inc. — independent feasibility study consultants since 1998. More than 4,000 feasibility studies completed across all 50 states and internationally, evaluating $40.2 billion in project value for SBA, USDA, EB-5, conventional, and institutional financing decisions. Fiduciary duty runs to the lender and agency in every engagement.
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Schedule a ConversationIndependent feasibility studies since 1998 — 4,000+ engagements, $40.2 billion in evaluated project value. Standard delivery in 10 to 15 business days. Fiduciary duty to the lender and agency.