Prioritise short term investment towards areas of maximum return — cows, grazing infrastructure, soil fertility — expanding dairy farmers have been advised by Pat Dillon, Head of Animal & Grassland Research and Innovation Programme, Teagasc.
This is one of the main lessons learned in the first seven years of the Greenfield Dairy Farm project in Co Kilkenny, highlighted by Mr Dillon at the recent farm open day.
Another finding has been that dairy expansion can add a severe workload, if not carefully planned; expanders should seek help and advice.
Cash flow management during conversion and the initial years of production was found to be critical for success.
Herd performance can be sub-optimal in the early years; however, performance will increase with use of high-EBI genetics, and increasing grass production and utilisation.
Seek healthy high-EBI dairy stock from herds with a proven herd health history, and have a vaccination plan, advised Mr Dillon.
And it’s crucial for operating an efficient, large-scale dairy farm that staff are highly skilled.
With volatile milk prices likely to continue, a resilient system of milk production is required, according to Mr Dillon.
That means a low cost base to insulate the business from price shocks and allow family-based farms generate sufficient funds in times of higher milk prices to meet family commitments and to finance expansion.
The system must also have sufficient tactical flexibility to overcome unanticipated events that can lower short term profitability (a cold wet spring, for example).
The key components of resilient dairy systems are:
In 2009, Teagasc set up the large grass-based greenfield dairy farm in Co Kilkenny to identify risks, and demonstrate risk management strategies for dairy expansion, in conjunction with the Irish Farmers Journal; the Department of Agriculture, Fisheries and Food; Glanbia; FBD Trust; and AIB.
© Irish Examiner Ltd. All rights reserved