Tuesday 27 September 2016

There's finally some light at the end of the milk price tunnel

Henry Walsh

Published 24/08/2016 | 02:30

A new breed record was set for Limousins at a dispersal sale in Carlisle in the north of England when four year-old Millington Highlight was sold with her heifer calf at-foot for 50,000gns to Mick Gould who is establishing a new Limousin herd alongside his dairy and sheep enterprises in Shrewsbury.
A new breed record was set for Limousins at a dispersal sale in Carlisle in the north of England when four year-old Millington Highlight was sold with her heifer calf at-foot for 50,000gns to Mick Gould who is establishing a new Limousin herd alongside his dairy and sheep enterprises in Shrewsbury.

Finally some light has appeared in relation to milk price. There is now real hope that global dairy prices will continue to rise. The change has come quickly, albeit at a very late stage, with a combined 18pc increase in the GDT auction over the last two weeks.

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We all, as milk producers, now require our milk processors to pass on the higher returns quickly to help alleviate the pain being endured at farm level. The signs were there over the last month, beginning with the global slowdown in production and the increased demand for dairy product as it became cheaper.

We must never forget the importance of delivering value to the consumer and the big weakness in that principle is that we do not sell to them directly, which usually results in the processor and the retailer increasing their margin when raw material prices are falling.

We must now hope they pass on the returns to us immediately and regain their normal margin over time. However, because we have no influence at retail level, I believe it is critical we control our costs and strive to manage our dairy farms to survive at low milk prices, and be positioned to take advantage of the good milk price years.

The superb grass growth is continuing. More than adequate rainfall here in the west, along with the high summer temperatures, is driving grass covers. We applied 30 units of urea in the last application and this really delivered, so we will stay with it rather than CAN.

Finally, the price of N has fallen and with urea available below €300/t, it is 10pc cheaper than CAN at €200/t on a per unit basis.

We took out one surplus paddock for bales last week and spread all the yard scrapings and parlour washings on it.

Our grass wedge is showing we need to take out another paddock now so we will cut the first chance we get over the weekend. Rotation length is being extended to 24 days and the cows are going into covers of 1,600kg/dm/ha. Farm cover has lifted to 230kgs per cow.

Milk output per cow is holding very well and the herd is producing 20 litres per day at 4.65pc fat and 3.77pc protein. We are stocked at 3.35 cows/ha but still feeding 1.5kg of ration.

The progress made over the last 20 years on grassland management when combined with the breeding of the modern dairy cow is very encouraging. Our herd is milking for 170 days on average (ie. a mean calving date of March 1) and still producing 85pc of their peak milk solids.

The challenge for the next three months is to grow as much high quality grass as possible on the milking platform and to let the cows convert it into milk solids for sale.

There is no longer a quota constraint so we will be paid for the milk and hopefully at a higher price than we are currently receiving.

We cut half the area closed for silage on the out-farms on August 15 and hope to cut the rest of it in the next few days when the weather allows. We will then blanket spread all the out-farms with 1.5 bags per acre of 18/6/12 to build the cover for winter grazing.

This is the same as we have been doing for the last number of years and it is a well proven way of reducing winter feed costs.

In our experience, the ground must be cleaned with the mower or grazed bare before building winter cover.

The target is to have a cover of 2,500 kg/dm/ha available when the stock move on to it in November and December. This will be high quality feed and we have never supplemented the in-calf heifers or cows while they are grazing it. If you have reasonably dry land on an out-farm there may be an opportunity to drive on growth by blanket spreading another round of fertiliser and closing off part of it for block grazing until November or December.

Henry and Patricia Walsh farm in Oranmore, Co Galway, along with their son, Enda, and neighbour and out-farm owner John Moran.

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