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World population growth will increase the demand for food, while rising incomes are expected to change the eating habits. Agriculture remains a major source of nutrients that may require drastic changes. Accordingly, it is necessary to project the potential future development of various agricultural sectors. Therefore, the overall aim of this study is to identify the development opportunities for dairy farms of various sizes in Latvia until 2050. In the period 2005-2018, Latvia experienced significant structural changes in dairy farming, as the production of cow’s milk and the sales of it for processing increased, while the numbers of dairy cows and dairy farms decreased significantly owing to the disappearance of small dairy farms (up to 5 cows). For this reason, it is required to project the future development of dairy farming. To generate projections for agricultural production in Latvia until 2050, the Latvian Agricultural Sector Analysis Model (LASAM) was developed at the Latvia University of Life Sciences and Technologies in 2016. Within this research project, the LASAM model was extended by a module for the distribution of farms by size. According to the projection generated by the LASAM model, the milk production in Latvia is expected to gradually increase to 1196.1 thou. t by 2050, while the number of dairy cows is expected to gradually decrease to 119.6 thou. (-17 % compared with 2018), which is determined by production intensification in dairy farming and expansion of large farms with more than 300 cows.

Development prospects of milk production in various size farm groups in Latvia