Farm Ireland
Independent.ie

Thursday 23 November 2017

We've had too much rain, but these Irish farmers in the US can't get enough of it

While farmers are despairing of what is rapidly shaping up to be one of the wettest summers on record, their counter-parts on the other side of the Atlantic are not fairing any better, although for very different reasons.

The harshest drought in more than half a century has ravaged America's midwest, the breadbasket of the entire continent and a major source of maize and soybean across the world.

Daytime temperatures are regularly in the 40s, forcing beef farmers to sell unfinished stock and grain farmers to plough down failing crops to claim insurance.

One of the worst hit states is Missouri, where an Irish duo, Gary Nolan and Niall Murphy, are dairy farming since 2009.

"If only I could get just one of those wet Westmeath days over here, all my problems would be sorted," joked Collinstown native Gary Nolan.

"This is the second record dry season in a row here, with daytime temperatures at least 10C higher than normal.

"It is often 43C here during the day and about 24C at night."

Mr Nolan and Mr Murphy started as managers on a large dairy farm in Missouri four years ago.

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Since then they have bought 1,200 cows and now farm in a 50:50 sharemilking partnership with the New Zealand-based owners of the unit.

Next year the pair expect to milk 2,100 cows on two separate farms and take a share in 640ac of land.

"Our plan was to spend 10 years in Missouri with the aim of owning 10,000 cows by the time we're 40," said Mr Nolan. "It may not happen but so far so good."

Experiment

The 1,200 cow dairy that the Irishmen run is faring better than most in the area at the moment, largely because of its low-cost base.

They have taken the principles of low-cost, grass-based, spring-calving dairy farming to an area where the tradition of grazing barely existed.

"We're learning a lot as we go and have had to experiment with a number of different grass types," admitted Mr Nolan.

"Last year we lost a lot of pasture to an insect infestation.

"This year, we've used new varieties from France and Romania and experimented with other crops such as summer turnip (yielding 13t/ha) and sedan grass, which is similar to maize but grazable."

But the soaring temperatures have forced the pair to feedlot the cows for up to eight weeks until grass starts to grow again.

This will create a number of headaches for the business.

"We had budgeted to feed about 500kg of maize grain to the cows during the year but so many of the maize crops have failed in the area that we will be paying dearly for sub-standard feed that we will ultimately end up supplementing with extra proteins.

"Crops that would normally yield 100 bushels per acre are now looking closer to 20 bushels, and prices have shot up by almost $100/t in the last three months."

But Mr Nolan maintains that they are a lot better off than the typical confined dairy operation that predominates in the US.

"A ton of maize in 2009 was costing $30 on a fresh weight basis.

"Today it's closer to $60/t, despite the feed being lower quality. So when feed accounts for 70pc of your costs, as it does in a high input operation, there is very little room for manoeuvre in a year like this," he said.

"The milk price here converts to about 30-32c/l, but this is the actual cost of production at the moment for a lot of units, even before things like repairs and maintenance or depreciation are taken into account.

"If feed prices go up further, these guys, especially the big lads with 3,000-4,000 cows who had to go to the banks for refinancing in 2009, will be in real trouble."

Drought

And it appears that feed prices in the US are only going one way.

Stocks of hay and alfalfa were run down to zero last winter after an early onset of drought in 2011 decimated yields.

Farmers were banking on being able to get their usual four to five cuts of alfalfa this year to replenish stocks but it now looks like many growers will only get two.

Prices of hay and alfalfa have tripled as a result, with China creating extra pressure by competing for already scarce supplies.

Prices are reported to have reached as high as $500/t for quality roughage.

"The feedlots in Texas and Kansas are just selling off stock 60-90 days before they are fit for slaughter because they are simply not prepared to buy in expensive feed," said Mr Nolan.

This liquidation of stock is costing $200-400/hd, according to US newswire reports.

But the Westmeathman believes that this bodes well for cull cow prices from his own operation over the coming months.

"There's been such a clear-out that there will probably be a shortage of culls for the next two to four years.

"Even our Jersey cross bull calves have increased [in value] seven-fold from $25/hd in 2009 to as much as $175/hd recently."

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