Stick to the plan for sake of efficiency
BUILDING an efficient business relies on planning and the sticking to that plan.
Milk producer Rupert Hutchinson Smith, who hosted the meeting at Hope Farm, said that when he took over the business six years ago it was run-down.
"Then it employed four men for 200 cows and used contractors for all seasonal work. Cows were loose housed, ate outside, and as the parlour was built for 80 cows, milking took about eight hours a day."
As he was farming in partnership with his landlord, moving the business forward meant justifying all proposals. "We did a SWOT analysis, looking at the strengths, weaknesses, opportunities and threats of all the things we had, and those that we would like to introduce.
"We have managed to cut labour costs, improve cow performance and have a system that we can take forward for the next 20-30 years," he said. He now runs 250 cows which average 8000 litres.
Last years results illustrate the improvement, with variable costs of 6.4 p/litre at Hope Farm – 3.1p/litre cheaper that the average.
The key step forward at Hope Farm came when a new loose housing building and 16/32 parlour were built. Although Mr Hutchinson Smith admitted he would be reluctant to build it at the current milk price, he said it was saving 1p/litre including finance over the period of tax write down, so will be quickly paid back.
"The building – including the parlour – cost £800 a cow place. We kept costs down by budgeting for everything, and seeking quotes for all work and supplies."
Quotes were sought each time the specs changed, particularly for the parlour. This meant there were no extras required or extra costs. "We analysed what we needed, planned accordingly and did what we planned to do at the beginning.
"Now we have got a flexible, simple system which has room for expansion," he told visitors.
Run unit to make profit at 16-17p/litre to survive
More than 200 farmers
attended the Milk
Development Councils first
focus centre meeting in
Shropshire to hear about
business planning and
Emma Penny reports
WITH the Competition Comm-issions report into Milk Marque likely to carry weight, producers should design dairying systems which will make a profit at 16-17p/litre, says Axients Tom Kelly.
"You may violently disagree with the report into Milk Marque, but bear in mind it has been carried out by an independent group, and so will carry weight in high places. It will have a dramatic effect on the industry and people in it," Mr Kelly told a Milk Development Council, Harper Adams and Shropshire Grassland Society meeting at Hope Farm, Hadnall, Shrewsbury.
That meant running a system which was profitable at 16-17p/litre, he said. "The report into Milk Marque talks about a range in performance, and that is backed up by latest Milkminder figures."
Those show that milk price varies from 10p/litre – due to poor hygiene or very small farms on daily collection with low constituents – to 21p/litre. Cow performance ranges from 3000 litres to more than 11,000 litres.
"The bottom 10% are producing 3000 litres or less. A lot of those people do not come to meetings, and they will be the ones who go out of business."
For larger producers, Mr Kelly said producing more was the only way forward. "More quota will come into play when smaller producers leave the industry. But consider how you will produce more.
"Also, it is vital to cut costs. But do not do it Local Authority-style and cut a little off all costs. Stopping doing things such as silage making is the only way to make money, a fact farmers are often reluctant to face up to.
"Today, the cost of some silage is comparable with concentrates. Consider everything you do carefully, and think the unthinkable – stop doing things if they cost too much, and sell machinery where necessary," he urged.
But he added that rather than dwelling on the state of the industry, producers had to realise what they had, and that it was worth working for. "You have a lifestyle you like, and are enthusiasts for what you do, but you must realise the financial benefits of your position.
"Most of you will still be in milk production in five years time, and will be more profitable than you are now, but you will have to make changes to survive."
uCOWS will look at where they place their front foot, and will put their hind foot there, according to MDC-funded research. On stony tracks, walk cows slowly to ensure they can do this, so helping to cut lameness incidence.
uSHEEP can have a role on dairy farms in winter, and can help boost profitability as long as they are not on-farm for too long, said the SACs Dave Roberts. "But ensure you know what they are doing and that they leave the farm when you want them removed."
uAVERAGE silage costings were absolutely useless, told producers nothing, and could be dangerous, said Dr Roberts. "You need to know your own costs for first, second and third cut silage."
uKNOW the true costs of every operation and enterprise, and make plans but change them when necessary, advised Dr Roberts. "And keep in control, it is all too easy to lose track of what is going on."
Study research principles – and apply them
BE prepared to put new research into practice to help survive low milk prices.
Dave Roberts of SAC and Dairy Research and Consultancy told producers at the meeting that there were many research projects which could be successfully put into practice on-farm.
"Do not just look at headline research results, look at the principles underneath to apply them on your farm, and do not follow fashion when you are considering changing something, consider whether it is right for your farm."
But he said there were research projects with messages which could be easily applied on any farm.
"An Institute of Grassland and Environmental Research project shows that moving cows to fresh pasture after afternoon milking can boost yields by one litre a cow without any extra cost. Grass is drier, higher in sugar levels and cows will graze for longer.
"Whether set stocking or using paddocks, cows should have access to fresh, good quality grass after the afternoon milking, rather than just being out in the most convenient field."
He admitted that grass quality could be difficult to maintain in late summer and autumn, but said that now was the time to consider spring grazing.
"Research at SAC, Harper Adams and Hillsborough in Northern Ireland is looking at extending the grazing season. Now is the time to work out autumn grazing plans so you can get cows out two weeks earlier in spring, which will save feed costs."
"But there is no point in growing grass if you are not going to use it. Cows only need to go out for a couple of hours a day to start with, but if you do not use the grass you have got, you wont know how much you have wasted."
He urged producers to walk their fields. "Look at how many rejected areas there are. If there are 20-25% or more you have mis-managed grazing, and should consider how you could improve it next year." *
Find alternatives to conventional feeds
FEEDING a proportion of non-organic ingredients to dairy cows will eventually be phased out by organic regulatory bodies.
Finding alternatives was the challenge at the Organic Advisory Service open day.
As with conventional systems, maximising milk from forage by increasing intakes was high on the agenda. Mixed forage systems rather than just grass silage could increase intakes by up to 3.5kg DM a day according to OAS dairy advisor, Mike Tame.
"Although maize is not used in many organic systems, feeding equal proportions of grass and maize silage can increase intakes from 12.5kg DM a day for grass silage to 14kg a day.
"Including 50% whole-crop with grass silage also raises silage DM intakes to about 14kg a day. If a third of the forage mix is fodder beet, I expect intakes could be even higher at about 16kg DM a day."
Fodder beet is also good for rumen function because sugars are released slowly, and Dr Tame believes it may offer further nutritional benefits through enhancing rumen protein production.
Getting enough protein into organic rations, particularly when feeding cows yielding more than 6500 litres, can be tricky. Expeller rape, permitted by organic regulating bodies, is the best source, but could be difficult to find, he said.
"Peas, beans and clover provide rapidly digestible protein and are fine up to 6500-litre yields, but if you want to increase yields an unde-gradable protein source is required.
"Sainfoin offers a lot of promise because its tannin content makes it slowly digestible. It can be grazed without risk of bloat, or ensiled, but needs high pH calcareous soils," he said.
Weeds need thought
WEEDS may have high mineral levels and even be palatable in silage, but ingenuity is required to control them, especially in organic systems.
But advice was at hand for producers at an organic open day in Berks, particularly those troubled by docks. "For every 1% of docks above 10%, there is a 1% decrease in grass production," explained Organic Advisory Service head, Mark Measures, speaking at a beef, sheep and dairy farmer group meeting at Elm Farm Research Centre, Newbury.
Rotovating to break well established grass/clover leys in July followed by repeated harrowing and ploughing in September before sowing winter cereal is effective, but cultivations must be deep enough, warned Mr Measures.
"You need to rotovate below the crown of docks to cut off growing points. This means going about 3 inches below the soil surface."
Other methods discussed include using a fallow, grazing intensively with sheep, and undersowing which can work because docks do not like competition.
Repeated topping was recommended for creeping thistle control. "On some farms, creeping thistle can be a real problem on permanent grazing. But it can be managed."
British breeds suit job
BRITISH breeds are ideal for organic production systems because cattle readily produce meat from grass and some rare sheep breeds could offer good immunity against parasites and foot rot.
Speaking at the OAS open day, Rob Brighton said there was a surge of interest in British breeds for organic production. "British breeds are early maturing and able to pro-duce meat successfully from grass." With organic feed wheat costing £230/t, he said Continental breeds, which needed more concentrates, are less suitable for organic systems because margins were lower.
Exploiting the gene pool of rare breed sheep to minimise disease in organic flocks could also make good business sense. "Wiltshire Horns have strong feet with hard keratin which seems to be resistant to foot rot," he said. *