7 August 1998

COST-EFFECTIVENESS MEANS COST SAVING

ALMOST 10p/litre has been slashed from milk production costs in four years on a Devon farm producing milk and traditional cheddar cheese.

The trick is to concentrate on running a cost effective business without worrying too much about politics and economics which, like the weather, are beyond farmers control, a conference organised by Wilts based business consultant AKC heard.

"We have been trying to strip out the complications – we are now at 16.6p/litre and we plan to self feed silage to take out another 2p/litre," said Mary Quicke, chief executive of J G Quicke and Partners.

In 1994, milk from the herds 2.5m-litre quota was costing 26p/litre to produce, at a time of good milk prices and breeding stock sales. Cows were eating 13t a head of costly silage.

A switch to rotational and extended grazing, has seen silage come down to 8t a head and consumption is still falling. The business has also moved away from producing breeding stock for sale.

At Home Farm, Newton St Cyres, cows are out from March to November, and silage land was grazed twice before the first cut was taken this year.

The aim is to produce 60 to 70% of the herds total ME intake from grazed forage. "As you move to a higher level of grazing, the whole system cheapens and some fixed costs shrivel.

"When the cows are outside, youre not asking so much of them, and other costs come down too." For example, vet and med costs for the herd stand at just 0.51p/litre, at least half the usual average.

Despite Agenda 2000 proposals favouring higher yielding herds and maize, the business was unlikely to make any changes since a simple system outweighed any possible rewards.

The business is three years into the change to extended grazing – a process which she believes will take five years. Her aim is a 15p/litre production cost by 2000, with silage at 6t a cow. &#42