Greenfield unit may offer hope for dairying so just give it time
Published 02/02/2010 | 05:00
The Greenfield dairy farm project on the Kilkenny/ Carlow border is very interesting. This 15-year project involves setting up a 350-cow dairy unit on a 117ha leased greenfield site that was previously in tillage.
Under the project's business plan, this herd will generate an income capable of paying all running costs, including labour (€88,000-120,000) and land rental (€240/ha), and repay a €350,000 investor start-up capital and a €750,000 bank loan.
There is major investment in grassland, paddocks, roadways and a minimum spend on housing and equipment. The only cow accommodation is a one-acre outdoor pad and a few calving boxes, and €20,500 is the budget for a Jeep and tractor. Labour is just two people, feeding, fertiliser spreading and topping will be contracted out, bull calves will be sold as they drop and heifer replacements will be reared off-farm.
All effort will be focused on growing and using grass. There is no set target for meal usage but 300kg/cow/year is hoped.
The project is a strong vote of confidence in Teagasc's grass-based dairy research programme at Moorepark, the investors, Glanbia, Agricultural Trust/FBD, and the Phelan family, who own the farmland.
Also, fair dues to Teagasc researchers who will oversee the running of the project. The targets they have set themselves are ambitious. Securing 16t/ha of harvested grass dry matter and stocking at 2.9 cows/ha is much easier on a small scale on the very dry Moorepark soil than on a large unit up country. They are also staking their reputation on their dairying advice in a very commercial and public way. To achieve the targets this venture will need excellent day-to-day management. If it succeeds it will be a blueprint for expansion in Irish dairying, post-milk quotas.
The budget is based on a 24c/l milk price, but genetic improvement on fat and protein content over the period will lift this closer to 29c/l. This 24c/l is to cover labour (5c/l), rental (3.5c/l) and other variable costs (10c/l), plus to make interest and capital repayments.
There is some farmer comment to the effect that the unit will be used by Glanbia as a stick to keep down milk prices. The Glanbia argument could be: "If the Greenfield project can produce milk for less than 20 c/l, including rental and labour, what are farmers at?"