Animals generate a significant amount of wastes (urine, feces, etc.) and the management and disposal of these wastes can be problematic. Currently, most livestock waste is applied to fields as fertilizer. However, animal wastes can potentially be used for bioenergy through the capture of biogas (from anaerobic digestion), syngas (from gasification), or bio-oils (from pyrolysis). Components of manure may also be recovered for use in producing bioproducts.
Unlike the poultry and swine industries, which are characterized by production contracts and vertical integration (a single firm controls two or more successive stages of the production, processing, and/or marketing), the dairy industry is composed primarily of independent farmers who make the milk production decisions. In 2002, almost 85% of dairy farms were either individual or family-operated businesses (Miller, 2006). Milk production is the sole or most important activity on most dairy farms (94% in 1993) (Short, 2000).
Milk production is shifting regionally (figure 1). The traditional milk producing states of Minnesota, Michigan, New York, Pennsylvania, and Wisconsin continue to be large producers, but other states, particularly in the western U.S. (California, Idaho, New Mexico, Texas, and Washington) represent an increasing share of production. Milk production in the Southeast is declining. Dairy operations in the western U.S. tend to be much larger than those in other parts of the country (Miller, 2006).

The total number of milk cows has been declining over time, but total milk production has increased due to higher milk production per cow (and average of 18,967 pounds/cow in 2004). Table 1 contains the total inventory of dairy cattle in 2004. In addition to the nearly 9 million milk cows on dairy farms, an additional 4 million head of heifers (juveniles who have not yet started to produce milk) are kept as replacement stock for older milk cows that are retired from production.

Dairy production is shifting to fewer farms with larger herds. The number of farms with greater than 1,000 milk cows increased to 1373 (523 with greater than 2000 head) and to 1443 (573 with more than 2000 head) by 2005 and 2006, respectively. Farms in all other size categories decreased in those years. Large farms (greater than 1,000 milk cows) accounted for 35.3 and 37.3% of milk production in 2005 and 2006, respectively (about 63% from farms with more than 2,000 milk cows) (USDA NASS, 2007). Table 2 shows the distribution of milk cows by number of cows per farm in 2002.

The amount and characteristics of wastes produced per animal depends on a number of factors, including breed, size, type of feed, and whether or not the animal is producing milk (lactating or dry). Different breeds of dairy cattle produce different amounts of manure (e.g., Jerseys produce 60% as much manure as do Holsteins) (EPA, 2006). Dairy production is shifting from pasture/forage feeds (lower digestibility) to the use of corn and other grains (higher digestibility) in confined feeding systems (Short, 2000). Digestibility is an important component of the overall composition of manure, particularly the total solids content. Physical properties of interest include weight, volume, total solids and moisture content, because these properties describe the amount and consistency of the material that must be dealt with by equipment and in treatment and storage facilities. Chemical constituents (nitrogen [N], phosphorus [P], and potassium [K]) are important in use of livestock wastes as fertilizers, as well as for environmental considerations (NRCS, 1999).
Estimates of the average manure produced per animal and the composition of the manure can be found in a number of sources, including the National Resource, Agriculture and Engineering Service (NRAES), the American Society of Agricultural and Biological Engineers (ASABE), North Carolina State University, and USDA National Resource Conservation Service (NRCS), among others. Average estimated quantities of manure per unit and manure characteristics differ among studies - due to different assumptions regarding feed ration composition, the use of feed additives such as phytases (used to reduce phosphorus), and the efficiency of conversion of feed to milk, among other factors. Table 3 provides dairy manure characteristics by animal type, as estimated by USDA-NRCS (1999). Waste characteristics are expressed as pounds per day per 1,000 pounds of livestock live weight (lb/d/1000#) for weight, total solidsa, N, P, and K; as cubic feet per day per 1,000 pounds of livestock live weight (ft3/d/1000#) for volume; and percent (wet basis) for moisture and total solidsb. Estimated waste quantities and characteristics are based on average amounts as excreted from the animal (i.e., do not contain bedding or other materials). Dairy stalls are often covered with bedding and the quantities, and characterization of bedding influences the composition of the manure. Different quantities of bedding may be used per cow, depending on housing type (EPA, 2006; USDA-NRCS, 1999).

The USDA estimates that in 1997, 27 million tons (dry matter) of manure were generated by dairy operations, of which 21.3 million tons were on operations where the cattle were confined (USDA-ERS, 2001). Dairy manure that is collected from such operations is mostly disposed of via field application as a fertilizer. Sometimes field application is in excess of the nutrient assimilation capacity of the soil, leading to problems associated with nitrogen and phosphorus runoff (Ribaudo, 2003). Concentrated animal feeding operations (CAFO, which for dairy production means 700 or more dairy cows - based on the average annual number of cows in inventory or sold) must be permitted under the National Pollutant Discharge Elimination System (NPDES) and must have a nutrient management plan for wastes applied to the field as fertilizer. A nutrient management plan is voluntary for non-CAFO operations (Ribaudo, 2003).
Dairy manure is collected in both solid and liquid form (EPA, 2001). In operations using tiestall barns, manure is collected in gutters behind the cows and removed by a barn cleaner. In operations using freestall barns, manure is either scraped to the end of the barn for temporary storage or (in barns equipped with an alley way) flushed and deposited in a storage pit or lagoon. Milking parlor wastes (i.e. the area where the cow is milked) are dilute (up to 50% of the waste volume but only 15% of total solids) and contain little manure, but contain residual milk and may include quantities of cleaning products. Some collection pits permit separation of solids from the liquid portion of the manure. Liquid storage systems are more common in the southern U.S. (66% of operations in 2000) relative to the northern U.S. (29% of operations) (Ribaudo, 2001).
The problem of excessive application of manure for fertilizer is particularly important for large dairy operations that store manure wastes as liquids, due to the large volumes of manure produced and the frequency of manure collection. The USDA identified 68 counties where manure nitrogen levels exceed the soil nutrient assimilative capacity of all the county’s crop and pasture land (primarily in North Carolina, northern Georgia, Alabama, central Mississippi, western Arkansas, and California) and 152 counties (concentrated in eastern North Carolina, northern Georgia, northern Alabama, western Arkansas, central California, and western Washington) where the manure phosphorus levels exceed the county assimilative capacity. Additionally, 155 and 337 counties were identified where manure nitrogen and phosphorus levels, respectively, exceed half of the county soil nutrient assimilative capacity (Gollehon, 2001; Ribaudo, 2003; Ribaudo, 2006). These counties are most in need of alternative waste management methods.
The EPA estimates that as of 2005, approximately 2,623 dairy farms were good candidates for biogas collection and bioenergy production. Nearly 38% of these farms were located in California, and about 80% of the candidate farms were located in the top 10 dairy production states (EPA AgStar, 2006).