Cow management retains profit
By Wendy Owen
WITH this years improved milk prices, increasing levels of concentrate in dairy rations this winter will be economically sound, but profits could be retained by reviewing cow management instead.
According to Kite Consulting adviser Andrew Marlow, it has been a while since the economics of producing an extra litre of milk have stacked up.
He estimates that producing an additional litre/cow/day on 100 cows for a year could mean about £5000 extra profit after feed and quota costs.
"This year, quota issues are being hotly debated, but feed is the most significant cost against the price of a litre of milk. There is room within the 13p margin for concentrate input to be increased," he says (see table).
"But when there is no increase in milk yield when feeding 0.45kg of concentrate/litre, then it is unlikely there will be a profitable response beyond that."
On farms where inputs are relatively low to start with, increasing concentrate feed levels can have an immediate and positive effect, he adds.
However, Promar dairy consultant Derek Gardner says there is no point in producers planning winter concentrate feeding programmes until they know exactly what is in forage clamps. "Producers need to assess what bulk feeds are available and forward plan to see what energy and protein are required.
"Buying in large tonnages of concentrate feed may not necessarily be the most profitable strategy this year."
Mr Marlow agrees that when feeding quality silage as part of a well balanced ration, producers may see a lift in milk yield through an overall improvement in diet digestibility.
However, he warns that the forage to concentrate ratio must be maintained at no less than 40:60 or expensive problems may occur with milk quality and cow health.
Apart from the quick fix of boosting concentrate intakes to increase milk yields, producers should also review cow management. Mr Marlow believes the genetic potential for annual yields in the national herd is at least 1000 litres more than the current 6000 litres average.
"Gaining genetic potential from cows is dependent upon removing environmental barriers," he says. These barriers are negative producer-created situations which prevent cows from performing, such as feed shortages or poor cow management around calving.
This winter producers need to anticipate possible feed shortages and minimise variation in feed quantity and quality. Although financial rewards can be substantial, feed costs will usually increase, he adds.
"Avoiding spending £20/cow on two months worth of brewers grains this winter could be a false economy if milk revenues fall by £150/cow in the long term," says Mr Marlow. *
• Opportunity to increase yields/profits?
• Improve overall ration.
• Anticipate feed shortages.
Estimated profit margin on one litre of milk
Revenue from litre of milk 19.5p
Less quota leasing 1.5p
Less feed costs 5.5p*
Margin on the litre 13.0p
*(0.5 kg concentrate @ £110/t)