Increased margins at Gelli Aur College help fund parlour investment

Gelli Aur College farm manager John Owen faces a dilemma shared by many other dairy units that have outdated and overstretched milking facilities.

“It is easy to be tempted by the improvement in milk price to invest, but production costs are rising fast and it is impossible to predict what will happen to the market,” says Mr Owen.

“The 24:24 fast exit parlour we installed 10 years ago to milk 200 cows is now handling 420 and should be replaced, not least to create a more pleasant working environment for the good staff we want to retain.”

Mr Owen told journalists attending the farm’s annual press day that his team was preparing a business plan that would include a new parlour designed to fit within the existing buildings.

“The choice is between a 50 point rotary costing about £250,000 and two side by side 20:40 herringbones costing £60,000 less.”

Costly

Having proved to be too costly to run, the unit’s mothballed robotic parlour would be sold to defray some of the costs.

Mr Owen said the college planned to continue operating two herds, one managed to achieve a high margin per cow and the other to get a high margin per litre.

Figures for both were beginning to show the improvement in milk price. In 2007 the average yield of the 230 cows in the high input herd fell 3%, from 6582 litres a head to 6139 litres and yield from forage declined by 4% to 40%.

Purchased feed cost/litre rose by 0.39p to 3.44p, but the average milk price was 26% higher at 21.84p/litre. This boosted margin over purchased feeds from £941 a cow to £1129 a cow, and MOPF/litre from 14.29p to 18.4p.

The 163 cows on a forage-based system produced an average of 4676 litres a head compared with 4021 litres in 2006. Seasonal factors meant yield from forage was down from 89% to 86% and spending on purchased feed was 0.88p/litre compared with 0.61p/litre the year before.

But the average milk price rose by 0.27p to 18.57p/litre, which boosted margin over purchased feed costs from £690 to £868 a cow and MOPF/litre from 17.17p to 18.57p.

“While we are pleased with the improved margins we are conscious of rising input costs, particularly fertiliser, feed and fuel. The emphasis has to switch away from increasing output to containing and cutting costs.

Herd health

“We have to concentrate on herd health and cow fertility. We have tightened the calving pattern of the autumn calvers, but we can do more.

“The rise in fertiliser costs means we have to use slurry more efficiently and optimise forage use.”

Management of both herds would become easier when the unit was free of bovine TB, which claimed more than 30 animals in 2007.

Mr Owen reported he had decided not to repeat the 2006/07 trial outwintering beef steers and yearling dairy heifers on forage kale.

“The cattle did well, gaining 0.8kg a head a day at a cost of 11p a day, or less than half what it would have cost indoors. They also showed good compensatory growth the following summer.

“But I was concerned about the visual impact on the general public. The performance showed there were no welfare problems, but I felt that perhaps our wet lowland was not suitable.”

Silage

However, he decided not take a third cut of silage from some land used for beef cattle and use the grass to store 27 yearling steers between October and January 2008.

“The area was divided up using electric fences to give them a fresh square block each day. There was little poaching and cattle did well without any silage or straw until grass ran out. I feel deferred grazing has real potential as it is going to be more expensive than ever to make silage this year.”

Clean energy research facility

• The college farm is to be used as a clean energy research and demonstration facility. Guto Owen, manager of Carmarthenshire Energy Agency, said the project would focus on the development of technology appropriate to the Welsh and Irish agricultural industry. If funding was obtained the farm’s livestock slurry would go though an anaerobic digester and the biogas produced used in a combined heat and power plant. The digested material would be spread as a fertiliser. Some methane would be mixed with hydrogen produced from specially grown crops to fuel college vehicles. He also announced plans to develop a biomass energy project in Carmarthenshire with a target of marketing 15,000t of renewable material a year.