Do you pay too much for concentrate?

9 July 1999

Do you pay too much for concentrate?

SOME milk producers are paying too high a price for concentrate and could quickly improve profits by up to £50 a cow by paying less, according to ADASs Dairy Blueprint Action for Profit, launched at the show.

ADAS dairy business development manager, David Levick, said feed costs accounted for 25% of milk production costs, so even a small saving could make a significant difference to bottom line profit. Concentrate costs are at an all-time low, but he believed many producers were not taking full advantage of this.

The top 10% of farms ranked on use of least expensive feed pay £89/t for concentrate, whereas the bottom 10% spend £138/t, according to ADAS Milk Cheque dairy costings.

While the figures show farms paying £49/t less for feed have almost 50 more cows, they feed more a cow to produce higher yields, resulting in a margin over all feeds which is £50 a cow better. Reducing dairy feed costs could, therefore, quickly add £7500 to the profit of a 150-cow herd.

"These top producers are not necessarily feeding straights, but are sourcing compound feed at low prices, such as through ADAS Direct, which ensures that they receive high quality feed and good value for money. This allows them to use compounds without investing in straights storage bunkers and complete diet feeding," said Mr Levick. &#42

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