Farmer Focus: A 41p milk price will still need cost control

January is the month of reckoning, as the annual farm performance figures and decisions we made come up for scrutiny.

This can be a difficult exercise, as sometimes it’s tempting to freewheel from one year to the next, provided there’s money left over in the current account.

Time spent reviewing is time well spent, as it resets the farm’s focus, putting the long-standing farm system goals into pole position.

This exercise is particularly important facing into a year where farm input prices might start hitting record levels. 

In 2021 we hit record milk prices in Ireland and saw our average reach 49c/litre (41p/litre), cushioning the impacts of hikes in feed, fertiliser and electricity.

See also: Opinion: Bumpy road ahead as dairy margins feel the squeeze

About the author

Gillian O’Sullivan
Livestock Farmer Focus writer Gillian O’Sullivan milks 100 crossbred cows once-a-day with her husband Neil and father Michael on Ireland’s South-East coast. They operate a seasonal calving, grass-based system with milk supplied to Glanbia trying to deliver work-life-balance and system resilience.
Read more articles by Gillian O’Sullivan

The outlook for the milk price in 2022 is good, but further input price hikes are expected across fertiliser, feed, milk replacer and silage plastic, to mention a few.

Ongoing erosion of our bottom line through cost increases means we need early planning to offset the impact.

Chasing a few easy wins has resulted in us banking a reserve of 2021 winter feed. The outcome of high fertiliser prices will result in silage becoming very expensive to make this year.

An opportunity to buy a month’s worth of hay/silage bales for the dry cows at a good price came up, and we saved our own good-quality, well-wrapped silage for a month, which will keep until next winter.

Having an early reserve takes pressure off the need to spread any more pricey fertiliser than is absolutely necessary.

The second easy win has come from our experience with trialling multispecies swards over the past 12 months.

Growing plentiful, high-quality pasture on steep slopes with only 52kg of nitrogen/ha spread is definitely an experiment that will be repeated.

Excellent summer pasture that tolerates some dry weather while maintaining quality, and with very little nitrogen usage, ticks all the right boxes.

Along with the clover swards which are growing more than 14t dry matter (DM)/ha with just 120kg of nitrogen/ha, multispecies swards are helping the farm transition to much lower inputs and greater resilience overall.

It might be easy to be profitable when milk prices are high, but discipline is the difficult part. We need to keep the focus on controlling costs instead of pushing production.