Bringing down the costs of dairy replacements

All too often milk producers are focused on costs of feeding as the key driver for dairy farm profitability. Without doubt cow feeding costs represent the single biggest expense of keeping a cow – but how many dairy farmers fully appreciate the cost of replacing a cow?

A down-calving heifer in current market conditions costs about £1,200 to rear (with a realistic range of between £1,000 and £1,500 a heifer including its own value). The number of replacements required annually in the UK varies considerably, from as low as 15% a year to in excess of 35%.

The table below indicates the net annual cost a cow and a litre (7,000 litre a cow).

With the current standard litre milk price at 31p/litre, the cost a litre ranges from 6% to13%.

And yes – there are many farmers from various studies completed (including Kingshay and NMR) that show replacement rates at 30%+, which means only three lactations a cow compared with others who are averaging six lactations a cow in their herds.

So what makes the difference and how can you improve your replacement rate? There are two main areas for consideration; genetics and management.

Genetics

• Only breed from long-life trait sire proofs.
• Dam selection is also critical, and the key traits here include the need to breed from good regular breeding cows that consistently get back in-calf at 365 to 380 days.
• Key selection traits also include: feet/legs – the ability to stand and walk well with minimal foot trimming intervention; and udder/teats – size, suspension and teat length to allow easy hygienic milk production with minimal infection risk.

Management

Low replacement rates

As is always proven, the better the management the better the result, irrespective of the milk production system. However, my experience shows herd replacement costs are lower in block-calving herds (be they autumn or spring). This is owing to a number of reasons:

• Heifers as replacements are reared on forage-based systems with clear target weights and so do not lay down excessive fat in the body that later reduces lifespan and productivity.
• Replacements are reared from the front of the block, so by default are reared from the most fertile cows.
• Easy-calving bulls (in some cases Jersey) are used to ensure a down-calving heifer has one less challenge when she calves and is often quicker to come on heat.
• Calving at two years is an essential discipline compared with the average calving heifer aged at 29 months, which costs about £165 more a heifer.
• Yield a cow (combined weight of fat and protein) is lower in a block-calved animal and therefore the cow is under less energy and metabolic stress.

High replacement rates

These herds tend to have lower vet costs, pay less attention to mobility and have less focus on preventative action such as regular foot-bathing and pre-bulling checks to ensure the cows are cycling properly, as well as a robust vaccination programme or animal biosecurity practice.

Financial returns for those producers with low replacement costs and high replacement costs vary considerably. For example:

• cow herd @ 20% replacement rate: £32,800
• 200 cow herd @ 30% replacement rate: £49,200
• Difference: £16,400

High-replacement-rate producers will find it harder to grow their business, with fewer surplus heifers to increase herd size. Low-replacement-rate producers can – and often do – sell surplus stock and generate as much as +3-5p/litre on top of their milk receipts, or can significantly contribute to herd growth from within, with all the associated health and genetic benefits.

Future Profitability and Competiveness

Quite simply, low replacement rates provide choices, while high replacement rates just increase demand on all resources, including finance, land area, housing and people, as well as minimising growth opportunities.

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