Margins not everything

10 October 1997

Margins not everything

DAIRY producers should think carefully about making management decisions based on margins.

So New Zealand consultant Paul Bird, working in the UK under the auspices of the British Grassland Society, told producers at the South West Dairy Show. (more reports p46). "Marginal costs and marginal litres are used as a tool to sell concentrate," he said.

Focusing on yield a cow was also a mistake when it meant producers were not prepared to consider a small drop in yield for the sake of improving profits.

Mr Bird said increasing output to cover fixed costs is only viable when operating from an efficient base. Focus on that efficient level of base before increasing output.

Consider investments according to the financial returns they offer. "Investments in grazing have been badly neglected," he said. Only 31% of UK dairy cows diets came from grazed grass, with 42% from silage and 27% from cake.

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