Alan Agnew, a senior dairying development adviser with the College of Agriculture, Food and Rural Environment (CAFRE), explains why farmers should focus on forage to combat rising costs.
The terrible events unfolding in Ukraine are, first and foremost, a humanitarian tragedy.
However, they have also disrupted supplies of key commodities and led to increased volatility in global markets.
For the key agricultural inputs of feed, fertiliser, and fuel, we are now experiencing unprecedented price rises. There are even some concerns about availability and supply.
In response, producers will need to consider:
- Revising nutrient management plans. Ensure you make the most of slurry and manures and make the best use of any fertiliser inputs;
- Preparing a cash flow for the next 6-12 months. This will ensure facilities are sufficient to meet the increased working capital needs of the business;
- Preparing a fodder budget to ensure adequate fodder for next winter.
All dairy producers need to focus on taking more from forage. Rising fertiliser and fuel costs increase the cost of forages, but they are still significantly cheaper than concentrates.
Producers, who can improve milk from forage performance, can offset rising feed costs to some extent.
Applying current fertiliser and fuel prices to our Forage Costing model shows the cash cost of grazed grass is now approximately £66/t of dry matter (DM).
The cash cost of good quality silage produced on a three-cut system has increased to around £160/t DM.
With concentrates projected at possibly £350/t, it is clear that improving milk from forage will pay dividends.
Cost of keeping a dairy cow
You can see the extent of the potential savings when you apply these figures to diet costings.
If a 30-litre cow is housed full-time and fed on good quality silage and concentrates, her diet cost will be £4.60/day. Grazed full-time and topped up in the parlour, the cost is £3.20/day.
Where the same cow is grazed by day and housed at night, the diet cost will be around £3.75 to £3.90 per day – depending on silage quality.
Therefore, the feed costs for a typical 100-cow herd can vary, at the extreme, by up to £140 per day or £980 per week for the same level of performance.
For a group of cows averaging 20 litres daily, the difference between full-time grazed versus fully housed is even larger, potentially £1.85 per cow per day.
With higher-yielding cows averaging 40 litres daily, the benefit of grazing is reduced. However, it is still around £1.00 per cow per day.
Clearly, there is a real opportunity to reduce feed costs by taking more from grazed grass.
Cows settled in-calf and yielding below 35 litres/day should be considered suitable for grazing.
However, the grazing needs to be properly planned and implemented to ensure grass quality through the summer and achieve good utilisation of the grass-grown.
Where there is only a limited platform available, then consider splitting the herd or housing at night.
The Forage Costings also raise some other interesting points.
Firstly, forage maize, with a lesser fertiliser requirement and the benefit of a large bulk at a single harvest, is now comparatively cheaper than three-cut grass silage.
But it requires a suitable site and technical expertise to grow successfully.
Secondly, the costings suggest that a four-cut system increases the cash cost of silage by about £35/t DM or £10/t fresh compared to three-cut.
Producers need to be confident that they can actually realise the potential of the higher quality silage.
Milk from forage needs to be improved by at least 1.5litres/cow/day to justify the extra cost, and Margin over Concentrate (MOC) data at business development groups indicates that this is not necessarily being achieved.
Reducing feed costs and improving feed efficiency must be a focus for all producers this year.
Grazing cows is one option to achieve this. Fodder budgets, financial cash flow budgets and effective nutrient management plans will also be required to manage the crisis.
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