From a financial perspective, monthly cashflow must be the number one priority for dairy farmers. Taking control of farm spending and identifying the peaks and troughs in cashflow on each individual farm will make a difference in the current financial climate and may be the only way a farm business can survive.
Generating cash is the key challenge for all dairy farmers for the months ahead. Given that we have limited control over our final product price and improving milk components to positively influence price takes a number of years with a focused breeding plan, the only immediate avenue to take is on the production system and its associated costs.
Achieving technical efficiency in a number of key areas including feeding, cow fertility and production is important and has been the main focus for the Dairylink group when preparing budgets for 2016.
As can be expected, developing a plan for the year ahead requires looking critically at each aspect of the operation and identifying where improvements can be made.
Have no doubt, tough decisions need to be taken regarding farm investment. In many cases, investment will have to put on hold.
However, some investments are still important to make and will help the overall business in terms of lowering production costs.
One Dairylink project farmer has made these decisions for 2016 and has budgeted ahead to assess the impact on his business.
Charles Clarke, Bailieborough, Co Cavan
This year, the herd will calve in 14 weeks, with plans to shorten this next year. Compact calving is an important aspect of herd management for Charles. The key drivers behind the rationale are improved herd fertility and better time management.
The herd is managed with only casual labour hired for occasional milking and periods of peak workload, such as calving and breeding.
Charles admits there are many other financial advantages with a compact calving profile, including the advantage of managing the herd as one group throughout the year.
Currently, the six-week calving rate is 70% and Charles intends to improve on this further.
Charles plans to continue his investment in high-return areas on the farm, such as reseeding, soil nutrients and grazing infrastructure.
Last year, the 38ha grazing platform grew 11.8t DM/ha on average. Weekly measurement via the AgriNet grass measurement tool has helped identify under-performing paddocks.
To increase average grass growth on the farm, Charles intends to focus attention on these paddocks.
A total reseed may be required for some paddocks, with approximately 8% of the grazing platform reseeded last year, and another 10% approximately earmarked for this year.
At between ¤650 and ¤700/ha, this is a significant investment. However, increasing both grass growth and quality will see this investment returned within two years.
Soil analysis has been another valuable tool for Charles in ensuring pH, P and K levels are optimum for individual paddocks.
The ultimate aim of this investment is to carry a greater stocking density on the grazing platform, allowing a slight expansion in cow numbers.
As expected, younger swards with higher percentages of perennial ryegrass varieties will respond better to nitrogen applied throughout the growing season.
Holding back on major capital investment when cash is limited is equally important. Charles had plans to invest in milking facilities with a new parlour and associated facilities. This investment has been put on hold.
However, milking is a limiting factor on the farm. With potentially 115 cows to be milked, the existing eight-unit parlour is a bottleneck in the system.
Last year, with 110 cows, Charles was milking for 2.5 hours in the morning and two hours in the evening.
The additional cows this year will increase this time further.
With the investment on hold, Charles is considering a smaller investment into the existing parlour, doubling the parlour to 16 milking units – eight each side of the parlour.
Improvements can be made to the collecting yard and exit area of the parlour.
A simple manual cow drafting gate will be fitted at the exit door to allow cows to be separated during milking, which will save time separating cows after milking for things such as breeding or animal health issues.
The overall investment of ¤40,000 is seen as a short-term fix for the farm with the aim to reduce milking time and time spent separating cows. It is a minimal investment when compared with the investment required for a new facility.
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