That was the year when silage bales went over €50
The New Year marks a closure of 2013, and the promise and hopes for a good year ahead.
From a dairy farmer’s perspective, 2013 was a year of two halves. The first half was marked by unseasonally low grass growth, a lack of silage and other fodder, extenuating the carry-over from a poor grass growing season in 2012. There was rehousing of cattle, with growth stalled in March and April, plus the stress from the potential impact of Schmallenberg.
But the latter half of the year was perhaps one of the best periods ever to be producing milk, with record milk prices, bountiful grass driving milk supply, and an opportunity to avail of late grazing on many farms into December. Thankfully, this allowed many farmers catch up with feed bills, and restore overdrafts to more normal positions by year end.
The most successful business people learn from their experiences, and apply that knowledge within their businesses.
Some of the most important lessons to be carried into 2014 are the need to budget an appropriate amount of winter forage for your given level of stock, and to maintain a rainy day fund such as deposit account savings, to be used in exceptional circumstances.
Keeping a store of pit silage, or hay and straw, is a real option allowing farmers to carry forward spare fodder from one year to another without significant spoilage. Keeping an additional stock of fodder does of course tie up both cash and storage space, but the importance of doing so was borne out by the experience of last spring.
Who will forget that, at the height of the crisis, those few silage bales which were being traded were selling for over €50?
On the financial side, keeping a store of money on deposit gives great piece of mind. In some instances, farmers who bank entirely through their current accounts found themselves in the desperate situation of turning to charity, having no money to either feed their stock or their families.
Even a modest amount of money on deposit or in a separate family current account can give that all-important separation of family from business, preventing unnecessary family stress.
Dragging up these memories from 2013 isn’t about dwelling on the past, but rather about making good planning decisions for 2014.
So, when making this New Year’s resolutions, it’s worthwhile considering whether fodder stocks can be replenished by additional fertiliser usage, lower stocking rates, renting additional land or by purchase.
On the financial side, is it possible to bulk up savings by deferring non-routine expenditure to 2015, looking for cost savings and efficiencies, and setting aside the additional cash flow from higher sales prices?
The choices to carry higher fodder stocks and a cash reserve show alternative approaches in coping with business risks. One option seeks to avoid risk, the other provides the financial ability to cope with risk.
Whatever your New Year’s resolutions are, it’s a good idea to write down your intentions, decide what needs to be done, and set timelines for achieving each step along the way.
Previous studies suggest that the simple act of writing down your goals results in an individual being many times more likely to actually achieve their goals; and the probability of success is even more likely if you actually regularly review the plan you have created.
Wishing you all a prosperous New Year.
