Further milk price rise needed to cover rising input costs

A modest investment in a second-hand forage harvester has paid dividends at Thornton Grange Farm, although milk prices and rising input costs are still causing concern. Wendy Short reports.

No waste, no storage, no additives. That’s the conclusion Peter Chapman made after successfully introducing a zero-grazing policy for the first time this spring.

The persistent wet weather was the main reason for him adopting the practice, but the heavy clay soil on most of the grazing fields, coupled with rapid grass growth, meant he had little choice but to come up with an alternative to letting cows out to graze.

So, after buying a Taarup direct-cut forage harvester (pictured), which cost no more than couple of thousand pounds, Mr Chapman introduced zero-grazing for the whole herd during the second week in May.

Peter Chapman

Initially the cows were kept in for a week, until it was dry enough for turn-out. Subsequently, fresh grass – making up about one-third of the ration (10kg a cow) – was brought in and fed along the barriers using a complete diet feeder, with the whole process taking about 30 minutes. The cows were allowed access to the food for an hour after milking. Other ingredients in the ration included 2.5kg of sugar beet, 2kg of waste bread and 1.2kg of maize distillers’ grains.

Mr Chapman admits that zero-grazing would not have worked so well, if he had had to spend valuable time picking up the grass in a separate pass after cutting. Using the direct-cut system was particularly helpful this year, as the cows were brought inside for several periods over the spring and summer, because of the appalling weather.

Forage harvester

The zero-grazing policy has also brought considerable financial benefits. He reckons that the cost of producing fresh grass and putting it in front of the herd works out at about 30% of the production costs involved in making clamp silage. There has been an estimated 5% increase in yields, as well as savings on additives, fuel and man hours.

There have also been management advantages. Zero-grazing has taken the pressure off space in the silage clamp, which is becoming inadequate due to the increase in cow numbers. Given all the advantages zero-grazing has brought, Mr Chapman plans to make it a regular occurrence, unless weather patterns change dramatically.

Higher milk prices still fall short

The rolling average milk price at Thornton Grange has been creeping up gradually, and now stands at 24.5p/litre (see table). However, this still falls short of the 30+p/litre that is needed to put the business on a secure footing for the future, Mr Chapman says.

He agrees with the recent report by Kite Consulting (Business, 5 September), which put typical production costs at 28-29p/litre, and said dairy farmers needed a further 3p/litre to reinvest and improve confidence.


Reinvestment is an issue that is particularly relevant at Thornton Grange, where thousands of pounds have been spent on a new parlour and extending the housing capacity.

“There was a lot of optimism when returns first started increasing, but that is now dwindling, because of the rapid rise in input prices,” says Mr Chapman. “I think there is some justification in passing on some of this extra expense to the consumer.

“I don’t understand why supermarkets compete with each other to offer the cheapest milk. It’s still a comparatively inexpensive product – in some stores bottled water costs more – and I’m not convinced that shoppers choose or reject a supermarket on the basis of the price of its milk.”

Peter Chapman

Another report, issued by Promar, has indicated that milk producers may face higher tax bills this year, because of a slight increase in profitability. Mr Chapman accepts this may apply to his business, but feels it is scarcely a cause for optimism.

“Our situation may look a bit better on paper, but cashflow is very tight. My next Single Payment cheque is not due until March, but I could really do with it right now. It has been very noticeable that creditors are not prepared to wait as long for payment as they would have in the past.”


Milk production figures (12-month rolling)

Margin over purchased feed

£1,350 a cow

Feed cost/litre


Feed kg/litre


Milk value/cow


Rolling average milk price



More time needed for bonus scheme plans to work

A plan to make the most of a bonus scheme offered by the farm’s milk buyer, Arla, has not worked out as hoped. The business had been aiming to capitalise on a potential 5p/litre price increase, payable for every litre above a 3500 litres a day threshold and applicable in September, October and November.

“We had set ourselves a target to calve 16-20 cows each month in the autumn, but the average is probably going to work out at closer to 10,” Mr Chapman says. “Fertility has taken a battering, and we can only put it down to the stress the cows suffered while getting used to the new parlour.

“We anticipated that there would be a settling in period, but we have underestimated its effect, and the length of time it would take for the cows to get accustomed to the new building, which was used for the first time last November. Obviously, we could see that the cows were wary when they entered the new parlour, but there was no outward sign of any nervousness after that.

“There has also been an increase in lameness, which we have put down to teething problems with the newly laid concrete. But things are looking up, and we are getting back on track with the calving interval.”

Silage Analysis

First cut silage analysis

  • Cutting date 23 May

  • Acreage cut 170

  • Additive Ecosyl

  • Dry matter 30%

  • Crude protein 15%

  • Digestibility value 70

  • Metabolisable energy 11.2

Second cut silage analysis

  • Cutting date 10 July

  • Acreage cut 90

  • Additive Ecosyl

  • Dry matter 23.5%

  • Crude protein 16.5%

  • Digestibility value 71

  • Metabolisable energy 11.4

Third cut

  • Analysis not yet available

Farm Facts box

  • Thornton Grange Farm, Thornton Village, Middlesbrough, Cleveland, is a 167ha (415-acre) rented dairy and arable unit run by Peter Chapman
  • The majority of the land is ring-fenced and rented from one private landlord. The soil is a fairly heavy, deep clay
  • Around 97ha (240 acres) of grass are rotated with 70ha (175 acres) of wheat, maize and set-aside. Oilseed rape is sometimes grown as a break crop
  • Thornton Grange supports 168 mainly commercial Holstein Friesians averaging 7,850 litres a cow. Calving is all year round and milk is sold to Arla. The business is on course to move up to 200 cows over the next few years
  • Peter and his wife, Jane manage the farm with help from one full-time worker.
  • The farm has been in Countryside Stewardship since 2000, and entered into an ELS agreement February 2006

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