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Independent.ie

Sunday 22 January 2017

Dairy industry needs to deliver a realistic 'roadmap' for farmers

There were plenty of tough messages for the dairy industry and their suppliers at last week's Winter Milk Conference in Navan

Published 28/10/2015 | 02:30

A long-term road map is required for liquid milk producers.
A long-term road map is required for liquid milk producers.

The dairy industry needs to provide a long-term roadmap for the country's liquid milk producers, last week's Winter Milk Conference was told by a leading dairying expert.

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Producers are now playing in a different "game" in the post-quota world, said Teagasc dairy research officer Joe Patton.

The conference heard studies are showing that the most efficient and profitable methods by the top liquid milk producers involves pushing as much of the milk as possible from expanding herds into the spring period.

"We're looking at having that structure in place and being able to exploit that mid-season capacity to produce milk from grass. That is going to be critically important for liquid milk herds," said Dr Patton

"How many times have we heard at group meetings that your system will do better in a high price year, and my system will do better in a low price year. We hear that a lot."

Yet, he pointed out that they decided to test the myth by examining the profitability of farms at both 26c/l and at 35c/l. However, the figures showed the same farms were profitable at both high and low prices, similarly for the poorly performing farms.

"I think we need to start getting away from this idea of making excuses for some systems and saying that you'll be alright in the high price year. It is important we realise that good things are the good things to do no matter what the milk price is. That is the key thing," he said.

"The highest profit farms are averaging about 5.5c/l to 6c/l in liquid milk for feed costs, the least profitable farms at either milk price are up at 8c/l.

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"Interestingly, when you look at it in high or low milk prices something around 6,000 to 6,500 litres per cow at relatively high solids - that is where the most profitable farms are sitting and doing that at about 5.5c/l. They are actually producing the same or more milk per cow at a higher stocking rate at a lower feed cost per litre. That's a recipe for everybody," he said.

"It is the stocking rate and the feed budget decisions that make the difference."

He said that it was "very rare" with around 1pc of the herds in the country milking at 35l in the winter period, yet many herds were being fed to deliver 35l.

"We need to feed to a realistic yield and look at the milk recording," he said, adding the message they wanted to get across was the need to bring the overall crude protein back to 15pc.

However, he said the diet should be simplified and with a good silage herds would probably manage with less than a third of a second forage.

"Strip back the diet - base it on composition rather than worrying about ingredients. We tend to look at energy levels, protein levels, starch and sugar together, and fibre.

Calving patterns

"Once those are right we shouldn't be adding extra ingredients in for the sake of it. If you can strip the diet down you can save a lot of money," he said, pointing out the importance of high quality silage to reduce the level of concentrates.

"It is too late to be looking at diet formulation in October what we really need to be looking at is what about next year's silage," he said.

Dr Patton pointed out when it comes to calving patterns and feed costs that August was the most expensive month to calve a cow, with figures showing it was 40pc more costly in terms of delivering the same yield as a February calved cow.

He pointed out herds with 20pc autumn calving means the milk sent in December or January, actually comes out of the late summer and reduces the revenue during July to October.

"I would question moderate amounts of autumn calving for cashflow," he said.

"We need to stop worrying about very fancy dry cow diets as long as we get a condition score of 3.25 and keep the magnesium up and the forage scale down that's all we need to do.

"That can be achieved very, very easily. There is really no clear benefit to a lot of these other strategies such as feeding meal before calving, high straw diets and anionic salts for grass silage diets.

"A lot of that stuff could add a cent a litre to your costs for no real benefit. Don't spent a cent a litre before you start milking."

He also stressed the latest ICBF figures show there were about 15pc fewer cows calving this autumn compared with last year. "The guys that already have cows calving in the autumn, they will probably milk on because they have the cows there. The big question is more will they put those cows in calf?" said Dr Patton.

"There looks to be a reduction in the number of autumn calving cows so far up to the end of September - it appears there is evidence of a slight drift.

"There are about 15pc fewer cows calving in the autumn this year than there was last year. It is around 5,000 cows which is still significant enough in terms of the signs of the overall industry. The most efficient liquid milk farmers are the guys that have control of their fertility.

"And when they have control of their fertility they can choose to move between systems. A lot of those would be larger scale, tuned into the cost of production.

"The most profitable liquid milk farmers are the ones that have most control over their system, when they have most control over their system they are most likely to be able to shift to the simpler system.

"We have it here with guys in Co Meath - that were committed 10 years ago and through developments with EBI and grazing management they are now saying: 'I can just do spring milk now and it is so much easier.'

"People that get control of cow fertility have the capacity to make the decision for themselves and not have the cows that decide for them." Dr Patton stressed that the milk price was an issue for every dairy farmer.

"Are liquid milk farmers special in their concerns about milk prices - absolutely not. But the one thing they do have is they are locked into fundamentally a higher price system. The bar is just so much higher for them. They could probably begin to suffer at an earlier point," he said.

"It is clear from our figures that in the absence of a significant liquid premium, there is no comparison, the system doesn't stack.

"In one way I was happy to see that the winter milk cows are starting to fall a bit it shows that more and more people are taking control of the situation and that is a good thing from a farmers point of view. It does create a question then for the industry.

"There are somewhere around 10 to 15pc in September calving, which was the traditionally the starting month for calving liquid milk herds. It either suggests they are shifting to later or shifting out of it altogether, some of them may have shifted to later autumn calving which is a legitimate thing to do as well.

"It puts a question to the industry then - we've 2,200 liquid milk suppliers in the country. We need to give a long term roadmap for those guys.

"For some of them it will mean they are not going to be in it anymore and that is perfectly fine. But for others it will mean they have to have a clear indication of where their system is going," he said, adding the conversion from liquid milk may accelerate.

"A lot of people stayed in it because of the quotas. You could only produce so much milk, you were getting X amount of a premium for your liquid milk so it was a way of bringing in more cash. Now people can keep a few more spring cows and the conversion from winter to spring might accelerate now as people have a new decision to make."

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