Building resilience: dairy farmers must know cost of production on rolling basis, RABDF chairman, Mike King
Future dairy producers must know their cost of production and know the market, and if the contributing elements don’t tally, then they should weigh up future options, according to RABDF chairman Mike King speaking at the RABDF NMR Gold Cup open day, Crewkerne, on 25 May .
“Dairy farming businesses will have to survive at 21ppl to 25ppl farmgate milk price for the next five years since there is no appreciable change in sight to future market trends,” he said. “Consequently producers are going to have to focus, and once and for all know how much it costs to produce one litre of milk. Calculations must be made on a month by month basis, not a one off, in order to respond to market conditions and build resilience in to the business. If these figures don’t stack up, then farmers should seriously consider, should I stay or should I go.”
Mr King who together with his brother, Chris manages a 550 cow pedigree Holstein herd in south Gloucestershire explained: “We are regularly reviewing our business’s cost of production and making decisions accordingly. For example, this season we are saving in excess of 1ppl from our cost of production by introducing zero grazing from March to October.”
Host farmer and current holder of the RABDF NMR Gold Cup, Neil Baker explained how he was continually trimming budgets in line with the current milk price and making ongoing changes to the business which features 1,750 pedigree Holstein cows and 900 followers.
“Building resilience in the business is an essential part of our plans going forward. We are currently looking at five key areas and applying tactics.
• Improving forage management to reduce feed cost inputs
• Fine tuning replacement policy by culling poor cows more quickly
• Reducing antibiotic interventions by reducing mastitis, dealing and fresh cow issues and lameness
• Improving manure utilisation by spreading at the right rates at the right times
• Improving breeding selections by increasing beef calf sale values and breeding heifers from best animals
“Some of these measures are incurring big changes, others small, however when added together should have considerable impact.”
NMR director, Jonathan Davies said: “Measuring and monitoring every component of a dairy farming business is absolutely essential for all producers going forward if they are to make fully informed management decisions. Quite simply, if you don’t measure you can’t manage and that’s not just milk yield and quality but also health, fertility and disease status monitoring.” He adds: “We at NMR are pleased to annually support the RABDF Gold Cup which justly rewards those exemplary dairy farmers who are actively measuring and monitoring and are able to demonstrate the subsequent results in their business’s level of performance.